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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
(Mark One)☒
xANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2020
or
For the fiscal year ended December 31, 2018
OR
o☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                             to                              
For the transition period from to
Commission file numberFile Number 001-36124
Gaming and Leisure Properties, Inc.
(Exact name of registrant as specified in its charter)
Pennsylvania
46-2116489
(State or other jurisdiction of

incorporation or organization)
46-2116489
(I.R.S. Employer

Identification No.)
845 Berkshire Blvd., Suite 200
Wyomissing, Pennsylvania
(Address of principal executive offices)
19610
(Zip Code)
845 Berkshire Blvd., Suite 200
Wyomissing, PA 19610
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (610)610 401-2900
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $.01 per shareGLPINASDAQ
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x☒   No o☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o☐   No x☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x☒   No o☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x☒  No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act:
Large accelerated filer x
☒
Accelerated filer o
☐
Emerging growth company
☐
Non-accelerated filero
 (Do not check if a
smaller reporting company)
☐
Smaller reporting companyo Emerging growth company o
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section13(a) of the Exchange Act. o☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o☐   No x☒
As of June 30, 20182020 (the last business day of the registrant's most recently completed second fiscal quarter), the aggregate market value of the voting common stock held by non-affiliates of the registrant was approximately $7.2$7.1 billion. Such aggregate market value was computed by reference to the closing price of the common stock as reported on the NASDAQ Global Select Market on June 29, 2018.30, 2020.

The number of shares of the registrant's common stock outstanding as of February 8, 201916, 2021 was 214,638,534.232,780,891.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's definitive proxy statement for its 20192021 annual meeting of shareholders (when it is filed) will be incorporated by reference into Part III of this Annual Report on Form 10-K.



IMPORTANT FACTORS REGARDING FORWARD-LOOKING STATEMENTS
Forward-looking statements in this document are subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievementsTable of Gaming and Leisure Properties, Inc. ("GLPI") and subsidiaries (collectively, the "Company") to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements include information concerning the Company's business strategy, plans, and goals and objectives.Contents
Forward-looking statements in this document include, but are not limited to, statements regarding our ability to grow our portfolio of gaming facilities and to secure additional avenues of growth beyond the gaming industry In addition, statements preceded by, followed by or that otherwise include the words "believes," "expects," "anticipates," "intends," "projects," "estimates," "plans," "may increase," "may fluctuate," and similar expressions or future or conditional verbs such as "will," "should," "would," "may" and "could" are generally forward-looking in nature and not historical facts. You should understand that the following important factors could affect future results and could cause actual results to differ materially from those expressed in such forward-looking statements:
the availability of and the ability to identify suitable and attractive acquisition and development opportunities and the ability to acquire and lease the respective properties on favorable terms;

the degree and nature of our competition;

the ability to receive, or delays in obtaining, the regulatory approvals required to own and/or operate our properties, or other delays or impediments to completing our planned acquisitions or projects;

our ability to maintain our status as a real estate investment trust ("REIT"), given the highly technical and complex Internal Revenue Code (the "Code") provisions for which only limited judicial and administrative authorities exist, where even a technical or inadvertent violation could jeopardize REIT qualification and where requirements may depend in part on the actions of third parties over which the Company has no control or only limited influence;

the satisfaction of certain asset, income, organizational, distribution, shareholder ownership and other requirements on a continuing basis in order for the Company to maintain its REIT status;

the ability and willingness of our tenants, operators and other third parties to meet and/or perform their obligations under their respective contractual arrangements with us, including lease and note requirements and in some cases, their obligations to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities;

the ability of our tenants and operators to maintain the financial strength and liquidity necessary to satisfy their respective obligations and liabilities to third parties, including without limitation obligations under their existing credit facilities and other indebtedness;

the ability of our tenants and operators to comply with laws, rules and regulations in the operation of our properties, to deliver high quality services, to attract and retain qualified personnel and to attract customers;

the satisfaction of the mortgage loan made to Eldorado Resorts, Inc. ("Eldorado") 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 master lease agreement with Eldorado;

the ability to generate sufficient cash flows to service our outstanding indebtedness;

the access to debt and equity capital markets, including for acquisitions or refinancing due to maturities;

adverse changes in our credit rating;

fluctuating interest rates;

the impact of global or regional economic conditions;

the availability of qualified personnel and our ability to retain our key management personnel;


GLPI's duty to indemnify Penn National Gaming, Inc. ("Penn") in certain circumstances if the spin-off transaction described in Part 1 of this Annual Report on Form 10-K fails to be tax-free;

changes in the United States tax law and other state, federal or local laws, whether or not specific to real estate, real estate investment trusts or to the gaming, lodging or hospitality industries;

changes in accounting standards;

the impact of weather events or conditions, natural disasters, acts of terrorism and other international hostilities, war or political instability;

other risks inherent in the real estate business, including potential liability relating to environmental matters and illiquidity of real estate investments; and

additional factors discussed in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this report.
Certain of these factors and other factors, risks and uncertainties are discussed in the "Risk Factors" section of this report. Other unknown or unpredictable factors may also cause actual results to differ materially from those projected by the forward-looking statements. Most of these factors are difficult to anticipate and are generally beyond the control of the Company.
You should consider the areas of risk described above, as well as those set forth under the heading "Risk Factors," in connection with considering any forward-looking statements that may be made by the Company generally. The Company does not undertake any obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events unless required to do so by law.



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ITEM 6.
SELECTED FINANCIAL DATA
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118104
118104
120106
121107
121107
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FORM 10-K SUMMARY
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EXHIBIT INDEX
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128115




This Annual Report on Form 10-K includes information regarding Penn National
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IMPORTANT FACTORS REGARDING FORWARD-LOOKING STATEMENTS
Forward-looking statements in this document are subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of Gaming and Leisure Properties, Inc., a Pennsylvania corporation, ("GLPI") and its subsidiaries (collectively, "Penn"the "Company") to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements include information concerning the Company's business strategy, plans, goals and objectives.
Forward-looking statements in this document include, but are not limited to, statements regarding our ability to grow our portfolio of gaming facilities. In addition, statements preceded by, followed by or that otherwise include the words "believes," "expects," "anticipates," "intends," "projects," "estimates," "plans," "may increase," "may fluctuate," and similar expressions or future or conditional verbs such as "will," "should," "would," "may" and "could" are generally forward-looking in nature and not historical facts. You should understand that the following important factors could affect future results and could cause actual results to differ materially from those expressed in such forward-looking statements:
•The novel coronavirus COVID-19 (including variants thereof, "COVID-19") had, and may continue to have, a significant impact on our tenants' financial conditions and operations.As a result of the outbreak, our casino operations and those of our tenants were forced to close temporarily, as federal, state and local officials undertook various steps to mitigate the spread of infections from COVID-19.Although the majority of our tenants' operations have recommenced operations to strong results and our tenants have improved their liquidity profiles, there can be no assurance whether these encouraging results will continue in future periods, particularly with the potential for continued increased transmission from new strains of COVID-19;

•the impact that the sharp increase in unemployment levels and uncertainty with respect to the future state of the economy could have on discretionary consumer spending, including on casino operations;

•the current and uncertain future impact of the COVID-19 outbreak, including its effect on the ability or desire of people to gather in large groups (including in casinos), which could impact our financial results, operations, outlooks, plans, goals, growth, cash flows, liquidity, and stock price;

•unforeseen consequences related to United States government stimulus packages or a failure to mitigate the sharp economic downturn from COVID-19;

•our ability to realize significant value for the real property assets of Tropicana Las Vegas which we acquired from Penn National Gaming, Inc. (NASDAQ: PENN) ("Penn")) in return for $307.5 million of rent credits;

•the availability of and the ability to identify suitable and attractive acquisition and development opportunities and the ability to acquire and lease the respective properties on favorable terms;

•the degree and nature of our competition;

•the ability to receive, or delays in obtaining, the regulatory approvals required to own and/or operate our properties, or other delays or impediments to completing our planned acquisitions or projects;

•our ability to maintain our status as a real estate investment trust ("REIT"), Eldorado Resorts, Inc.,given the highly technical and complex Internal Revenue Code (the "Code") provisions for which only limited judicial and administrative authorities exist, where even a Nevada corporation,technical or inadvertent violation could jeopardize REIT qualification and where requirements may depend in part on the actions of third parties over which the Company has no control or only limited influence;

•the satisfaction of certain asset, income, organizational, distribution, shareholder ownership and other requirements on a continuing basis in order for the Company to maintain its REIT status;

•the ability and willingness of our tenants, operators and other third parties to meet and/or perform their obligations under their respective contractual arrangements with us, including lease and note requirements and in some cases, their obligations to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities;

•the ability of our tenants and operators to maintain the financial strength and liquidity necessary to satisfy their respective obligations and liabilities to third parties, including, without limitation, to satisfy obligations under their existing credit facilities and other indebtedness;
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•the ability of our tenants and operators to comply with laws, rules and regulations in the operation of our properties, to deliver high quality services, to attract and retain qualified personnel and to attract customers;

•the ability to generate sufficient cash flows to service our outstanding indebtedness;

•the access to debt and equity capital markets, including for acquisitions or refinancing due to maturities;

•adverse changes in our credit rating;

•fluctuating interest rates and the potential phasing out of the London Interbank Offered Rate ("LIBOR") after 2021;

•the impact of global or regional economic conditions;

•the ability to attract qualified personnel and our ability to retain our key management personnel;

•GLPI's obligation to indemnify Penn and its subsidiaries (collectively "Eldorado") and Boyd Gaming Corporation, a Nevada corporation, and its subsidiaries (collectively "Boyd"). Penn, Eldorado and Boyd are subject toin certain circumstances if the reporting requirementsspin-off transaction described in Part 1 of the U.S. Securities and Exchange Commission ("SEC") and are required to file with the SEC annual reports containing audited financial information and quarterly reports containing unaudited financial information. The information related to Penn, Eldorado and Boyd provided in this Annual Report on Form 10-K has been derivedfails to be tax-free;

•changes in the United States tax law and other state, federal or local laws, whether or not specific to real estate, REITs or to the gaming, lodging or hospitality industries;

•changes in accounting standards;

•the impact of weather or climate events or conditions, natural disasters, acts of terrorism and other international hostilities, war or political instability;

•The historical financial statements included herein do not reflect what the business, financial position or results of operations of GLPI may be in the future.

•other risks inherent in the real estate business, including potential liability relating to environmental matters and illiquidity of real estate investments; and

•additional factors discussed in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this report.
Other unknown or unpredictable factors may also cause actual results to differ materially from Penn's, Eldorado'sthose projected by the forward-looking statements. Most of these factors are difficult to anticipate and Boyd's respective public filings. We haveare generally beyond the control of the Company.
You should consider the areas of risk described above, as well as those set forth under the heading "Risk Factors," in connection with considering any forward-looking statements that may be made by the Company generally. The Company does not independently verified this information. We have no reasonundertake any obligation to believe that this information derived from such public filings is inaccurate inrelease publicly any material respect that has not been disclosed publicly. We are providing this data for information purposes only. Penn's, Eldorado's and Boyd's filings withrevisions to any forward-looking statements, to report events or to report the SEC can be found at www.sec.gov.occurrence of unanticipated events unless required to do so by law.


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In this Annual Report on Form 10-K, the terms "we," "us," "our," the "Company" and "GLPI" refer to Gaming and Leisure Properties, Inc. and subsidiaries, unless the context indicates otherwise.
PART I


ITEM 1.    BUSINESS
Overview
GLPI is a self-administered and self-managed Pennsylvania REIT. The Company was formed from the 2013 tax-free spin-off of the real estate assets of Penn and was incorporated in Pennsylvania on February 13, 2013, as a wholly-owned subsidiary of Penn. On November 1, 2013, Penn contributed to GLPI, through a series of internal corporate restructurings, substantially all of the assets and liabilities associated with Penn's real property interests and real estate development business, as well as the assets and liabilities of Louisiana Casino Cruises, Inc. (d/b/a Hollywood Casino Baton Rouge) and Penn Cecil Maryland, Inc. (d/b/a Hollywood Casino Perryville), which (which are referred to herein as the "TRS Properties,"Properties") and then spun-off GLPI to holders of Penn's common and preferred stock in a tax-free distribution (the "Spin-Off"). The assets and liabilities of GLPI were recorded at their respective historical carrying values at the time of the Spin-Off in accordance with the provisions of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 505-60 - Spinoffs and Reverse Spinoffs. GLPI owns and operates the TRS Properties and holds the real estate of Tropicana Las Vegas through its indirect wholly-owned subsidiary, GLP Holdings, Inc.
The Company elected on its United States ("U.S.") federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and GLPI,Tropicana LV, LLC which together with the TRS Properties and GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. and Penn Cecil Maryland, Inc. as a "taxable REIT subsidiary" ("TRS") effective onis the first day of the first taxable year of GLPI as a REIT. Company's TRS Segment (the "TRS Segment").
In connection with the Spin-Off, Penn allocated its accumulated earnings and profits (as determined for U.S. federal income tax purposes) for periods prior to the consummation of the Spin-Off between Penn and GLPI. In connection with its election to be taxed as a REIT for U.S. federal income tax purposes for the year ended December 31, 2014, GLPI declared a special dividend to its shareholders to distribute any accumulated earnings and profits relating to the real property assets and attributable to any pre-REIT years, including any earnings and profits allocated to GLPI in connection with the Spin-Off, to comply with certain REIT qualification requirements (the "Purging Distribution"requirements.
GLPI's primary business consists of acquiring, financing, and owning real estate property to be leased to gaming operators in triple-net lease arrangements. Triple-net leases are leases in which the lessee pays rent to the lessor, as well as all taxes, insurance, utilities and maintenance expenses that arise from the use of the property. As of December 31, 2020, GLPI’s portfolio consisted of interests in 48 gaming and related facilities, including the TRS Segment, the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with 7 gaming and related facilities operated by Caesars Entertainment Corporation (NASDAQ: CZR) ("Caesars").), the real property associated with 4 gaming and related facilities operated by Boyd Gaming Corporation (NYSE: BYD) ("Boyd")) and the real property associated with the Casino Queen in East St. Louis, Illinois.  Penn, Caesars and Boyd are leading, diversified, multi-jurisdictional owners and managers of gaming and pari-mutual properties and established gaming providers with strong financial performance. These facilities, including our corporate headquarters building, are geographically diversified across 16 states and contain approximately 24.3 million square feet. As of December 31, 2020, the Company's properties were 100% occupied. We expect to continue growing our portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming operators under prudent terms.
Properties and Leases
Penn Master Lease, Amended Pinnacle Master Lease, Boyd Master Lease and Belterra Park Lease
As a result of the Spin-Off, GLPI owns substantially all of Penn's former real property assets (as of the consummation of the Spin-Off) and leases back most of thesethose assets to Penn for use by its subsidiaries pursuant to a unitary master lease (the "Penn Master Lease"). The Penn Master Lease is a triple-net operating lease, with an initialthe term of 15 years (expiringwhich expires October 31, 2028)2033, with no purchase option, followed by fourthree remaining 5-year renewal options (exercisable by Penn)the tenant) on the same terms and conditions.
In April 2016, the Company acquired substantially all of the real estate assets of Pinnacle Entertainment, Inc. ("Pinnacle") for approximately $4.8 billion. GLPI originally leased these assets back to Pinnacle, under a unitary triple-net lease, with an initialthe term of 10 years (expiringwhich expires April 30, 2026)2031, with no purchase option, followed by fivefour remaining 5-year renewal options (exercisable by Pinnacle)the tenant) on the same terms and conditions (the "Pinnacle Master Lease"). On October 15, 2018, the Company completed its previously announced transactions with Penn, Pinnacle and Boyd to accommodate Penn's acquisition of the majority of Pinnacle's operations, pursuant to a definitive agreement and plan of merger between Penn and Pinnacle, dated December 17, 2017 (the "Penn-Pinnacle Merger"). Concurrent with the Penn-Pinnacle Merger, the Company amended the Pinnacle Master Lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd (the "Amended Pinnacle Master Lease") and entered into a new
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unitary triple-net master lease agreement with Boyd (the "Boyd Master Lease") for these properties on terms similar to the Company’s existing master leases.Amended Pinnacle Master Lease. The Boyd Master Lease has an initial term of 10 years (from the original April 2016 commencement date of the Pinnacle Master Lease and expiring April 30, 2026), with no purchase option, followed by five 5-year renewal options (exercisable by the tenant) on the same terms and conditions. The Company also purchased the real estate assets of Plainridge Park Casino ("Plainridge Park") from Penn for $250.0 million, exclusive of transaction fees and taxes and added this property to the Amended Pinnacle Master Lease. The Amended Pinnacle Master Lease was assumed by Penn at the consummation of the Penn-Pinnacle Merger. The Company also entered into a mortgage loan agreement with Boyd in connection with Boyd's acquisition of Belterra Park Gaming & Entertainment Center ("Belterra

Park"), whereby the Company loaned Boyd $57.7 million (the "Belterra Park Loan"). See Note 4 for further details surroundingIn May 2020, the original Pinnacle acquisitionCompany acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to a long-term lease (the "Belterra Park Lease") with a Boyd affiliate operating the property.
Meadows Lease
The real estate assets of the Meadows Racetrack and Casino (the "Meadows") are leased to Penn under a single property triple-net lease (the "Meadows Lease"). The Meadows Lease commenced on September 9, 2016 and has an initial term of 10 years, with no purchase option, and the subsequent acquisition of Pinnacleoption to renew for three successive 5-year terms and one 4-year term (exercisable by Penn.the tenant) on the same terms and conditions.
GLPI's primary business consists of acquiring, financing,
Amended and owning real estate property to be leased to gaming operators in triple-net lease arrangements. Triple-net leases are leases in which the lessee pays rent to the lessor, as well as all taxes, insurance, and maintenance expenses that arise from the use of the property. As of December 31, 2018, GLPI’s portfolio consisted of interests in 46 gaming and related facilities, including the TRS Properties, the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with 6 gaming and related facilities operated by Eldorado (including one mortgaged facility), the real property associated with 4 gaming and related facilities operated by Boyd (including one mortgaged property) and the real property associated with the Casino Queen in East St. Louis, Illinois.  These facilities are geographically diversified across 16 states and contain approximately 23.5 million square feet. As of December 31, 2018, the Company's properties were 100% occupied.Restated Caesars Master Lease
We expect to grow our portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming operators under prudent terms. In addition to the acquisition of Plainridge Park described above, on
On October 1, 2018, the Company closed its previously announced transaction to acquire certain real property assets from Tropicana Entertainment Inc. (“Tropicana”("Tropicana") and certain of its affiliates pursuant to a Purchase and Sale Agreement (the “Real"Real Estate Purchase Agreement”Agreement") dated April 15, 2018 between Tropicana and GLP Capital L.P. (“("GLP Capital”Capital"), the operating partnership of GLPI, which was subsequently amended on October 1, 2018 (as amended, the “Amended"Amended Real Estate Purchase Agreement”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”"GLP Assets") from Tropicana for an aggregate cash purchase price of $964.0 million, exclusive of transaction fees and taxes (the "Tropicana Acquisition"). Concurrent with the Tropicana Acquisition, Eldorado Resorts, Inc. ("Eldorado")(now doing business as Caesars) 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, EldoradoCaesars and a wholly-owned subsidiary of Eldorado (the "Tropicana Merger Agreement")Caesars and leased the GLP Assets from the Company pursuant to the terms of a new unitary triple-net master lease with a 15-yearan initial term of 15 years, with no purchase option, followed by four successive 5 -year5-year renewal periods (exercisable by Eldorado)the tenant) on the same terms and conditions (the “Eldorado"Caesars Master Lease”Lease"). Additionally,

On June 15, 2020, the Company entered into an agreement to amend and restate the Caesars Master Lease (as amended, the "Amended and Restated Caesars Master Lease") to, (i) extend the initial term of 15 years to 20 years, with renewals of up to an additional 20 years at the option of Caesars, (ii) remove the variable rent component in its entirety, commencing with the third lease year, (iii) in the third lease year increase annual land base rent to approximately $23.6 million and annual building base rent to approximately $62.1 million, (iv) provide fixed escalation percentages that delay the escalation of building base rent until the commencement of the fifth lease year with building base rent increasing annually by 1.25% in the fifth and sixth lease year, 1.75% in the seventh and eighth lease years and 2% in the ninth lease year and each lease year thereafter, (v) subject to regulatory approvals and the satisfaction of certain conditions, permit Caesars to elect to replace the Tropicana Evansville and/or Tropicana Greenville properties under the Amended and Restated Caesars Master Lease with one or more of Caesars Gaming Scioto Downs, The Row in Reno, Isle Casino Racing Pompano Park, Isle Casino Hotel – Black Hawk, Lady Luck Casino – Black Hawk, Isle Casino Waterloo ("Waterloo"), Isle Casino Bettendorf ("Bettendorf") or Isle of Capri Casino Boonville, provided that the aggregate value of such new property, individually or collectively, is at least equal to the value of Tropicana Evansville or Tropicana Greenville, as applicable, (vi) permit Caesars to elect to sell its interest in Belle of Baton Rouge and sever it from the Amended and Restated Caesars Master Lease, subject to regulatory approvals and the satisfaction of certain conditions, and (vii) provide certain relief under the operating, capital expenditure and financial covenants thereunder in the event of facility closures due to pandemics, governmental restrictions and certain other instances of unavoidable delay.The Amended and Restated Caesars Master Lease became effective on July 23, 2020 when all of the necessary regulatory approvals were received and notice periods were satisfied. On December 18, 2020, Caesars transferred to the Company the real estate assets of the Waterloo and Bettendorf in exchange for the transfer by the Company to Caesars of the real property assets of the Tropicana Evansville and a cash payment of $5.7 million.The Waterloo and Bettendorf facilities were added to the Amended and Restated Caesars Master Lease and the annual rent increased by approximately $520,000.


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Lumière Place Lease

On October 1, 2018 the Company madeentered into a mortgage loan to Eldorado in the amount of $246.0 millionagreement with Caesars in connection with Eldorado’sCaesars’s acquisition of Lumière Place (togetherCasino ("Lumière Place"), whereby the Company loaned Caesars $246.0 million (the "CZR loan"). The CZR loan bore interest at a rate equal to (i) 9.09% until October 1, 2019 and (ii) 9.27% until its maturity. On the one-year anniversary of the CZR loan, the mortgage evidenced by a deed of trust on the Lumière Place property terminated and the loan became unsecured. On June 24, 2020, the Company received approval from the Missouri Gaming Commission to own the Lumière Place property in satisfaction of the CZR loan.On September 29, 2020, the transaction closed and we entered into a new triple net lease with Caesars (the "Lumière Place Lease") the initial term of which expires on October 31, 2033 with four separate renewal options of five years each, exercisable at the tenant's option.The Lumière Place Lease rent is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met.

Tropicana Las Vegas

On April 16, 2020, the Company and certain of its subsidiaries closed on its previously announced transaction to acquire the real property associated with the Tropicana AcquisitionLas Vegas Casino Hotel Resort ("Tropicana Las Vegas") from Penn in exchange for rent credits of $307.5 million, which were applied against future rent obligations due under the "Tropicana Transactions"parties' existing leases during 2020. This asset has been placed in the Company's TRS Segment.

Morgantown Lease

On October 1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits that were fully utilized by Penn in the fourth quarter of 2020.The Company is leasing the land back to an affiliate of Penn for an initial annual rent of $3.0 million, provided, however, that (i) on the opening date and on each anniversary thereafter the rent shall be increased by 1.5% annually (on a prorated basis in for the remainder of the lease year in which the gaming facility opens) for each of the following three lease years and (ii) commencing on the fourth anniversary of the opening date and for each anniversary thereafter, (a) if the Consumer Price Index ("the CPI") increase is at least 0.5% for any lease year, the rent for such lease year shall increase by 1.25% of rent as of the immediately preceding lease year, and (b) if the CPI increase is less than 0.5% for such lease year, then the rent shall not increase for such lease year (the "Morgantown Lease").

Bally's Master Lease

On October 27, 2020, the Company entered into a series of definitive agreements pursuant to which a subsidiary of Twin River Worldwide Holdings, Inc. (now doing business as Bally's Corporation (NYSE: BALY) ("Bally's")), will acquire 100% of the equity interests in the Caesars subsidiary that currently operates Tropicana Evansville and the Company will reacquire the real property assets of Tropicana Evansville from Caesars for a cash purchase price of approximately $340.0 million.In addition, the Company entered into a real estate purchase agreement with Bally's pursuant to which the Company will purchase the real estate assets of the Dover Downs Hotel & Casino, located in Dover, Delaware, which is currently owned and operated by Bally's, for a cash purchase price of approximately $144.0 million.At the closing of the transactions, which is expected in mid-2021, subject to regulatory approvals, the Tropicana Evansville and Dover Downs Hotel and Casino facilities will be added to a new master lease between the Company and Bally's (the “Bally's Master Lease”).The Company anticipates that the Bally's Master Lease will have an initial term of 15 years, with no purchase option, followed by four five-year renewal options (exercisable by the tenant) on the same terms and conditions. Rent under the Bally's Master Lease will be $40.0 million annually and is subject to an annual escalator of up to 2% determined in relation to the annual increase in the Consumer Price Index.

Casino Queen Lease and Casino Queen Master Lease

Finally, GLPI leases the Casino Queen property in East St. Louis back to its operators on a triple-net basis on terms similar to those in the Penn Master Lease (the "Casino Queen Lease"). On November 25, 2020, the Company entered into a definitive agreement to sell the operations of its Hollywood Casino Baton Rouge to Casino Queen for $28.2 million. The Company will retain ownership of all real estate assets at Hollywood Casino Baton Rouge and will simultaneously enter into a master lease with Casino Queen, which will include the Casino Queen property in East St. Louis that is currently leased by us to them and the Hollywood Casino Baton Rouge facility (the "Casino Queen Master Lease"). The initial annual cash rent on the retained real estate will be approximately $21.4 million and the lease will have an initial term of 15 years with four 5 year renewal options. This rental amount will be increased annually by 0.5% for the first six years. Beginning with the seventh lease year through the remainder of the lease term, if the CPI increases by at least 0.25% for any lease year then annual rent shall be increased by 1.25%, and if the CPI increase is less than 0.25% then rent will remain unchanged for such lease year. Additionally, the Company will complete the current land side development project that is in process and the rent under the
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Casino Queen Master Lease will be adjusted upon delivery to reflect a yield of 8.25% on GLPI's project costs. The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the second half of 2021.

Hollywood Casino Perryville Lease

On December 11, 2020, Penn agreed to purchase from the Company the operations of our Hollywood Casino Perryville, located in Perryville, Maryland, for $31.1 million, with the closing of such purchase, subject to regulatory approvals, expected to occur during calendar year 2021 on a date selected by Penn with reasonable prior notice to the Company unless otherwise agreed by both parties. Upon closing, the Company will lease the real estate of the Perryville facility to Penn pursuant to a lease providing for initial annual rent on the retained real estate of $7.77 million, $5.83 million of which will be subject to escalation provisions beginning in the second lease year through the fourth lease year and shall increase by 1.50% and then to 1.25% for the remaining lease term. The escalation provisions beginning in the fifth lease year are subject to CPI being at least 0.5% for the preceding lease year (the "Hollywood Casino Perryville Lease").
Additionally, we believe we have
COVID-19
In the abilityfirst quarter of 2020, COVID-19 became a global pandemic. Responses to leverage the expertiseCOVID-19 outbreak in the United States included mandates from federal, state, and/or local authorities requiring temporary closures of, or imposed limitations, on the operations of non-essential businesses. All of the Company's tenants' casino operations, in addition to the Company's two TRS Properties, were closed in mid-March. Our properties began reopening at limited capacity in May and by early July nearly all had resumed operations at limited capacity. However, in the fourth quarter, increased spread of COVID-19 led some jurisdictions to impose temporary closures once again. As of the date of this filing, only one of our management team has developed over the years to secure additional avenues for growth beyond the gaming industry.tenants' properties is closed.
Tax Status
We elected on our 2014In connection with the Spin-Off, Penn allocated its accumulated earnings and profits (as determined for U.S. federal income tax returnpurposes) for periods prior to the consummation of the Spin-Off between Penn and GLPI. In connection with its election to be treatedtaxed as a REIT for U.S. federal income tax purposes for the year ended December 31, 2014, GLPI declared a special dividend to its shareholders to distribute any accumulated earnings and profits relating to the real property assets and attributable to any pre-REIT years, including any earnings and profits allocated to GLPI in connection with the Spin-Off, to comply with certain REIT qualification requirements. We intend to continue to be organized and to operate in a manner that will permit us to qualify as a REIT. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our annual REIT taxable income to shareholders. As a REIT, we generally will not be subject to federal income tax on income that we distribute as dividends to our shareholders. If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income tax, including any applicable alternative minimum tax, on our taxable income at regular corporate income tax rates, and dividends paid to our shareholders would not be deductible by us in computing taxable income. Any resulting corporate liability could be substantial and could materially and adversely affect our net income and net cash available for distribution to shareholders. Unless we were entitled to relief under certain provisions of the Code, we also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which we failed to qualify to be taxed as a REIT.
Our TRS Properties areSegment is able to engage in activities resulting in income that is not qualifying income for a REIT. As a result, certain activities of the Company which occur within our TRS PropertiesSegment are subject to federal and state income taxes.
Tenants
As of December 31, 2018, 202020, 33 of the Company’s real estate investment properties were leased to a subsidiarysubsidiaries of Penn under the Penn Master Lease, 12the Amended Pinnacle Master Lease, the Meadows Lease and the Morgantown Lease, 7 of the Company's real estate investment properties were leased to a subsidiarysubsidiaries of PennCaesars under the Amended Pinnacleand Restated Caesars Master Lease 5and the Lumière Place Lease and 4 of the Company's real estate investment properties were leased to a subsidiary of Eldorado under the Eldorado Master Lease and 3 of the Company's real estate investment properties were leased to a subsidiarysubsidiaries of Boyd under the Boyd Master Lease and the Belterra Park Lease. Penn, Eldorado and Boyd are leading, diversified, multi-jurisdictional owners and managers of gaming and pari-mutuel properties and established gaming providers with strong financial performance. We also lease a single real estate investment property to Casino Queen pursuant to the Casino Queen Lease.

Guarantees

The obligations under the Penn and Amended Pinnacle Master Leases, as well as the Meadows Lease and Morgantown Lease, are guaranteed by Penn and, with respect to each lease, jointly and severally by Penn's subsidiaries that occupy and operate the facilities covered by such lease. Similarly, the obligations under the Amended and Restated Caesars Master Lease are jointly and severally guaranteed by Caesars and by most of Penn'sCaesars's subsidiaries that occupy and operate the facilities leased under the respective master leases. The obligations under the Eldorado Master Lease are guaranteed by EldoradoAmended and by most of Eldorado's subsidiaries that occupy and operate the facilities under the

EldoradoRestated Caesars Master Lease. The obligations under the Boyd Master LeaseLeases are
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jointly and severally guaranteed by most of Boyd's subsidiaries that occupy and operate the facilities leased under the Boyd Master Lease. Additionally, the real estate assets of the Meadows Racetrack and Casino (the "Meadows") are leased to Penn under a single property triple-net operating lease (the "Meadows Lease"). GLPI also leases the Casino Queen property back to its operator on a triple-net basis on terms similar to those in the master leases (the "Casino Queen Lease").


Rent

The rent structure under the Penn Master Lease includes a fixed component, a portion of which is subject to an annual 2% escalator if certain rent coverage ratio thresholds are met, and a component that is based on the performance of the facilities, which is prospectively adjusted, subject to certain floors (i) every five years to an amount equal to 4% of the average net revenues of all facilities under the Penn Master Lease (other than Hollywood Casino Columbus and Hollywood Casino Toledo) during the preceding five years in excess of a contractual baseline, and (ii) monthly by an amount equal to 20% of the net revenues of Hollywood Casino Columbus and Hollywood Casino Toledo during the preceding month.month in excess of a contractual baseline, although Hollywood Casino Toledo has a monthly percentage rent floor that equals $22.9 million annually due to Penn's 2019 purchase of a competing facility, the Greektown Casino Hotel in Detroit, Michigan.


Similar to the Penn Master Lease, the Amended Pinnacle Master Lease also includes aand Boyd Master Lease both include fixed component,components, a portion of which is subject to an annual 2% escalator if certain rent coverage ratio thresholds are met and a component that is based on the performance of the facilities, which is prospectively adjusted, subject to certain floors (namely the Bossier City Boomtown property in the Amended Pinnacle Master Lease due to Penn's acquisition of a competing facility, Margaritaville Resort Casino), every two years to an amount equal to 4% of the average annual net revenues of all facilities under the Amended Pinnacle Master Lease and Boyd Master Lease during the preceding two years.years in excess of contractual baselines.


The EldoradoBelterra Park Lease rent terms are consistent with the Boyd Master Lease includesLease.The annual rent is comprised of a fixed component, a portionpart of which is subject to an annual escalator of up to 2% escalator if certain rent coverage ratio thresholds are met and a component that is based on the performance of the facilities which is adjusted, subject to certain floors every two years to an amount equal to 4% of the average annual net revenues of all facilities under the Eldorado Master LeaseBelterra Park during the preceding two years.years in excess of a contractual baseline.

 The Boyd Master Lease includes a fixed component, a portion of which is subject to an annual 2% escalator if certain rent coverage ratio thresholds are met and a component that is based on the performance of the facilities, which is adjusted, subject to certain floors every two years to an amount equal to 4% of the average annual net revenues of all facilities under the Boyd Master Lease during the preceding two years.


The Meadows Lease contains a fixed component, subject to annual escalators, and a component that is based on the performance of the facility, which is reset every two years to a fixedan amount determined by multiplying (i) 4% by (ii) the average annual net revenues of the facility for the trailing two yeartwo-year period. The Meadows Lease contains an annual escalator provision for up to 5% of the base rent, if certain rent coverage ratio thresholds are met, which remains at 5% until the earlier of ten years or the year in which total rent is $31 million, at which point the escalator will be reduced to 2% annually thereafter.


The rent structure under the Casino Queen Lease also includes a fixed component, a portion of which is subject to an annual 2% escalator if certain rent coverage ratio thresholds are met, and a component that is based on the performance of the facility, which is reset every five years to a fixedan amount equal to the greater of (i) the annual amount of non-fixed rent applicable for the lease year immediately preceding such rent reset year and (ii) an amount equal to 4% of the average annual net revenues of the facility for the trailing five-year period.


The Amended and Restated Caesars Master Lease became effective on July 23, 2020, and among other things, changed the rental terms to become entirely fixed in nature, with the majority being subject to fixed escalations beginning in the 5th lease year as previously discussed.

As previously discussed, on September 29, 2020, we entered into the Lumière Place Lease with Caesars the initial term of which expires on October 31, 2033 with four separate renewal options of five years each, exercisable at the tenant's option. The Lumière Place Lease rent is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met.
On October 1, 2020, the Company acquired the underlying land at Penn's development facility in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits and entered into the Morgantown Lease whereby the Company is leasing the underlying land back to an affiliate of Penn for an initial annual rent of $3.0 million, provided, however, that (i) on the opening date and on each anniversary thereafter the rent shall be increased by 1.5% annually (on a prorated basis for the remainder of the lease year in which the gaming facility opens) for each of the following three lease years and (ii) commencing on the fourth anniversary of the opening date and for each anniversary thereafter, (a) if the CPI increase is at least 0.5% for any lease year, the rent for such lease year shall increase by 1.25% of rent as of the immediately preceding lease year, and (b) if the CPI increase is less than 0.5% for such lease year, then the rent shall not increase for such lease year.

Furthermore, the Company's master leases provide for a floor on the percentage rent described above, should the Company's tenants acquire or commence operating a competing facility within a restricted area (typically 60 miles from a
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property under the existing master lease with such tenant). These clauses provide landlord protections by basing the percentage rent floor for any affected facility on the net revenues of such facility for the calendar year immediately preceding the year in which the competing facility is acquired or first operated by the tenant.

In addition to rent, as triple-net lessees, all of the Company's tenants are required to pay the following executory costs: (1) all facility maintenance, (2) all insurance required in connection with the leased properties and the business conducted on the leased properties, including coverage of the landlord's interests, (3) taxes and other impositions levied on or with respect to the leased properties, (other than taxes on the income of the lessor), and (4) all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties.
Termination of Leases
Our tenants do not have the ability to terminate their obligations under our long-term tenant leases prior to theirthe expiration of the initial expirationterm without the Company's consent. If our long-term tenant leases are terminated prior to their initial expiration other than with our consent, our tenants may be liable for damages and incur charges such as continued payment of rent through the end of the lease term and maintenance costs for the leased property. All of our tenant leases contain a limited number of renewal options which may be exercised at our tenants' option. The Penn Master Lease, the Eldorado Master Lease and the Casino Queen Lease each have an initial term
8
Table of 15 years with no purchase option, followed by four 5-year renewal options (exercisable by Penn, Eldorado or Casino Queen, respectively) on the same terms and conditions, while the Amended Pinnacle Master Lease and the Boyd Master Lease each have an initial term of 10 years (from the original April 2016 commencement date of the Pinnacle Master Lease) with no purchase option, followed by five 5-year renewal options (exercisable by Penn or Boyd, respectively) on the same terms and conditions. The Meadows Lease has an initial term of 10 years with no purchase option and the option to renew for three successive 5-year terms and one 4-year term (exercisable by Penn) on the same terms and conditions.Contents

Property Features
The following table summarizes certain features of our properties as of December 31, 2018:2020:
 LocationTenant/Lease Agreement
Approx.
Property
Square
Footage (1)
Owned
Acreage
Leased
Acreage (2)
Hotel
Rooms
Tenant Occupied Properties      
Hollywood Casino LawrenceburgLawrenceburg, INPenn/Penn Master Lease634,000 73.1 32.1 295 
Hollywood Casino AuroraAurora, ILPenn/Penn Master Lease222,189 0.4 1.7 — 
Hollywood Casino JolietJoliet, ILPenn/Penn Master Lease322,446 275.6 — 100 
Argosy Casino AltonAlton, ILPenn/Penn Master Lease124,569 0.2 3.6 — 
Hollywood Casino ToledoToledo, OHPenn/Penn Master Lease285,335 42.3 — — 
Hollywood Casino ColumbusColumbus, OHPenn/Penn Master Lease354,075 116.2 — — 
Hollywood Casino at Charles Town RacesCharles Town, WVPenn/Penn Master Lease511,249 298.6 — 153 
Hollywood Casino at Penn National Race CourseGrantville, PAPenn/Penn Master Lease451,758 573.7 — — 
M ResortHenderson, NVPenn/Penn Master Lease910,173 83.5 — 390 
Hollywood Casino BangorBangor, MEPenn/Penn Master Lease257,085 6.4 37.9 152 
Zia Park Casino (3)
Hobbs, NMPenn/Penn Master Lease109,067 317.4 — — 
Hollywood Casino Gulf CoastBay St. Louis, MSPenn/Penn Master Lease425,920 578.7 — 291 
Argosy Casino RiversideRiverside, MOPenn/Penn Master Lease450,397 37.9 — 258 
Hollywood Casino TunicaTunica, MSPenn/Penn Master Lease315,831 — 67.7 494 
Boomtown BiloxiBiloxi, MSPenn/Penn Master Lease134,800 1.5 1.0 — 
Hollywood Casino St. LouisMaryland Heights, MOPenn/Penn Master Lease645,270 220.8 — 502 
Hollywood Gaming at Dayton RacewayDayton, OHPenn/Penn Master Lease191,037 119.7 — — 
Hollywood Gaming at Mahoning Valley Race CourseYoungstown, OHPenn/Penn Master Lease177,448 193.4 — — 
1st Jackpot CasinoTunica, MSPenn/Penn Master Lease78,941 52.9 93.8 — 
Ameristar Black HawkBlack Hawk, COPenn/Amended Pinnacle Master Lease775,744 104.1 — 536 
Ameristar East ChicagoEast Chicago, INPenn/Amended Pinnacle Master Lease509,867 — 21.6 288 
Ameristar Council Bluffs (3)
Council Bluffs, IAPenn/Amended Pinnacle Master Lease312,047 36.2 22.6 160 
L'Auberge Baton RougeBaton Rouge, LAPenn/Amended Pinnacle Master Lease436,461 99.1 — 205 
Boomtown Bossier CityBossier City, LAPenn/Amended Pinnacle Master Lease281,747 21.8 — 187 
L'Auberge Lake CharlesLake Charles, LAPenn/Amended Pinnacle Master Lease1,014,497 — 234.5 995 
Boomtown New OrleansNew Orleans, LAPenn/Amended Pinnacle Master Lease278,227 53.6 — 150 
Ameristar VicksburgVicksburg, MSPenn/Amended Pinnacle Master Lease298,006 74.1 — 148 
River City Casino and HotelSt. Louis, MOPenn/Amended Pinnacle Master Lease431,226 — 83.4 200 
Jackpot Properties (4)
Jackpot, NVPenn/Amended Pinnacle Master Lease419,800 79.5 — 416 
Plainridge Park CasinoPlainville, MAPenn/Amended Pinnacle Master Lease196,473 87.9 — — 
The Meadows Racetrack and Casino (3)
Washington, PAPenn/Meadows Lease417,921 155.5 — — 
Hollywood Casino MorgantownMorgantown, PAPenn/Morgantown Lease— 36.0 — — 
Casino QueenEast St. Louis, ILCasino Queen330,502 67.2 — 157 
Belterra Casino ResortFlorence, INBoyd/Boyd Master Lease782,393 167.1 148.5 662 
Ameristar Kansas CityKansas City, MOBoyd/Boyd Master Lease763,939 224.5 31.4 184 
Ameristar St. CharlesSt. Charles, MOBoyd/Boyd Master Lease1,272,938 241.2 — 397 
Belterra Park Gaming & Entertainment CenterCincinnati, OHBoyd/Belterra Park Lease372,650 160.0 — — 
Tropicana Atlantic CityAtlantic City, NJCaesars/Amended Caesars Master Lease4,232,018 18.3 — 2,364 
Tropicana LaughlinLaughlin, NVCaesars/Amended Caesars Master Lease936,453 93.6 — 1,487 
Isle Casino Hotel BettendorfBettendorf, IACaesars/Amended Caesars Master Lease738,905 24.6 — 509 
Isle Casino Hotel WaterlooWaterloo, IACaesars/Amended Caesars Master Lease287,436 52.6 — 194 
Trop Casino GreenvilleGreenville, MSCaesars/Amended Caesars Master Lease94,017 — 7.4 40 
Belle of Baton RougeBaton Rouge, LACaesars/Amended Caesars Master Lease386,398 13.1 0.8 288 
Lumiere PlaceSt. Louis, MOCaesars/Lumiere Place Lease807,407 18.5 — 494 
22,978,662 4,820.8 788.0 12,696 
9
Table of Contents
 LocationTenant/Operator 
Approx.
Property
Square
Footage (1)
 
Owned
Acreage
 
Leased
Acreage (2)
 
Hotel
Rooms
Tenant Occupied Properties    
  
  
  
Hollywood Casino LawrenceburgLawrenceburg, INPenn 634,000
 73.1
 32.1
 295
Hollywood Casino AuroraAurora, ILPenn 222,189
 0.4
 1.7
 —
Hollywood Casino JolietJoliet, ILPenn 322,446
 275.6
 —
 100
Argosy Casino AltonAlton, ILPenn 124,569
 0.2
 3.6
 —
Hollywood Casino ToledoToledo, OHPenn 285,335
 42.3
 —
 —
Hollywood Casino ColumbusColumbus, OHPenn 354,075
 116.2
 —
 —
Hollywood Casino at Charles Town RacesCharles Town, WVPenn 511,249
 298.6
 —
 150
Hollywood Casino at Penn National Race CourseGrantville, PAPenn 451,758
 573.7
 —
 —
M ResortHenderson, NVPenn 910,173
 83.5
 —
 390
Hollywood Casino BangorBangor, MEPenn 257,085
 6.4
 37.9
 152
Zia Park Casino (3)
Hobbs, NMPenn 109,067
 317.4
 —
 —
Hollywood Casino Gulf CoastBay St. Louis, MSPenn 425,920
 578.7
 —
 291
Argosy Casino RiversideRiverside, MOPenn 450,397
 37.9
 —
 248
Hollywood Casino TunicaTunica, MSPenn 315,831
 —
 67.7
 494
Boomtown BiloxiBiloxi, MSPenn 134,800
 1.5
 1.0
 —
Hollywood Casino St. LouisMaryland Heights, MOPenn 645,270
 222.4
 —
 502
Hollywood Gaming at Dayton RacewayDayton, OHPenn 191,037
 119.7
 —
 —
Hollywood Gaming at Mahoning Valley Race CourseYoungstown, OHPenn 177,448
 193.4
 —
 —
Resorts Casino TunicaTunica, MSPenn 319,823
 —
 86.6
 201
1st Jackpot CasinoTunica, MSPenn 78,941
 52.9
 93.8
 —
Ameristar Black HawkBlack Hawk, COPenn 775,744
 104.1
 —
 535
Ameristar East ChicagoEast Chicago, INPenn 509,867
 —
 21.6
 288
Ameristar Council Bluffs (3)
Council Bluffs, IAPenn 312,047
 36.2
 22.6
 160
L'Auberge Baton RougeBaton Rouge, LAPenn 436,461
 99.1
 —
 205
Boomtown Bossier CityBossier City, LAPenn 281,747
 21.8
 —
 187
L'Auberge Lake CharlesLake Charles, LAPenn 1,014,497
 —
 234.5
 995
Boomtown New OrleansNew Orleans, LAPenn 278,227
 53.6
 —
 150
Ameristar VicksburgVicksburg, MSPenn 298,006
 74.1
 —
 148
River City Casino and HotelSt. Louis, MOPenn 431,226
 —
 83.4
 200
Jackpot Properties (4)
Jackpot, NVPenn 419,800
 79.5
 —
 416
Plainridge Park CasinoPlainville, MAPenn 196,473
 87.9
 —
 —
The Meadows Racetrack and Casino (3)
Washington, PAPenn 417,921
 155.5
 —
 —
Casino QueenEast St. Louis, ILCasino Queen 330,502
 67.2
 —
 157
Belterra Casino ResortFlorence, INBoyd 782,393
 167.1
 148.5
 662
Ameristar Kansas CityKansas City, MOBoyd 763,939
 224.5
 31.4
 184
Ameristar St. CharlesSt. Charles, MOBoyd 1,272,938
 241.2
 —
 397
Tropicana Atlantic CityAtlantic City, NJEldorado 4,232,018
 18.3
 —
 2,366
Tropicana EvansvilleEvansville, INEldorado 754,833
 18.4
 10.2
 338
Tropicana LaughlinLaughlin, NVEldorado 936,453
 93.6
 —
 1,487
Trop Casino GreenvilleGreenville, MSEldorado 94,017
 —
 7.4
 40
Belle of Baton RougeBaton Rouge, LAEldorado 386,398
 13.1
 0.8
 288
    21,846,920
 4,549.1
 884.8
 12,026
           
Mortgaged Properties          
Belterra Park Gaming & Entertainment Center (5)
Cincinnati, OHBoyd 372,650
 160.0
 —
 —
Other Properties
Other owned buildings and land (5)
variousN/A23,400 3.9 — — 
TRS Segment      
Hollywood Casino Baton RougeBaton Rouge, LAGLPI95,318 25.1 — — 
Hollywood Casino PerryvillePerryville, MDGLPI97,961 36.3 — — 
Tropicana Las Vegas (6)
Las Vegas, NVPenn1,148,212 35.1 — 1,467 
  1,341,491 96.5 — 1,467 
Total24,343,553 4,921.2 788.014,163 

Lumiére Place (5)
St. Louis, MOEldorado 1,020,782
 18.5
 —
 494
    1,393,432
 178.5
 —
 494
           
Other Properties          
Other owned buildings and land (6)
variousN/A 23,400
 3.9
 —
 —
           
TRS Properties    
  
  
  
Hollywood Casino Baton RougeBaton Rouge, LAGLPI 95,318
 25.1
 —
 —
Hollywood Casino PerryvillePerryville, MDGLPI 97,961
 36.4
 —
 —
    193,279
 61.5
 —
 —
Total   23,457,031
 4,793.0
 884.8
 12,520




(1)
(1)Square footage includes air-conditioned space and excludes parking garages and barns.

(2)
Leased acreage reflects land subject to leases with third-parties and includes land on which certain of the current facilities and ancillary supporting structures are located as well as parking lots and access rights.

(3)
These properties include hotels not owned by the Company. Square footage and rooms associated with properties not owned by GLPI are excluded from the table above.

(4)
Encompasses two gaming properties in Jackpot, Nevada, Cactus Petes and The Horseshu.

(5)
The Company financed the purchase of these properties by their respective owner-operators through mortgage loans to the owner-operators. Square footage, acreage and rooms associated with these properties that we do not own are included in this table for informational purposes only.

(6)
This includes our corporate headquarters building and undeveloped land the Company owns at locations other than its tenant occupied properties.
Hollywood Casino Lawrenceburg
We own 73.1 acres and lease 32.1 acres in Lawrenceburg, Indiana, a portion of which serves as the dockside embarkation for the gaming vessel, and includes a Hollywood-themed casino riverboat, an entertainment pavilion, a 295-room hotel, two parking garages and an adjacent surface lot,barns.

(2)Leased acreage reflects land subject to leases with an additional surface lot used for remote parking. This property is leased to Penn as partthird-parties and includes land on which certain of the Penn Master Lease.
Hollywood Casino Aurora
We own a dockside barge structurecurrent facilities and land-based pavilion in Aurora, Illinois. We own the land, which is approximately 0.4 acres, on which the pavilion is located. The property also includes two parking garages under capital lease agreements and rights to a pedestrian walkway bridge under an operating lease, together comprising 1.7 acres. This property is leased to Penn as part of the Penn Master Lease.
Hollywood Casino Joliet
We own 275.6 acres in Joliet, Illinois, which includes a barge-based casino, land-based pavilion, a 100-room hotel, a parking garage, surface parking areas and a recreational vehicle park. This property is leased to Penn as part of the Penn Master Lease.
Argosy Casino Alton
We lease 3.6 acres in Alton, Illinois, a portion of which serves as the dockside boarding for the Alton Belle II, a riverboat casino. The dockside facility includes an entertainment pavilion and office space,ancillary supporting structures are located as well as surface parking areas. In addition, we own an officelots and access rights.

(3)    These properties include hotels not owned by the Company. Square footage and rooms associated with properties not owned by GLPI are excluded from the table above.

(4)    Encompasses two gaming properties in Jackpot, Nevada: Cactus Pete's and The Horseshu.

(5)     This includes our corporate headquarters building and undeveloped land the Company owns at locations other than its tenant occupied properties.
(6)    The Company acquired the real property consisting of 0.2 acres. This property is leased to Penn as part of the Penn Master Lease.



Hollywood Casino Toledo
We own a 42.3 acre site in Toledo, Ohio, where Hollywood Casino Toledo is located. The property includes a casino as well as structured and surface parking. This property is leased to Penn as part of the Penn Master Lease.
Hollywood Casino Columbus
We own 116.2 acres of land in Columbus, Ohio, where Hollywood Casino Columbus is located. The property includes a casino as well as structured and surface parking. this property is leased to Penn as part of the Penn Master Lease.
Hollywood Casino at Charles Town Races
We own 298.6 acres on various parcels in Charles Town and Ranson, West Virginia of which 155 acres comprise the Hollywood Casino at Charles Town Races. The facility includes a 150-room hotel and a 3/4-mile all-weather lighted thoroughbred racetrack, a training track, two parking garages, an employee parking lot, an enclosed grandstand/clubhouse and stable facilities for over 1,300 horses. This property is leased to Penn as part of the Penn Master Lease.
Hollywood Casino at Penn National Race Course
We own 573.7 acres in Grantville, Pennsylvania, where Penn National Race Course is located on 181 acres. The facility includes a casino, a one-mile all-weather lighted thoroughbred racetrack and a 7/8-mile turf track, a parking garage and surface parking spaces. The property also includes approximately 393 acres surrounding the Penn National Race Course that are available for future expansion or development. This property is leased to Penn as part of the Penn Master Lease.
M Resort
We own 83.5 acres on the southeast corner ofassociated with Tropicana Las Vegas Boulevard and St. Rose Parkwayfrom Penn in Henderson, Nevada, where the M Resort is located. The M Resort property includes a casino, a 390-room hotel and a parking facility. In addition, our tenant has rights to 4.0 acresexchange for $307.5 million of land at the casino site. This property is leased to Penn as part of the Penn Master Lease.
Hollywood Casino Bangor
We lease 2.5 acresrent credits in Bangor, Maine on which Hollywood Casino Bangor is located. We also own 6.4 acres adjacent to the casino on which a 152-room hotel and a four-story parking garage are located. In addition, we lease 35.4 acres at and around historic Bass Park, which is adjacent to the casino and includes a one-half mile standardbred racetrack, a grandstand with over 12,000 square feet and seating for 3,500 patrons and parking. This property is leased to Penn as part of the Penn Master Lease.
Zia Park Casino
We own 317.4 acres in Hobbs, New Mexico, where the Zia Park Casino is located. The property also includes a one-mile thoroughbred and quarterhorse racetrack. This property is leased to Penn as part of the Penn Master Lease.
Hollywood Casino Gulf Coast
We own 578.7 acres in the city of Bay St. Louis, Mississippi, including a 20-slip marina. The property includes a casino, an 18-hole golf course, a 291-room hotel, a recreational vehicle park and other facilities. This property is leased to Penn as part of the Penn Master Lease.
Argosy Casino Riverside
We own 37.9 acres in Riverside, Missouri, which includes a barge-based casino, a 248-room hotel, an entertainment/banquet facility and a parking garage. This property is leased to Penn as part of the Penn Master Lease.
Hollywood Casino Tunica
We lease 67.7 acres of land in Tunica, Mississippi. The property includes a dockside single-level casino, a 494-room hotel, surface parking and other land-based facilities. This property is leased to Penn as part of the Penn Master Lease.
Boomtown Biloxi
We lease 1.0 acre of land mostly used for parking and a welcome center and own an additional 1.5 acres in Biloxi, Mississippi. In addition, our tenant has rights to 18.5 acres of land, most of which is utilized for the dockside casino and 4.5 acres of submerged tidelands at the casino site. This property is leased to Penn as part of the Penn Master Lease.


Hollywood Casino St. Louis
We own 222.4 acres along the Missouri River in Maryland Heights, Missouri. The property includes a casino, a 502-room hotel and structure and surface parking. This property is leased to Penn as part of the Penn Master Lease.
Hollywood Gaming at Dayton Raceway
We own 119.7 acres in Dayton, Ohio, where Penn opened Hollywood Gaming at Dayton Raceway on August 28, 2014. The property includes a gaming facility, a 5/8-mile all-weather standardbred racetrack and surface parking. This property is leased to Penn as part of the Penn Master Lease.
Hollywood Gaming at Mahoning Valley Race Course
We own 193.4 acres in Youngstown, Ohio, where Penn opened Hollywood Gaming at Mahoning Valley Race Course on September 17, 2014. The property includes a gaming facility, a one-mile thoroughbred racetrack and surface parking. This property is leased to Penn as part of the Penn Master Lease.
Resorts Casino Tunica
We lease 86.6 acres in Tunica, Mississippi, where the Resorts Casino Tunica is located.April 2020. The property is located alongoperated by an affiliate of Penn pursuant to a triple net lease for nominal rent for the Mississippi River and includes a dockside casino, surface parking, a 201-room hotel and other land-based facilities. This propertyearlier of two years (subject to three one-year extensions at the Company's option) or until the Tropicana Las Vegas is leased to Penn as part ofsold. See Note 7 in the Penn Master Lease.
1st Jackpot Casino
We own 52.9 acres of wetlands and lease an additional 93.8 acres in Tunica, Mississippi located approximately 30 miles from downtown Memphis, Tennessee. The property is located along the Mississippi River and includes a dockside casino, surface parking and other land-based facilities. This property is leased to Penn as part of the Penn Master Lease.
Ameristar Black Hawk
We own 104.1 acres in Black Hawk, Colorado which includes a casino and a 535 room hotel. The casino property sits on approximately 6 acres and the remaining 98 acres, which are located across the street from the casino, are used mainly for overflow parking, administrative offices and a warehouse. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

Ameristar East Chicago

We lease 21.6 acres in East Chicago, Indiana located approximately 25 miles from downtown Chicago, Illinois. The property includes a dockside riverboat casino and a 288 room hotel. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

Ameristar Council Bluffs

We own 36.2 acres and lease an additional 22.6 acres in Council Bluffs, Iowa. The property is located across the Missouri River from Omaha, Nebraska. The property includes a dockside casino and a 160 room hotel. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

L’ Auberge Baton Rouge

We own 99.1 acres in Baton Rouge, Louisiana. The property includes a dockside casino and a 205 room hotel and is located approximately 10 miles south of downtown Baton Rouge. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

Boomtown Bossier City

We own 21.8 acres on the banks of the Red River in Bossier City, Louisiana. The property features a 187 room hotel adjoining a dockside riverboat casino. This property is leased to Penn as part of the Amended Pinnacle Master Lease.





L’Auberge Lake Charles

We lease 234.5 acres in Lake Charles, Louisiana. The property includes a dockside casino and a 995 room hotel and is one of the closest full-scale casino-hotel facilities to Houston, Texas. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

Boomtown New Orleans

We own 53.6 acres in Harvey, Louisiana. The property includes a dockside riverboat casino and a 150 room hotel. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

Ameristar Vicksburg

We own 74.1 acres in Vicksburg, Mississippi. The property includes a dockside riverboat casino and a 148 room hotel. Also located on the property is a recreational vehicle park and buildings which are used for warehousing and support services. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

River City Casino and Hotel

We lease 83.4 acres in St. Louis County Missouri approximately 12 miles south of downtown St. Louis. The property includes a dockside casino and a 200 room hotel. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

Jackpot Properties

We own 79.5 acres in Jackpot, Nevada, encompassing Cactus Petes and The Horseshu. In addition to these two casinos, the property includes a 416 room hotel and a recreational vehicle park. These two properties sit directly across from each other with Highway 93 separating them. These properties are leased to Penn as part of the Amended Pinnacle Master Lease.

Plainridge Park Casino

We own 87.9 acres in Plainridge, Massachusetts. The property includes a gaming facility, live harness racing on a 5/8 mile track, 1,620 structured and surface parking spaces, a grandstand and a clubhouse. This property is leased to Penn as part of the Amended Pinnacle Master Lease.

The Meadows Racetrack and Casino

We own 155.5 acres in Washington, Pennsylvania. The property includes a casino, an off-track wagering facility, a 24-lane bowling alley and a state-of-the-art 5/8- mile harness track with a 500-seat grandstand. This property is leased to Penn under the Meadows Lease.
Casino Queen
We own 67.2 acres in East St. Louis, Illinois,. The property includes a casino, a 157-room hotel, a recreational vehicle park and surface parking areas. This property is leased to Casino Queen under the Casino Queen Lease.
Belterra Casino Resort

We own 167.1 acres and lease an additional 148.5 acres in Florence, Indiana. The property is located along the Ohio River and includes a dockside riverboat casino, an 18-hole golf course and a 608 room casino hotel, in additionNotes to the 54 room Ogle Haus Inn. This property is leased to Boyd as part of the Boyd Master Lease.

Ameristar Kansas City

We own 224.5 acres in Kansas City, Missouri, along the north bank of the Missouri River and lease an additional 31.4 adjacent acres. The property includes a dockside casino and a 184 room hotel. This property is leased to Boyd as part of the Boyd Master Lease.



Ameristar St. Charles

We own 241.2 acres in St. Charles, Missouri, along the west bank of the Missouri River. The property includes a dockside casino and a 397 room hotel. This property is leased to Boyd as part of the Boyd Master Lease.

Tropicana Atlantic City

We own 18.3 acresin Atlantic City, New Jersey. The property includes a casino and 2,366 hotel rooms across five hotel towers. This property is leased to Eldorado as part of the Eldorado Master Lease.

Tropicana Evansville

We own 18.4 acres and lease another 10.2 acres along the banks of the Ohio river in Evansville, Indiana. The property includes a casino and two hotels with a combined 338 rooms along with a 1,660 vehicle attached parking garage. This property is leased to Eldorado as part of the Eldorado Master Lease.

Tropicana Laughlin

We own 93.6 acres in Laughlin, Nevada. The property includes a casino and a 1,487 room hotel. This property is leased to Eldorado as part of the Eldorado Master Lease.

Trop Casino Greenville

We lease 7.4 acres in historic downtown Greenville, Mississippi. The property includes a riverboat and casino and a 40 room hotel. This property is leased to Eldorado as part of the Eldorado Master Lease.

Belle of Baton Rouge

We own 13.1 acres and lease another 0.8 acres in the downtown historic district of Baton Rouge, Louisiana. The property includes a dockside casino and a 288 room hotel. This property is leased to Eldorado as part of the Eldorado Master Lease.

Mortgaged Properties

Belterra Park Gaming and Entertainment Center

We hold the mortgage on thisproperty which encompasses 160.0 acres on the banks of the Ohio River approximately 10 minutes from downtown Cincinnati, Ohio. The property includes a gaming facility and live thoroughbred racing on two tracks, a 7/8 mile turf track and a one mile dirt track.

Lumière Place

We hold the mortgage on this property which encompasses 18.5 acres overlooking the Mississippi River in historic downtown St. Louis, Missouri. The property includes a casino and two hotels with a combined 494 rooms.

TRS Properties
Hollywood Casino Baton Rouge
Hollywood Casino Baton Rouge is a dockside riverboat casino operating in Baton Rouge, Louisiana. The riverboat features approximately 29,000 square feet of gaming space with 894 gaming machines and 12 table games and also features a deli. The facility also includes a two-story, 66,318 square foot dockside building featuring a variety of amenities, including a grill, a 268-seat buffet, a premium players' lounge, an event venue, a lobby bar, a public atrium, two meeting rooms and 1,407 surface parking spaces.
Hollywood Casino Perryville
Hollywood Casino Perryville is located directly off Interstate 95 in Cecil County, Maryland just 35 miles northeast of Baltimore and 70 miles from Washington, D.C. Hollywood Casino Perryville is a Hollywood-themed facility which offers 34,329 square feet of gaming space with 822 slot machines, 14 table games, 8 poker tables and a simulcast race book. The

facility also offers several third-party operated food and beverage options, including a bar and grill, a casino bar, a gift shop and 1,600 surface parking spaces with valet and self-parking.Consolidated Financial Statements for further details.
Competition
We compete for additional real property investments with other REITs, including two other publicly traded gaming focused REITs, MGM Growth Properties LLC and VICI Properties Inc., investment companies, private equity and hedge fund investors, sovereign funds, lenders, gaming companies and other investors. Some of our competitors are significantly larger and have greater financial resources and lower costs of capital than we have. Furthermore, in April 2016, MGM Resorts International ("MGM") formed MGM Growth Properties, a separate publicly traded REIT, holding a substantial portion of the real estate assets associated with MGM's operations. Additionally, in October 2017, Caesars Entertainment Corporation emerged from bankruptcy and completed the spin-off of substantially all of its real estate assets to VICI Properties, a separate publicly traded REIT. Increased competition will makehave, making it more challenging to identify and successfully capitalize on acquisition opportunities that meet our investment objectives.
In addition, revenues from our gaming properties are dependent on the ability of our gaming tenants and operators to compete with other gaming operators. The gaming industry is characterized by an increasingly high degree of competition among a large number of participants, including riverboat casinos, dockside casinos, land-based casinos, video lottery, sweepstakes and poker machines not located in casinos, Native American gaming, emerging varieties of internet gaming, sports betting and other forms of gaming in the U.S. In a broader sense, our gaming tenants and operators face competition from all manner of leisure and entertainment activities, including: shopping, athletic events, television and movies, concerts and travel. Legalized gaming is currently permitted in various forms throughout the U.S., in several Canadian provinces and on various lands taken into trust for the benefit of certain Native Americans in the U.S. and Canada. Other jurisdictions, including states adjacent to states in which our gaming tenants and operators are located have legalized, and may expand gaming in the near future. In addition, established gaming jurisdictions could award additional gaming licenses or permit the expansion or relocation of existing gaming operations. New, relocated or expanded operations by other persons willmay increase competition for our gaming tenants and operators and could have a material adverse impact on our gaming tenants and operators and us as landlord. Finally, the imposition of smoking bans and/or higher gaming tax rates have a significant impact on our gaming tenants' and operators' ability to compete with facilities in nearby jurisdictions.
Segments
Consistent with how our Chief Operating Decision Maker (as such term is defined in ASC 280 - Segment Reporting) reviews and assesses our financial performance, we have two reportable segments, GLP Capital, L.P. (a wholly-owned subsidiary of GLPI through which GLPI owns substantially all of its real estate assets) ("GLP Capital") and the TRS Properties.Segment. The GLP Capital reportable segment consists of the leased real property and represents the majority of our business. The TRS Properties reportable segmentSegment consists of Hollywood Casino Perryville, and Hollywood Casino Baton Rouge.Rouge and Tropicana Las Vegas. See "Item 7—
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Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Item 8—Financial Statements and Supplementary Data—Note 16—19—Segment Information" for further information with respect to the Company's segments.
Information about our Executive Officers of the Company
NameAgePosition
Peter M. Carlino7274 
Chairman of the Board and Chief Executive Officer
Steven T. Snyder58
Interim Chief Financial Officer and Senior Vice President of Corporate Development
Brandon J. Moore4446 
SeniorExecutive Vice President, General Counsel and Secretary
Desiree A. Burke5355 
Senior Vice President, and Chief Accounting Officer and Treasurer
Matthew Demchyk39 Senior Vice President, Chief Investment Officer
Steven L. Ladany40 Senior Vice President, Chief Development Officer
Peter M. Carlino.    Mr. Carlino ishas been the Company's Chairman of our Board of Directors and Chief Executive Officer.Officer since the Company's inception in November 2013. Mr. Carlino joinedwas the Company in connection with the Spin-Off on November 1,founder of Penn and served as its Chief Executive Officer from 1994 through October 2013. Prior to the Spin-Off, Mr. Carlino also served as Penn's founder and Chief Executive Officer. He continues as Penn's non-executivethe Chairman of the Board of Directors. Since 1976,Directors of Penn from April 1994 through May 28, 2019. Mr. Carlino continues to serve as Chairman Emeritus on Penn's Board of Directors and has served in such position since June 2019. Mr. Carlino has been Presidentserved as the Chairman of Carlino Capital Management Corp. (formerly knownthe Board of Directors and as Carlino Financial Corporation), a holding company that ownsChief Executive Officer for Penn, and operates various Carlino family investments.
Steven T. Snyder.    Mr. Snyder is our Interim Chief Financial Officer and our Senior Vice President of Corporate Development. Mr. Snyder joinednow the Company, in connection with the Spin-Off on November 1, 2013. Prior to the Spin-Off, he served as Penn's Senior Vice President of Corporate Development from 2003 and was responsiblecollectively for identifying and conducting internal and industry analysis of potential acquisitions, partnerships and other opportunities. He joined Penn as Vice President of Corporate Development in May 1998 and held that position until his appointment to Senior Vice President in 2003. Prior to joining Penn, Mr. Snyder was a partner with Hamilton Partners, Ltd. and previously served as Managing Director ofover 25 years.

Municipal and Corporate Investment Banking for Meridian Capital Markets. Mr. Snyder began his career in finance at Butcher & Singer, where he served as First Vice President of Public Finance.
Brandon J. Moore.    Mr. Moore is our SeniorExecutive Vice President, General Counsel and Secretary. Mr. Moore joined the Company in January 2014. Previously, he served as Penn's Vice President, Senior Corporate Counsel from March 2010 where he was a member of the legal team responsible for a variety of transactional, regulatory and general legal matters. Prior to joining Penn, Mr. Moore was with Ballard Spahr LLP, where he provided advanced legal counsel to clients on matters including merger and acquisition transactions, debt and equity financings, and various other matters.
Desiree A. Burke. Ms. Burke is our Senior Vice President, Chief Accounting Officer and Treasurer. Shejoined the Company in April 2014 as our Senior Vice President and Chief Accounting Officer. Previously, Ms. Burke served as Penn's Vice President and Chief Accounting Officer from November 2009. Additionally, she served as Penn's Vice President and Corporate Controller from November 2005 to October 2009. Prior to her time at Penn National Gaming, Inc., Ms. Burke was the Executive Vice President/Director of Financial Reporting and Control for MBNA America Bank, N.A. She joined MBNA in 1994 and held positions of ascending responsibility in the finance department during her tenure. Ms. Burke is a CPA.
Matthew Demchyk. Mr. Demchyk became our Senior Vice President, Chief Investment Officer in January 2021 in which he leads the Company's investment strategy and is responsible for capital allocation. Mr. Demchyk joined the Company in February 2019 as our Senior Vice President of Investments. Previously, he served as Portfolio Manager of Real Estate Securities at Millennium Partners for nine years. Prior to joining Millennium Partners, he managed a portfolio of REIT equity securities at Carlson Capital and served as Assistant Portfolio Manager at CenterSquare Investment Management, a leading REIT dedicated asset manager. Mr. Demchyk is a CFA Charterholder.
Steven L. Ladany. Mr. Ladany became our Senior Vice President, Chief Development Officer in January 2021 and leads the Company's ongoing merger, acquisition and development efforts. Mr. Ladany joined the Company in September 2014 as Vice President, Finance and served in that role until March 2019, when he was promoted to Senior Vice President, Finance. Prior to joining the Company, Mr. Ladany served as a Vice President at Revel Casino Hotel, a regional gaming property currently known as Ocean Casino Resort, and as a Vice President at J.P. Morgan in the Syndicated and Leveraged Finance group within the firm's investment banking division.

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Tax Considerations
We elected to be treated as a REIT on our 2014 U.S. federal income tax return and we, together with an indirect wholly-owned subsidiary of the Company, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. and Penn Cecil Maryland, Inc. as a "taxable REIT subsidiary" ("TRS") effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company, elected to treat Tropicana LV, LLC as a TRS. We intend to continue to be organized and to operate in a manner that will permit us to qualify as a REIT. Qualification and taxation as a REIT depends on our ability to meet on a continuing basis, through actual operating results, distribution levels, and diversity of stock ownership, various qualification requirements imposed upon REITs by the Code. Our ability to qualify to be taxed as a REIT also requires that we satisfy certain tests, some of which depend upon the fair market values of assets that we own directly or indirectly. The material qualification requirements are summarized below. Such values may not be susceptible to a precise determination. Accordingly, no assurance can be given that the actual results of our operations for any taxable year will satisfy such requirements for qualification and taxation as a REIT. Additionally, while we intend to operate so that we continue to qualify to be taxed as a REIT, no assurance can be given that the Internal Revenue Service (the "IRS") will not challenge our qualification, or that we will be able to operate in accordance with the REIT requirements in the future.
Taxation of REITs in General
As a REIT, generally we will be entitled to a deduction for dividends that we pay and therefore will not be subject to U.S. federal corporate income tax on our net REIT taxable income that is currently distributed to our shareholders. This treatment substantially eliminates the "double taxation" at the corporate and shareholder levels that generally results from an investment in a C corporation. A "C corporation" is a corporation that generally is required to pay tax at the corporate level. Double taxation means taxation once at the corporate level when income is earned and once again at the shareholder level when the income is distributed. In general, the income that we generate is taxed only at the shareholder level upon a distribution of dividends to our shareholders. We will nonetheless be subject to U.S. federal tax in the following circumstances:
•We will be taxed at regular corporate rates on any undistributed net taxable income, including undistributed net capital gains.


•For tax years that began prior to January 1, 2018, we may be subject to the "alternative minimum tax" on our items of tax preference, including any deductions of net operating losses.


•If we have net income from prohibited transactions, which are, in general, sales or other dispositions of inventory or property held primarily for sale to customers in the ordinary course of business, other than foreclosure property, such income will be subject to a 100% tax.


•If we elect to treat property that we acquire in connection with a foreclosure of a mortgage loan or certain leasehold terminations as "foreclosure property," we may thereby avoid the 100% tax on gain from a resale of that property (if the sale would otherwise constitute a prohibited transaction), but the income from the sale or operation of the property may be subject to corporate income tax at the highest applicable rate (currently 21%).


•If we fail to satisfy the 75% gross income test and/or the 95% gross income test, as discussed below, but nonetheless maintain our qualification as a REIT because we satisfy other requirements, we will be subject to a 100% tax on an amount based on the magnitude of the failure, as adjusted to reflect the profit margin associated with our gross income.


•If we violate the asset tests (other than certain de minimis violations) or other requirements applicable to REITs, as described below, and yet maintain our qualification as a REIT because there is reasonable cause for the failure and other applicable requirements are met, we may be subject to a penalty tax. In that case, the amount of the penalty tax will be at least $50,000 per failure, and, in the case of certain asset test failures, will be determined as the amount of net income generated by the nonqualifying assets in question multiplied by the highest corporate tax rate (currently 21%) if that amount exceeds $50,000 per failure.


•If we fail to distribute during each calendar year at least the sum of (i) 85% of our ordinary income for such year, (ii) 95% of our capital gain net income for such year and (iii) any undistributed net taxable income from prior periods, we will be subject to a nondeductible 4% excise tax on the excess of the required distribution over the sum of (a) the amounts that we actually distributed and (b) the amounts we retained and upon which we paid income tax at the corporate level.


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•We may be required to pay monetary penalties to the IRS in certain circumstances, including if we fail to meet record-keeping requirements intended to monitor our compliance with rules relating to the composition of a REIT's shareholders.


•A 100% tax may be imposed on transactions between us and a TRS that do not reflect arm's-length terms.


•If we acquire appreciated assets from a corporation that is not a REIT (i.e., a corporation taxable under subchapter C of the Code) in a transaction in which the adjusted tax basis of the assets in our hands is determined by reference to the adjusted tax basis of the assets in the hands of the subchapter C corporation, we may be subject to tax on such appreciation at the highest corporate income tax rate then applicable if we subsequently recognize gain on a disposition of any such assets during the five-year period following their acquisition from the subchapter C corporation. (Notwithstanding the “Supplement to Certain United States Federal Income Tax Considerations” section of our Prospectus Supplement dated August 9, 2016, to our Prospectus dated March 28, 2016, final regulations were issued by the U.S. Department of the Treasury (the “Treasury”) on January 17, 2017, confirming that the recognition period during which this tax could apply is a 5-year period and not a 10-year period.)  


•The earnings of our TRS PropertiesSegment will generally be subject to U.S. federal, state and corporate income tax.
In addition, we and our subsidiaries may be subject to a variety of taxes, including payroll taxes and state, local, and foreign income, property, gross receipts and other taxes on our assets and operations. We could also be subject to tax in situations and on transactions not presently contemplated.
Requirements for Qualification—General
The Code defines a REIT as a corporation, trust or association:
1.that is managed by one or more trustees or directors;
2.the beneficial ownership of which is evidenced by transferable shares, or by transferable certificates of beneficial interest;
3.that would be taxable as a domestic corporation but for its election to be subject to tax as a REIT;
4.that is neither a financial institution nor an insurance company subject to specific provisions of the Code;
5.the beneficial ownership of which is held by 100 or more persons;
6.in which, during the last half of each taxable year, not more than 50% in value of the outstanding stock is owned, directly or indirectly, by five or fewer "individuals" (as defined in the Code to include specified tax-exempt entities); and
7.that meets other tests described below, including with respect to the nature of its income and assets.
1.that is managed by one or more trustees or directors;
2.the beneficial ownership of which is evidenced by transferable shares, or by transferable certificates of beneficial interest;
3.that would be taxable as a domestic corporation but for its election to be subject to tax as a REIT;
4.that is neither a financial institution nor an insurance company subject to specific provisions of the Code;
5.the beneficial ownership of which is held by 100 or more persons;
6.in which, during the last half of each taxable year, not more than 50% in value of the outstanding stock is owned, directly or indirectly, by five or fewer "individuals" (as defined in the Code to include specified tax-exempt entities); and
7.that meets other tests described below, including with respect to the nature of its income and assets.
The Code provides that conditions (1) through (4) must be met during the entire taxable year, and that condition (5) must be met during at least 335 days of a taxable year of 12 months, or during a proportionate part of a shorter taxable year. Conditions (5) and (6) need not be met during a corporation's initial tax year as a REIT (which, in our case, was 2014). Our charter provides restrictions regarding the ownership and transfers of our stock, which are intended to assist us in satisfying the stock ownership requirements described in conditions (5) and (6) above. These restrictions, however, may not ensure that we will, in all cases, be able to satisfy the share ownership requirements described in conditions (5) and (6) above. If we fail to

satisfy these share ownership requirements, except as provided in the next sentence, our status as a REIT will terminate. If, however, we comply with the rules contained in the applicable Treasury regulations that require us to ascertain the actual ownership of our shares and we do not know, or would not have known through the exercise of reasonable diligence, that we failed to meet the requirements described in condition (6) above, we will be treated as having met this requirement.
To monitor compliance with the stock ownership requirements, we generally are required to maintain records regarding the actual ownership of our stock. To do so, we must demand written statements each year from the record holders of significant percentages of our stock pursuant to which the record holders must disclose the actual owners of the stock (i.e., the persons required to include our dividends in their gross income). We must maintain a list of those persons failing or refusing to comply with this demand as part of our records. We could be subject to monetary penalties if we fail to comply with these record-keeping requirements. If, upon request by the Company, a shareholder fails or refuses to comply with the demands, such holder will be required by Treasury regulations to submit a statement with his, her or its tax return disclosing the actual ownership of our stock and other information.

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Qualified REIT Subsidiaries


The Code provides that a corporation that is a "qualified REIT subsidiary" shall not be treated as a separate corporation, and all assets, liabilities and items of income, deduction and credit of a "qualified REIT subsidiary" shall be treated as assets, liabilities and items of income, deduction and credit of the REIT. A "qualified REIT subsidiary" is a corporation, all of the capital stock of which is owned by the REIT, that has not elected to be a "taxable REIT subsidiary" (discussed below). In applying the requirements described herein, all of our "qualified REIT subsidiaries" will be ignored, and all assets, liabilities and items of income, deduction and credit of such subsidiaries will be treated as our assets, liabilities and items of income, deduction and credit. These subsidiaries, therefore, will not be subject to federal corporate income taxation, although they may be subject to state and local taxation.
Taxable REIT Subsidiaries
In general, we may jointly elect with a subsidiary corporation, whether or not wholly-owned, to treat such subsidiary corporation as a TRS. We generally may not own more than 10% of the securities of a taxable corporation, as measured by voting power or value, unless we and such corporation elect to treat such corporation as a TRS. The separate existence of a TRS is not ignored for U.S. federal income tax purposes. Accordingly, a TRS generally is subject to corporate income tax on its earnings, which may reduce the cash flow that we and our subsidiaries generate in the aggregate and may reduce our ability to make distributions to our shareholders.
We are not treated as holding the assets of a TRS or as receiving any income that the subsidiary earns. Rather, the stock issued by the TRS to us is an asset in our hands, and we treat the dividends paid to us, if any, as income. This treatment can affect our income and asset test calculations, as described below. Because we do not include the assets and income of TRSs on a look-through basis in determining our compliance with the REIT requirements, we may use such entities to undertake indirectly activities that the REIT rules might otherwise preclude us from doing directly or through pass-through subsidiaries. For example, we may use a TRS to perform services or conduct activities that give rise to certain categories of income or to conduct activities that, if conducted by us directly, would be treated in our hands as prohibited transactions.
The TRS rules impose a 100% excise tax on transactions between a TRS and its parent REIT or the REIT's tenants that are not conducted on an arm's-length basis. We intend that all of our transactions with our TRS, if any, will be conducted on an arm's-length basis.
Income Tests
As a REIT, we must satisfy two gross income requirements on an annual basis. First, at least 75% of our gross income for each taxable year, excluding gross income from sales of inventory or dealer property in "prohibited transactions," discharge of indebtedness and certain hedging transactions, generally must be derived from "rents from real property," gains from the sale of real estate assets (but not including certain debt instruments of publicly offered REITs that are not secured by mortgages on real property), interest income derived from mortgage loans secured by real property (including certain types of mortgage-backed securities), dividends received from other REITs, and specified income from temporary investments. Second, at least 95% of our gross income in each taxable year, excluding gross income from prohibited transactions, discharge of indebtedness and certain hedging transactions, must be derived from some combination of income that qualifies under the 75% gross income test described above, as well as other dividends, interest, and gain from the sale or disposition of stock or securities, which need not have any relation to real property. Income and gain from certain hedging transactions will be excluded from both the numerator and the denominator for purposes of both the 75% and 95% gross income tests.
Rents received by a REIT will qualify as "rents from real property" in satisfying the gross income requirements described above only if several conditions are met.



•The amount of rent must not be based in whole or in part on the income or profits of any person. However, an amount received or accrued generally will not be excluded from the term "rents from real property" solely by reason of being based on a fixed percentage or percentages of gross receipts or sales.


•Rents received from a tenant will not qualify as "rents from real property" in satisfying the gross income tests if the REIT, or a direct or indirect owner of 10% or more of the REIT, directly or constructively, owns 10% or more of such tenant (a "Related Party Tenant"). However, rental payments from a taxable REIT subsidiary will qualify as rents from real property even if we own more than 10% of the total value or combined voting power of the taxable REIT subsidiary if (i) at least 90% of the property is leased to unrelated tenants and the rent paid by the taxable REIT subsidiary is substantially comparable to the rent paid by the unrelated tenants for comparable space or (ii) the property leased is a “qualified"qualified lodging facility,”" as defined in Section 856(d)(9)(D) of the Code, or a “qualified"qualified health care property,”" as defined in Section 856(e)(6)(D)(i) of the Code, and certain other conditions are satisfied.

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•Rent attributable to personal property leased in connection with a lease of real property will not qualify as "rents from real property" if such rent exceeds 15% of the total rent received under the lease.


•The REIT generally must not operate or manage the property or furnish or render services to tenants, except through an "independent contractor" who is adequately compensated and from whom the REIT derives no income, or through a taxable REIT subsidiary. The "independent contractor" requirement, however, does not apply to the extent the services provided by the REIT are "usually or customarily rendered" in connection with the rental of space for occupancy only, and are not otherwise considered "rendered to the occupant." In addition, a de minimis rule applies with respect to non-customary services. Specifically, if the value of the non-customary service income with respect to a property (valued at no less than 150% of the direct costs of performing such services) is 1% or less of the total income derived from the property, then all rental income except the non-customary service income will qualify as "rents from real property." A taxable REIT subsidiary may provide services (including noncustomary services) to a REIT’s tenants without "tainting" any of the rental income received by the REIT, and will be able to manage or operate properties for third parties and generally engage in other activities unrelated to real estate.


We do not anticipate receiving rent that is based in whole or in part on the income or profits of any person (except by reason of being based on a fixed percentage or percentages of gross receipts or sales consistent with the rules described above). Our former parent, Penn, received a private letter ruling from the IRS that concluded certain rental formulas under the Penn Master Lease will not cause any amounts received under the Penn Master Lease to be treated as other than rents from real property. While we do not expect to seek similar rulings for additional leases we enter into that have substantially similar terms as the Penn Master Lease, we intend to treat amounts received under those leases consistent with the conclusions in the ruling, though there can be no assurance that the IRS will not challenge such treatment. We also do not anticipate receiving more than a de minimis amount of rents from any Related Party Tenant or rents attributable to personal property leased in connection with real property that will exceed 15% of the total rents received with respect to such real property. We may receive certain types of income that will not qualify under the 75% or 95% gross income tests. In particular, dividends received from a taxable REIT subsidiary will not qualify under the 75% test. We believe, however, that the aggregate amount of such items and other non-qualifying income in any taxable year will not cause GLPI to exceed the limits on non-qualifying income under either the 75% or 95% gross income tests.
We may directly or indirectly receive distributions from TRSs or other corporations that are not REITs or qualified REIT subsidiaries. These distributions generally are treated as dividend income to the extent of the earnings and profits of the distributing corporation. Such distributions will generally constitute qualifying income for purposes of the 95% gross income test, but not for purposes of the 75% gross income test. Any dividends that we receive from another REIT or qualified REIT subsidiary, however, will be qualifying income for purposes of both the 95% and 75% gross income tests.
We believe that we have and will continue to be in compliance with these gross income tests. If we fail to satisfy one or both of the 75% or 95% gross income tests for any taxable year, we may still qualify to be taxed as a REIT for such year if we are entitled to relief under applicable provisions of the Code. These relief provisions will be generally available if (i) our failure to meet these tests was due to reasonable cause and not due to willful neglect and (ii) following our identification of the failure to meet the 75% or 95% gross income test for any taxable year, we file a schedule with the IRS setting forth each item of our gross income for purposes of the 75% or 95% gross income test for such taxable year in accordance with Treasury regulations. It is not possible to state whether we would be entitled to the benefit of these relief provisions in all circumstances. If these relief provisions are inapplicable to a particular set of circumstances, we will not qualify to be taxed as a REIT. Even if these relief provisions apply, and we retain our status as a REIT, the Code imposes a tax based upon the amount by which we fail to satisfy the particular gross income test.
Asset Tests

At the close of each calendar quarter, we must also satisfy five tests relating to the nature of our assets. First, at least 75% of the value of our total assets must be represented by some combination of "real estate assets," cash, cash items, U.S. government securities, and, under some circumstances, stock or debt instruments purchased with new capital. For this purpose, real estate assets include interests in real property (such as land, buildings, leasehold interest in real property and, for taxable years that began or after January 1, 2016, personal property leased with real property if the rents attributable to the personal property would be rents from real property under the income tests discussed above), interests in mortgages on real property or on interests in real property, shares in other qualifying REITs, and stock or debt instruments held for less than one year purchased with the proceeds from an offering of shares of our stock or certain debt and, for tax years that began on or after January 1, 2016, debt instruments issued by publicly offered REITs. Assets that do not qualify for purposes of the 75% asset test are subject to the additional asset tests described below.
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Second, the value of any one issuer's securities that we own may not exceed 5% of the value of our total assets.
Third, we may not own more than 10% of any one issuer's outstanding securities, as measured by either voting power or value. The 5% and 10% asset tests do not apply to securities of TRSs and qualified REIT subsidiaries and the 10% asset test does not apply to "straight debt" having specified characteristics and to certain other securities described below. Solely for purposes of the 10% asset test, the determination of our interest in the assets of a partnership or limited liability company in which we own an interest will be based on our proportionate interest in any securities issued by the partnership or limited liability company, excluding for this purpose, certain securities described in the Code. The safe harbor under which certain types of securities are disregarded for purposes of the 10% value limitation includes (1) straight debt securities (including straight debt securities that providesprovide for certain contingent payments); (2) any loan to an individual or an estate; (3) any rental agreement described in Section 467 of the Code, other than with a "related person"; (4) any obligation to pay rents from real property; (5) certain securities issued by a State or any political subdivision thereof, or the Commonwealth of Puerto Rico; (6) any security issued by a REIT; and (7) any other arrangement that, as determined by the Secretary of the Treasury, is excepted from the definition of a security. In addition, for purposes of applying the 10% value limitation, (a) a REIT’s interest as a partner in a partnership is not considered a security; (b) any debt instrument issued by a partnership is not treated as a security if at least 75% of the partnership’s gross income is from sources that would qualify for the 75% REIT gross income test; and (c) any debt instrument issued by a partnership is not treated as a security to the extent of the REIT’s interest as a partner in the partnership.
Fourth, the aggregate value of all securities of TRSs that we hold, together with other non-qualified assets (such as furniture and equipment or other tangible personal property, or non-real estate securities) may not, in the aggregate, exceed 25%20% of the value of our total assets. Beginning after December 31, 2017, the aggregate value of all securities of the TRSs that we hold may not exceed 20% of our total assets.
Fifth, not more than 25% of the value of our gross assets may be represented by debt instruments of publicly offered REITs that are not secured by mortgages on real property or interests in real property.
However, certain relief provisions are available to allow REITs to satisfy the asset requirements or to maintain REIT qualification notwithstanding certain violations of the asset and other requirements. For example, if we should fail to satisfy the asset tests at the end of a calendar quarter, such a failure would not cause us to lose our REIT qualification if we (i) satisfied the asset tests at the close of the preceding calendar quarter and (ii) the discrepancy between the value of our assets and the asset requirements was not wholly or partly caused by an acquisition of non-qualifying assets, but instead arose from changes in the relative market values of our assets. If the condition described in (ii) werewas not satisfied, we still could avoid disqualification by eliminating any discrepancy within 30 days after the close of the calendar quarter in which it arose or by making use of the relief provisions described above.
In the case of de minimis violations of the 10% and 5% asset tests, a REIT may maintain its qualification despite a violation of such requirements if (i) the value of the assets causing the violation does not exceed the lesser of 1% of the REIT's total assets and $10,000,000 and (ii) the REIT either disposes of the assets causing the failure within six months after the last day of the quarter in which it identifies the failure, or the relevant tests are otherwise satisfied within that time frame.
Even if we did not qualify for the foregoing relief provisions, one additional provision allows a REIT which fails one or more of the asset requirements to nevertheless maintain its REIT qualification if (i) the REIT provides the IRS with a description of each asset causing the failure, (ii) the failure is due to reasonable cause and not willful neglect, (iii) the REIT pays a tax equal to the greater of (a) $50,000 per failure and (b) the product of the net income generated by the assets that caused the failure multiplied by the highest applicable corporate tax rate (currently 21%) and (iv) the REIT either disposes of the assets causing the failure within six months after the last day of the quarter in which it identifies the failure, or otherwise satisfies the relevant asset tests within that time frame.
We believe that we have been and will continue to be in compliance with the asset tests described above.

Annual Distribution Requirements
In order to qualify to be taxed as a REIT, we are required to distribute dividends, other than capital gain dividends, to our shareholders in an amount at least equal to:
(i)the sum of

(i)the sum of
(a)90% of our REIT taxable income, computed without regard to our net capital gains and the deduction for dividends paid; and


(b)90% of our after tax net income, if any, from foreclosure property (as described below); minus

(a)    90% of our REIT taxable income, computed without regard to our net capital gains and the deduction for dividends paid; and
(ii)the excess of the sum of specified items of non-cash income over 5% of our REIT taxable income, computed without regard to our net capital gain and the deduction for dividends paid.

(b)    90% of our after tax net income, if any, from foreclosure property (as described below); minus

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(ii)the excess of the sum of specified items of non-cash income over 5% of our REIT taxable income, computed without regard to our net capital gain and the deduction for dividends paid.
We generally must make these distributions in the taxable year to which they relate, or in the following taxable year if declared before we timely file our tax return for the year and if paid with or before the first regular dividend payment after such declaration. These distributions will be treated as received by our shareholders in the year in which paid. In order for distributions to be counted as satisfying the annual distribution requirements for REITs, and to provide us with a REIT-level tax deduction, the distributions must not be "preferential dividends." A dividend is not a preferential dividend if the distribution is (i) pro rata among all outstanding shares of stock within a particular class and (ii) in accordance with any preferences among different classes of stock as set forth in our organizational documents. Given our status as a "publicly offered REIT" (within the meaning of the Code), the preferential dividend rules do not apply to us for taxable years beginning after December 31, 2014.
To the extent that we distribute at least 90%, but less than 100%, of our REIT taxable income, as adjusted, we will be subject to tax at ordinary corporate tax rates on the retained portion. We may elect to retain, rather than distribute, some or all of our net long-term capital gains and pay tax on such gains. In this case, we could elect for our shareholders to include their proportionate shares of such undistributed long-term capital gains in income, and to receive a corresponding credit for their share of the tax that we paid. Our shareholders would then increase the adjusted basis of their stock by the difference between (i) the amounts of capital gain dividends that we designated and that they include in their taxable income, minus (ii) the tax that we paid on their behalf with respect to that income.
To the extent that in the future we may have available net operating losses carried forward from prior tax years, such losses may reduce the amount of distributions that we must make in order to comply with the REIT distribution requirements.
If we fail to distribute during each calendar year at least the sum of (i) 85% of our ordinary income for such year, (ii) 95% of our capital gain net income for such year and (iii) any undistributed net taxable income from prior periods, we will be subject to a non-deductible 4% excise tax on the excess of such required distribution over the sum of (a) the amounts actually distributed, plus (b) the amounts of income we retained and on which we have paid corporate income tax.
We expect that our REIT taxable income will be less than our cash flow because of depreciation and other non-cash charges included in computing REIT taxable income. Accordingly, we anticipate that we generally will have sufficient cash or liquid assets to enable us to satisfy the distribution requirements described above. However, from time to time, we may not have sufficient cash or other liquid assets to meet these distribution requirements due to timing differences between the actual receipt of income and actual payment of deductible expenses, and the inclusion of income and deduction of expenses in determining our taxable income. In addition, we may decide to retain our cash, rather than distribute it, in order to repay debt, acquire assets, or for other reasons. If these timing differences occur, we may borrow funds to pay dividends or pay dividends through the distribution of other property (including shares of our stock) in order to meet the distribution requirements, while preserving our cash.
If our taxable income for a particular year is subsequently determined to have been understated, we may be able to rectify a resultant failure to meet the distribution requirements for a year by paying "deficiency dividends" to shareholders in a later year, which may be included in our deduction for dividends paid for the earlier year. In this case, we may be able to avoid losing REIT qualification or being taxed on amounts distributed as deficiency dividends, subject to the 4% excise tax described above. We will be required to pay interest based on the amount of any deduction taken for deficiency dividends.
For purposes of the 90% distribution requirement and excise tax described above, any distribution must be paid in the taxable year to which they relate, or in the following taxable year if such distributions are declared in October, November or December of the taxable year, are payable to shareholders of record on a specified date in any such month, and are actually paid before the end of January of the following year. Such distributions are treated as both paid by us and received by our shareholders on December 31 of the year in which they are declared.

In addition, at our election, a distribution for a taxable year may be declared before we timely file our tax return for the year, provided we pay such distribution with or before our first regular dividend payment after such declaration, and such payment is made during the 12-month period following the close of such taxable year. Such distributions are taxable to our shareholders in the year in which paid, even though the distributions relate to our prior taxable year for purposes of the 90% distribution requirement.


We believe that we have satisfied the annual distribution requirements for the year ended December 31, 2018.2020. Although we intend to satisfy the annual distribution requirements to continue to qualify as a REIT for the year ending December 31, 20192021 and thereafter, economic, market, legal, tax or other considerations could limit our ability to meet those requirements.
Failure to Qualify
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If we fail to satisfy one or more requirements for REIT qualification other than the income or asset tests, we could avoid disqualification as a REIT if our failure is due to reasonable cause and not to willful neglect and we pay a penalty of $50,000 for each such failure. Relief provisions are also available for failures of the income tests and asset tests, as described above in "—"Income Tests"Tests" and "—"Asset Tests.Tests."
If we fail to qualify for taxation as a REIT in any taxable year, and the relief provisions described above do not apply, we would be subject to tax, including any applicable alternative minimum tax, on our taxable income at regular corporate rates. We cannot deduct distributions to shareholders in any year in which we are not a REIT, nor would we be required to make distributions in such a year. In this situation, to the extent of current and accumulated earnings and profits (as determined for U.S. federal income tax purposes), distributions to shareholders would be taxable as regular corporate dividends. Such dividends paid to U.S. shareholders that are individuals, trusts and estates may be taxable at the preferential income tax rates (i.e., currently the 20% maximum U.S. federal rate) for qualified dividends. In addition, subject to the limitations of the Code, corporate distributees may be eligible for the dividends received deduction. Unless we are entitled to relief under specific statutory provisions, we would also be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year during which we lost our qualification. It is not possible to state whether, in all circumstances, we would be entitled to this statutory relief.
Legislative or Other Actions Affecting REITs
The present U.S. federal income tax treatment of REITs may be modified, possibly with retroactive effect, by legislative, judicial or administrative action at any time. The REIT rules are constantly under review by persons involved in the legislative process and by the IRS and the Treasury which may result in statutory changes as well as revisions to regulations and interpretations. Changes to the U.S. federal tax laws and interpretations thereof could adversely affect an investment in our common stock.
On December 22, 2017, H.R. 1, known as the Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018 (the "Tax Cuts and Jobs Act") was signed into law. The Tax Cuts and Jobs Act makes significant changes to the U.S. federal income taxation of individuals and corporations, generally effective for taxable years beginning after December 31, 2017. In addition to reducing corporate and individual income tax rates, the Tax Cuts and Jobs Act eliminates or restricts various deductions that, along with other provisions, may change the way that we calculate our REIT taxable income and our TRS’sTRSs' taxable income. Significant provisions of the Tax Cuts and Jobs Act that investors should be aware of include provisions that: (i) lower the corporate income tax rate to 21%, (ii) provide noncorporate taxpayers with a deduction of up to 20% of certain income earned through partnerships and REITs, (iii) limitslimit the net operating loss deduction to 80% of taxable income, where taxable income is determined without regard to the net operating loss deduction itself, generally eliminates net operating loss carrybackscarry backs and allowsallow unused net operating losses to be carried forward indefinitely, (iv) expand the ability of businesses to deduct the cost of certain property investments in the year in which the property is purchased, and (v) generally lower tax rates for individuals and other noncorporate taxpayers, while limiting deductions such as miscellaneous itemized deductions and state and local tax deductions. In addition, the Tax Cuts and Jobs Act limits the deduction for net interest expense incurred by a business to 30% of the "adjusted taxable income" of the taxpayer. The Coronavirus Aid, Relief, and Economic Stability Act increased the limitation to 50% of “adjusted taxable income” of the taxpayer. However, thefor tax years beginning in 2019 and 2020. The limitation on the interest expense deduction does not apply to certain small-business taxpayers or electing real property trades or businesses, such as any real property development, redevelopment, construction, reconstruction, acquisition, conversion, rental, operation, management, leasing, or brokerage trade or business. Making the election to be treated as a real property trade or business requires the electing real property trade or business to depreciate non-residential real property, residential rental property, and qualified improvement property over a longer period using the alternative depreciation system. We have not yet determined whether we will electelected out of the new interest expense limitation.


The effect of the Tax Cuts and Jobs Act is highly uncertain, both in terms of its direct effect on the taxation of holders of our common stock and its indirect effect on the value of our assets or market conditions generally. Furthermore, many of the

provisions of the Tax Cuts and Jobs Act will require guidance through the issuance of Treasury regulations in order to assess their effect. While there have been recent regulations proposed in relation to the Tax Cuts and Jobs Act, there may be a substantial delay or modifications before such regulations are finalized, increasing the uncertainty as to the ultimate effect of the statutory amendments on us.


Shareholders are urged to consult with their own tax advisors with respect to the impact that the Tax Cuts and Jobs Act and other legislation may have on their investment and the status of legislative, regulatory or administrative developments and proposals and their potential effect on their investment in our shares.
Regulation
The ownership, operation, and management of, and provision of certain products and services to, gaming and racing facilities are subject to pervasive regulation. Gaming laws are generally based upon declarations of public policy designed to protect gaming consumers and the viability and integrity of the gaming industry. Gaming laws also may be designed to protect and maximize state and local revenues derived through taxes and licensing fees imposed on gaming industry participants as well as to enhance economic development and tourism. To accomplish these public policy goals, gaming laws establish
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procedures to ensure that participants in the gaming industry, including landlords and other suppliers, meet certain standards of character and fitness. In addition, gaming laws require gaming industry participants to:
•ensure that unsuitable individuals and organizations have no role in gaming operations;operations, including suppliers, and in some cases, landowners;


•establish procedures designed to prevent cheating and fraudulent practices;


•establish and maintain responsible accounting practices and procedures;


•maintain effective controls over their financial practices, including establishment of minimum procedures for internal fiscal affairs and the safeguarding of assets and revenues;


•maintain systems for reliable record keeping;


•file periodic reports with gaming regulators;


•ensure that contracts and financial transactions are commercially reasonable, reflect fair market value and are arms-length transactions; and


•establish programs to promote responsible gaming.
These regulations impact our business in three important ways: (1) our ownership and operation of the TRS Properties; (2) our ownership of land and buildings in which gaming activities are operated by third party tenants pursuant to long-term leases; and (3) the operations of our gaming tenants. Our ownership and operation of the TRS Properties subject GLPI, its subsidiaries and its officers and directors to the jurisdiction of the gaming regulatory agencies in Louisiana and Maryland. Further, many gaming and racing regulatory agencies in the jurisdictions in which our gaming tenants operate require GLPI and its affiliates to maintain a license as a key business entity, principal affiliate, business entity, qualifier, operator or supplier because of its status as landlord, including Colorado, Illinois, Indiana, Massachusetts, Mississippi, Missouri, New Jersey, Ohio and Pennsylvania.
Our businesses and those operated by our tenants are subject to various federal, state and local laws and regulations in addition to gaming regulations. These laws and regulations include, but are not limited to, restrictions and conditions concerning alcoholic beverages, environmental matters, employees, health care, currency transactions, taxation, zoning and building codes, and marketing and advertising. Such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. Material changes, new laws or regulations, or material differences in interpretations by courts or governmental authorities could adversely affect our operating results.
Insurance
We have comprehensive liability, property and business interruption insurance at our TRS Properties. In regards to our properties subject to triple-net leases, the lease agreements require our tenants to haveprocure and maintain their own comprehensive liability, property and business interruption insurance policies, including protection for our insurable interests as the landlord.

Environmental Matters

Our properties are subject to environmental laws regulating, among other things, air emissions, wastewater discharges and the handling and disposal of wastes, including medical wastes. Certain of the properties we own utilize above or underground storage tanks to store heating oil for use at the properties. Other properties were built during the time that asbestos-containing building materials were routinely installed in residential and commercial structures. Our triple-net leases obligate the tenants thereunder to comply with applicable environmental laws and to indemnify us if their noncompliance results in losses or claims against us, and we expect that any future leases will include the same provisions for other operators. An operator's failure to comply could result in fines and penalties or the requirement to undertake corrective actions which may result in significant costs to the operator and thus adversely affect their ability to meet their obligations to us.
Pursuant to U.S. federal, state and local environmental laws and regulations, a current or previous owner or operator of real property may be required to investigate, remove and/or remediate a release of hazardous substances or other regulated materials at, or emanating from, such property. Further, under certain circumstances, such owners or operators of real property may be held liable for property damage, personal injury and/or natural resource damage resulting from or arising in connection with such releases. Certain of these laws have been interpreted to provide for joint and several liability unless the harm is divisible and there is a reasonable basis for allocation of responsibility. We also may be liable under certain of these laws for
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damage that occurred prior to our ownership of a property or at a site where we or our tenants sent wastes for disposal. The failure to properly remediate a property could result in fines or sanctions and may also adversely affect our ability to lease, sell or rent the property or to borrow funds using the property as collateral.
In connection with the ownership of our real property, we could be legally responsible for environmental liabilities or costs relating to a release of hazardous substances or other regulated materials at or emanating from such property. In order to assess the potential for such liability, we conduct routine due diligence of environmental assessmentsconditions prior to acquisition. We are not aware of any environmental issues that are expected to have a material impact on the operations of any of our properties.
Pursuant to the Penn Master Lease and a Separation and Distribution Agreement between Penn and GLPI, any liability arising from or relating to environmental liabilities arising from the businesses and operations of Penn's real property holdings prior to the Spin-Off (other than any liability arising from or relating to the operation or ownership of the TRS Properties and except to the extent first discovered after the end of the term of the Penn Master Lease) was retained by Penn and Penn will indemnify GLPI (and its subsidiaries, directors, officers, employees and agents and certain other related parties) against any losses arising from or relating to such environmental liabilities. Similarly, pursuant to a Separation and Distribution Agreement originally between Pinnacle's operating company and GLPI (as successor to Pinnacle Entertainment), any liability arising from or relating to environmental liabilities arising from the business and operations of Pinnacle's real property holdings prior to the Pinnacle transactionCompany's acquisition of the majority of Pinnacle's real property assets (except to the extent first discovered after the end of the term of the Amended Pinnacle Master Lease) was retained by Pinnacle and Pinnacle will indemnify GLPI (and its subsidiaries, directors, officers, employees and agents and certain other related parties) against any losses arising from or relating to such environmental liabilities. Effective October 15, 2018, Penn assumed all obligations of Pinnacle as pursuant to a merger of Pinnacle with and into a subsidiary of Penn. There can be no assurance that Penn will be able to fully satisfy these indemnification obligations. Moreover, even if we ultimately succeed in recovering from Penn any amounts for which we are held liable, we may be temporarily required to bear these losses.
EmployeesCorporate Responsibility at GLPI

We believe that environmental and community stewardship is an integral component of growing shareholder value and we are committed to fostering a corporate culture that encourages and seeks the betterment of the Company and the communities in which we operate or conduct business. With this in mind, we endeavor to integrate environmental, social and governance (ESG) practices that create long-term economic value for our shareholders, employees and other constituents.

We have initiated an ESG strategy to further understand the environmental impact of our leased properties, as well as an undertaking of Greenhouse Gas inventory at our own corporate headquarters.

We strive to maintain a corporate environment that fosters a sense of community and well-being and that encourages our employees to focus on their long-term success along with the long-term success of the Company.

We promote sustainable practices and environmental stewardship throughout the organization, with a particular emphasis on energy efficiency, recycling, indoor environmental quality and environmental awareness.

The Leased properties in our portfolio are leased to gaming operators in triple-net lease arrangements, meaning each gaming operator is ultimately responsible for maintaining the buildings including controlling its energy usage and the implementation of environmentally sustainable practices. We are committed to promoting awareness, influencing and engaging with our tenants where possible, regarding sustainability practices and environmentally beneficial energy solutions. Many of our tenants have implemented similar efficiency and conservation measures in recent capital expenditure projects, including cost-saving indoor and outdoor LED lighting retrofits, installation of guest room occupancy-based thermostats, building management systems upgrades, and installation of electronic vehicle charging stations.

Recognizing that sustainability is a journey, we are committed to continuous improvement and will strive to engage and communicate with our key stakeholders as we make progress on our ESG stewardship.
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Human Capital
As of December 31, 2018,2020, we had 644560 full and part-time employees. Substantially all of these employees are employed at Hollywood Casino Baton Rouge and Hollywood Casino Perryville. TheWe strive to maintain a corporate environment that fosters a sense of community and well-being and that encourages our employees to focus on their long-term success along with the long-term success of the Company. We offer, among other things, competitive and balanced compensation programs on par with those of our peers and competitors that include well-rounded healthcare, prescription drug and disability insurance benefits for our employees and their families, participation in a 401(k) plan, with a matching contribution by the Company, believes its relationscompetitive paid time-off benefits, a parental leave program that applies to both women and men and an employee assistance plan that provides professional support, access to special programs and certain resources to our employees experiencing personal, work, financial or family related issues.

We are passionate about developing and growing our talent. We devote substantial efforts to retaining, motivating and supporting our employees by providing access to such benefits and opportunities as tuition reimbursement, professional development reimbursement and internal growth and advancement. We created a Leadership Academy to cultivate management and leadership skills to empower our employees to succeed.

We view providing our employees with itsa healthy and safe working environment as essential. Our goal is to reduce the potential for injury or illness by maintaining safe working conditions, such as providing proper tools and training to all employees. Our corporate headquarters and Hollywood Casino Baton Rouge and Hollywood Casino Perryville are smoke-free environments. Additionally, we offer resources to our employees to encourage healthy habits, such as tobacco cessation and health coaches for those employees with certain chronic conditions, including but not limited to diabetes and asthma.

We also believe that maintaining and promoting a diverse and inclusive workplace where every employee feels valued and respected is essential for us to grow as a company. As such, we are good.focused on cultivating a diverse and inclusive culture where our employees can freely bring diverse perspectives and varied experiences to work. We seek to hire and retain highly talented employees and empower those employees to create value for our shareholders. In our employee recruitment and selection process and operation of our business, we adhere to equal employment policies and provide annual trainings on diversity and inclusion. We employ, train and refresh our employees in accordance with our nondiscriminatory, inclusive practices and policies implemented to prevent discrimination and protect our employees, customers and stakeholders from offensive and harmful behaviors.
Some
We recognize and respect the freedom of employees to exercise their lawful rights and free association and collective bargaining. Certain of our employees at Hollywood Casino Perryville are currently represented by labor unions. The Seafarers Entertainment and Allied Trade Union represents 145129 of our employees at Hollywood Casino Perryville under an agreement that expires in February 2020.January 2032. Additionally, Local No. 27 United Food and Commercial Workers and United Industrial Service Transportation Professional and Government Workers of North America and Local No. 27 United Food and Commercial Workers represent certain employees under collective bargaining agreements that expire in 2020,2021 and 2033, respectively, neither of which represents more than 50 of our employees at Hollywood Casino Perryville.We value the relationships we have with not only those employees but their representation as well. We believe our relations with its employees are good.

Available Information
For more information about us, visit our website at www.glpropinc.com. The contents of our website are not part of this Annual Report on Form 10-K. Our electronic filings with the SEC (including all annual reports on Form 10-K and Form 10-K/A, quarterly reports on Form 10-Q and Form 10-Q/A, and current reports on Form 8-K, and any amendments to these reports), including the exhibits, are available free of charge through our website as soon as reasonably practicable after we electronically file them with or furnish them to the SEC.

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ITEM 1A.    RISK FACTORS
Risk Factors Relating to Our Business
Following completion of Penn-Pinnacle Merger, theThe majority of our revenues are dependent on Penn and its subsidiaries until we further diversify our portfolio. Any event that has a material adverse effect on Penn’s business, financial position or results of operations is likely tomay have a material adverse effect on our business, financial position or results of operations.


Following completion of the Penn-Pinnacle Merger on October 15, 2018, theThe majority of our revenue is based on the revenue derived under our master leases with subsidiaries of Penn. Because these master leases are triple-net leases, we depend on Penn to operate the properties that we own in a manner that generates revenues sufficient to allow Penn to meet its obligations to us, including payment of rent and all insurance, taxes, utilities and maintenance and repair expenses, and to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities arising in connection with its business. There can be no assurance that Penn will have sufficient assets, income or access to financing to enable it to satisfy its payment obligations to us under the master leases. The ability of Penn to fulfill its obligations depends, in part, upon the overall profitability of its gaming operations and, other than limited contractual protections afforded to us as a landlord, we have no control over Penn or its operations. The inability or unwillingness of Penn to meet its subsidiaries’ rent obligations and other obligations under the master leases wouldmay materially and adversely affect our business, financial position or results of operations, including our ability to pay dividends to our shareholders.


Due to our dependence on rental payments from Penn as a significant source of revenue, we may be limited in our ability to enforce our rights under the master leases. Failure by Penn to comply with the terms of its master leases or to comply with the gaming regulations to which the leased properties are subject could require us to find another lessee for such leased property. In such event, we may be unable to locate a suitable lessee at similar rental rates or at all, which would have the effect of reducing our rental revenues. Likewise, our financial position wouldmay be materially weakened if Penn failed to renew or extend any master lease as such lease expires and we are unable to lease or re-lease our properties on economically favorable terms.


Any event including the integration of Penn and Pinnacle, that has a material adverse effect on Penn’s business, financial position or results of operations could have a material adverse effect on our business, financial position or results of operations. In addition, continued consolidation in the gaming industry would increase our dependence on our existing tenants and could make it increasingly difficult for us to find alternative tenants for our properties.
Our pursuit of investments in, and acquisitions or development of, additional properties may be unsuccessful or fail to meet our expectations.
We operate in a highly competitive industry and face competition from other REITs (including other gaming-focused REITs), investment companies, private equity and hedge fund investors, sovereign funds, lenders, gaming companies (including gaming companies considering REIT structures) and other investors, some of whom are significantly larger and have greater resources and lower costs of capital. Increased competition willmay make it more challenging to identify and successfully capitalize on acquisition opportunities that meet our investment objectives. If we cannot identify and purchase a sufficient number of investment properties at favorable prices or if we are unable to finance acquisitions on commercially favorable terms, our business, financial position or results of operations could be materially adversely affected. Additionally, the fact that we must distribute 90% of our net taxable income in order to maintain our qualification as a REIT may limit our ability to rely upon rental payments from our leased properties or subsequently acquired properties in order to finance acquisitions. As a result, if debt or equity financing is not available on acceptable terms, further acquisitions might be limited or curtailed and completing proposed acquisitions may be adversely impacted. Furthermore, fluctuations in the price of our common stock may impact our ability to finance additional acquisitions through the issuance of common stock and/or cause significant dilution.
Investments in and acquisitions of gaming properties and other properties we might seek to acquire entail risks associated with real estate investments, including that the investment's performance will fail to meet expectations or that the tenant, operator or manager will underperform. Real estate development projects present other risks, including construction delays or cost overruns that increase expenses, the inability to obtain required zoning, occupancy and other governmental approvals and permits on a timely basis, and the incurrence of significant development costs prior to completion of the project.
We are dependent on the gaming industry and may be susceptible to the risks associated with it, which could materially adversely affect our business, financial position or results of operations.
As the owner and landlord of gaming facilities, we are impacted by the risks associated with the gaming industry. Therefore, our success is to some degree dependent on the gaming industry, which could be adversely affected by economic conditions in general, changes in consumer trends and preferences and other factors over which we and our tenants have no

control. As we are subject to risks inherent in substantial investments in a single industry, a decrease in the gaming business would likelymay have a greater adverse effect on our revenues than if we owned a more diversified real estate portfolio, particularly because
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a component of the rent under our leases is based, over time, on the performancerevenue of the gaming facilities operated by our tenants. Decreases in discretionary consumer spending brought about by weakened general economic conditions such as, but not limited to, high unemployment levels, higher income taxes, low levels of consumer confidence, weakness in the housing market, cultural and demographic changes, and increased stock market volatility may negatively impact our revenues and operating cash flow.
The gaming industry is characterized by an increasing number of gaming facilities with an increasingly high degree of competition among a large number of participants, including riverboat casinos, dockside casinos, land-based casinos, video lottery, sweepstakes and poker machines not located in casinos, Native American gaming and other forms of gaming in the U.S. Furthermore, competition from alternative wagering products, such as internet lotteries, sweepstakes, social gaming products, daily fantasy sports and other internet wagering gaming services, online sports wagering or games of skill, which allow their customers a wagering alternative to the casino-style, such as remote home gaming or in non-casino settings, could divert customers from our properties and thus adversely affect our TRS Properties and the business of our tenants and, indirectly, our business. Certain alternative wagering products may be illegal under federal or state law but operate exclusively in certain states or from overseas locations and are accessible to certain domestic gamblers. Present state or federal laws that restrict the forms of gaming authorized or the number of competitors that offer gaming in the applicable jurisdiction are subject to change and may increase the competition affecting our TRS Properties and the business of our tenants and, indirectly, our business. Currently, there are proposals that would legalize several forms of internet gaming and other alternative wagering products in a number of states. Further, several states have already approved intrastate internet gaming.gaming and sports betting. Expansion of internet gaming and sports betting in other jurisdictions (both legal and illegal) could furthermay compete with our traditional operations, which could have an adverse impact on our business and result of operations.
The operations of our TRS Properties and of our tenants in our leased facilities are subject to disruptions or reduced patronage as a result of severe weather conditions, changing climate conditions, natural disasters and other casualty events. Because many of our facilities are located on or adjacent to bodies of water, they are subject to risks in addition to those associated with land-based facilities, including loss of service due to casualty, forces of nature, mechanical failure, extended or extraordinary maintenance, flood, hurricane or other severe weather and climate conditions. A component of the rent under our leases is based, over time, on the performancerevenues of the gaming facilities operated by Penn, Eldorado,Caesars, Boyd and Casino Queen on our properties; consequently, a casualty that leads to the loss of use of a casino facility subject to our leases for an extended period may negatively impact our revenues.
COVID-19 has had, and may continue to have, a significant impact on our tenants' financial conditions and operations.
In December 2019, a new strain of novel coronavirus, COVID-19, was reported in China and shortly thereafter spread across the globe. This global pandemic outbreak led to unprecedented responses by federal, state and local officials. Certain responses have included mandates from authorities requiring temporary closures of or imposed limitations on the operations of many businesses in the attempt to mitigate the spread of infections. Unemployment levels rose sharply and economic activity levels declined dramatically as a result. The United States government implemented various significant aid packages to support the economy and credit markets to combat these declines.

Our TRS Properties and our tenants' casino operations were forced to close temporarily in mid-March through various dates into May and June 2020. Even though most of our properties recommenced operations to encouraging results, including certain locations where earnings were higher than the corresponding period in the prior year, it is uncertain whether these strong results will continue in future periods, particularly with the recent increases in COVID-19 case counts throughout the United States which in turn has resulted in additional temporary closures of certain casino facilities in various jurisdictions. As of the date of this filing, 1 facility out of our 48 facilities is temporarily closed. Although rent payments continue to be paid by our tenants, the temporary closures will likely result in lower variable rent reset amounts and reduce the likelihood of rent escalators that are tied to certain rent coverage ratios which contain such clauses. The ultimate impact of COVID-19 on us is highly uncertain and subject to change and will depend on future developments, which cannot be accurately predicted, including the duration of the pandemic, continued emergence of new strains of COVID-19, the speed with which available vaccines are administered to the public, additional or modified government actions, new information that will emerge concerning the severity and impact of COVID-19 and the actions taken to contain COVID-19 or address its impact in the short and long term, among others.

Our ability to realize significant value for the real property assets of Tropicana Las Vegas is uncertain.

Our ability to realize significant value for the real property assets of Tropicana Las Vegas, which we acquired from Penn in return for $307.5 million of rent credits, is uncertain given current economic conditions resulting from COVID-19. It is possible that we may need to wait for a prolonged period of time before market conditions improve to enable us to realize significant value for the Tropicana real property assets, if at all.

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We face extensive regulation from gaming and other regulatory authorities.
The ownership, operation, and management of gaming and racing facilities are subject to pervasive regulation. These regulations impact both our ownership and operation of the TRS Properties and the operations of our gaming tenants. Our ownership and operation of the TRS Properties subject us, our officers, directors and shareholders to the jurisdiction of the gaming regulatory agencies in Louisiana and Maryland. Further, many gaming and racing regulatory agencies in the jurisdictions in which our tenants operate require GLPI, its affiliates and certain officers and directors to maintain licenses as a key business entity, principal affiliate, business entity qualifier, operator, supplier or key person because of GLPI's status as landlord. For GLPI to maintain such licenses in good standing, certain of GLPI's officers directors and shareholdersdirectors are also required to maintain licenses or a finding of suitability.
Many jurisdictions also require any person who acquires beneficial ownership of more than a certain percentage of voting securities of a gaming company and,licensed in some jurisdictions, non-voting securities,such jurisdiction, typically 5%, to report the acquisition to gaming authorities, and gaming authorities may require such holders to apply for qualification or a finding of suitability, subject to limited exceptions for "institutional investors" that hold a company's voting securities for passive investment purposes only. Some jurisdictions may also limit the number of gaming licenses or gaming facilities in which a person may hold an ownership or a controlling interest. Subject to certain administrative proceeding requirements, the gaming regulators have the authority to deny any application or limit, condition, restrict, revoke or suspend any license, registration, finding of suitability or approval, or fine any person licensed, registered or found suitable or approved, for any cause deemed reasonable by the gaming authorities.
Additionally, substantially all material loans, significant acquisitions, leases, sales of securities and similar financing transactions by us and our subsidiaries must be reported to and in some cases approved by gaming authorities in advance of the transaction. Neither we nor any of our subsidiaries may make a public offering of securities without the prior approval of certain gaming authorities. Changes in control through merger, consolidation, stock or asset acquisitions, management or consulting agreements, or otherwise are subject to receipt of prior approval of certain gaming authorities. Entities seeking to acquire control of GLPI or one of its subsidiaries must satisfy gaming authorities with respect to a variety of stringent licensing standards prior to assuming control.


Required regulatory approvals can delay or prohibit transfers of our gaming properties, which could result in periods in which we are unable to receive rent for such properties.
The tenants of our gaming properties are operators of gaming facilities and must be licensed under applicable state law. Prior to the transfer of gaming facilities, including a controlling interest, the new owner or operator generally must become licensed under applicable state law. In the event that any current lease or any future lease agreement we enter into is terminated or expires and a new tenant is found, any delays in the new tenant receiving regulatory approvals from the applicable state government agencies, or the inability to receive such approvals, may prolong the period during which we are unable to collect the applicable rent.
We may not achieve the intended benefits from the Tropicana Acquisition or the Boyd Master Lease, which could have an adverse impact on our business.

We consummated the Tropicana Acquisition on October 1, 2018 and entered into a master lease agreement with Boyd on October 15, 2018. However, our ability to successfully realize the expected benefits of these transactions is largely dependent upon Eldorado’s and Boyd’s respective ability to operate our properties in a manner that generates revenues sufficient to allow Eldorado and Boyd to meet their obligations to us, including payment of rent, loan interest and all insurance, taxes, utilities and maintenance and repair expenses, and to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities arising in connection with their respective businesses. We cannot guarantee that either Eldorado or Boyd will maintain its operations in a profitable manner and, other than limited contractual protections afforded to us as a landlord and, under limited circumstances, as a lender, we have no control over either Eldorado’s or Boyd’s business or finances. Our financial position could be materially weakened if either Eldorado or Boyd were unable to meet its obligations to us or failed to renew or extend any lease as such lease expires, or if we were unable to lease or re-lease our properties on economically favorable terms.

In addition, we made a short-term mortgage loan to Eldorado in the amount of $246.0 million in connection with Eldorado’s acquisition of Tropicana’s Lumière Place property, and we made a mortgage loan to Boyd in the amount of $57.7 million in connection with Boyd’s acquisition of the Belterra Park property. In our capacity as a lender, we have fewer protections available to us with respect to these properties than we would have as a landlord, and there are regulatory restrictions that may prevent our ability to take possession of these properties upon a default by the borrower. In addition, on the one-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.  If Eldorado or Boyd are unable or unwilling to satisfy their respective obligations to us under these loans in a timely manner or at all, our business and/or our financial position could be materially and adversely affected.

Our pursuit of strategic acquisitions unrelated to the gaming industry may be unsuccessful or fail to meet our expectations.


We may pursue strategic acquisitions of real property assets unrelated to the gaming industry, including acquisitions that may be complementary to our existing gaming properties.  Our management does not possess the same level of expertise with the dynamics and market conditions applicable to non-gaming assets, which could adversely affect the results of our expansion into other asset classes.  In addition, we may be unable to achieve our desired return on our investments in new or adjacent asset classes.
Our charter restricts the ownership and transfer of our outstanding stock, which may have the effect of delaying, deferring or preventing a transaction or change of control of our company.
In order for us to qualify to be taxed as a REIT, not more than 50% in value of our outstanding shares of stock may be owned, actually or constructively, by five or fewer individuals at any time during the last half of each taxable year after the first year for which GLPI elected to qualify to be taxed as a REIT (2014). Additionally, at least 100 persons must beneficially own GLPI stock during at least 335 days of a taxable year (other than the first taxable year for which GLPI elected to be taxed as a REIT). GLPI's charter, with certain exceptions, authorizes the Board of Directors to take such actions as are necessary and desirable to preserve GLPI's qualification as a REIT. GLPI's charter also provides that, subject to certain exceptions approved by the Board of Directors, no person may beneficially or constructively own more than 7% in value or in number, whichever is more restrictive, of GLPI's outstanding shares of all classes and series of stock. The constructive ownership rules are complex and may cause shares of stock owned directly or constructively by a group of related individuals or entities to be constructively owned by one individual or entity. These ownership limits could delay or prevent a transaction or a change in control of GLPI that might involve a premium price for shares of GLPI stock or otherwise be in the best interests of GLPI shareholders. The acquisition of less than 7% of our outstanding stock by an individual or entity could cause that individual or entity to own
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beneficially or constructively in excess of 7% in value of our outstanding stock, and thus violate our charter's ownership limit. Our charter prohibits any person from owning shares of our stock that would result in our being "closely held" under

Section 856(h) of the Code. Any attempt to own or transfer shares of our stock in violation of these restrictions may result in the transfer being automatically void. GLPI's charter also provides that shares of GLPI's capital stock acquired or held in excess of the ownership limit will be transferred to a trust for the benefit of a designated charitable beneficiary, and that any person who acquires shares of GLPI's capital stock in violation of the ownership limit will not be entitled to any dividends on the shares or be entitled to vote the shares or receive any proceeds from the subsequent sale of the shares in excess of the lesser of the market price on the day the shares were transferred to the trust or the amount realized from the sale. GLPI or its designee will have the right to purchase the shares from the trustee at this calculated price as well. A transfer of shares of GLPI's capital stock in violation of the limit may be void under certain circumstances. GLPI's 7% ownership limitation may have the effect of delaying, deferring or preventing a change in control of GLPI, including an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets) that might provide a premium price for GLPI's shareholders. To assist GLPI in complying with applicable gaming laws, our charter also provides that capital stock of GLPI that is owned or controlled by an unsuitable person or an affiliate of an unsuitable person will be transferred to a trust for the benefit of a designated charitable beneficiary, and that any such unsuitable person or affiliate will not be entitled to any dividends on the shares or be entitled to vote the shares or receive any proceeds from the subsequent sale of the shares in excess of the lesser of the price paid by the unsuitable person or affiliate for the shares or the amount realized from the sale, in each case less a discount in a percentage (up to 100%) to be determined by our Board of Directors in its sole and absolute discretion. The shares shall additionally be redeemable by GLPI, out of funds legally available for that redemption, to the extent required by the gaming authorities making the determination of unsuitability or to the extent determined to be necessary or advisable by our Board of Directors, at a redemption price equal to the lesser of (i) the market price on the date of the redemption notice, (ii) the market price on the redemption date, or (iii) the actual amount paid for the shares by the owner thereof, in each case less a discount in a percentage (up to 100%) to be determined by our Board of Directors in its sole and absolute discretion.
Pennsylvania law and provisions in our charter and bylaws may delay or prevent takeover attempts by third parties and therefore inhibit our shareholders from realizing a premium on their stock.
Our charter and bylaws, in addition to Pennsylvania law, contain provisions that are intended to deter coercive takeover practices and inadequate takeover bids and to encourage prospective acquirors to negotiate with our Board of Directors rather than to attempt a hostile takeover. Our charter and bylaws, among other things (i) permit the Board of Directors, without further action of the shareholders, to issue and fix the terms of preferred stock, which may have rights senior to those of the common stock; (ii) establish certain advance notice procedures for shareholder proposals, and require all director candidates to be recommended by the nominating committee of the Board of Directors following the affirmative determination by the nominating committee that such nominee is likely to meet the applicable suitability requirements of any federal, state or local regulatory body having jurisdiction over us; (iii) provide that a director may only be removed by shareholders for cause and upon the vote of 75% of the shares entitled to vote; (iv) do not permit direct nomination by shareholders of nominees for election to the Board of Directors, but instead permit shareholders to recommend potential nominees to our CompensationNominating and Corporate Governance Committee; (v) require shareholders to have beneficially owned at least 1% of our outstanding common stock in order to recommend a person for nomination for election to the Board of Directors, or to present a shareholder proposal, for action at a shareholders' meeting; and (vi) provide for supermajoritysuper majority approval requirements for amending or repealing certain provisions in our charter and in order to approve an amendment or repeal of any provision of our bylaws that has not been proposed by our Board of Directors.
In addition, specific anti-takeover provisions in Pennsylvania law could make it more difficult for a third party to attempt a hostile takeover. These provisions require (i) approval of certain transactions by a majority of the voting stock other than that held by the potential acquirer; (ii) the acquisition at "fair value" of all the outstanding shares not held by an acquirer of 20% or more; (iii) a five-year moratorium on certain "business combination" transactions with an "interested shareholder;" (iv) the loss by interested shareholders of their voting rights over "control shares;" (v) the disgorgement of profits realized by an interested shareholder from certain dispositions of our shares; and (vi) severance payments for certain employees and prohibiting termination of certain labor contracts.
We believe these provisions will protect our shareholders from coercive or otherwise unfair takeover tactics by requiring potential acquirers to negotiate with our Board of Directors and by providing our Board of Directors with more time to assess any acquisition proposal. These provisions are not intended to make GLPI immune from takeovers or to prevent a transaction from occurring. However, these provisions will apply even if the offer may be considered beneficial by some shareholders and could delay or prevent an acquisition that our Board of Directors determines is not in the best interests of GLPI. These provisions may also prevent or discourage attempts to remove and replace incumbent directors.



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We may experience uninsured or underinsuredunder insured losses, which could result in a significant loss of the capital we have invested in a property, decrease anticipated future revenues or cause us to incur unanticipated expense.
While our leases require, and new lease agreements are expected to require, that comprehensive insurance and hazard insurance be maintained by the tenants, a tenant's failure to comply could lead to an uninsured or underinsuredunder insured loss and there can be no assurance that we will be able to recover such uninsured or underinsuredunder insured amounts from such tenant. Further, there are certain types of losses, generally of a catastrophic nature, such as earthquakes, hurricanes and floods, that may be uninsurable or not economically insurable. Insurance coverage may not be sufficient to pay the full current market value or current replacement cost of a loss. Inflation, changes in building codes and ordinances, environmental considerations, and other factors also might make it infeasible to use insurance proceeds to replace the property after such property has been damaged or destroyed. Under such circumstances, the insurance proceeds received might not be adequate to restore the economic position with respect to such property.
If we or one of our tenants experience a loss that is uninsured, or that exceeds our or our tenant's policy coverage limits, we could lose the capital invested in the damaged properties as well as the anticipated future cash flows from those properties. In addition, if the damaged properties were subject to recourse indebtedness, we could continue to be liable for the indebtedness even if these properties were irreparably damaged.
In addition, even if damage to our properties is covered by insurance, a disruption of our or our tenant's business caused by a casualty event may result in the loss of business or tenants. The business interruption insurance we or our tenant's carry may not fully compensate us for the loss of business or tenants due to an interruption caused by a casualty event.
A disruption in the financial markets may make it more difficult to evaluate the stability, net assets and capitalization of insurance companies and any insurer's ability to meet its claim payment obligations. A failure of an insurance company to make payments to us or our tenants upon an event of loss covered by an insurance policy could adversely affect our business, financial condition and results of operations.
The market price of our common stock may be volatile, and holders of our common stock could lose a significant portion of their investment if the market price of our common stock declines.
The market price of our common stock may be volatile, and shareholders may not be able to resell their shares of our common stock at or above the price at which they acquired the common stock due to fluctuations in its market price, including changes in price caused by factors unrelated to our performance or prospects.
Specific factors that may have a significant effect on the market price for our common stock include, among others, the following:
•changes in stock market analyst recommendations or earnings estimates regarding our common stock or other comparable REITs;


•actual or anticipated fluctuations in our revenue stream or future prospects;


•strategic actions taken by us or our competitors, such as acquisitions;


•our failure to close pending acquisitions;


•our failure to achieve the perceived benefits of our acquisitions, including financial results, as rapidly as or to the extent anticipated by financial or industry analysts;


•new laws or regulations or new interpretations of existing laws or regulations applicable to our business and operations or the gaming industry;


•changes in tax or accounting standards, policies, guidance, interpretations or principles;


•changes in the interest rate environment;environment and/or the impact of rising inflation;


•adverse conditions in the financial markets or general U.S. or international economic conditions, including those resulting from war, incidents of terrorism and responses to such events; and


•sales of our common stock by members of our management team or other significant shareholders.

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Environmental compliance costs and liabilities associated with real estate properties owned by us may materially impair the value of those investments.
As an owner of real property, we are subject to various federal, state and local environmental and health and safety laws and regulations. Although we do not operate or manage most of our properties, we may be held primarily or jointly and severally liable for costs relating to the investigation and clean-up of any property from which there has been a release or threatened release of a regulated material as well as other affected properties, regardless of whether we knew of or caused the release.
In addition to these costs, which are typically not limited by law or regulation and could exceed the property's value, we could be liable for certain other costs, including governmental fines and injuries to persons, property or natural resources. Further, some environmental laws create a lien on the contaminated site in favor of the government for damages and the costs the government incurs in connection with such contamination.
Although we require our operators and tenants to undertake to indemnify us for certain environmental liabilities, including environmental liabilities they cause, the amount of such liabilities could exceed the financial ability of the tenant or operator to indemnify us. The presence of contamination or the failure to remediate contamination may adversely affect our ability to sell or lease the real estate or to borrow using the real estate as collateral.
Changes to U.S. federal income tax laws could materially and adversely affect us and our shareholders.
The Tax Cuts and Jobs Act made significant changes to the federal income taxation of individuals and corporations under the Code, generally effective for taxable years beginning after December 31, 2017. In addition to reducing corporate and individual income tax rates, the Tax Cuts and Jobs Act eliminates or restricts various deductions that, along with other provisions, may change the way that we calculate our REIT taxable income and our TRS’s taxable income. Significant provisions of the Tax Cuts and Jobs Act that investors should be aware of include provisions that: (i) lower the corporate income tax rate to 21%, (ii) provide noncorporate taxpayers with a deduction of up to 20% of certain income earned through partnerships and REITs, (iii) limitslimit the net operating loss deduction to 80% of taxable income, where taxable income is determined without regard to the net operating loss deduction itself, generally eliminates net operating loss carrybackscarry backs and allows unused net operating losses to be carried forward indefinitely, (iv) expand the ability of businesses to deduct the cost of certain property investments in the year in which the property is purchased, (v) generally lower tax rates for individuals and other noncorporate taxpayers, while limiting deductions such as miscellaneous itemized deductions and state and local tax deductions, and (vi) limitslimit the deduction for net interest expense incurred by a business to 30% of the “adjusted"adjusted taxable income”income" of the taxpayer, but doesdo not apply to certain small-business taxpayers or electing real property trades or businesses, including REITs. The effect of these, and the many other, changes made is highly uncertain, both in terms of their direct effect on the taxation of holders of our common stock and their indirect effect on the value of our assets or market conditions generally. Furthermore, manyIn addition, future changes in tax laws, including the proposed tax agenda presented by the new U.S. presidential administration, or tax rulings, could affect our effective tax rate, the tax rate of shareholders of our stock, and overall benefit of maintaining our status as a REIT. For example, the provisions ofreduction in the corporate income tax rate resulting from the Tax Cuts and Jobs Act require guidance throughcould be reduced or rescinded, individual tax rates may increase, and the issuance of Treasury regulations in order to assess their effect. While there have been recent regulations proposed in relation to the Tax Cuts and Jobs Act, there may§199A deduction for REIT dividends could be a substantial delay or modifications before such regulations are finalized, increasing the uncertainty as to the ultimate effect of the statutory amendments on us.phased out. .

We face risks associated with security breaches through cyber-attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems.


We face risks associated with security breaches, whether through cyber-attacks or cyber intrusions over the internet, malware, computer viruses, attachments to e-mails, persons inside our organization or persons with access to systems inside our organization, and other significant disruptions of our IT networks and related systems. The risk of a security breach or disruption, particularly through cyber-attack or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. Our IT networks and related systems are essential to the operation of our business and our ability to perform day-to-day operations. Although we make efforts to maintain the security and integrity of these types of IT networks and related systems, and we have implemented various measures to manage the risk of a security breach or disruption, there can be no assurance that our security efforts and measures will be effective or that attempted security breaches or disruptions would not be successful or damaging. A security breach or other significant disruption involving our IT networks and related systems could disrupt the proper functioning of our networks and systems; result in misstated financial reports, violations of loan covenants and/or missed reporting deadlines; result in our inability to monitor our compliance with the rules and regulations regarding our qualification as a REIT; result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of proprietary, confidential, sensitive or otherwise valuable information of ours or others, which others could use to compete against us or for disruptive, destructive or otherwise harmful purposes and outcomes; require significant management attention and resources to remedy any damages that result; subject us to claims for breach of contract, damages, credits, penalties or termination of certain agreements; or damage our reputation among our tenants and investors generally.

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Risk Factors Relating to our Status as a REIT
If we do not qualify to be taxed as a REIT, or fail to remain qualified as a REIT, we will be subject to U.S. federal income tax as a regular corporation and could face a substantial tax liability, which wouldmay reduce the amount of cash available for distribution to our shareholders.
We elected on our 2014 U.S. federal income tax return to be treated as a REIT and intend to continue to be organized and to operate in a manner that will permit us to qualify as a REIT. We currently operate, and intend to continue to operate, in a manner that will allow us to continue to qualify to be taxed as a REIT for U.S. federal income tax purposes. We received an opinion from our special tax advisors, Wachtell, Lipton, Rosen & Katz and KPMG LLP (collectively the "Special Tax Advisors"), with respect to our qualification as a REIT in connection with the Spin-Off. Investors should be aware, however, that opinionsOpinions of advisors are not binding on the IRS or any court. The opinions of the Special Tax Advisors represent only the view of the Special Tax Advisors based on their review and analysis of existing law and on certain representations as to factual matters and covenants made by us, including representations relating to the values of our assets and the sources of our income. The opinions are expressed as of the date issued. The Special Tax Advisors have no obligation to advise us or the holders of our common stock of any subsequent change in the matters stated, represented or assumed or of any subsequent change in applicable law. Furthermore, both the validity of the opinions of Special Tax Advisors and our qualification as a REIT will depend on our satisfaction of certain asset, income, organizational, distribution, shareholder ownership and other requirements on a continuing basis, the results of which are not monitored by the Special Tax Advisors. Our ability to satisfy the asset tests depends upon our analysis of the characterization and fair market values of our assets, some of which are not susceptible to a precise determination, and for which we will not obtain independent appraisals.
Penn has received a private letter ruling from the IRS with respect to certain issues relevant to our qualification as a REIT. In general, the ruling provides, subject to the terms and conditions contained therein, that (1) certain of the assets to be held by us after the Spin-Off and (2) the methodology for calculating a certain portion of rent received by us pursuant to the Penn Master Lease will not adversely affect our qualification as a REIT. Although we may generally rely upon the ruling, noNo assurance can be given that the IRS will not challenge our qualification as a REIT on the basis of other issues or facts outside the scope of the ruling.
If we were to fail to qualify to be taxed as a REIT in any taxable year, we would be subject to U.S. federal income tax, including any applicable alternative minimum tax, on our taxable income at regular corporate rates, and dividends paid to our shareholders would not be deductible by us in computing our taxable income. Any resulting corporate liability could be substantial and would reduce the amount of cash available for distribution to our shareholders, which in turn could have an adverse impact on the value of our common stock. Unless we were entitled to relief under certain Code provisions, we also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which we failed to qualify to be taxed as a REIT.
Qualifying as a REIT involves highly technical and complex provisions of the Code and violations of these provisions could jeopardize our REIT qualifications.
Qualification as a REIT involves the application of highly technical and complex Code provisions for which only limited judicial and administrative authorities exist. Even a technical or inadvertent violation could jeopardize our REIT qualification. Our qualification as a REIT depends on our satisfaction of certain asset, income, organizational, distribution, shareholder ownership and other requirements on a continuing basis. In addition, our ability to satisfy the requirements to qualify to be taxed as a REIT may depend in part on the actions of third parties over which we have no control or only limited influence.
We could fail to qualify to be taxed as a REIT if income we receive from Penn, Eldorado,Caesars, Boyd, or their subsidiaries, is not treated as qualifying income.
Under applicable provisions of the Code, we will not be treated as a REIT unless we satisfy various requirements, including requirements relating to the sources of our gross income. Rents received or accrued by us from Penn, Eldorado,Caesars, Boyd, or their subsidiaries, will not be treated as qualifying rent for purposes of these requirements if the Penn Master Lease, Amended Pinnacle Master Lease, EldoradoAmended and Restated Caesars Master Lease or Boyd Master Lease is not respected as a true lease for U.S. federal income tax purposes and is instead treated as a service contract, joint venture or some other type of arrangement. If the Penn Master Lease, Amended Pinnacle Master Lease, EldoradoAmended and Restated Caesars Master Lease or Boyd Master Lease is not respected as a true lease for U.S. federal income tax purposes, we may fail to qualify to be taxed as a REIT. Furthermore, our qualification as a REIT will depend on our satisfaction of certain asset, income, organizational, distribution, shareholder ownership and other requirements on a continuing basis. Our ability to satisfy the asset tests depends upon our analysis of the characterization and fair market values of our assets, some of which are not susceptible to a precise determination, and for which we will not obtain independent appraisals.

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In addition, subject to certain exceptions, rents received or accrued by us from Penn, Eldorado,Caesars, Boyd, or their subsidiaries, will not be treated as qualifying rent for purposes of these requirements if we or an actual or constructive owner of 10% or more of our stock actually or constructively owns 10% or more of the total combined voting power of all classes of Penn stock, EldoradoCaesars stock or Boyd stock entitled to vote or 10% or more of the total value of all classes of Penn stock, EldoradoCaesars stock or Boyd stock. Our charter provides for restrictions on ownership and transfer of our shares of stock, including restrictions on such ownership or transfer that would cause the rents received or accrued by us from Penn, Eldorado,Caesars, Boyd, or their subsidiaries, to be treated as non-qualifying rent for purposes of the REIT gross income requirements. Nevertheless, there can be no assurance that such restrictions will be effective in ensuring that rents received or accrued by us from Penn, Eldorado,Caesars, Boyd, or their subsidiaries, will not be treated as qualifying rent for purposes of REIT qualification requirements.
Dividends payable by REITs do not qualify for the reduced tax rates available for some dividends.
The maximum U.S. federal income tax rate applicable to income from "qualified dividends" payable by U.S. corporations to U.S. shareholders that are individuals, trusts and estates is currently 20%. Ordinary dividends payable by REITs, however, generally are not eligible for the reduced rates. However, for taxable years that begin after December 31, 2017, and before January 1, 2026: (i) the U.S. federal income tax brackets generally applicable to ordinary income of individuals, trusts and estates have been modified (with the rates generally reduced) and (ii) shareholders that are individuals, trusts or estates are generally entitled to a deduction equal to 20% of the aggregate amount of ordinary income dividends received from a REIT (not including dividends that are eligible for the reduced rates applicable to “qualified"qualified dividend income”income" or treated as capital gain dividends), subject to certain limitations.
The more favorable rates applicable to regular corporate qualified dividends could cause investors who are individuals, trusts or estates to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends, which could adversely affect the value of the stock of REITs, including our stock, even taking into account the lower 37% maximum rate for ordinary income and the 20% deduction for ordinary REIT dividends received in taxable years beginning after December 31, 2017 and before January 1, 2026.
REIT distribution requirements could adversely affect our ability to execute our business plan.
We generally must distribute annually at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gains, in order to qualify to be taxed as a REIT (assuming that certain other requirements are also satisfied) so that U.S. federal corporate income tax does not apply to earnings that we distribute. To the extent that we satisfy this distribution requirement and qualify for taxation as a REIT but distribute less than 100% of our REIT taxable income, determined without regard to the dividends paid deduction and including any net capital gains, we will be subject to U.S. federal corporate income tax on our undistributed net taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we distribute to our shareholders in a calendar year is less than a minimum amount specified under U.S. federal income tax laws. We intend to make distributions to our shareholders to comply with the REIT requirements of the Code.
From time to time, we may generate taxable income greater than our cash flow as a result of differences in timing between the recognition of taxable income and the actual receipt of cash or the effect of nondeductible capital expenditures, the creation of reserves or required debt or amortization payments. If we do not have other funds available in these situations, we could be required to borrow funds on unfavorable terms, sell assets at disadvantageous prices, distribute amounts that would otherwise be invested in future acquisitions, or pay dividends in the form of taxable in-kind distributions of property, including potentially, shares of our common stock, to make distributions sufficient to enable us to pay out enough of our taxable income to satisfy the REIT distribution requirement and to avoid corporate income tax and the 4% excise tax in a particular year. These alternatives could increase our costs or reduce our equity. Thus, compliance with the REIT requirements may hinder our ability to grow, which could adversely affect the value of our stock. Restrictions on our indebtedness, including restrictions on our ability to incur additional indebtedness or make certain distributions, could preclude us from meeting the 90% distribution requirement. Decreases in funds from operations due to unfinanced expenditures for acquisitions of properties or increases in the number of shares of our common stock outstanding without commensurate increases in funds from operations each would adversely affect our ability to maintain distributions to our shareholders. Moreover, the failure of Penn to make rental payments under the Penn Master Lease, the Amended Pinnacle Master Lease or the Meadows Lease, as applicable, would materially impair our ability to make distributions. Consequently, there can be no assurance that we will be able to make distributions at the anticipated distribution rate or any other rate.
Even if we remain qualified as a REIT, we may face other tax liabilities that reduce our cash flow.
Even if we remain qualified for taxation as a REIT, we may be subject to certain U.S. federal, state, and local taxes on our income and assets, including taxes on any undistributed income and state or local income, property and transfer taxes. For example, we hold certain of our assets and conduct related activities through TRS subsidiary corporations that are subject to

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federal, state, and local corporate-level income taxes as regular C corporations as well as state and local gaming taxes. In addition, we may incur a 100% excise tax on transactions with a TRS if they are not conducted on an arm's-length basis. Any of these taxes would decrease cash available for distribution to our shareholders.
Complying with REIT requirements may cause us to forego otherwise attractive acquisition opportunities or liquidate otherwise attractive investments.
To qualify to be taxed as a REIT for U.S. federal income tax purposes, we must ensure that, at the end of each calendar quarter, at least 75% of the value of our assets consist of cash, cash items, government securities and "real estate assets" (as defined in the Code), including certain mortgage loans and securities. The remainder of our investments (other than government securities, qualified real estate assets and securities issued by a TRS) generally cannot include more than 10% of the outstanding voting securities of any one issuer or more than 10% of the total value of the outstanding securities of any one issuer. In addition, in general, no more than 5% of the value of our total assets (other than government securities, qualified real estate assets and securities issued by a TRS) can consist of the securities of any one issuer, and no more than 20% of the value of our total assets can be represented by securities of one or more TRSs. If we fail to comply with these requirements at the end of any calendar quarter, we must correct the failure within 30 days after the end of the calendar quarter or qualify for certain statutory relief provisions to avoid losing our REIT qualification and suffering adverse tax consequences. As a result, we may be required to liquidate or forego otherwise attractive investments. These actions could have the effect of reducing our income and amounts available for distribution to our shareholders.
In addition to the asset tests set forth above, to qualify to be taxed as a REIT we must continually satisfy tests concerning, among other things, the sources of our income, the amounts we distribute to shareholders and the ownership of our stock. We may be unable to pursue investments that would be otherwise advantageous to us in order to satisfy the source-of-income or asset-diversification requirements for qualifying as a REIT. Thus, compliance with the REIT requirements may hinder our ability to make certain attractive investments.
Complying with REIT requirements may limit our ability to hedge effectively and may cause us to incur tax liabilities.
The REIT provisions of the Code substantially limit our ability to hedge our assets and liabilities. Income from certain hedging transactions that we may enter into to manage risk of interest rate changes with respect to borrowings made or to be made to acquire or carry real estate assets or from transactions to manage risk of currency fluctuations with respect to any item of income or gain that satisfy the REIT gross income tests (including gain from the termination of such a transaction) does not constitute "gross income" for purposes of the 75% or 95% gross income tests that apply to REITs, provided that certain identification requirements are met. To the extent that we enter into other types of hedging transactions or fail to properly identify such transaction as a hedge, the income is likely to be treated as non-qualifying income for purposes of both of the gross income tests. As a result of these rules, we may be required to limit our use of advantageous hedging techniques or implement those hedges through a TRS. This could increase the cost of our hedging activities because the TRS may be subject to tax on gains or expose us to greater risks associated with changes in interest rates that we would otherwise want to bear. In addition, losses in the TRS will generally not provide any tax benefit, except that such losses could theoretically be carried back or forward against past or future taxable income in the TRS.
We could be subject to tax on any unrealized net built-in gains on the assets held before electing to be treated as a REIT and on the assets acquired from Pinnacle (prior to the Penn-Pinnacle Merger), which could have a material and adverse effect on our business and financial condition.
We own appreciated assets that were held by a C corporation before we elected to be treated as a REIT and were acquired them in a transaction in which the adjusted tax basis of the assets in our ownership is determined by reference to the adjusted tax basis of the assets in the hands of the C corporation. If we dispose of any such appreciated assets during the five-year period following our acquisition of the assets from the C corporation, (i.e., during the five-year period following our qualification as a REIT), we will be subject to tax at the highest corporate tax rates on any gain from such assets to the extent of the excess of the fair market value of the assets on the date that they were acquired by us over the adjusted tax basis of such assets on such date, which are referred to as built-in gains. The assets acquired from Pinnacle (prior to the Penn-Pinnacle Merger) are expected to have significant built-in-gains. Because, prior to the original Pinnacle transaction, Pinnacle was a C corporation, if we dispose of any such appreciated assets during the five-year period following the transactions, we will be subject to tax at the highest corporate tax rates on any gain from such assets to the extent of the built-in-gain in such assets at the time of the transaction.
We would be subject to this tax liability even if we continue to qualify and maintain our status as a REIT. Any recognized built-in gain will retain our character as ordinary income or capital gain and will be taken into account in determining REIT taxable income and our distribution requirement. Any tax on the recognized built-in gain will reduce REIT taxable income. We may choose not to sell in a taxable transaction appreciated assets we might otherwise sell during the five-

yearfive-year period in which the built-in gain tax applies in order to avoid the built-in gain tax. However, there can be no assurances that such a taxable transaction will not occur. If we sell such assets in a taxable transaction, the amount of corporate tax that we
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will pay will vary depending on the actual amount of net built-in gain or loss present in those assets as of the time we became a REIT. The amount of tax could be significant.
Risks Related to Our Capital Structure
We may have future capital needs and may not be able to obtain additional financing on acceptable terms.
As of December 31, 2018,2020, we had approximately $5.9$5.8 billion in long-term indebtedness, net of unamortized debt issuance costs, bond premiums and original issuance discounts, consisting of:
•$927.0424.0 million of total indebtedness outstanding under our senior unsecured credit facility (the "Credit Facility") (consisting of the $525.0;

•$5,375.0 million Term Loan A-1 facility and $402.0 million of borrowings under our revolving credit facility) and approximately $772.6 million available for borrowing under our Revolver (including $0.4 million of contingent obligations under letters of credit);

$4.975 billion of outstanding senior unsecured notes; and


•approximately $1.1$0.9 million of capitalfinance lease obligationliabilities related to certain assets.
We may incur additional indebtedness in the future to refinance our existing indebtedness or to finance newly-acquired properties. Any significant additional indebtedness could require a substantial portion of our cash flow to make interest and principal payments due on our indebtedness. Greater demands on our cash resources may reduce funds available to us to pay dividends, make capital expenditures and acquisitions, or carry out other aspects of our business strategy. Increased indebtedness canmay also limit our ability to adjust rapidly to changing market conditions, make us more vulnerable to general adverse economic and industry conditions and create competitive disadvantages for us compared to other companies with relatively lower debt levels and/or borrowing costs. Increased future debt service obligations may limit our operational flexibility, including our ability to acquire properties, finance or refinance our properties, contribute properties to joint ventures or sell properties as needed. To the extent thatIf we incur additional indebtedness or such other obligations, the risks associated with our leverage, including our possible inability to service our debt, wouldmay increase.
We may be unable to obtain additional financing or financing on favorable terms or our operating cash flow may be insufficient to satisfy our financial obligations under indebtedness outstanding from time to time (if any). If financing is not available when needed, or is available on unfavorable terms, we may be unable to develop new or enhance our existing properties, complete acquisitions or otherwise take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition and results of operations.
We incurred additionalhave a material amount of indebtedness in connection with our financing for the Tropicana Acquisition, the purchase of Plainridge Park Casino and our mortgage loans to casino owner-operators.
Our increased indebtednesswhich could have significant effects on our business and ability to pay dividends to our shareholders, including the following:
•it may limit our ability to obtain additional debt or equity financing for working capital, capital expenditures, acquisitions, debt service requirements and general corporate or other purposes;


•a material portion of our cash flows will be dedicated to the payment of principal and interest on our indebtedness, including indebtedness we may incur in the future, and will not be available for other purposes, including to make acquisitions;


•it could limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate and place us at a competitive disadvantage compared to our competitors that have less debt or are less leveraged;


•it could make us more vulnerable to downturns in general economic or industry conditions or in our business, or prevent us from carrying out activities that are important to our growth;


•it could increase our interest expense if interest rates in general increase because our indebtedness under the Credit Facility bears interest at floating rates;



•it could limit our ability to take advantage of strategic business opportunities; and


•it could make it more difficult for us to satisfy our obligations with respect to our indebtedness. Any failure to comply with the obligations of any of our debt instruments could result in an event of default which, if not cured or waived, could result in the acceleration of our indebtedness under the Credit Facility and other outstanding debt obligations.obligations; and


•it could impact our ability to pay dividends to our shareholders.
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We cannot assure you that our business will generate sufficient cash flow from operations, or that future borrowings will be available to us under our Credit Facility or from other debt financing, in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. If we do not generate sufficient cash flow from operations to satisfy our debt service obligations, we may have to undertake alternative financing plans, such as refinancing or restructuring our indebtedness, selling assets or seeking to raise additional capital, including by issuing equity securities or securities convertible into equity securities. Our ability to restructure or refinance our indebtedness will depend on the capital markets and our financial condition at such time. Any refinancing of our indebtedness could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. Our inability to generate sufficient cash flow to satisfy our debt service requirements or to refinance our obligations on commercially reasonable terms wouldmay have an adverse effect, which could be material to our business, financial position or results of operations.
Our shareholders may be subject to significant dilution caused by the additional issuance of equity securities.
If and when additional funds are raised through the issuance of equity securities, including under our "at the market" offering program relating to our common stock (the "ATM Program") or in connection with future acquisitions, our shareholders may experience significant dilution. Additionally, sales of substantial amounts of our common stock in the public market, or the perception that such sales could occur, could adversely affect the market price of our common stock, may make it more difficult for our shareholders to sell their GLPI common stock at a time and price that they deem appropriate and could impair our future ability to raise capital through an offering of our equity securities.
Adverse changes in our credit rating may affect our borrowing capacity and borrowing terms.
Our outstanding debt is periodically rated by nationally recognized credit rating agencies. The credit ratings are based upon our operating performance, liquidity and leverage ratios, overall financial position, and other factors viewed by the credit rating agencies as relevant to both our industry and the economic outlook. Our credit rating may affect the amount of capital we can access, as well as the terms of any financing we obtain. Because we rely in part on debt financing to fund growth, the absence of an investment grade credit rating or any credit rating downgrade may have a negative effect on our future growth.
If we cannot obtain additional capital, our growth may be limited.
As described above, in order to qualify and maintain our qualification as a REIT each year, we are required to distribute at least 90% of our REIT taxable income, excluding net capital gains, to our shareholders. As a result, our retained earnings available to fund acquisitions, development, or other capital expenditures are nominal, and we rely upon the availability of additional debt or equity capital to fund these activities. Our long-term ability to grow through acquisitions or development, which is an important component of our strategy, willmay be limited if we cannot obtain additional debt financing or raise equity capital. Market conditions may make it difficult to obtain debt financing or raise equity capital, and we cannot assure you that we will be able to obtain additional debt or equity financing or that we will be able to obtain such capital on favorable terms.
An increase in market interest rates could increase our interest costs on existing and future debt and could adversely affect our stock price.
If interest rates increase, so could our interest costs for any new debt and our variable rate debt obligations. This increased cost could make the financing of any acquisition more costly, as well as lower our current period earnings. Rising interest rates could limit our ability to refinance existing debt when it matures or cause us to pay higher interest rates upon refinancing. In addition, an increase in interest rates could decrease the access third parties have to credit, thereby decreasing the amount they are willing to pay for our assets and consequently limiting our ability to reposition our portfolio promptly in response to changes in economic or other conditions.
Further, the dividend yield on our common stock, as a percentage of the price of such common stock, willmay influence the price of such common stock. Thus, an increase in market interest rates may lead prospective purchasers of our common stock to expect a higher dividend yield, which wouldmay adversely affect the market price of our common stock.

The majority of our debt is at fixed rates and our exposure to variable interest rates is currently limited to our revolving credit facility and our Term Loan A-2. Both of these debt instruments are indexed to LIBOR which is expected to be phased out between December 31, 2021 through June 30, 2023. The discontinuance of LIBOR would affect our interest expense and earnings. The borrowings under our Credit Facility will be subject to the expected LIBOR transition. LIBOR is currently expected to transition to a new standard rate, the Secured Overnight Financing Rate (“SOFR”). We are currently monitoring the transition and cannot be certain whether SOFR will become the standard rate for our variable rate debt. However, the transition away from LIBOR rates will likely require us to renegotiate our revolving credit facility. We intend to continue to monitor the developments with respect to the phase out of LIBOR and work with our lenders to minimize the impact of any LIBOR

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transition on our financial condition and results of operations, but can provide no assurances regarding the impact of the discontinuance of LIBOR.
Covenants in our debt agreements may limit our operational flexibility, and a covenant breach or default could materially adversely affect our business, financial position or results of operations.
The agreements governing our indebtedness contain customary covenants, including restrictions on our ability to grant liens on our assets, incur indebtedness, sell assets, make investments, engage in acquisitions, mergers or consolidations and pay certain dividends and other restricted payments. Specifically, our debt agreements contain the following financial covenants: a maximum total debt to total asset value ratio of 60% (subject to increase to 65% for specified periods in connection with certain acquisitions), a minimum fixed charge coverage ratio of 1.5 to 1, a maximum senior secured debt to total asset value ratio of 40% and a maximum unsecured debt to unencumbered asset value ratio of 60%. These restrictions may limit our operational flexibility. Covenants that limit our operational flexibility as well as defaults under our debt instruments could have a material adverse effect on our business, financial position or results of operations.
Risk Factors Relating to Our Acquisition of Penn, Pinnacle and Tropicana's Gaming Properties
Our recourse against Tropicana, including for any breaches under the Amended Real Estate Purchase Agreement or the Tropicana Merger Agreement, is limited.


As is customary for a public company target in a merger and acquisition transaction, Tropicana has no obligation to indemnify us or EldoradoCaesars for any breaches of its representations and warranties or covenants included in the Merger Agreement and the Real Estate Purchase Agreement, or for any pre-closing liabilities or claims. While we have certain arrangements in place with EldoradoCaesars in connection with certain limited pre-closing liabilities, if any issues arise post-closing (other than as provided for in the EldoradoAmended and Restated Caesars Master Lease), we may not be entitled to sufficient, or any, indemnification or recourse from Tropicana or Eldorado,Caesars, which could have a materially adverse impact on our business and results of operations.
Each of Penn and Pinnacle havehas contractual obligations to indemnify us for certain liabilities.liabilities, including liabilities as successor in interest to Pinnacle. However, there can be no assurance that these indemnities will be sufficient to insure us against the full amount of such liabilities, or that Penn's ability to satisfy its and Pinnacle's indemnification obligations will not be impaired in the future.
Each of Penn and Pinnacle havehas contractual obligations to indemnify us for certain liabilities.liabilities, including liabilities as successor in interest to Pinnacle. However, third parties could seek to hold us responsible for any of the liabilities that Penn and Pinnacle agreed to retain, and there can be no assurance that Penn (including as successor in interest to Pinnacle) will be able to fully satisfy its indemnification obligations. Moreover, even if we ultimately succeed in recovering from Penn any amounts for which we are held liable, we may be temporarily required to bear these losses while seeking recovery from Penn and such recovery could have a material adverse impact on Penn's financial condition and ability to pay rent due under the Penn Master Lease and/or the Amended Pinnacle Master Lease.
Risk Factors Relating to Our Spin-Off from Penn
If the Spin-Off, together with certain related transactions, does not qualify as a transaction that is generally tax-free for U.S. federal income tax purposes, GLPI could be subject to significant tax liabilities and, in certain circumstances, GLPI could be required to indemnify Penn for material taxes pursuant to indemnification obligations under the Tax Matters Agreement.
Penn has received a private letter ruling from the IRS substantially to the effect that, among other things, the Spin-Off, together with the required compliance exchanges and certain related transactions, will qualify as a transaction that is generally tax-free for U.S. federal income tax purposes under Sections 355 and/or 368(a)(1)(D) of the Code (the "IRS Ruling"). The IRS Ruling does not address certain requirements for tax-free treatment of the Spin-Off under Section 355, and Penn received from its tax advisors a tax opinion substantially to the effect that, with respect to such requirements on which the IRS will not rule, such requirements have been satisfied. The IRS Ruling, and the tax opinions that Penn received from its tax advisors, relied on, among other things, certain representations, assumptions and undertakings, including those relating to the past and future conduct of GLPI's business, and the IRS Ruling and the opinions would not be valid if such representations, assumptions and undertakings were incorrect in any material respect.
Notwithstanding the IRS Ruling and the tax opinions, the IRS could determine the Spin-Off should be treated as a taxable transaction for U.S. federal income tax purposes if it determines any of the representations, assumptions or undertakings that were included in the request for the IRS Ruling are false or have been violated or if it disagrees with the conclusions in the opinions that are not covered by the IRS Ruling.
Under a Tax Matters Agreement that GLPI entered into with Penn, GLPI generally is required to indemnify Penn against any tax resulting from the Spin-Off to the extent that such tax resulted from (i) an acquisition of all or a portion of the equity securities or assets of GLPI, whether by merger or otherwise, (ii) other actions or failures to act by GLPI, or (iii) any of GLPI's representations or undertakings being incorrect or violated. GLPI's indemnification obligations to Penn and its

subsidiaries, officers and directors will not be limited by any maximum amount. If GLPI is required to indemnify Penn or such other persons under the circumstance set forth in the Tax Matters Agreement, GLPI may be subject to substantial liabilities.
The historical financial information included in this filing may not be a reliable indicator of future results.
The historical financial statements included herein do not reflect what the business, financial position or results of operations of GLPI may be in the future.
Peter M. Carlino, our Chairman and Chief Executive Officer, and David A. Handler, one of our independent directors, also serve on the Penn Board of Directors which may create conflicts of interest and/or create regulatory obstacles for the Company in its pursuit of additional properties.
Peter M. Carlino serves as non-executive Chairman of the Board of Directors of Penn and the Chairman and Chief Executive Officer of GLPI. In addition, David A. Handler, one of our directors, serves as a director at Penn. These overlapping positions could create, or appear to create, potential conflicts of interest when our or Penn's management and directors pursue the same corporate opportunities, such as greenfield development opportunities, or face decisions that could have different implications for us and Penn. For example, potential conflicts of interest could arise in connection with the negotiation or the resolution of any dispute between us and Penn (or its subsidiaries) regarding the terms of the agreements governing the separation and the relationship (e.g., Penn Master Lease) thereafter. Potential conflicts of interest could also arise if we and Penn enter into any commercial arrangements with each other in the future. We have established a mechanism in our Corporate Governance Guidelines to address potential conflicts through the use of an independent director but there can be no assurance that this process will completely eliminate conflicts resulting from overlapping directors. In addition to potential conflicts of interest, the overlapping director position could create obstacles to engaging in certain transactions in close proximity to existing Penn properties and there can be no assurance that we will be able to overcome such obstacles.
Potential indemnification liabilities of GLPI pursuant to the Separation and Distribution Agreement could materially adversely affect GLPI.
The Separation and Distribution Agreement between GLPI and Penn provides for, among other things, the principal corporate transactions required to effect the separation, certain conditions to the separation and provisions governing the relationship between GLPI and Penn with respect to and resulting from the separation.
Among other things, the Separation and Distribution Agreement provides for indemnification obligations designed to make us financially responsible for substantially all liabilities that may result relating to or arising out of our business. If GLPI is required to indemnify Penn under the circumstances set forth in the Separation and Distribution Agreement, GLPI may be subject to substantial liabilities.
ITEM 1B.    UNRESOLVED STAFF COMMENTS
None.



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ITEM 2.     PROPERTIES
Rental Properties
As of December 31, 2018,2020, the Company had 4245 rental properties, consisting of the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with fiveseven gaming and related facilities operated by Eldorado,Caesars, the real property associated with threefour gaming and related facilities operated by Boyd and the real property associated with the Casino Queen in East St. Louis, Illinois. All rental properties are subject to long-term triple-net leases. For additional information pertaining to our tenant leases and our rental properties see Item 1.
GLPI Financed Properties
As of December 31, 2018, the Company had financial interests in two casino properties through secured mortgage loans to the respective casino owner-operators. For additional information pertaining to these properties see Item 1.
TRS PropertiesSegment
Hollywood Casino Baton Rouge
Hollywood Casino Baton Rouge is a dockside riverboat casino located on approximately 21.1 acres, which we own, on the east bank of the Mississippi River in the East Baton Rouge Downtown Development District. The property site serves as the dockside embarkation for Hollywood Casino Baton Rouge and features a two-story building. We also own approximately 4.0 acres of land which features a railroad underpass that provides unimpeded access to the casino property.
Hollywood Casino Perryville
We own 36.436.3 acres of land in Perryville, Maryland where Hollywood Casino Perryville is located. The property is located directly off Interstate 95 in Cecil County, Maryland just 35 miles northeast of Baltimore and 70 miles from Washington, D.C.


See Item 1Tropicana Las Vegas

This property was acquired on April 16, 2020 from Penn in exchange for further information pertaining$307.5 million of rent credits. We own approximately 35 acres on the strip of Las Vegas, Nevada and the real estate of the casino which has a 1,467 room hotel and structured and surface parking. An affiliate of Penn continues to our TRS Properties.operate the casino and hotel business pursuant to a triple net lease with the Company for nominal rent for the earlier of two years (subject to three one-year extensions at the Company's option).


Corporate Office


The Company's corporate headquarters building is located in Wyomissing, Pennsylvania and is owned by the Company.


ITEM 3.    LEGAL PROCEEDINGS
The Company is subject to various legal and administrative proceedings relating to personal injuries, employment matters, commercial transactions and other matters arising in the normal course of business. The Company does not believe that the finalfinancial outcome of these matters will have a material adverse effect on the Company's consolidated financial position or results of operations. In addition, the Company maintains what it believes is adequate insurance coverage to further mitigate the risks of such proceedings. However, such proceedings can be costly, time consuming and unpredictable and, therefore, no assurance can be given that the final outcome of such proceedings may not materially impact the Company's consolidated financial condition or results of operations. Further, no assurance can be given that the amount or scope of existing insurance coverage will be sufficient to cover losses arising from such matters.
ITEM 4.    MINE SAFETY DISCLOSURES
Not applicable.



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Table of Contents
PART II
ITEM 5.   MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our common stock is quoted on the NASDAQ Global Select Market under the symbol "GLPI." As of February 8, 2019,16, 2021, there were approximately 697720 holders of record of our common stock.
Dividend Policy
The Company's annual dividend is greater than or equal to at least 90% of its REIT taxable income on an annual basis, determined without regard to the dividends paid deduction and excluding any net capital gains. U.S. federal income tax law generally requires that a REIT annually distribute at least 90% of its REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains, and that it pay regular corporate rates to the extent that it annually distributes less than 100% of its taxable income.
Cash available for distribution to GLPI shareholders is derived from income from real estate and the income of the TRS Properties.Segment. All distributions will be made by GLPI at the discretion of its Board of Directors and will depend on the financial position, results of operations, cash flows, capital requirements, debt covenants, applicable laws and other factors as the Board of Directors of GLPI deems relevant. See Note 1418 to the consolidated financial statements for further details on dividends.



ITEM 6.    SELECTED FINANCIAL DATA
The following selected consolidated financial and operating data for the five-year period ended December 31, 2018 is derived from our consolidated financial statements. The selected consolidated financial and operating data should be read in conjunction with our consolidated financial statements and notes thereto, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the other financial information included herein.
35
 Year Ended December 31,
 
2018 (1)
 
2017 (1) 
 
2016 (1) 
 2015 2014
 (in thousands, except per share data)
Income statement data: 
  
  
  
  
Total revenues$1,055,727
 $971,307
 $828,255
 $575,053
 $591,068
Total operating expenses461,917
 365,789
 347,632
 317,638
 332,562
Income from operations593,810
 605,518
 480,623
 257,415
 258,506
Total other expenses249,330
 215,133
 183,773
 121,851
 114,586
Income before income taxes344,480
 390,385
 296,850
 135,564
 143,920
Taxes on income4,964
 9,787
 7,545
 7,442
 5,113
Net income (2)
$339,516
 $380,598
 $289,305
 $128,122
 $138,807
Per share data: 
  
  
  
  
Basic earnings per common share$1.59
 $1.80
 $1.62
 $1.12
 $1.23
Diluted earnings per common share$1.58
 $1.79
 $1.60
 $1.08
 $1.18
Weighted shares outstanding - Basic213,720
 210,705
 178,594
 114,432
 112,037
Weighted shares outstanding - Diluted214,779
 212,752
 180,622
 118,439
 117,586
Other data: 
  
  
  
  
Net cash provided by operating activities$654,433
 $598,711
 $514,370
 $319,688
 $273,259
Net cash (used in) provided by investing activities(1,509,784) 698
 (3,218,616) (14,142) (317,319)
Net cash provided by (used in) financing activities852,080
 (606,911) 2,698,927
 (299,644) (205,188)
Depreciation and amortization148,365
 123,835
 115,717
 109,783
 106,843
Straight-line rent adjustments61,888
 65,971
 58,673
 55,825
 44,877
Goodwill impairment charges (2)
59,454
 —
 —
 —
 —
Collections of principal payments on investment in direct financing lease (3)
38,459
 73,072
 48,533
 —
 —
Interest expense247,684
 217,068
 185,896
 124,183
 117,030
Capital expenditures (4)
4,304
 3,256
 3,441
 19,102
 142,769
Balance sheet data: 
  
  
  
  
Cash and cash equivalents$25,783
 $29,054
 $36,556
 $41,875
 $35,973
Real estate investments, net (3)
7,331,460
 3,662,045
 3,739,091
 2,090,059
 2,180,124
Investment in direct financing lease, net (3)
—
 2,637,639
 2,710,711
 —
 —
Total assets8,577,293
 7,246,882
 7,369,330
 2,448,155
 2,525,454
Long-term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts5,853,497
 4,442,880
 4,664,965
 2,510,341
 2,570,361
Shareholders' equity (deficit)2,265,607
 2,458,247
 2,433,869
 (253,514) (176,290)
Property Data:         
Number of rental properties owned at year end42
 36
 34
 19
 19
Rentable square feet at year end21,847
 15,198
 14,799
 6,970
 6,970

(1)
In October 2018, the Company purchased the real property assets of five Tropicana properties for approximately $992.5 million. These assets were subsequently leased to Eldorado under a triple-net master lease. Also in October

2018, the Company purchased Plainridge Park from Penn for $250.9 million in conjunction with the Penn-Pinnacle Merger. This property was leased back to Penn under the Amended Pinnacle Master Lease. The purchaseTable of these assets contributed to the Company's growth in asset base as well as improved financial performance during fiscal year 2018.Contents
In April 2016, the Company purchased substantially all of the real property assets of Pinnacle for approximately $4.8 billion. The purchase of these assets, which were subsequently leased back to Pinnacle under a triple-net lease and financed through a combination of debt and equity, contributed to the Company's significant growth in asset base as well as improved financial performance during fiscal years 2017 and 2016. To a lesser extent, the purchase of the real property assets of the Meadows for $323.3 million in September 2016 also contributed to the Company's improved operating results during fiscal years 2017 and 2016. Finally, the purchase of the real property assets of the 1st Jackpot Casino and Resorts Casino Tunica for $82.9 million in May 2017 contributed slightly to the Company's increase in net revenues for fiscal year 2017. See Note 4 to the consolidated financial statements for additional information on the Company's acquisitions.

(2)
During the fourth quarter of 2018, the Company recorded an impairment charge of $59.5 million, related to the
goodwill recorded on the books of its subsidiary, Hollywood Casino Baton Rouge. This was the largest driver of the decrease in the Company's net income during the year ended December 31, 2018. For further information on the impairment charge see Note 9 to the consolidated financial statements.

(3)
Prior to the Penn-Pinnacle Merger, the Pinnacle Master Lease was bifurcated between an operating lease and a direct financing lease, with the land assets qualifying for operating lease treatment and the building assets triggering direct financing lease treatment. This net investment in direct financing lease was unwound in conjunction with the Penn-Pinnacle Merger, via the fourth amendment to the Pinnacle Master Lease. As a result of this amendment, the Company reassessed the lease's classification and determined the new lease agreement qualified for operating lease treatment under ASC 840 - Leases ("ASC 840"). Therefore, subsequent to the Penn-Pinnacle Merger, the Amended Pinnacle Master Lease is treated as an operating lease in its entirety, the building assets previously recorded as an investment in direct financing lease on the Company's consolidated balance sheet were recorded as real estate assets on the Company's consolidated balance sheet and all rent received under the Amended Pinnacle Master Lease is recorded as rental income on the Company's consolidated statement of income.

(4)
The higher level of capital expenditures in 2014 was primarily due to the construction of Hollywood Gaming at Dayton Raceway and Hollywood Gaming at Mahoning Valley Race Course which opened to the public on August 28, 2014 and September 17, 2014, respectively.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Our Operations

GLPI is a self-administered and self-managed Pennsylvania REIT. GLPIThe Company was formed from the 2013 tax-free spin-off of the real estate assets of Penn and was incorporated in Pennsylvania on February 13, 2013, as a wholly-owned subsidiary of Penn. On November 1, 2013, Penn contributed to GLPI, through a series of internal corporate restructurings, substantially all of the assets and liabilities associated with Penn's real property interests and real estate development business, as well as the assets and liabilities of Hollywood Casino Baton Rouge and Hollywood Casino Perryville, which are referred to as the "TRSTRS Properties" and then spun-off GLPI to holders of Penn's common and preferred stock in a tax-free distribution.the Spin-Off. The Company elected on its U.S. federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and the Company, together with an indirect wholly-owned subsidiary of the Company, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. (d/b/a Hollywood Casino Baton Rouge) and Penn Cecil Maryland, Inc. (d/b/a Hollywood Casino Perryville) as a "taxable REIT subsidiary" effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a “taxable REIT subsidiary”. As a result of the Spin-Off, GLPI owns substantially all of Penn's former real property assets (as of the consummation of the Spin-Off) and leases back most of those assets to Penn for use by its subsidiaries, under the Penn Master Lease and GLPI also owns and operates the TRS Properties through its indirect wholly-owned subsidiary, GLP Holdings, Inc. The assets and liabilities of GLPI were recorded at their respective historical carrying values at the time of the Spin-Off.

GLPI's primary business consists of acquiring, financing, and owning real estate property to be leased to gaming operators in triple-net lease arrangements. As of December 31, 2020, GLPI's portfolio consisted of interests in 48 gaming and related facilities, including the TRS Segment, the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with 7 gaming and related facilities operated by Caesars, the real property associated with 4 gaming and related facilities operated by Boyd and the real property associated with the Casino Queen in East St. Louis, Illinois. These facilities, including our corporate headquarters building, are geographically diversified across 16 states and contain approximately 24.3 million square feet. As of December 31, 2020, our properties were 100% occupied. We expect to continue growing our portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming operators under prudent terms.

Amended Pinnacle Master Lease, Boyd Master Lease and Belterra Park Lease

In April 2016, the Company acquired substantially all of the real estate assets of Pinnacle for approximately $4.8 billion. GLPI originally leased these assets back to Pinnacle, under a triple-net lease with an initialthe Pinnacle Master Lease, the term of 10 yearswhich expires on April 30, 2031, with no purchase option, followed by fivefour remaining 5-year renewal options (exercisable by Pinnacle)the tenant) on the same terms and conditions. On October 15, 2018, the Company completed itsthe previously announced transactions with Penn, Pinnacle and BoydPenn-Pinnacle Merger to accommodate Penn's acquisition of the majority of Pinnacle's operations, pursuant to a definitive agreement and plan of merger between Penn and Pinnacle, dated December 17, 2017. Concurrent with the Penn-Pinnacle Merger, the Company amended the Pinnacle Master Lease to allow for the sale of the operating assets of Ameristar Casino

Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd and entered into a new unitary triple-net master lease agreement withthe Boyd Master Lease for these properties on terms similar to the Company’s existing master leases.Amended Pinnacle Master Lease. The Boyd Master Lease has an initial term of 10 years (from the original April 2016 commencement date of the Pinnacle Master Lease and expiring April 30, 2026), with no purchase option, followed by five 5-year renewal options (exercisable by the tenant) on the same terms and conditions. The Company also purchased the real estate assets of Plainridge Park from Penn for $250.0 million, exclusive of transaction fees and taxes and added this property to the Amended Pinnacle Master Lease. The Amended Pinnacle Master Lease was assumed by Penn at the consummation of the Penn-Pinnacle Merger. The Company also entered into a mortgage loan agreementthe Belterra Park Loan with Boyd in connection with Boyd's acquisition of Belterra Park, wherebyPark. In May 2020, the Company loaned Boyd $57.7 million. See Note 4acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to the consolidated financial statements for further details surroundingBelterra Park Lease with a Boyd affiliate operating the original Pinnacle acquisitionproperty.The Belterra Park Lease rent terms are consistent with the Boyd Master Lease. The annual rent is comprised of a fixed component, part of which is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met, and a component that is based on the performance of the facilities which is adjusted, subject to certain floors, every two years to an amount equal to 4% of the average annual net revenues of Belterra Park during the preceding two years in excess of a contractual baseline.

The Meadows Lease

The real estate assets of the Meadows are leased to Penn pursuant to the Meadows Lease. The Meadows Lease commenced on September 9, 2016 and has an initial term of 10 years, with no purchase option, and the subsequent acquisitionoption to renew for
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Table of PinnacleContents
three successive 5-year terms and one 4-year term (exercisable by Penn.the tenant) on the same terms and conditions. The Meadows Lease contains a fixed component, subject to annual escalators, and a component that is based on the performance of the facility, which is reset every two years to an amount determined by multiplying (i) 4% by (ii) the average annual net revenues of the facility for the trailing two-year period. The Meadows Lease contains an annual escalator provision for up to 5% of the base rent, if certain rent coverage ratio thresholds are met, which remains at 5% until the earlier of ten years or the year in which total rent is $31 million, at which point the escalator will be reduced to 2% annually thereafter.
GLPI's primary business consists of acquiring, financing,
Amended and owning real estate property to be leased to gaming operators in triple-net lease arrangements. As of December 31, 2018, GLPI's portfolio consisted of interests in 46 gamingRestated Caesars Master Lease and related facilities, including the TRS Properties, the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with 6 gaming and related facilities operated by Eldorado (including one mortgaged facility), the real property associated with 4 gaming and related facilities operated by Boyd (including one mortgaged facility) and the real property associated with the Casino Queen in East St. Louis, Illinois. These facilities are geographically diversified across 16 states and contain approximately 23.5 million square feet. As of December 31, 2018, our properties were 100% occupied.Lumière Place Lease
We expect to grow our portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming operators under prudent terms. In addition to the acquisition of Plainridge Park described above, on
On October 1, 2018, the Company closed its previously announced transaction to acquire certain real property assets from Tropicana and certain of its affiliates pursuant to the Real Estate Purchase Agreement dated April 15, 2018 between Tropicana and GLP Capital, which was subsequently amended on October 1, 2018. 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 from Tropicana for an aggregate cash purchase price of $964.0 million, exclusive of transaction fees and taxes. Concurrent with the Tropicana Acquisition, EldoradoCaesars 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, EldoradoCaesars and a wholly-owned subsidiary of EldoradoCaesars and leased the GLP Assets from the Company pursuant to the terms of a new unitary triple-net master lease with a 15-year initial term, with no purchase option followed by four successive 5 -year renewal periods (exercisable by Eldorado) on the same terms and conditions.Caesars Master Lease. Additionally, on October 1, 2018, the Company made a mortgageentered into the CZR loan to Eldorado in the amount of $246.0 million in connection with Eldorado’sCaesars’s acquisition of Lumière Place. The CZR loan was satisfied and replaced with the Lumière Place Lease on September 29, 2020, the initial term of which expires on October 31, 2033, with 4 separate renewal options of five years each, exercisable at the tenants' option. The Lumière Place Lease rent is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met.On June 15, 2020, the Company amended and restated the Caesars Master Lease (as amended, the "Amended and Restated Caesars Master Lease") to, (i) extend the initial term of 15 years to 20 years, with renewals of up to an additional 20 years at the option of Caesars, (ii) remove the variable rent component in its entirety commencing with the third lease year, (iii) in the third lease year increase annual land base rent to approximately $23.6 million and annual building base rent to approximately $62.1 million, (iv) provide fixed escalation percentages that delay the escalation of building base rent until the commencement of the fifth lease year with building base rent increasing annually by 1.25% in the fifth and sixth lease year, 1.75% in the seventh and eighth lease years and 2% in the ninth lease year and each lease year thereafter, (v) subject to the satisfaction of certain conditions, permit Caesars to elect to replace the Tropicana Evansville and/or Tropicana Greenville properties under the Amended and Restated Caesars Master Lease with one or more of Caesars Gaming Scioto Downs, The Row in Reno, Isle Casino Racing Pompano Park, Isle Casino Hotel – Black Hawk, Lady Luck Casino – Black Hawk, Waterloo, Bettendorf or Isle of Capri Casino Boonville, provided that the aggregate value of such new property, individually or collectively, is at least equal to the value of Tropicana Evansville or Tropicana Greenville, as applicable (vi) permit Caesars to elect to sell its interest in Belle of Baton Rouge and sever it from the Amended and Restated Caesars Master Lease (with no change to the rent obligation to the Company), subject to the satisfaction of certain conditions, and (vii) provide certain relief under the operating, capital expenditure and financial covenants thereunder in the event of facility closures due to pandemics, governmental restrictions and certain other instances of unavoidable delay. The effectiveness of the Amended and Restated Caesars Master Lease was subject to the review of certain gaming regulatory agencies and the expiration of applicable gaming regulatory advance notice periods which were received on July 23, 2020. On December 18, 2020, the Company and Caesars completed an Exchange Agreement with subsidiaries of Caesars in which Caesars transferred to the Company the real estate assets of Waterloo and Bettendorf in exchange for the transfer by the Company to Caesars of the real property assets of Tropicana Evansville, plus a cash payment of $5.7 million.
Additionally, we believe we
Tropicana Las Vegas
On April 16, 2020, the Company and certain of its subsidiaries closed on its previously announced transaction to acquire the real property associated with the Tropicana Las Vegas from Penn in exchange for rent credits of $307.5 million, which were applied against future rent obligations due under the parties' existing leases during 2020. An affiliate of Penn will continue to operate the casino and hotel business of the Tropicana Las Vegas pursuant to a triple net lease with GLPI for nominal rent for the earlier of two years (subject to three one-year extensions at the Company's option) or until the Tropicana Las Vegas is sold. We will conduct a sale process with respect to the Tropicana Las Vegas, with Penn receiving 75% of the net proceeds above $307.5 million (plus certain taxes, expenses and costs) if a sale agreement is signed during the first 12 months following closing and 50% of net proceeds above $307.5 million (plus certain taxes, expenses and costs) if a sale agreement is signed during the subsequent 12 months following closing. Penn will not be entitled to receive any net sale proceeds if the relevant sale agreement is signed at any time after 24 months from closing.


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Morgantown Lease

On October 1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits that were utilized by Penn in the fourth quarter of 2020.The Company is leasing the land back to an affiliate of Penn pursuant to the Morgantown Lease for an initial annual rent of $3.0 million, provided, however, that (i) on the opening date and on each anniversary thereafter the rent shall be increased by 1.5% annually (on a prorated basis for the remainder of the lease year in which the gaming facility opens) for each of the following three lease years and (ii) commencing on the fourth anniversary of the opening date and for each anniversary thereafter, (a) if the CPI increase is at least 0.5% for any lease year, the rent for such lease year shall increase by 1.25% of rent as of the immediately preceding lease year, and (b) if the CPI increase is less than 0.5% for such lease year, then the rent shall not increase for such lease year subject to escalation provisions following the opening of the property.

Hollywood Casino Baton Rouge

On November 25, 2020, the Company entered into a definitive agreement to sell the operations of our Hollywood Casino Baton Rouge to Casino Queen Holding Company Inc. ("Casino Queen") for $28.2 million. The Company will retain ownership of all real estate assets at Hollywood Casino Baton Rouge and will simultaneously enter into a master lease with Casino Queen, which will include the Casino Queen property in East St. Louis that is currently leased by us to them and the Hollywood Casino Baton Rouge facility. The initial annual cash rent will be approximately $21.4 million and the lease will have an initial term of 15 years with four 5 year renewal options exercisable by the abilitytenant. This rental amount will be increased annually by 0.5% for the first six years. Beginning with the seventh lease year through the remainder of the lease term, if the CPI increases by at least 0.25% for any lease year then annual rent shall be increased by 1.25%, and if the CPI increase is less than 0.25% then rent will remain unchanged for such lease year.Additionally, the Company will complete the current landside development project that is in process and the rent under the master lease will be adjusted upon delivery to leverage the expertise our management team has developedreflect a yield of 8.25% on GLPI's project costs. The Company will also have a right of first refusal with Casino Queen for other sale leaseback transactions up to $50 million over the yearsnext 2 years. Finally, upon the closing of the transaction, which is anticipated to secure additional avenuesoccur in mid 2021, subject to regulatory approvals and customary closing conditions, GLPI will forgive the Casino Queen Loan which has been previously written off in return for growth beyonda one-time cash payment of $4 million.

Hollywood Casino Perryville

On December 11, 2020, Penn agreed to purchase from the gaming industry. Accordingly we anticipate weCompany the operations of our Hollywood Casino Perryville, located in Perryville, Maryland, for $31.1 million, with the closing of such purchase, subject to regulatory approvals, expected to occur during calendar year 2021 on a date selected by Penn with reasonable prior notice to the Company unless otherwise agreed by both parties. Upon closing, the Company will lease the real estate assets of the Perryville facility to Penn pursuant to a lease providing for initial annual rent of $7.77 million, $5.83 million of which will be ablesubject to effect strategic acquisitions unrelatedescalation provisions beginning in the second lease year through the fourth lease year and shall increase by 1.50% and then to 1.25% for the gaming industry as well as other acquisitions that may prove complimentaryremaining lease term. The escalation provisions beginning in the fifth lease year are subject to GLPI's gaming facilities.CPI being at least 0.5% for the preceding lease year.
As of December 31, 2018,2020, the majority of our earnings are the result of the rental revenues we receive from our triple-net Master Leasesmaster leases with Penn, Boyd and Eldorado.Caesars. Additionally, we have rental revenue from the Casino Queen property which is leased back to a third-party operator on a triple-net basis andpursuant to the Meadows property which is leased to Penn under a single property triple-net lease.Casino Queen Lease. In addition to rent, the tenants are required to pay the following executory costs: (1) all facility maintenance, (2) all insurance required in connection with the leased properties and the business conducted on the leased properties, including coverage of the landlord's interests, (3) taxes levied on or with respect to the leased properties (other than taxes on the income of the lessor) and (4) all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties. 
Additionally, in accordance with ASC 606 - Revenue from Contracts with Customers ("ASC 606"), we record revenue for the real estate taxes paid by our tenants on the leased properties with an offsetting expense in general and administrative expense within the consolidated statement of income, as we believe we are the primary obligor. Similarly,842, we record revenue for the ground lease rent paid by our tenants with an offsetting expense in generalland rights and administrativeground lease expense within the consolidated statementConsolidated Statement of income,Income as we have concluded that as the lessee we are the primary obligor under the ground leases. We sublease these ground leases back to our tenants, who are responsible for payment directly to the landlord.

Gaming revenue generated byfor our TRS Properties is derived primarily from revenue fromgaming on slot machines and to a lesser extent, table game and poker revenue, which is highly dependent upon the volume and spending levels of customers at our TRS Properties. Other revenues at our TRS Properties are derived from our dining, retail and certain other ancillary activities.



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Table of Contents
Our Competitive Strengths
We believe the following competitive strengths will contribute significantly to our success:
Geographically Diverse Property Portfolio
As of December 31, 2018,2020, our portfolio consisted of 4648 gaming and related facilities, including 4245 rental properties, the TRS Properties and two properties we had financial interests in via secured mortgage loans to the respective casino owner-operators.Segment. Our portfolio, including our corporate headquarters building, comprises approximately 23.524.3 million square feet and over 5,600approximately 5,700 acres of land and is broadly diversified by location across 16 states. We expect that our geographic diversification will limit the effect of a decline in any one regional market on our overall performance.
Financially Secure Tenants
Three of the company's tenants, Penn, EldoradoCaesars and Boyd, are leading, diversified, multi-jurisdictional owners and managers of gaming and pari-mutuel properties and established gaming providers with strong financial performance. All three of these tenants raised significant amounts of capital in 2020 to bolster their liquidity positions in response to COVID-19. Additionally, all of the aforementioned tenants are publicly traded companies that are subject to the informational filing requirements of the Securities Exchange Act of 1934, as amended, and are required to file periodic reports on Form 10-K and Form 10-Q and current reports on Form 8-K with the Securities and Exchange Commission ("SEC"). Readers are directed to Penn's, Eldorado'sCaesar's and Boyd's respective websites for further financial information on these companies.
Long-Term, Triple-Net Lease Structure
Our real estate properties are leased under long-term triple-net leases guaranteed by our tenants, pursuant to which the tenant is responsible for all facility maintenance, insurance required in connection with the leased properties and the business conducted on the leased properties, including coverage of the landlord's interests, taxes levied on or with respect to the leased properties (other than taxes on our income) and all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties.
Resilient Regional Gaming Characteristics
We believe that the recession resulting from COVID-19 pandemic has illustrated the resiliency of the regional gaming market. In spite of all our properties being forced to close during mid-March 2020, the Company collected all contractual rents, inclusive of rent credits, due in 2020. Furthermore, our tenants' results since they have reopened has been strong and in some cases better than prior to COVID-19, due to their increased focus on cost efficiencies and decreasing and/or eliminating lower margin amenities. Although we are unable to predict whether these results will continue, we believe that our assets should generate substantial cash flows well into the future for both ourselves and our tenants.
Flexible UPREIT Structure
We have the flexibility to operate through an umbrella partnership, commonly referred to as an UPREIT structure, in which substantially all of our properties and assets are held by GLP Capital or by subsidiaries of GLP Capital. Conducting business through GLP Capital allows us flexibility in the manner in which we structure and acquire properties. In particular, an UPREIT structure enables us to acquire additional properties from sellers in exchange for limited partnership units, which provides property owners the opportunity to defer the tax consequences that would otherwise arise from a sale of their real properties and other assets to us. As a result, this structure potentially may facilitate our acquisition of assets in a more efficient manner and may allow us to acquire assets that the owner would otherwise be unwilling to sell because of tax considerations. We believe that this flexibility will provide us an advantage in seeking future acquisitions.
Experienced and Committed Management Team
Although ourOur management team has limited experience in operating a REIT, it has extensive gaming and real estate experience. Peter M. Carlino, our chief executive officer, of GLPI, has more than 30 years of experience in the acquisition and development of gaming facilities and other real estate projects. Steven T. Snyder, interim chief financial officer and senior vice president of corporate development of GLPI, is a finance professional with more than 20 years of experience in the gaming industry, including identifying and analyzing potential acquisitions. Through years of public company experience, our management team also has extensive experience accessing both debt and equity capital markets to fund growth and maintain a flexible capital structure.
Segment Information
 
Consistent with how our Chief Operating Decision Maker (as such term is defined in ASC 280 - Segment Reporting) reviews and assesses our financial performance, we have two reportable segments, GLP Capital and the TRS Properties.Segment. The GLP Capital reportable segment consists of the leased real property and represents the majority of our business. The TRS Properties reportable segmentSegment consists of our operations at Hollywood Casino Perryville and Hollywood Casino Baton Rouge.Rouge, as well as the real estate of Tropicana Las Vegas we acquired in 2020.
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Executive Summary
 
Financial Highlights
 
We reported total revenues and income from operations of $1,055.7$1,153.2 million and $593.8$809.3 million, respectively, for the year ended December 31, 2018,2020, compared to $971.3$1,153.5 million and $605.5$717.4 million, respectively, for the year ended December 31, 2017.2019.  The major factors affecting our results for the year ended December 31, 2018,2020, as compared to the year ended December 31, 2017, were:2019, were as follows:


•Total income from real estate was $923.2$1,050.2 million and $829.2$1,025.1 million for the years ended December 31, 20182020 and 2017,2019, respectively. Total income from real estate increased by $94.0$25.1 million for the year ended December 31, 2018,2020, as compared to the year ended December 31, 2017,2019, primarily due to favorable non-cash straight line rent adjustments on our Amended Pinnacle Master Lease, Boyd Master Lease and Amended and Restated Caesars Master Lease. Additionally current year results were positively impacted by higher building base rents as the Tropicana Transactions,majority of our leases incurred escalators in 2019. This was partially offset by lower percentage rent from the Penn-Pinnacle MergerAmended Pinnacle Master Lease and our entry intoBoyd Master Lease which reset on May 1, 2020 and the Belterra Park Loan,Meadows Lease which reset on October 1, 2020 as well as lower ground rents due to the performance of the Ohio properties, the impact of the rent escalators under the Penn and Pinnacle master leases, netcasino closures related to COVID-19. Finally, 2020 results were negatively impacted by lower percentage rent adjustments and the partial recognition of income previously deferred underon the Penn Master Lease in accordance with ASC 840.due to the temporary closures of Hollywood Casino Columbus and to a lesser extent, Hollywood Casino Toledo from mid-March 2020 to June 19, 2020.


•Net revenues for our TRS Properties decreased by $9.5$25.4 million for the year ended December 31, 2018,2020, as compared to the prior year, primarily due to decreased revenues at both TRS Properties. The largest driver of the decrease resulted from the temporary closures of the properties during 2020 due to COVID-19. The TRS Properties were closed in mid-March 2020. Hollywood Casino Baton Rouge partially offset by a slight increase in revenues atreopened to the public on May 18, 2020 and Hollywood Casino Perryville.Perryville reopened on June 19, 2020 with various restrictions to limit capacity in accordance with regulatory requirements.
 
•Total operating expenses increaseddecreased by $96.1$92.2 million for the year ended December 31, 2018,2020, as compared to the prior year, primarily driven by a goodwillnon-cash gain on the disposition of property related to the Evansville swap transaction of $41.4 million, the $13 million loan impairment charge recorded on the Casino Queen Loan in 2019, lower land rights and ground lease expense due primarily to the acceleration of $59.5 millionamortization of expense related to Hollywoodthe ground lease for the closure of the Resorts Casino Baton RougeTunica property and an increase inlower ground rents due to the casino closures from COVID-19 and decreased expenses at both TRS Properties during 2020 due to the temporary closures from COVID-19. Finally, depreciation expense resulting from the addition of the Tropicana and Plainridge Park real estate assets to our real estate portfolio, as well as the reclassification of the Pinnacle building assets to real estate investments on our balance sheet as a result of the Penn-Pinnacle Merger, which required the Amended Pinnacle Master Lease to be treated as an operating lease in its entirety. Also driving the increase in total operating expenses for the year ended December 31, 2018, as compareddeclined due primarily to the prior year, are accrued retirement costsacceleration of $13.1$10.3 million related to the retirementclosure of our former Chief Financial Officer.the Resorts Casino Tunica property in 2019.


•Other expenses, net increaseddecreased by $34.2$22.1 million for the year ended December 31, 2018,2020, as compared to the prior year, driven by an increase inprimarily due to lower interest expense related toresulting from the debt refinancing in the second quarter of 2018 and debt issuances in the third quarter of 2018, the proceeds of which were utilized for the October closings of both the Tropicana Transactions and the acquisition of Plainridge Park and the funding of the Belterra Park Loan in connection with the Penn-Pinnacle Merger. In addition, the Company incurred losses on the extinguishment of debt during the second quarter of 2018.long term debt.


Income tax expense decreased•Net income increased by $4.8$114.8 million for the year ended December 31, 2018, primarily due to the Tax Cuts and Jobs Act, which lowered the corporate tax rate to 21%, effective for tax years including or commencing January 1, 2018, as well as lower income at our TRS Properties.

Net income decreased by $41.1 million for the year ended December 31, 2018,2020, as compared to the prior year, primarily due to the variances explained above.


Segment Developments
 
The following are recent developments that have had or are likelyexpected to have an impact on us by segment:
 
GLP Capital


•Due to temporary casino closures that occurred during 2020 as a result of COVID-19, for our leases that contain variable rent which is reset on varying schedules depending on the lease, we would expect downward resets. In the aggregate, the portion of our cash rents that are variable represented approximately 15% of our 2020 full year cash rental income. Of that variable rent, approximately 29% resets every five years which is associated with our Penn Master Lease and Casino Queen Lease, 41% resets every two years and 30% resets monthly which is associated with the Penn Master Lease (of which approximately 51% is subject to a floor or $22.9 million annually for Hollywood Casino Toledo). The percentage rent in the Penn Master Lease decreased by $4.0 million for the year ended December 31, 2020 compared to the year ended 2019 due to the temporary closures of Hollywood Casino Columbus and to a lesser extent, Hollywood Casino Toledo from mid-March 2020 to June 19, 2020, which was partially offset by the strong reopening performance of these properties in the third quarter of 2020 as well as the benefit Hollywood Casino Toledo experienced due to the
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Detroit, Michigan gaming market being closed until August 5, 2020 and being closed once again from November 18, 2020 to December 23, 2020.

•The variable rent resets in the Amended Pinnacle Master Lease and the Boyd Master Lease reset for the two year period ended April 30, 2020, which resulted in a $5.0 million and a $1.4 million reduction in annual variable rent on each of these leases, respectively, which will prevail for the subsequent two year period through April 30, 2022. In addition, the Meadows Lease variable rent reset occurred in October 2020 which lowered variable rent annually by $2.1 million. The Caesars Master Lease variable rent reset was scheduled to occur in October 2020; however, the variable rent component was removed in its entirety commencing with the third lease year in connection with the Amended and Restated Caesars Master Lease. We have no other variable resets scheduled to occur until 2022.

•The fact that several wholly-owned subsidiaries of Penn lease a substantial number of our properties which account for a significant portion of our revenue, pursuant to two master leases and a single property lease.

•On April 16, 2020, we acquired from Penn the real property assets of Tropicana Las Vegas in return for $307.5 million in rent credits. There can be no assurance that we will realize a return on this investment.

•On October 15, 2018,1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's acquisitiongaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits that were utilized in 2020. The Company is leasing the land back to an affiliate of Pinnacle closed,Penn pursuant to the Morgantown Lease for an initial annual rent of $3.0 million, provided, however, that (i) on the opening date and on each anniversary thereafter the rent shall be increased by 1.5% annually (on a prorated basis for the remainder of the lease year in which the gaming facility opens) for each of the following three lease years and (ii) commencing on the fourth anniversary of the opening date and for each anniversary thereafter, (a) if the CPI increase is at least 0.5% for any lease year, the rent for such lease year shall increase by 1.25% of rent as of the immediately preceding lease year, and (b) if the CPI increase is less than 0.5% for such lease year, then the rent shall not increase for such lease year subject to escalation provisions following the opening of the property.

•In connection with the Exchange Agreement with Caesars described earlier, whereby the Company acquired Waterloo and Bettendorf to replace Tropicana Evansville under the Amended and Restated Caesars Master Lease, the Company recorded a non-cash gain of $41.4 million in the fourth quarter of 2020, which represented the difference between the fair value of the properties received compared to the carrying value of Tropicana Evansville and the cash payment of $5.7 million made to Caesars.

•On October 27, 2020, the Company entered into a series of definitive agreements pursuant to which a subsidiary of Bally's will acquire 100% of the equity interests in the Caesars subsidiary that currently operates Tropicana Evansville and the Company completed its previously announced transactions with Penn, Pinnacle and Boyd. Concurrent with Penn's acquisition,will reacquire the Company amended the Pinnacle Master Lease to allow for the sale of the operatingreal property assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino ResortTropicana Evansville from Pinnacle to Boyd andCaesars for a cash purchase price of approximately $340.0 million. In addition, the Company entered into a new triple-net master leasereal estate purchase agreement with Boyd for these properties on terms similarBally's pursuant to which the Company’s existing master leases. The Company also purchasedwill purchase the real estate assets of Plainridge Parkthe Dover Downs Hotel & Casino, from Pennlocated in Dover, Delaware which is currently owned and operated by Bally's, for $250.0 million, exclusivea cash purchase price of transaction feesapproximately $144.0 million. At the closing of the transactions, which is expected in mid-2021, subject to regulatory approvals, the Tropicana Evansville and taxesDover Downs Hotel and Casino facilities will be added this property to the Amended PinnacleBally's Master Lease. We alsoThe Company anticipates that the Bally's Master Lease will have an initial term of 15 years, with no purchase option, followed by four five-year renewal options (exercisable by the tenant) on the same terms and conditions. Rent under the Bally's Master Lease will be $40.0 million annually and is subject to an annual escalator of up to 2% determined in relation to the annual increase in the Consumer Price Index. On November 6, 2020, the Company issued 9.2 million common shares at $36.25 to partially finance the funding required for this transaction.

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TRS Segment

•The Company's wholly-owned and operated TRS Properties closed in mid-March 2020 due to the COVID-19 outbreak. Our property in Baton Rouge reopened on May 18, 2020 and our property in Perryville, Maryland reopened on June 19, 2020 with enhanced safety protocols and capacity restrictions. To date, both properties have performed well in spite of lower attendance levels; however we are unable to predict whether this will continue as we believe results have benefited from pent up demand, reduced competition from non-gaming leisure related activities and federal stimulus benefits.

•As previously discussed, the Company has entered into a loan agreement with Boyd in connection with Boyd's acquisitiondefinitive agreements to sell the operations of Belterra Park, whereby we loaned Boyd $57.7 million, act as mortgagee and collect

interest income from Boyd. Our initial annualthe TRS Properties while maintaining the real estate income will increase by $45.3 million as a result of these transactions.assets and in turn entering into lease agreements with the operators. These transactions are subject to customary closing conditions and regulatory approvals and are anticipated to close in mid-2021.

◦On October 1, 2018, the Company purchased the real property assets of five properties from Tropicana for $964.0 million, exclusive of taxes and transaction fees. Concurrent with the acquisition of these properties, Eldorado purchased the operating assets of these Tropicana properties and Lumière Place and entered into a new triple-net master lease with the Company for the lease of the five Tropicana properties purchased by us for a 15-year initial term with no purchase option followed by four successive 5-year renewal periods (exercisable by Eldorado). Initial annual rent under the Eldorado Master Lease is $87.6 million. The Company also made a loan to Eldorado in the amount of $246.0 million in connection with Eldorado’s acquisition of Lumière Place, which will generate initial annual interest income of $22.4 million.


•On May 1, 2017,April 16, 2020, the Company purchasedand certain of its subsidiaries acquired the real property assetsassociated with the Tropicana Las Vegas from Penn. This asset has been placed in the Company's TRS Segment. An affiliate of Penn will continue to operate the casino and hotel business of the 1st Jackpot Casino and Resorts Casino TunicaTropicana Las Vegas pursuant to a triple net lease with GLPI for $82.9 million.nominal rent for the earlier of two years (subject to three one-year extensions at the Company's option) or until the Tropicana Las Vegas is sold. The Company will conduct a sale process with respect to the Tropicana Las Vegas, with Penn purchased the operating assetsreceiving 75% of the Tunica Properties directly from the seller, operates both propertiesnet proceeds above $307.5 million (plus certain taxes, expenses and leases the real property assets from the Company under the Penn Master Lease.

TRS Properties

During the second quarter of 2018,costs) if a smoking ban went into effect at all Baton Rouge, Louisiana casinos, which in combination with the general market deterioration in the Baton Rouge region has contributed to the poor performance of our Hollywood Casino Baton Rouge property, resulting in the impairment charge of $59.5 millionsale agreement is signed during the fourth quarterfirst 12 months following closing and 50% of 2018.

During the first quarter of 2017, Hollywood Casino Perryville outsourced the operation of its foodnet proceeds above $307.5 million (plus certain taxes, expenses and beverage outlets tocosts) if a third-party provider. Employees of these outlets are now employees of the third-party; therefore both Hollywood Casino Perryville's revenues and expenses related to food and beverage decreasedsale agreement is signed during the year ended December 31, 2017, as comparedsubsequent 12 months following closing. Penn will not be entitled to receive any net sale proceeds if the prior year.relevant sale agreement is signed at any time after 24 months from closing.



Critical Accounting Estimates
We make certain judgments and use certain estimates and assumptions when applying accounting principles in the preparation of our consolidated financial statements. The nature of the estimates and assumptions are material due to the levels of subjectivity and judgment necessary to account for highly uncertain factors or the susceptibility of such factors to change. We have identified the accounting for leases, income taxes, and real estate investments and goodwill and other intangible assets as critical accounting estimates, as they are the most important to our financial statement presentation and require difficult, subjective and complex judgments.
We believe the current assumptions and other considerations used to estimate amounts reflected in our consolidated financial statements are appropriate. However, if actual experience differs from the assumptions and other considerations used in estimating amounts reflected in our consolidated financial statements, the resulting changes could have a material adverse effect on our consolidated results of operations and, in certain situations, could have a material adverse effect on our consolidated financial condition.
Leases
 
As a REIT, the majority of our revenues are derived from rent received from our tenants under long-term triple-net leases. Currently, we have master leases with Penn, EldoradoCaesars and Boyd under which we lease 32, fivethirty one, six and three properties, respectively, to these tenants. We also have a long-term lease with Casino Queen and a separate single property lease by which we lease the Meadows' real estate assets to Penn.leases with Penn, Caesars and Boyd. The accounting guidance under ASC 840842 is complex and requires the use of judgments and assumptions by management to determine the proper accounting treatment of a lease. We perform a lease classification test upon the entry into any new tenant lease or lease modification to determine if we will account for the lease as a capitalan operating or operatingsales-type lease. The revenue recognition model and thus the presentation of our financial statements is significantly different under capitaloperating leases and operatingsales-type leases.


Under the operating lease model, as the lessor, the assets we own and lease to our tenants remain on our booksbalance sheet as real estate investments and we record rental revenues on a straight-line basis over the lease term. This includes the recognition of percentage rents that are fixed and determinable at the lease inception date on a straight-line basis over the entire lease term, resulting in the recognition of deferred rental revenue on our consolidated balance sheets. Deferred rental revenue is amortized to rental revenue on a straight-line basis over the remainder of the lease term. The lease term includes the initial non-cancelable lease term and any reasonably assured renewal

periods. Contingent rental income that is not fixed and determinable at lease inception is recognized only when the lessee achieves the specified target. Recognition

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Table of rental income commences when control of the facility has been transferred to the tenant. Under operating lease treatment, assets we own and lease to tenants are recorded on our consolidated balance sheet as real estate investments.Contents

Under the direct financingsales-type lease model, however, at lease inception we would record an investment in direct financingsales-type lease on our consolidated balance sheet rather than recording the actual assets we own andown. Furthermore, the cash rent we receive from tenants is not entirely recorded as rental revenue, but rather a portion is recorded as interest income and a portion is recorded as a reduction to the direct financing lease receivable. Under ASC 840,842, for leases ofwith both land and building and land,components, leases may be bifurcated between operating and capital leases, with the land portion of the lease typically qualifying for operating lease treatment.sales-type leases. To determine if the building portion of a lease triggers capitalour real estate leases trigger full or partial sales-type lease treatment we conduct the fourfive lease tests outlined in ASC 840 outlined842 below. If a lease meets any of the fourfive criteria below, it is accounted for as a capitalsales-type lease.


1)    Transfer of ownership - The lease transfers ownership of the propertyunderlying asset to the lessee by the end of the lease term. This criterion is met in situations in which the lease agreement provides for the transfer of title at or shortly after the end of the lease term in exchange for the payment of a nominal fee, for example, the minimum required by statutory regulation to transfer title.


2)    Bargain purchase option - The lease contains a bargain purchase option, which is a provision allowing the lessee, at its option, to purchase the leased property for a price which is sufficiently lower than the expected fair value of the property at the date the option becomes exercisable. In addition, the exercise of the option mustexercisable and that is reasonably certain to be reasonably assured at lease inception.exercised.


3)    Lease term - The lease term is equal to 75 percent or morefor the major part of the estimatedremaining economic life of the leased property.underlying asset. However, if the beginningcommencement date falls at or near the end of the lease term falls within the last 25 percent of the total estimated economic life of the leased property, including earlier years of use,underlying asset, this criterion shall not be used for purposes of classifying the lease. This test is conducted on a property by property basis.


4)    Minimum lease payments - The present value of the minimum lease payments at the beginningsum of the lease term, excluding that portion of the payments representing executory costs such as insurance, maintenance, and taxes to be paidany residual value guaranteed by the lessor, including any profit thereon,lessee that is not already reflected in the lease payments equals or exceeds 90%substantially all of the fair value of the leased propertyunderlying asset.

5)    Specialized nature - The underlying asset is of such specialized nature that it is expected to have no alternative use to the lessor at lease inception less any related investment tax credit retained by the lessor and expected to be realized by the lessor. If the beginningend of the lease term falls withinterm.

Additionally, the last 25%adoption of ASC 842 requires us to record right-of-use assets and lease liabilities on balance sheet for the assets we lease from third-party landlords, including equipment and real estate. As a lessee, we utilize our own incremental borrowing rate as the discount rate utilized to determine the initial lease liability and right-of-use asset we record on balance sheet, as well as the lease's classification as an operating or finance lease, using the same tests outlined above. Although both operating and finance leases result in the same right-of-use asset and lease liability being recorded on balance sheet at lease inception, the expense profile of the total estimated economic lifetwo lease types differs, in that expense is straight-lined over the term of an operating lease, while the leased property, including earlier years of use, this criterion shall not be used for purposes of classifyingexpense profile under a finance lease is front-loaded. Furthermore, expense under the lease.operating lease model is classified simply as lease expense, whereas the finance lease model breaks the expense into the interest expense and asset amortization expense.


The tests outlined above, as well as the resulting calculations, require subjective judgments, such as determining, at lease inception, the fair value of the underlying leased assets, the residual value of the assets at the end of the lease term, the likelihood a tenant will exercise all renewal options (in order to determine the lease term), the estimated remaining economic life of the leased assets, and an allocation of rental income received under our Master Leases to the incremental borrowing rate of the lessee and the interest rate implicit in the lease.underlying leased assets. A slight change in estimate or judgment can result in a materially different financial statement presentation.
Income Taxes
We elected on our U.S. federal income tax return for our taxable year that began on January 1, 2014 to be treated as a REIT and we, together with an indirect wholly-owned subsidiary of the Company, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. and Penn Cecil Maryland, Inc. as a "taxable REIT subsidiary" effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a “taxable REIT subsidiary”. We intend to continue to be organized and to operate in a manner that will permit us to qualify as a REIT. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our annual REIT taxable income to shareholders determined without regard to the dividends paid deduction and excluding any net capital gain, and meet the various other requirements imposed by the Code relating to matters such as operating results, asset holdings, distribution levels, and diversity of stock ownership.
As a REIT, we generally will not be subject to federal income tax on income that we distribute as dividends to our shareholders. If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income tax, including any applicable alternative minimum tax, on our taxable income at regular corporate income tax rates, and dividends paid to our
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shareholders would not be deductible by us in computing taxable income. Any resulting corporate liability could be substantial and could materially and adversely affect our net income and net cash available for distribution to shareholders. Unless we were entitled to relief under certain Code provisions, we also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which we failed to qualify to be taxed as a REIT. It is not possible to state whether in all circumstances we would be entitled to this statutory relief.

Our TRS Properties areSegment is able to engage in activities resulting in income that would not be not qualifying income for a REIT. As a result, certain activities of the Company which occur within our TRS PropertiesSegment are subject to federal and state income taxes.
Real Estate Investments
Real estate investments primarily represent land and buildings leased to the Company's tenants. Real estate investments that we received in connection with the Spin-Off were contributed to us at Penn's historical carrying amount. We record the acquisition of real estate at fair value, including acquisition and closing costs. The cost of properties developed by GLPI includeincludes costs of construction, property taxes, interest and other miscellaneous costs incurred during the development period until the project is substantially complete and available for occupancy. We consider the period of future benefit of the asset to determine the appropriate useful lives. Depreciation is computed using a straight-line method over the estimated useful lives of the buildings and building improvements. Additionally, the amortizationIf we used a shorter or longer estimated useful life, it could have a material impact on our results of real estate assets subject to capital leases (for which GLPI is the lessee) is included within the depreciation line item of the Company's consolidated statements of income.operations.
We continually monitor events and circumstances that could indicate that the carrying amount of our real estate investments may not be recoverable or realized. The factors considered by the Company in performing these assessments include evaluating whether the tenant is current on their lease payments, the tenant’s rent coverage ratio, the financial stability of the tenant and its parent company, and any other relevant factors. When indicators of potential impairment suggest that the carrying value of a real estate investment may not be recoverable, we estimate the fair value of the investment by calculating the undiscounted future cash flows from the use and eventual disposition of the investment. This amount is compared to the asset's carrying value. If we determine the carrying amount is not recoverable, we would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP.U.S. Generally Accepted Accounting Principles ("GAAP"). We group our real estate investments together by lease, the lowest level for which identifiable cash flows are available, in evaluating impairment. In assessing the recoverability of the carrying value, we must make assumptions regarding future cash flows and other factors. Factors considered in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the effect of obsolescence, demand, competition and other factors. If these estimates or the related assumptions change in the future, we may be required to record an impairment loss.
Goodwill and Other Intangible Assets
Under ASC 350 - Intangibles - Goodwill and Other ("ASC 350"), we are required to test goodwill and other intangible assets for impairment at least annually and whenever events or circumstances indicate that it is more likely than not that goodwill or other intangible assets may be impaired. We have elected to perform our annual goodwill and intangible asset impairment tests as of October 1 of each year. Goodwill is tested at the reporting unit level, which is an operating segment or one level below an operating segment for which discrete financial information is available.
ASC 350 prescribes a two-step goodwill impairment test, the first step which involves the determination of the fair value of each reporting unit and its comparison to the carrying amount. In order to determine the fair value of the Baton Rouge reporting unit, where the Company's goodwill resides, the Company utilizes a discounted cash flow model, which relies on projected EBITDA to determine the reporting unit's future cash flows. If the carrying amount of the reporting unit exceeds the fair value in step 1, then step 2 of the impairment test is performed to determine the implied value of goodwill. If the implied value of goodwill is less than the goodwill allocated to the reporting unit, an impairment loss is recognized.
In accordance with ASC 350, we consider the Hollywood Casino Perryville gaming license an indefinite-lived intangible asset that does not require amortization based on our future expectations to operate this casino indefinitely as well as the gaming industry's historical experience in renewing these intangible assets at minimal cost with various state gaming commissions. Rather, the gaming license is tested annually, or more frequently if indicators of impairment exist, for impairment by comparing the fair value of the recorded asset to its carrying amount. If the carrying amount of the indefinite-life intangible asset exceeds its fair value, an impairment loss is recognized. Hollywood Casino Perryville's gaming license will expire in September 2025, fifteen years from the casino's opening date. We expect to expense any costs related to the gaming license renewal as incurred.
We assessed the fair value of our gaming license using the Greenfield Method under the income approach. The Greenfield Method estimates the fair value of the gaming license assuming we built a casino with similar utility to that of the existing facility. The method assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. As such the value of the license is a function of the following items:
Projected revenues and operating cash flows;
Theoretical construction costs and duration;
Pre-opening expenses;

Discounting that reflects the level of risk associated with receiving future cash flows attributable to the license; and
Remaining useful life of the license.
The evaluation of goodwill and indefinite-lived intangible assets requires the use of estimates about future operating results to determine the estimated fair value of the reporting unit and the indefinite-lived intangible assets. We must make various assumptions and estimates in performing our impairment testing. The implied fair value includes estimates of future cash flows that are based on reasonable and supportable assumptions which represent our best estimates of the cash flows expected to result from the use of the assets. Changes in estimates, increases in our cost of capital, reductions in transaction multiples, changes in operating and capital expenditure assumptions or application of alternative assumptions and definitions could produce significantly different results. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from our estimates. If our ongoing estimates of future cash flows are not met, we may have to record additional impairment charges in future accounting periods. Our estimates of cash flows are based on the current regulatory and economic climates, as well as recent operating information and budgets. These estimates could be negatively impacted by changes in federal, state or local regulations, economic downturns, or other events.
Forecasted cash flows can be significantly impacted by the local economy in which our subsidiaries operate. For example, increases in unemployment rates can result in decreased customer visitations and/or lower customer spend per visit. In addition, new legislation which approves gaming in nearby jurisdictions or further expands gaming in jurisdictions in which we operate can result in increased competition for the property. This generally has a negative effect on profitability once competitors become established, as a certain level of cannibalization occurs absent an overall increase in customer visitations. Lastly, increases in gaming taxes approved by state regulatory bodies can negatively impact forecasted cash flows.
Assumptions and estimates about future cash flow levels are complex and subjective. They are sensitive to changes in underlying assumptions and can be affected by a variety of factors, including external factors, such as industry, geopolitical and economic trends, and internal factors, such as changes in our business strategy, which may reallocate capital and resources to different or new opportunities which management believes will enhance our overall value but may be to the detriment of our existing operations. A change in any of our assumptions or estimates could result in additional impairment charges in future periods.
Results of Operations
 
The following are the most important factors and trends that contribute or may contribute to our operating performance:


•The fact that several wholly-owned subsidiaries of Penn lease a substantial number of our properties, pursuant to two master leases and atwo single property leaseleases and account for a significant portion of our revenue.


•The risks related to economic conditions, including uncertainty related to COVID-19 and the effect of such conditions on consumer spending for leisure and gaming activities, which may negatively impact our gaming tenants and operators and the variable rent and annual rent escalators we receive from our tenants as outlined in the long-term triple-net leases with these tenants.

•The ability to refinance our significant levels of debt at attractive terms and obtain favorable funding in connection with future business opportunities.
 
•The fact that the rules and regulations of U.S. federal income taxation are constantly under review by legislators, the IRS and the U.S. Department of the Treasury. Changes to the tax laws or interpretations thereof, with or without retroactive application, could materially and adversely affect GLPI's investors or GLPI.





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The consolidated results of operations for the years ended December 31, 2018, 20172020 and 20162019 are summarized below:


Year Ended December 31,
20202019
 (in thousands)
Total revenues$1,153,165 $1,153,473 
Total operating expenses343,891 436,050 
Income from operations809,274 717,423 
Total other expenses(299,686)(321,778)
Income before income taxes509,588 395,645 
Income tax expense3,877 4,764 
Net income$505,711 $390,881 
Year Ended December 31,2018 2017 2016
 (in thousands)
Revenues 
  
  
Rental income$747,654
 $671,190
 $567,444
Income from direct financing lease81,119
 74,333
 48,917
Interest income from mortgaged real estate6,943
 —
 —
Real estate taxes paid by tenants87,466
 83,698
 67,843
Total income from real estate923,182
 829,221
 684,204
Gaming, food, beverage and other132,545
 142,086
 144,051
Total revenues1,055,727
 971,307
 828,255
Operating expenses 
  
  
Gaming, food, beverage and other77,127
 80,487
 82,463
Real estate taxes88,757
 84,666
 69,448
Land rights and ground lease expense28,358
 24,005
 14,799
General and administrative71,128
 63,151
 71,368
Depreciation137,093
 113,480
 109,554
  Goodwill impairment charges59,454
 —
 —
Total operating expenses461,917
 365,789
 347,632
Income from operations$593,810
 $605,518
 $480,623


In accordance with the SEC's recent amendments to modernize and simplify Regulation S-K, the Company has omitted the discussion comparing its operating results for the year ended December 31, 2019 to its operating results for the year ended December 31, 2018 from its Annual Report on Form 10-K for the year ended December 31, 2020. Readers are directed to Item 7 of the Company's Annual Report on Form 10-K for the year ended December 31, 2019 for these disclosures.

Certain information regarding our results of operations by segment for the years ended December 31, 2018, 20172020 and 20162019 is summarized below:
 Total RevenuesIncome (Loss) from Operations
Year Ended December 31,Year Ended December 31,
2020201920202019
 (in thousands)
GLP Capital$1,050,166 $1,025,082 $792,467 $694,215 
TRS Segment102,999 128,391 16,807 23,208 
Total$1,153,165 $1,153,473 $809,274 $717,423 


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 Total Revenues Income from Operations
Year Ended December 31,2018 2017 2016 2018 2017 2016
 (in thousands)
GLP Capital$923,182
 $829,221
 $684,204
 $630,122
 $578,661
 $454,682
TRS Properties132,545
 142,086
 144,051
 (36,312) 26,857
 25,941
Total$1,055,727
 $971,307
 $828,255
 $593,810
 $605,518
 $480,623
Table of Contents

FFO, AFFO and Adjusted EBITDA
 
Funds From Operations ("FFO"), Adjusted Funds From Operations ("AFFO") and Adjusted EBITDA are non-GAAP financial measures used by the Company as performance measures for benchmarking against the Company’s peers and as internal measures of business operating performance, which is used as a bonus metric. The Company believes FFO, AFFO and Adjusted EBITDA provide a meaningful perspective of the underlying operating performance of the Company’s current business. This is especially true since these measures exclude real estate depreciation and we believe that real estate values fluctuate based on market conditions rather than depreciating in value ratably on a straight-line basis over time. In addition, in order for the Company to qualify as a REIT, it must distribute 90% of its REIT taxable income annually. The Company adjusts AFFO accordingly to provide our investors an estimate of the taxable income available for this distribution requirement.


FFO, is aAFFO and Adjusted EBITDA are non-GAAP financial measuremeasures that isare considered a supplemental measuremeasures for the real estate industry and a supplement to GAAP measures. The National Association of Real Estate Investment Trusts defines FFO as net income (computed in accordance with GAAP), excluding (gains) or losses from sales of property and real estate depreciation. We define AFFO as FFO excluding stock based compensation expense, the amortization of debt issuance costs, amortization,bond premiums and original issuance discounts, other depreciation, amortization of land rights, straight-line rent adjustments, direct financing lease adjustments, losses on debt extinguishment, retirement costs and goodwillloan impairment charges, reduced by maintenance capital expenditures. Finally, we define Adjusted EBITDA as net income excluding interest, taxes on income, depreciation, (gains) or losses from sales of property, stock based compensation expense, straight-line rent adjustments, direct financing lease adjustments, theamortization of debt issuance costs, bond premiums and original issuance discounts, amortization of land rights, losses on debt extinguishment, retirement costs and goodwillloan impairment charges.
 
FFO, AFFO and Adjusted EBITDA are not recognized terms under GAAP. Because certain companies do not calculate FFO, AFFO and Adjusted EBITDA in the same way and certain other companies may not perform such calculation, those

measures as used by other companies may not be consistent with the way the Company calculates such measures and should not be considered as alternative measures of operating profit or net income. The Company’s presentation of these measures does not replace the presentation of the Company’s financial results in accordance with GAAP.

These non-GAAP financial measures: (i) do not represent cash flowflows from operations as defined by GAAP; (ii) should not be considered as an alternative to net income as a measure of operating performance or to cash flows from operating, investing and financing activities; and (iii) are not alternatives to cash flowflows as a measure of liquidity. In addition, these measures should not be viewed as an indication of our ability to fund all of our cash needs, including to make cash distributions to our shareholders, to fund capital improvements, or to make interest payments on our indebtedness. Investors are also cautioned that FFO, AFFO and Adjusted EBITDA, as presented, may not be comparable to similarly titled measures reported by other real estate companies, including REITs due to the fact that not all real estate companies use the same definitions. Our presentation of these measures does not replace the presentation of our financial results in accordance with GAAP.


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The reconciliation of the Company’s net income per GAAP to FFO, AFFO, and Adjusted EBITDA for the years ended December 31, 2018, 20172020 and 20162019 is as follows:
 
Year Ended December 31,
20202019
(in thousands)
Net income$505,711 $390,881 
(Gains) losses from dispositions of property(41,393)92 
Real estate depreciation220,069 230,716 
Funds from operations$684,387 $621,689 
Straight-line rent adjustments4,576 34,574 
Other depreciation10,904 9,719 
Amortization of land rights12,022 18,536 
Amortization of debt issuance costs, bond premiums and original issuance discounts (1)
10,503 11,455 
Stock based compensation20,004 16,198 
Losses on debt extinguishment18,113 21,014 
Loan impairment charges— 13,000 
Capital maintenance expenditures(3,130)(3,017)
Adjusted funds from operations$757,379 $743,168 
Interest, net281,573 300,764 
Income tax expense3,877 4,764 
Capital maintenance expenditures3,130 3,017 
Amortization of debt issuance costs, bond premiums and original issuance discounts (1)
(10,503)(11,455)
Adjusted EBITDA$1,035,456 $1,040,258 
Year Ended December 31,2018 2017 2016
 (in thousands)
Net income$339,516
 $380,598
 $289,305
Losses (gains) from dispositions of property309
 530
 (455)
Real estate depreciation125,630
 100,576
 96,074
Funds from operations$465,455
 $481,704
 $384,924
Straight-line rent adjustments61,888
 65,971
 58,673
Direct financing lease adjustments38,459
 73,072
 48,533
Other depreciation11,463
 12,904
 13,480
Amortization of land rights11,272
 10,355
 6,163
Amortization of debt issuance costs (1)
12,167
 13,026
 15,146
Stock based compensation11,152
 15,636
 18,312
Losses on debt extinguishment3,473
 —
 —
Retirement costs13,149
 —
 —
Goodwill impairment charges59,454
 —
 —
Capital maintenance expenditures(4,284) (3,178) (3,111)
Adjusted funds from operations$683,648
 $669,490
 $542,120
Interest, net245,857
 215,133
 183,773
Income tax expense4,964
 9,787
 7,545
Capital maintenance expenditures4,284
 3,178
 3,111
Amortization of debt issuance costs (1)
(12,167) (13,026) (15,146)
Adjusted EBITDA$926,586
 $884,562
 $721,403


(1) Such amortization is a non-cash component included in interest, net.





























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The reconciliation of each segment’s net income per GAAP to FFO, AFFO, and Adjusted EBITDA for the years ended December 31, 2018, 20172020 and 20162019 is as follows: 
  GLP Capital  TRS Properties
Year Ended December 31, 2018 2017 2016 2018 2017 2016
  (in thousands)
Net income $390,341
 $372,832
 $280,295
 $(50,825) $7,766
 $9,010
Losses (gains) from dispositions of property 76
 —
 (471) 233
 530
 16
Real estate depreciation 125,630
 100,576
 96,074
 —
 —
 —
Funds from operations $516,047
 $473,408
 $375,898
 $(50,592) $8,296
 $9,026
Straight-line rent adjustments 61,888
 65,971
 58,673
 —
 —
 —
Direct financing lease adjustments 38,459
 73,072
 48,533
 —
 —
 —
Other depreciation 2,066
 2,076
 2,097
 9,397
 10,828
 11,383
Amortization of land rights 11,272
 10,355
 6,163
 —
 —
 —
Debt issuance costs amortization (1)
 12,167
 13,026
 15,146
 —
 —
 —
Stock based compensation 11,152
 15,636
 18,312
 —
 —
 —
Losses on debt extinguishment 3,473
 —
 —
 —
 —
 —
Retirement costs 13,149
 —
 —
 —
 —
 —
Goodwill impairment charges —
 —
 —
 59,454
 —
 —
Capital maintenance expenditures (55) —
 —
 (4,229) (3,178) (3,111)
Adjusted funds from operations $669,618
 $653,544
 $524,822
 $14,030
 $15,946
 $17,298
Interest, net (2)
 235,453
 204,730
 173,371
 10,404
 10,403
 10,402
Income tax expense 855
 1,099
 1,016
 4,109
 8,688
 6,529
Capital maintenance expenditures 55
 —
 —
 4,229
 3,178
 3,111
Debt issuance costs amortization (1)
 (12,167) (13,026) (15,146) —
 —
 —
Adjusted EBITDA $893,814
 $846,347
 $684,063
 $32,772
 $38,215
 $37,340
 GLP Capital TRS Segment
Year Ended December 31,Year Ended December 31,
2020201920202019
 (in thousands)
Net income (loss)$508,060 $382,184 $(2,349)$8,697 
(Gains) losses from dispositions of property(41,402)8 9 84 
Real estate depreciation220,069 230,716 — — 
Funds from operations$686,727 $612,908 $(2,340)$8,781 
Straight-line rent adjustments4,576 34,574 — — 
Other depreciation1,972 1,992 8,932 7,727 
Amortization of land rights12,022 18,536 — — 
Amortization of debt issuance costs, bond premiums and original issuance discounts (1)
10,503 11,455 — — 
Stock based compensation20,004 16,198 — — 
Losses on debt extinguishment18,113 21,014 — — 
Loan impairment charges— 13,000 — — 
Capital maintenance expenditures(186)(22)(2,944)(2,995)
Adjusted funds from operations$753,731 $729,655 $3,648 $13,513 
Interest, net (2)
265,597 290,360 15,976 10,404 
Income tax expense697 657 3,180 4,107 
Capital maintenance expenditures186 22 2,944 2,995 
Amortization of debt issuance costs, bond premiums and original issuance discounts (1)
(10,503)(11,455)— — 
Adjusted EBITDA$1,009,708 $1,009,239 $25,748 $31,019 


(1) Such amortization is a non-cash component included in interest, net.


(2)
(2)    Interest expense, net for the GLP Capital segment is net of an intercompany interest elimination of $16.0 million and $10.4 million for the years ended December 31, 2020 and 2019.
Interest expense, net for the GLP Capital segment is net of an intercompany interest elimination of $10.4 million for the years ended December 31, 2018, 2017 and 2016.
 
2018 Compared with 2017

Net income, FFO, AFFO, and Adjusted EBITDA for our GLP Capital segment were $390.3$508.1 million, $516.0$686.7 million, $669.6$753.7 million and $893.8$1,009.7 million, respectively, for the year ended December 31, 2018.2020. This compared to net income, FFO, AFFO, and Adjusted EBITDA, for our GLP Capital segment of $372.8$382.2 million, $473.4$612.9 million, $653.5$729.7 million and $846.3$1,009.2 million, respectively, for the year ended December 31, 2017.2019. The increase in net income in our GLP Capital segment was primarily driven by a $94.0$73.2 million decrease in operating expenses from a gain on the disposition of property related to the Evansville swap transaction of $41.4 million in 2020, lower land right and ground lease expense due to the acceleration of these items for the Penn closure of its Resorts Casino Tunica property in 2019 and a $13.0 million loan impairment charge related to the Casino Queen Loan in 2019. The Company also had a $27.7 million decrease in other expenses, resulting from lower interest expense due to refinancing activities and lower debt extinguishment charges, along with a $25.1 million increase in income from real estate, partially offset by a $42.5 million increase in operating expenses and a $34.2 million increase in other expenses, net. estate.

The increase in income from real estate in our GLP Capital segment was primarily due to the Tropicana Transactions, the Penn-Pinnacle Merger and our entry into the Belterra Park Loan, as well as the performance of the Ohio properties, the impact of the rent escalators under the Penn and Pinnacle master leases, net percentagefavorable non-cash straight-line rent adjustments of $30.0 million on our Amended Pinnacle Master Lease, Boyd Master Lease and the partial recognition of income previously deferred under the PennAmended and Restated Caesars Master Lease in accordance with ASC 840. 842. We also experienced higher building base rents as the majority of our leases incurred escalators in 2019. This was partially offset by lower percentage rent resets that occurred on May 1, 2020 for the Amended Pinnacle Master Lease of $3.3 million and the Boyd Master Lease of $0.9 million due primarily to the impact of the casino closures from COVID-19, lower percentage rent of $4.0 million on the Penn Master Lease due to the temporary closure of Hollywood Casino Columbus and to a lesser extent, Hollywood Casino Toledo from mid-March 2020 to June 19, 2020 due to COVID-19, and lower percentage rent on the Meadows Lease as the variable rent reset occurred in October 2020 which decreased percentage rent by $0.5 million.

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The increasedecrease in operating expenses in our GLP Capital segment was driven by an increase in depreciation expense resulting from the addition of the Tropicana and Plainridge Park real estate assets to our real estate portfolio, as well as the reclassification of the Pinnacle building assets to real estate investments on our balance sheet as a result of the Penn-Pinnacle Merger, which required the Amended Pinnacle Master Lease to be treated as an operating lease in its entirety. Also driving the increase in total operating expenses for the year ended December 31, 2018,2020 as compared to the prior year are accrued retirement costsperiod was primarily from a gain on the disposition of property related to the retirementEvansville swap transaction of $41.4 million along with lower depreciation expense and land right amortization expense in our former Chief Financial Officer. The increase in other expenses, net was driven by an increase in interestREIT segment of $24.1 million primarily from lower rent expense relatedon the Company's long term ground leases due to the debt refinancing in the second quarterimpact of 2018 and debt issuances in the third quarter of 2018, the proceeds of which were utilized for the October closings of both the Tropicana TransactionsCOVID-19 and the acquisitionacceleration of Plainridge Parkdepreciation and amortization in 2019 resulting from the fundingclosing of the Belterra Park Loan in connection with the Penn-Pinnacle Merger. In addition, the Company incurred losses on the extinguishmentPenn's Resorts Casino Tunica property. Additionally, there was a loan impairment charge of debt during the second quarter of 2018.

The changes described above also led to higher FFO$13.0 million for the year ended December 31, 2018, as compared2019 related to the Casino Queen Loan. These items were partially offset by charges of $6.3 million associated with severance and stock based compensation acceleration charges for the departure of our former chief financial officer.

The decrease in other expenses, net for the year ended December 31, 2017. 2020 compared to the prior year was driven by lower interest expense from our refinancing activities that occurred in the third quarter of 2019 and first quarter of 2020 and lower debt extinguishment charges compared to the prior year.

The increase in AFFOFFO for our GLP Capital segment was primarily driven by the changes described above, partially offset by lower stock based compensation, direct financing lease adjustments and straight-line rent adjustments, all of which are added back for purposes of calculating AFFO. Direct financing lease adjustments represent the portion of cash rent we received from tenants that was applied against our lease receivable and thus not recorded as revenue. These adjustments decreased due to the unwinding of the direct financing lease in October 2018, as the cash received is now recorded as rental income and no add-back to AFFO is necessary. The increase in Adjusted EBITDA for our GLP Capital segment was primarily driven by the increases in AFFO described above, as well as, a higher add-back for interest.

The net loss of $50.8 million for our TRS Properties segment for the year ended December 31, 2018, as compared2020 is due to net incomethe items described above, excluding gains from the disposition of $7.8 million forproperty and real estate depreciation. The increase in AFFO is due to the ended December 31, 2017 was primarily driven by a goodwillitems described above, excluding the impact of straight-line rent adjustments, loan impairment charge of $59.5 million at our Hollywood Casino Baton Rouge property. This charge was the result of general market deterioration in the Baton Rouge regioncharges and the smoking ban at all Baton Rouge, Louisiana casinos that went into effect duringother items listed on the second quarterprevious table.

The net loss of 2018, both of which significantly impacted the Company's forecasted cash flows for this reporting unit. This charge also led to lower FFO$2.3 million for our TRS Properties segmentSegment for the year ended December 31, 2018,2020 as compared to the year ended December 31, 2017.

2017 Compared with 2016

Netnet income FFO, AFFO, and Adjusted EBITDA for our GLP Capital segment were $372.8of $8.7 million $473.4 million, $653.5 million and $846.3 million, respectively, for the prior year ended December 31, 2017. This compared to net income, FFO, AFFO, and Adjusted EBITDA, for our GLP Capital segment of $280.3 million, $375.9 million, $524.8 million and $684.1 million, respectively, for the year ended December 31, 2016. The significant increase in net income in our GLP Capital segment was primarily driven by a $145.0 million increase in total revenues, partially offset by a $21.0 million increase in operating expenses and a $31.4 million increase in interest, net. The increase in total revenues in our GLP Capital segment was primarily due to the Pinnacle transaction, which increased rental income, income from the direct financing lease and revenue recorded for real estate taxes paid by our tenants and the Tunica and Meadows transactions, which increased both rental income and revenue recorded for real estate taxes paid by our tenants. The increase in operating expenses in our GLP Capital segment was driven by increases in real estate taxes, primarily as a result of the addition of the Pinnacle and Meadows properties to our real estate portfolio during 2016 and land right and ground rent lease expense,is primarily related to the land rights acquiredimpact of the mandated closures of our facilities during mid-March 2020 to May and June 2020 due to COVID-19 along with the Pinnacle and Tunica transactions, partially offset by a decline in general and administrative expenses. Thean increase in interest, net was driven by higher interestdepreciation expense related to the Company's additional borrowings incurred to finance the Pinnacle acquisition. The changes described above also led to higher FFO for the year ended December 31, 2017, as compared to the year ended December 31, 2016. The increase in AFFO for our GLP Capital segment was primarily driven by the changes described above, as well as, increases in adjustments for our direct financing lease, increased amortizationacquisition of land rights related to the acquired ground leases, increased straight-line rent adjustments related to our Meadows Lease and the addition of the Tunica Properties to the Penn Master Lease, partially offset by lower debt issuance costs amortization and stock based compensation, all of which are added back for purposes of calculating AFFO. Direct financing lease adjustments represent the portion of cash rent we receive from tenants that is applied against our lease receivable and thus not recorded as revenue and the amortization of land rights represents the non-cash amortization of the value assigned to the Company's acquired ground leases. These adjustments are added back to arrive at AFFO because they represent, in the case of the direct financing lease adjustments, cash we have received and recorded in taxable income and in the case of the amortization of land rights, non-cash charges which are non-deductible for tax purposes. Therefore, these adjustments help our investors better understand the components of our taxable income which must be distributed to our shareholders. The increase in Adjusted EBITDA for our GLP Capital segment was primarily driven by the increases in AFFO described above, as well as, a higher add-back for interest.Tropicana Las Vegas.

Net income and FFO for our TRS Properties segment decreased by $1.2 million and $0.7 million, respectively, for the year ended December 31, 2017, as compared to the year ended December 31, 2016, primarily due to declining revenues partially offset by decreased expenses.  AFFO for our TRS Properties segment decreased by $1.4 million for the year ended December 31, 2017, as compared to the year ended December 31, 2016, primarily due the reasons described above, as well as, lower depreciation expense due to certain assets reaching full depreciation.  Adjusted EBITDA for our TRS Properties segment increased by $0.9 million for the year ended December 31, 2017, as compared to the year ended December 31, 2016, primarily due to the explanations described above, in addition to higher income taxes in the year ended December 31, 2017.








Revenues

 
Revenues for the years ended December 31, 2018, 20172020 and 20162019 were as follows (in thousands):
 
 Year Ended December 31, Percentage
20202019VarianceVariance
Rental income$1,031,036 $996,166 $34,870 3.5 %
Interest income from real estate loans19,130 28,916 (9,786)(33.8)%
Total income from real estate1,050,166 1,025,082 25,084 2.4 %
Gaming, food, beverage and other102,999 128,391 (25,392)(19.8)%
Total revenues$1,153,165 $1,153,473 $(308)— %
        Percentage
Year Ended December 31, 2018 2017 Variance Variance
Total income from real estate $923,182
 $829,221
 $93,961
 11.3 %
Gaming, food, beverage and other 132,545
 142,086
 (9,541) (6.7)%
Total revenues 1,055,727
 971,307
 84,420
 8.7 %
        Percentage
Year Ended December 31, 2017 2016 Variance Variance
Total income from real estate $829,221
 $684,204
 $145,017
 21.2 %
Gaming, food, beverage and other 142,086
 144,051
 (1,965) (1.4)%
Total revenues 971,307
 828,255
 143,052
 17.3 %
Total income from real estate

2018 Compared to 2017


For the years ended December 31, 20182020 and 2017,2019, total income from real estate was $923.2$1,050.2 million and $829.2$1,025.1 million, respectively, for our GLP Capital segment, which included $87.5 million and $83.7 million, respectively, of revenue for the real estate taxes paid by our tenants on the leased properties. During October 2018, we acquired the real estate assets of five casino properties from Tropicana and leased these assets to Eldorado under a new long-term triple-net master lease. We also acquired Plainridge Park from Penn and leased it to Penn under the Amended Pinnacle Master Lease.

segment. In accordance with ASC 606, the Company is required to present the real estate taxes paid by its tenants on the leased properties as revenue with an offsetting expense on its consolidated statement of operations, as the Company believes it is the primary obligor. Similarly,842, the Company records revenue for the ground lease rent paid by its tenants with an offsetting expense in land rights and ground lease expense within the consolidated statementsstatement of income as the Company has concluded that as the lessee it is the primary obligor under the ground leases. The Company subleases these ground leases back to its tenants, who are responsible for payment directly to the landlord.


Total income from real estate increased $94.0$25.1 million, or 11.3%2.4%, for the year ended December 31, 2018,2020, as compared to the year ended December 31, 2017,2019. As previously discussed, this was primarily due to the Tropicana Transactions, the Penn-Pinnacle Merger and our entry into the Belterra Park Loan, as well as the performance of the Ohio properties, the impact of the rent escalators under the Penn and Pinnacle master leases, net percentagefavorable non-cash straight line rent adjustments on our Amended Pinnacle Master Lease, Boyd Master Lease and the partial recognition of income previously deferred under the PennAmended and Restated Caesars Master Lease in accordance with ASC 840. Specifically,842. Additionally the properties undercurrent year was positively impacted by higher building base rents as the majority of our leases incurred escalators in 2019. This was partially offset by lower ground lease rents due to the impact of COVID-19, lower percentage rent from the Amended Pinnacle Master Lease and Boyd Master Lease which reset on May 1, 2020 and the Meadows Lease which reset on October 1, 2020. Finally, the year ended December 31, 2020 was negatively impacted by lower percentage rent on the Penn Master Lease contributed $18.2 milliondue to the increaseclosures of Hollywood Casino Columbus and to a lesser extent, Hollywood Casino Toledo.

The reason for the decline in interest income from real estate loans was due to the CZR loan and Belterra Park Loan both being satisfied in 2020 as the Company acquired the real estate subject to the Lumière Place Lease and the Belterra Park Lease. See Note 8 in the Notes to the Consolidated Financial Statements for further details.

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Details of the Company's income from real estate for the year ended December 31, 2018,2020 was as compared to the year ended December 31, 2017, resulting from the collectionfollows (in thousands):

Year Ended December 31, 2020Penn Master LeaseAmended Pinnacle Master LeaseCaesars Master LeaseLumiere LeaseBoyd Master LeaseBelterra LeasePENN - Meadows LeaseCasino Queen LeasePENN Morgantown LeaseTotal
Building base rent$279,406 $227,201 $62,156 $5,828 $75,643 $1,783 $15,811 $9,101 $— $676,929 
Land base rent93,969 71,256 15,916 — 11,785 1,263 — — 750 194,939 
Percentage rent82,595 28,452 10,020 — 10,308 1,211 10,637 5,424 — 148,647 
Total cash rental income (1)$455,970 $326,909 $88,092 $5,828 $97,736 $4,257 $26,448 $14,525 $750 $1,020,515 
Straight-line rent adjustments8,926 (10,555)(2,980)— (1,448)(808)2,289 — — (4,576)
Ground rent in revenue2,317 5,770 5,299 — 1,519 — — — 14,905 
Other rental revenue— — — — — — 192 — — 192 
Total rental income$467,213 $322,124 $90,411 $5,828 $97,807 $3,449 $28,929 $14,525 $750 $1,031,036 
Interest income from mortgaged real estate— — — 16,976 — 2,154 — — — 19,130 
Total income from real estate$467,213 $322,124 $90,411 $22,804 $97,807 $5,603 $28,929 $14,525 $750 $1,050,166 

(1) Included in cash rental income were rent credits of a full year of rent from the Tunica Properties, the impact of the rent escalators, the performance at the Ohio properties and the partial recognition of income previously deferred in accordance with ASC 840, while the Meadows Lease contributed $3.1$337.5 million to the increase in income from real estate for the year ended December 31, 2018, as compared to the prior year. The properties under the Amended Pinnacle Master Lease and the Boyd Master Lease contributed an aggregate $40.9 million to the increase in income from real estate for the year ended December 31, 2018, as compared to the year ended December 31, 2017, primarily resulting from the impact of the rent escalators and the unwinding of the direct financing leasethat were recognized in connection with the Penn-Pinnacle Merger, resultingTropicana Las Vegas and Morgantown transactions with Penn. See Note 7 in all rent received under the Amended Pinnacle Master Lease recorded as rental income on the Company's consolidated statement of income. The Tropicana Transactions contributed $26.6 millionNotes to the increase in income from real estate, while the Belterra Park Loan contributed income of $1.4 million. Lastly, real estate taxes contributed $3.8 million to the increase in income from real estateConsolidated Financial Statements for the year ended December 31, 2018, as compared to the prior year period, primarily due to the addition of the new properties to our real estate portfolio.additional information.





2017 Compared to 2016

For the years ended December 31, 2017 and 2016, total income from real estate was $829.2 million and $684.2 million, respectively, for our GLP Capital segment, which included $83.7 million and $67.8 million, respectively, of revenue for the real estate taxes paid by our tenants on the leased properties. During April 2016, we acquired the real estate assets of Pinnacle and immediately leased these assets back to Pinnacle under a long-term triple-net master lease. Under ASC 840, the Pinnacle lease was bifurcated between an operating and direct financing lease, resulting in the recognition of rental revenue for the land portion of the lease and interest income from the direct financing lease, relating to the leased building assets. Additionally, during September 2016, we acquired the real estate assets of the Meadows and leased these assets to Pinnacle under a single property triple-net lease and during May 2017, we acquired the real estate assets of the Tunica Properties and leased these assets to Penn under the Penn Master Lease.

Total income from real estate increased $145.0 million or 21.2% for the year ended December 31, 2017, as compared to the year ended December 31, 2016, primarily due to a full year of rent for the portion of the rent received under the Pinnacle Master Lease recognized as rental income and as income from the direct financing lease, a full year of rent received under the Meadows Lease and from the addition of the Tunica Properties to the Penn Master Lease, as well as the impact of the Penn and Pinnacle rent escalators, improved results at our two Ohio properties with monthly variable rent and an increase in real estate taxes, primarily resulting from the addition of the Pinnacle properties to our real estate portfolio. Specifically, Pinnacle contributed $103.1 million of rental revenue and income from the direct financing lease to the increase in net revenues for the year ended December 31, 2017, as compared to the year ended December 31, 2016. The Penn properties contributed $14.5 million to the increase in net revenues for the year ended December 31, 2017, as compared to the year ended December 31, 2016, resulting from the addition of the Tunica Properties, the impact of the rent escalator and the performance at the Ohio properties, while the Meadows Lease contributed $11.4 million to the increase in net revenues for the year ended December 31, 2017, as compared to the prior year. Lastly, real estate taxes contributed $15.8 million to the increase in net revenues for the year ended December 31, 2017, as compared to the prior year period.


Gaming, food, beverage and other revenue

2018 Compared to 2017

Gaming, food, beverage and other revenue for our TRS Properties segment decreased by $9.5$25.4 million, or 6.7%19.8%, for the year ended December 31, 2018,2020, as compared to the year ended December 31, 2017,2019. These properties were closed in mid-March 2020 due to decreased gaming, food, beverage and other revenues of $10.1 million atCOVID-19. Hollywood Casino Baton Rouge partially offset by a $0.6 million increase in revenues at Hollywood Casino Perryville. The largest driver of the decrease resulted from general market deterioration in the Baton Rouge region and the smoking ban at all Baton Rouge, Louisiana casinos that went into effect during the second quarter of 2018.

2017 Compared to 2016

Gaming, food, beverage and other revenue for our TRS Properties segment decreased by $2.8 million, or 1.9%, for the year ended December 31, 2017, as comparedreopened to the year ended December 31, 2016, due to decreased gaming, food, beveragepublic on May 18, 2020 and other revenues of $2.5 million and $0.3 million at Hollywood Casino Perryville and Hollywood Baton Rouge, respectively. The largest driver ofreopened on June 19, 2020 with various restrictions to limit capacity in accordance with regulatory requirements. Results since reopening have exceeded the decrease resulted fromcorresponding periods in the prior years as spend per visit has increased which has more than offset lower revenues at Hollywood Casino Perryville, related to the outsourcing of its food and beverage outlets to a third-party provider during the first quarter of 2017.visitation levels.


Operating Expenses
 
Operating expenses for the years ended December 31, 2018, 20172020 and 20162019 were as follows (in thousands):
        Percentage
Year Ended December 31, 2018 2017 Variance Variance
Gaming, food, beverage and other $77,127
 $80,487
 $(3,360) (4.2)%
Real estate taxes 88,757
 84,666
 4,091
 4.8 %
Land rights and ground lease expense 28,358
 24,005
 4,353
 18.1 %
General and administrative 71,128
 63,151
 7,977
 12.6 %
Depreciation 137,093
 113,480
 23,613
 20.8 %
Goodwill impairment charges 59,454
 —
 59,454
 N/A
Total operating expenses $461,917
 $365,789
 $96,128
 26.3 %

Year Ended December 31, Percentage
       Percentage20202019VarianceVariance
Year Ended December 31, 2017 2016 Variance Variance
Gaming, food, beverage and other $80,487
 $82,463
 $(1,976) (2.4)%Gaming, food, beverage and other$56,698 $74,700 $(18,002)(24.1)%
Real estate taxes 84,666
 69,448
 15,218
 21.9 %
Land rights and ground lease expense 24,005
 14,799
 9,206
 62.2 %Land rights and ground lease expense29,041 42,438 (13,397)(31.6)%
General and administrative 63,151
 71,368
 (8,217) (11.5)%General and administrative68,572 65,385 3,187 4.9 %
Gains (losses) from disposition of propertiesGains (losses) from disposition of properties(41,393)92 (41,485)(45,092.4)%
Depreciation 113,480
 109,554
 3,926
 3.6 %Depreciation230,973 240,435 (9,462)(3.9)%
Loan impairment chargesLoan impairment charges— 13,000 (13,000)N/A
Total operating expenses $365,789
 $347,632
 $18,157
 5.2 %Total operating expenses$343,891 $436,050 $(92,159)(21.1)%
Gaming, food, beverage and other expense
 
2018 Compared with 2017

Gaming, food, beverage and other expense for our TRS Properties segment decreased by approximately $3.4$18.0 million, or 4.2%24.1%, for the year ended December 31, 2018,2020, as compared to the year ended December 31, 2017, primarily resulting from lower gaming taxes due to lower revenues at Hollywood Baton Rouge.

2017 Compared with 2016

Gaming, food, beverage and other expense for our TRS Properties segment decreased by approximately $2.0 million, or 2.4%, for the year ended December 31, 2017, as compared to the year ended December 31, 2016, primarily due to lower expenses resulting from the outsourcing of the operations of the food and beverage outlets at Hollywood Casino Perryville during the first quarter of 2017 and lower gaming taxes, resulting from lower revenues at both TRS Properties.

Real estate taxes

2018 Compared with 2017
Real estate taxes increased by $4.1 million, or 4.8%, for the year ended December 31, 2018, as compared to the year ended December 31, 2017,2019, primarily due to the acquisitionimpact of the Tropicana properties and Plainridge Park during the year ended December 31, 2018. Although this amount is paid byCOVID-19, which temporarily forced our tenants, we are requiredTRS Properties to present this amount in both revenues and expense for financial reporting purposes under ASC 606.close as previously discussed.
2017 Compared with 2016
Real estate taxes increased by $15.2 million, or 21.9%, for the year ended December 31, 2017, as compared to the year ended December 31, 2016, primarily due to a full year of the real estate tax expense attributable to the acquired Pinnacle and Meadows properties.


Land rights and ground lease expense

2018 Compared with 2017

Land rights and ground lease expense includes the amortization of land rights and rent expense related to the Company's long-term ground leases. Land rights and ground lease expense increaseddecreased by $4.4$13.4 million, or 18.1%31.6%, for the year
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ended December 31, 2018,2020, as compared to the year ended December 31, 2017,2019, primarily due to the acquisitionacceleration of rights to six long-term ground leases in connection with the Tropicana Acquisition. In connection with this acquisition, we acquired land rights to long-term leases which are recorded on our consolidated balance sheet as land right assets and amortized over the termamortization expense of the leases, including renewal options. We also record rent expense$6.3 million related to thesethe closure of Penn's Resorts Casino Tunica property in 2019 and lower ground leases with offsetting revenue recorded withinlease rents paid by our tenants in 2020 that are based on the consolidated statementsfacilities' revenues which declined due to the impact of income as we have concluded that as the lessee we are the primary obligor under the ground leases.COVID-19. We sublease these ground leases back to our tenants, who are responsible for payment directly to the applicable landlord. These amounts are required to be recorded in both revenue and expense within the consolidated statements of income as we have concluded that as the lessee the Company is the primary obligor under the ground leases.
2017 Compared with 2016

Land rights and ground lease expense increased by $9.2 million, or 62.2%, for the year ended December 31, 2017, as compared to the year ended December 31, 2016, primarily due to a full year of amortization of the land rights associated with

the Pinnacle acquisition, as well as a full year of ground rent related to these leases and the acquisition of the Tunica Properties in May of 2017.

General and administrative expense
 
General and administrative expenses include items such as compensation costs (including stock-based compensation awards), professional services and costs associated with development activities.

2018 Compared with 2017
General and administrative expenses increased by $8.0$3.2 million, or 12.6%4.9%, for the year ended December 31, 2018,2020, as compared to the year ended December 31, 2017, led2019. This is primarily by expenses forattributable to the retirementnegative impact from severance and stock acceleration charges of $6.3 million, related to the Chief Financial Officer,departure of our former chief financial officer which were partially offset by lower stock-based compensation chargespayroll costs primarily attributable to the temporary closures of our TRS Properties due to COVID-19 and lower bonus expense.

Gains and losses from dispositions of property

In connection with the Exchange Agreement with Caesars, whereby the Company acquired Waterloo and Bettendorf to replace Tropicana Evansville under the Amended and Restated Caesars Master Lease, the Company recorded a non-cash gain of $41.4 million in the current year.fourth quarter of 2020 which represented the difference between the fair value of the properties received compared to the carrying value of Tropicana Evansville and the cash payment of $5.7 million.


2017 Compared with 2016Depreciation expense


General and administrative expensesDepreciation expense decreased by $8.2$9.5 million, or 11.5%3.9%, to $231.0 million for the year ended December 31, 2017,2020 as compared to the year ended December 31, 2016, led by lower stock-based compensation charges2019, primarily due to the closure of the Resorts Casino Tunica property in 2019 which resulted in the current year.acceleration of $10.3 million of depreciation expense to bring the net book value related to the building value of this property to zero.


Depreciation expenseLoan impairment charges


On March 17, 2017 the Company provided the Casino Queen Loan to CQ Holding Company, to partially finance its acquisition of Lady Luck Casino in Marquette, Iowa. During 2018, Compared with 2017the operating results of Casino Queen declined substantially and Casino Queen defaulted under its senior credit agreement and also the Casino Queen Loan. As a result, the operations of Casino Queen were put up for sale during the fourth quarter of 2018. At December 31, 2018, active negotiations for the sale of Casino Queen's operations were taking place and full payment of the principal was still expected, due to the anticipation that the operations were to be sold in the near term for an amount allowing for repayment of the full $13.0 million of loan principal due to GLPI.

Depreciation expense increased by $23.6During 2019, the operating results of Casino Queen continued to decline, the secured debt of Casino Queen was sold to a third-party casino operator at a discount and the Company no longer expected the Casino Queen Loan to be repaid. Therefore, the Company recorded an impairment charge of $13.0 million or 20.8%, to $137.1 millionthrough the Consolidated Statement of Income for the year ended December 31, 2018 as compared2019 to reflect the year ended December 31, 2017, primarily resulting from the additionwrite-off of the Tropicana and Plainridge Park real estate assets to our portfolio, as well as the reclassification of the Pinnacle building assets to real estate investments on our balance sheet as a result of the Penn-Pinnacle Merger, which required the Amended Pinnacle Master Lease to be treated as an operating lease in its entirety.Casino Queen Loan.

2017 Compared with 2016
Depreciation expense increased by $3.9 million, or 3.6%, to $113.5 million for the year ended December 31, 2017 as compared to the year ended December 31, 2016, primarily due to a full year of depreciation expense on the Meadows assets, which were acquired in September of 2016.

Goodwill impairment charges

During the year ended December 31, 2018, the Company recorded a goodwill impairment charge of $59.5 million in connection with its operations at Hollywood Casino Baton Rouge. This charge was driven by general market deterioration in the Baton Rouge region and the smoking ban at all Baton Rouge, Louisiana casinos that went into effect during the second quarter of 2018, both of which significantly impacted the Company's forecasted cash flows for this reporting unit. Subsequent to conducting its impairment tests on other long-lived assets, including the gaming license at Hollywood Casino Perryville, the Company performed Step 1 of the goodwill impairment test, which indicated a potential impairment. Step 1 of the goodwill impairment test involved the determination of the fair value of the Baton Rouge reporting unit and its comparison to the reporting unit's carrying amount. Using a discounted cash flow model, which relied on projected EBITDA to determine the reporting unit's future cash flows, the Company calculated a fair value that was less than the reporting unit's carrying value and proceeded to Step 2. In Step 2 of the goodwill impairment test, the Company performed a fair value allocation as if the reporting unit had been acquired in a business combination and assigned the fair value of the reporting unit calculated in Step 1 to all assets and liabilities of the reporting unit, including any unrecognized intangible assets. Any residual fair value was allocated to goodwill to arrive at the implied fair value of goodwill. After completing the Step 2 allocation, the Company determined the goodwill on its Baton Rouge reporting unit had an implied fair value of $16.1 million and recorded the impairment charge of $59.5 million during the fourth quarter of 2018.









Other income (expenses)
 
Other income (expenses) for the years ended December 31, 2018, 20172020 and 20162019 were as follows (in thousands): 
 Year Ended December 31, Percentage
20202019VarianceVariance
Interest expense$(282,142)$(301,520)$19,378 (6.4)%
Interest income569 756 (187)(24.7)%
Losses on debt extinguishment(18,113)(21,014)2,901 (13.8)%
Total other expenses$(299,686)$(321,778)$22,092 (6.9)%
        Percentage
Year Ended December 31, 2018 2017 Variance Variance
Interest expense $(247,684) $(217,068) $(30,616) (14.1)%
Interest income 1,827
 1,935
 (108) (5.6)%
Losses on debt extinguishment $(3,473) $—
 $(3,473) N/A
Total other expenses $(249,330) $(215,133) $(34,197) (15.9)%

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        Percentage
Year Ended December 31, 2017 2016 Variance Variance
Interest expense $(217,068) $(185,896) $(31,172) (16.8)%
Interest income 1,935
 2,123
 (188) (8.9)%
Total other expenses $(215,133) $(183,773) $(31,360) (17.1)%
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Interest expense
2018 Compared with 2017
For the year ended December 31, 2018,2020, interest expense related to our fixed and variable rate borrowings was $247.7$282.1 million, as compared to $217.1$301.5 million in the year ended December 31, 2017.2019. Interest expense increaseddecreased primarily due to refinancing activities, such as the issuance of $850$400 million of 5.25%3.35% senior unsecured notes due 2025, $5002024 and $700 million of 5.75%4.000% senior unsecured notes due 2028 and $7502030 during the third quarter of 2019. These proceeds were utilized to repay higher cost unsecured borrowings with near term maturities. Interest expense also benefited from the first quarter 2020 redemption of $215.2 million of 5.30%4.875% senior unsecured notes that were due 2029, as well as, increasedin November 2020 and $400.0 million of 4.375% of senior unsecured notes that were due in April 2021, which were funded by borrowings under our revolving credit facility, partially offset by a decrease in interest expense related tofacility. Towards the terminationend of the first quarter of 2020, we fully drew down our revolving credit facility by borrowing just over $530 million to increase liquidity levels given the near term uncertainty associated with COVID-19. We subsequently repaid all of our outstanding advances on our revolving credit facility on June 25, 2020, with cash on hand and the net proceeds from our 4.00%, $500 million unsecured note issuance due in January 2031 and Term Loan A facility, partial repaymentA-2 borrowings. On August 18, 2020, we raised an additional $200 million of 4.00%, unsecured notes at a premium to par and used the proceeds to repay Term Loan A-1 facilityborrowings. Although these latter two transactions had a negative impact on interest expense they further increased the duration and the tender and callfixed rate nature of our debt profile.

Losses on debt extinguishment

In the first quarter of 2020, the Company redeemed all $215.2 million aggregate principal amount of the Company's outstanding 4.875% senior unsecured notes due in November 2020 and all $400 million aggregate principal amount of the Company's outstanding 4.375% senior unsecured notes due 2018 (as described below).in April 2021, resulting in the retirement of such senior notes. The additional borrowings were usedCompany recorded losses on the early extinguishment of debt related to finance the Tropicana Transactions, to purchase Plainridge Park and to fund the Belterra Park Loan.
2017 Compared with 2016
Forcurrent year retirements of $18.1 million for the year ended December 31, 2017, interest expense related2020 primarily for call premium charges and debt issuance write-offs.

On September 12, 2019, the Company completed a cash tender offer (the "2019 Tender Offer") to our fixed and variable rate borrowings was $217.1purchase its $1,000 million as compared to $185.9aggregate principal amount 4.875% Senior Unsecured Notes due 2020 (the "2020 Notes"). The Company received early tenders from the holders of approximately $782.6 million in aggregate principal of the year ended December 31, 2016. Interest expense primarily increased due to2020 Notes, or approximately 78% of its outstanding 2020 Notes, in connection with the 2019 Tender Offer at a price of 102.337% of the unpaid principal amount plus accrued and unpaid interest expense relatedthrough the settlement date. Subsequent to the April 2016 issuanceearly tender deadline, an additional $2.2 million in aggregate principal of $400the 2020 Notes was tendered at a price of 99.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date, for a total redemption of $784.8 million of senior unsecured notes due 2021 and $975 million of senior unsecured notes due 2026 and borrowings of $825 million under the term loan A-1 facility. The additional borrowings were utilized to finance the Pinnacle acquisition.

Losses on debt extinguishment

On May 21, 2018, the Company entered into the second amendment to the Credit Facility, which increased the Company's revolving commitments, eliminated the Term Loan A facility, required the Company to repay a portion of the Term Loan A-1 facility and extended the maturity date of the revolving credit facility to May 21, 2023.2020 Notes. The Company recorded a loss on the early extinguishment of debt related to the second amendment to the Credit Facility, of approximately $1.0 million for the proportional amount of unamortized debt issuance costs associated with the extinguished Term Loan A facility and related to the banks that are no longer participating in the Credit Facility.

Also on May 21, 2018, the Company completed a cash tender offer (the "Tender Offer") to purchase any and all of the outstanding $550 million aggregate principal of its 4.375% Senior Unsecured Notes due 2018 (the "2018 Notes"). The Company received tenders from the holders of approximately $393.5 million in aggregate principal of the 2018 Notes, or approximately 72% of its outstanding 2018 Notes in connection with the Tender Offer at a price of 100.396% of the unpaid principal amount plus accrued and unpaid interest through the settlement date. The Company recorded a loss on the early extinguishment of debt, related to the2019 Tender Offer, of approximately $2.5$21.0 million, for the proportional amount of unamortized debt issuance costs associated with the tendered 2018 Notes and the difference between the reaquisitionreacquisition price of the tendered 20182020 Notes and their net carrying value. On August 16, 2018, the Company redeemed the remaining 2018 Notes for 100% of the principal amount and accrued and unpaid interest to, but not including, the redemption date.






Taxes

2018 Compared to 2017


Our income tax expense decreased $4.8$0.9 million for the year ended December 31, 20182020 as compared to the year ended December 31, 2017.2019. During the year ended December 31, 2018,2020, we had income tax expense of approximately $5.0$3.9 million, compared to income tax expense of $9.8$4.8 million during the year ended December 31, 2017.2019. Our income tax expense is primarily driven from the operations of the TRS Properties,Segment, which are taxed at the corporate rate. The decrease in our effective tax rate for the year ended December 31, 2018 is primarily due to the Tax Cuts and Jobs Act, which lowered the corporate tax rate to 21%, effective for tax years including or commencing January 1, 2018, as well as lower pre-tax income at our TRS Properties. Our effective tax rate (income taxes as a percentage of income before income taxes) was 1.4%0.8% and 2.5%1.2% for the years ended December 31, 20182020 and 2017,2019, respectively.


2017 Compared to 2016

Our income tax expense increased $2.2 million for the year ended December 31, 2017 as compared to the year ended December 31, 2016. During the year ended December 31, 2017, we had income tax expense of approximately $9.8 million, compared to income tax expense of $7.5 million during the year ended December 31, 2016. Income tax expense increased primarily due to adjustments at the TRS Properties related to the December 2017 Tax Cuts and Job Act. Our effective tax rate (income taxes as a percentage of income before income taxes) was 2.5% for both the years ended December 31, 2017 and 2016.

Liquidity and Capital Resources
 
Our primary sources of liquidity and capital resources are cash flow from operations, borrowings from banks, and proceeds from the issuance of debt and equity securities.
 
Net cash provided by operating activities was $654.4 million, $598.7$428.1 million and $514.4$750.3 million during the years ended December 31, 2018, 20172020 and 2016,2019, respectively. The increasedecrease in net cash provided by operating activities of $55.7$322.2 million for the year ended December 31, 20182020 as compared to the year ended December 31, 20172019 was primarily comprised of an increasedue to a decrease in cash receipts from customers/tenants and customers of $74.0$361.6 million, (excluding cash received from Pinnaclepartially offset by $21.9 million and classified as an investing activity prior to the Penn-Pinnacle Merger) and a decrease$13.4 million decreases in cash paid for taxes of $6.3 million, partially offset by increases in cash paid to employees of $4.4 millionoperating expenses and cash paid for interest, of $25.3 million.respectively. The increasedecrease in cash receipts collected from our customerstenants and tenantscustomers for the year ended December 31, 20182020 as compared to the corresponding period in the prior year ended December 31, 2017 was primarily due to the recognition of $337.5 million in non-cash rent recognized in connection with the Tropicana Transactions, the acquisition of Plainridge ParkLas Vegas and our entry into the Belterra Park Loan, all of which resulted in additional income from real estate, as well as the performance of the Ohio properties,Morgantown transactions and the impact of the rent escalators under the Penn and Pinnacle master leases and net percentage rent adjustments, partially offset by a decrease inCOVID-19, which forced our TRS Properties' revenues.Properties to temporarily close in mid-March 2020 until May and June of 2020. The decreasereason for the decline in cash paid for taxes wasoperating expenses is primarily dueattributable to the Tax Cuts and Jobs Act, which lowered the corporate tax rate to 21%, effective for tax years including or commencing January 1, 2018, as well as lower income attemporary closures of our TRS Properties. The increase in cash paid for interest was related to the Company's new borrowings which were used to fund the Tropicana Transactions, the acquisitionproperties.
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Table of Plainridge Park and the Belterra Park Loan.Contents

The increase in net cash provided by operating activities for the year ended December 31, 2017 as compared to the year ended December 31, 2016 was primarily due to a full year of rent received under both the Pinnacle Master Lease and the Meadows Lease, as well as the additional rent received from Penn related to the new Tunica Properties, the performance of the Ohio properties and the impact of the rent escalators under both the Penn and Pinnacle master leases, partially offset by a decrease in our TRS Properties' net revenues. The increase in cash paid for interest was related to the Company's April 2016 acquisition of Pinnacle's real estate assets and the related borrowings.

Investing activities used net cash of $1,509.8$9.5 million and $2.8 million during the yearyears ended December 31, 2018, provided net cash of $0.7 million during the year ended December 31, 20172020 and used net cash of $3,218.6 million during the year ended December 31, 2016. Net cash used by investing activities during the year ended December 31, 2018 primarily consisted of cash payments of $1,243.5 million related to the acquisition of five Tropicana properties and Plainridge Park and $304 million of cash paid for the origination of mortgage loans to casino owner-operators, partially offset by $38.5 million of rental payments received from tenants and applied against the lease receivable we had on our balance sheet prior to the Penn-Pinnacle Merger. Net cash provided by investing activities during the year ended December 31, 2017 consisted of cash payments of $83.3 million primarily related to the acquisition of the Tunica Properties and capital maintenance expenditures of $3.2 million, partially offset by net cash received of $13.2 million from Casino Queen to retire their five-year term loan and borrow an additional $13.0 million under a new 5.5-year unsecured term loan at 15%, as well as rental payments received from tenants and applied against the lease receivable on our balance sheet of $73.1 million.2019, respectively. Net cash used in investing activities during the year ended

December 31, 20162020 primarily consisted of cash paymentscapital expenditures of $3.3 billion related to$3.1 million and $5.9 million for the acquisition of the Pinnacle and Meadows' real estate assets primarily relating to the Evansville swap transaction. Net cash used in investing activities during the year ended December 31, 2019 primarily consisted of capital expenditures of $3.0 million, partially offset by principal paymentsproceeds from sales of $3.2 million made by Casino Queen on their five-year term loan, as well as rental payments received from tenantsproperty and applied against the lease receivable on our balance sheetequipment of $48.5$0.2 million. In addition to the cash paid for the Pinnacle assets, we also issued approximately 56.0 million shares of our common stock as consideration for the Pinnacle real estate assets (non-cash investing activity).

Financing activities provided net cash of $852.1$63.2 million during the year ended December 31, 2018,2020 and used net cash of $606.9$746.4 million during the year ended December 31, 2017 and provided net cash of $2,698.9 million during the year ended December 31, 2016.2019. Net cash usedprovided by financing activities for the year ended December 31, 20182020 was driven by $2,076.4 million of proceeds from the issuance of long-term debt and $320.9 million of $2,593.4 million andnet proceeds from the issuance of common stock. During the year ended December 31, 2020, we issued approximately 9.2 million shares of our common stock option exercises, netin a primary equity offering and approximately 0.1 million shares of common stock through our ATM. This was partially offset by repayments of long-term debt of $2,060.9 million, dividend payments of $230.5 million, $15.7 million of premium and related costs paid on the tender of senior unsecured notes, taxes paid related to shares withheld for tax purposes on restricted stock award vestings of $7.5$15.3 million partially offsetand financing costs of $11.6 million.

Net cash used in financing activities for the year ended December 31, 2019 was driven by dividend payments of $550.4 million, repayments of long-term debt of $1,164.1$1,477.9 million, financing costsdividend payments of $32.4$589.1 million, and $1.9$18.9 million of premium and related costs paid on the tender of senior unsecured notes. During the year ended December 31, 2018, the Company issued $2,100.0 million par value of new senior unsecured notes, completed a tender and redemption of the $550 million aggregate principal senior unsecured notes maturing in 2018, repaid a portion of the Term Loan A-1 facility and extinguished the Term Loan A facility. Net cash used by financing activities for the year ended December 31, 2017 included dividend payments of $529.4 million and repayments of long-term debt of $335.1 million, partially offset by proceeds from the issuance of common stock under the ATM Program, net of issuance costs of $139.4 million, proceeds from stock option exercises, net of taxes paid related to shares withheld for tax purposes on restricted stock award vestings, net of $18.2stock option exercises of $9.1 million and financing costs of $10.0 million, partially offset by $1,358.9 million of proceeds from the issuance of long-term debt of $100.0 million. Net cash provided by financing activities for the year ended December 31, 2016 included proceeds from the issuance of long-term debt of $2.6 billion, proceeds from the issuance of common stock, net of issuance costs of $870.8 million and proceeds from stock option exercises of $113.5 million, partially offset by dividend payments of $428.4 million and repayments of long-term debt and financing costs of $409.0 million.debt. During the year ended December 31, 2016, we2019, the Company issued approximately 28.8$1,100.0 million shares of our common stock in a primary equity offering and approximately 1.3 million shares of our common stock under the ATM Program, as well as issuing $1.375 billionpar value in new senior unsecured notes, and drawing down on the $825 million term loan A-1 facility. These new debt and equity instruments were utilized to finance the acquisition of the Pinnacle and Meadows' real estate assets. In addition to the shares issued in the primary equity offering and the ATM Offering, we also issued approximately 56.0 million sharescompleted a cash tender for a portion of our common stock as consideration for the Pinnacle real estate assets (non-cash financing activity).2020 Notes, partially repaid borrowings under our Term Loan A-1 and revolving credit facilities and launched a $600 million ATM Program.

Capital Expenditures
 
Capital expenditures are accounted for as either capital project or capital maintenance (replacement) expenditures. Capital project expenditures are for fixed asset additions that expand an existing facility or create a new facility. The cost of properties developed by the Company include costs of construction, property taxes, interest and other miscellaneous costs incurred during the development period until the project is substantially complete and available for occupancy. Capital maintenance expenditures are expenditures to replace existing fixed assets with a useful life greater than one year that are obsolete, worn out or no longer cost effective to repair.


During the years ended December 31, 2018, 20172020 and 20162019 we spent approximately $4.3 million, $3.2$3.1 million and $3.1$3.0 million respectively, for capital maintenance expenditures. The majority of the capital maintenance expenditures were for slot machines and slot machine equipment at our TRS Properties. Our tenants are responsible for capital maintenance expenditures at our leased properties.


Debt


Senior Unsecured Credit Facility


ThePrior to June 25, 2020, the Company's Credit Facility consistssenior unsecured credit facility (the "Credit Facility"), consisted of a $1,175 million revolving credit facility (the "Revolver") with a maturity date of May 21, 2023, and a $525$449 million Term Loan A-1 facility.facility with a maturity date of April 28, 2021.

The Company fully drew down on its Revolver in the first quarter of 2020 to increase its liquidity position and repay certain senior unsecured notes as described below. On May 21, 2018,June 25, 2020, the Company entered into the secondan amendment to the Credit Facility which increased(as amended, the Company's revolving commitments to an aggregate principal amount of $1,100 million, eliminated the Term Loan A facility, required the Company to repay a portion of the Term Loan A-1 facility and"Amended Credit Facility" which extended the maturity date of the revolving credit facility. On October 10, 2018, the Company entered into the third amendmentapproximately $224 million of outstanding Term Loan A-1 facility borrowings to the Credit Facility, which further increased the Company's revolving commitments to an aggregate principal amount of $1,175 million. The revolving credit facility matures on May 21, 2023, andwhich term loans are now classified as a new tranche of term loans (Term Loans A-2). Additionally, the Company borrowed incremental Term Loans A-2 totaling $200 million. Furthermore, on June 25, 2020, the Company also closed on an offering of $500 million of 4.00% unsecured senior notes due in January 2031 priced at a slight discount to par. The Company utilized the proceeds from these two financings along with cash on hand to repay all outstanding obligations under its Revolver. On August 18, 2020, the Company borrowed an additional $200 million of 4.00% unsecured senior notes due in January 2031 priced at a premium to par. The Company utilized the net proceeds from this additional borrowing to repay indebtedness under the Term Loan A-1 facility matures on April 28, 2021.facility.

The Company recorded a loss on the early extinguishment of debt, related to the second amendment to the Credit Facility, of approximately $1.0 million for the proportional amount of unamortized debt issuance costs associated with the extinguished Term Loan A facility and related to the banks that are no longer participating in the Credit Facility.


At December 31, 2018,2020, the Amended Credit Facility had a gross outstanding balance of $927 million.$424.0 million, consisting of the $424.0 million Term Loan A-2 facility. No amounts were outstanding under the Revolver. Additionally, at December 31, 2018,
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2020, the Company was contingently obligated under letters of credit issued pursuant to the Amended Credit Facility with face amounts aggregating approximately $0.4 million, resulting in $772.6$1,174.6 million of available borrowing capacity under the revolving credit facility as of December 31, 2018.Revolver.


The interest rates payable on the loans are, at the Company's option, equal to either a LIBOR rate or a base rate plus an applicable margin, which ranges from 1.0% to 2.0% per annum for LIBOR loans and 0.0% to 1.0% per annum for base rate loans, in each case, depending on the credit ratings assigned to the Amended Credit Facility. At December 31, 2018,2020, the applicable margin was 1.50% for LIBOR loans and 0.50% for base rate loans. In addition, the Company is required to pay a commitment fee on the unused portion of the commitments under the revolving facilityRevolver at a rate that ranges from 0.15% to 0.35% per annum, depending on the credit ratings assigned to the Amended Credit Facility. At December 31, 2018,2020, the commitment fee rate was 0.25%. The Company is not required to repay any loans under the Amended Credit Facility prior to maturity on May 21, 2023 and may prepay all or any portion of the loans under the Amended Credit Facility prior to maturity without premium or penalty, subject to reimbursement of any LIBOR breakage costs of the lenders. The Company's wholly owned subsidiary, GLP Capital is the primary obligor under the Amended Credit Facility, which is guaranteed by GLPI.


The Amended Credit Facility contains customary covenants that, among other things, restrict, subject to certain exceptions, the ability of GLPI and its subsidiaries to grant liens on their assets, incur indebtedness, sell assets, make investments, engage in acquisitions, mergers or consolidations or pay certain dividends and other restricted payments. The Amended Credit Facility contains the following financial covenants, which are measured quarterly on a trailing four-quarter basis: a maximum total debt to total asset value ratio, a maximum senior secured debt to total asset value ratio, a maximum ratio of certain recourse debt to unencumbered asset value and a minimum fixed charge coverage ratio. In addition, GLPI is required to maintain a minimum tangible net worth and its status as a REIT on and after the effective date of its election to be treated as a REIT, which the Company elected on its 2014 U.S. federal income tax return.REIT. GLPI is permitted to pay dividends to its shareholders as may be required in order to maintain REIT status, subject to the absence of payment or bankruptcy defaults. GLPI is also permitted to make other dividends and distributions subject to pro forma compliance with the financial covenants and the absence of defaults. The Amended Credit Facility also contains certain customary affirmative covenants and events of default, including the occurrence of a change of control and termination of the Penn Master Lease (subject to certain replacement rights). The occurrence and continuance of an event of default under the Amended Credit Facility will enable the lenders under the Amended Credit Facility to accelerate the loans and terminate the commitments thereunder. At December 31, 2018,2020, the Company was in compliance with all required financial covenants under the Amended Credit Facility.


Senior Unsecured Notes


At December 31, 2018,2020, the Company had an outstanding balance of $4,975$5,375.0 million of senior unsecured notes consisting(the "Senior Notes").

In the first quarter of 2020, the Company redeemed all $215.2 million aggregate principal amount of the following:Company’s outstanding 4.875% senior unsecured notes due in November 2020 and all $400 million aggregate principal amount of the Company’s outstanding 4.375% senior unsecured notes due in April 2021, incurring a loss on the early extinguishment of debt related to the redemption of $17.3 million, primarily for call premium charges and debt issuance write-offs.

On September 26, 2018,June 25, 2020, the Company issued $750$500 million of 5.30%4.00% senior unsecured notes maturing ondue January 15, 20292031 at an issue price equal to 99.985%98.827% of the principal amount and $350to repay indebtedness under its Revolver. On August 18, 2020 the Company issued an additional $200 million of 5.25%4.00% senior unsecured notes maturing on June 1, 2025due January 2031 at an issue price equal to 102.148%103.824% of the principal amount to repay Term Loan A-1 indebtedness, incurring a loss on the early extinguishment of debt of $0.8 million, related to debt issuance write-offs. These bond offerings have extended the maturities of our long-term debt.

On August 29, 2019, the Company issued $400 million of 3.35% Senior Unsecured Notes maturing on September 1, 2024 at an issue price equal to 99.899% of the principal amount (the "New 2025"2024 Notes"). The New 2025 and $700 million of 4.00% Senior Unsecured Notes will become partmaturing on January 15, 2030 at an issue price equal to 99.751% of the same series as, and are expected to be fungible with, the Company's previously issued 5.25% senior notes due 2025, $500 million aggregate principal amount of which were originally issued on May 21, 2018 (the "Initial 2025"2030 Notes"). Interest on the notes maturing in 20252024 Notes is payable semi-annually on JuneMarch 1 and DecemberSeptember 1 of each year, commencing on DecemberMarch 1, 2018 and is deemed to accrue from May 21, 2018, the issuance date of the Initial 2025 Notes.2020. Interest on the notes maturing in 20292030 Notes is payable semi-annually on January 15 and July 15 of each year, commencing on January 15, 2019.2020. The net proceeds from the sale of the New 20252024 Notes and 2030 Notes were used to (i) finance the notes maturing in 2029, together with funds availableCompany's cash tender offer to purchase its 4.875% Senior Unsecured Notes due 2020 (described below) (ii) repay outstanding borrowings under the Company's revolving credit facility were used in October 2018 to (i) finance GLPI’s acquisitionand (iii) repay a portion of the real property assets of Plainridge Park Casino from Penn and its issuance of a secured mortgage loan to Boyd in connection with Boyd’s acquisition ofoutstanding borrowings under the real property assets of Belterra Park Gaming & Entertainment Center, (ii) finance GLPI’s acquisition of substantially all the real property assets of five gaming facilities owned by Tropicana and its issuance of a mortgage loan to Eldorado in connection with Eldorado’s acquisition of substantially all the real property assets of Lumière Place, and (iii) pay the estimated transaction fees and expenses associated with the transactions.Company's Term Loan A-1 facility.


On May 21, 2018,September 12, 2019, the Company completed a cash tender offer (the "Tender"2019 Tender Offer") to purchase any and all of the outstanding $550its $1,000 million aggregate principal of its 4.375% senior unsecured notesamount 4.875% Senior Unsecured Notes due 2018.2020 (the "2020 Notes"). The Company received early tenders from the holders of approximately $393.5$782.6 million in aggregate principal of these notes,the 2020 Notes, or approximately 72%,78% of its
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outstanding 2020 Notes, in connection with the 2019 Tender Offer at a price of 100.396%102.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date. Subsequent to the early tender deadline, an additional $2.2 million in aggregate principal of the 2020 Notes was tendered at a price of 99.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date, for a total redemption of $784.8 million of the 2020 Notes. The Company recorded a loss on the early extinguishment of debt related to the 2019 Tender Offer, of approximately $2.5$21.0 million, for the proportional amount of unamortized debt issuance costs associated with the tendered notes and the

difference between the reaquisitionreacquisition price of the tendered notes2020 Notes and their net carrying value. On August 16, 2018, the Company redeemed the remaining notes for 100% of the principal amount and accrued and unpaid interest to, but not including the redemption date.

Also on May 21, 2018, the Company issued $500 million of 5.25% senior unsecured notes maturing on June 1, 2025 and $500 million of 5.75% senior unsecured notes maturing on June 1, 2028. Interest is payable semi-annually on June 1 and December 1 of each year, commencing on December 1, 2018. The net proceeds from the sale of these notes were used (i) to prepay and extinguish the outstanding borrowings under the Term Loan A facility under the Credit Facility and to repay a portion of the outstanding borrowings under the Term Loan A-1 facility, (ii) to finance the tender offer of the 2018 Notes, (iii) to redeem the remaining 2018 Notes and (iv) to pay fees and expenses to amend our Credit Facility, as described above.

On April 28, 2016, in connection with the acquisition of Pinnacle, the Company issued $400 million of 4.375% senior unsecured notes maturing on April 15, 2021 and $975 million of 5.375% senior unsecured notes maturing on April 15, 2026. Interest on these notes is payable semi-annually on April 15 and October 15 of each year. The net proceeds from the sale of these notes were used (i) to finance the repayment, redemption and/or discharge of certain Pinnacle debt obligations that the Company assumed in the Pinnacle Merger, (ii) to pay transaction-related fees and expenses related to the Pinnacle Merger and (iii) for general corporate purposes.

On October 30 and 31, 2013, the Company issued $2,050 million aggregate principal amount of senior unsecured notes: $550 million of 4.375% senior unsecured notes that matured in 2018; $1,000 million of 4.875% senior unsecured notes maturing on November 1, 2020; and $500 million of 5.375% senior unsecured notes maturing on November 1, 2023. Interest on these notes is payable semi-annually on May 1 and November 1 of each year. The net proceeds from the sale of these notes, together with borrowings under the Credit Facility were used (i) to make distributions directly and indirectly to Penn in partial exchange for the contributions of real property assets by Penn and CRC Holdings, Inc. to the Company in connection with the Spin-Off, (ii) to pay related fees and expenses, (iii) to partially repay amounts funded under the revolving credit facility and (iv) to fund future earnings and profits distributions and for working capital purposes.
The Company may redeem the senior unsecured notes, collectively, the "Notes"Senior Notes of any series at any time, and from time to time, at a redemption price of 100% of the principal amount of the Senior Notes redeemed, plus a "make-whole" redemption premium described in the indenture governing the Senior Notes, together with accrued and unpaid interest to, but not including, the redemption date, except that if Senior Notes of a series are redeemed 90 or fewer days prior to their maturity, the redemption price will be 100% of the principal amount of the Senior Notes redeemed, together with accrued and unpaid interest to, but not including, the redemption date. If GLPI experiences a change of control accompanied by a decline in the credit rating of the Senior Notes of a particular series, the Company will be required to give holders of the Senior Notes of such series the opportunity to sell their Senior Notes of such series at a price equal to 101% of the principal amount of the Senior Notes of such series, together with accrued and unpaid interest to, but not including, the repurchase date. The Senior Notes also are subject to mandatory redemption requirements imposed by gaming laws and regulations. 
The Senior Notes were issued by GLP Capital, L.P. and GLP Financing II, Inc. (the "Issuers"), two wholly-owned subsidiaries of GLPI, and are guaranteed on a senior unsecured basis by GLPI. The guarantees of GLPI are full and unconditional. The Senior Notes are the Issuers' senior unsecured obligations and rank pari passu in right of payment with all of the Issuers' senior indebtedness, including the Credit Facility, and senior in right of payment to all of the Issuers' subordinated indebtedness, without giving effect to collateral arrangements. See Note 19 to the consolidated financial statements for additional financial information on the parent guarantor and subsidiary issuers of the Notes.
The Senior Notes contain covenants limiting the Company’s ability to: incur additional debt and use its assets to secure debt; merge or consolidate with another company; and make certain amendments to the Penn Master Lease. The Senior Notes also require the Company to maintain a specified ratio of unencumbered assets to unsecured debt. These covenants are subject to a number of important and significant limitations, qualifications and exceptions.
 
At December 31, 2018,2020, the Company was in compliance with all required financial covenants under theits Senior Notes.


CapitalFinance Lease Liability


The Company assumed the capitalfinance lease obligationobligations related to certain assets at its Aurora, Illinois property. GLPI recorded the asset and liability associated with the capitalfinance lease on its consolidated balance sheet. The original term of the capitalfinance lease wasis 30 years and it will terminate in 2026.

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Summarized financial information for Subsidiary Issuers and Parent Guarantor
As of December 31, 2020As of December 31, 2019
Real estate investments, net$2,720,767 $2,514,806 
Real estate loans— 246,000 
Right-of-use assets and land rights, net121,866 181,593 
Cash and cash equivalents480,066 4,281 
Long term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts5,754,689 5,737,962 
Accrued interest72,285 60,695 
Lease liabilities58,654 89,856 
Deferred rental revenue265,891 271,837 
For the year ended December 31, 2020For the year ended December 31, 2019
Revenues$580,428 $575,451 
Income from operations446,708 384,170 
Interest expense(282,142)(301,520)
Net income146,323 61,734 




The financial information presented above is that of the subsidiary issuers and parent guarantor and the financial information of non-issuer subsidiaries has been excluded. The financial information of subsidiary issuers and the parent guarantor has been presented on a combined basis; however, the only asset on the parent guarantor balance sheet is its investment in subsidiaries which is not included in the presentation above in accordance with the disclosure requirements.

We had no off-balance sheet arrangements at December 31, 2020 and 2019.

Distribution Requirements

We generally must distribute annually at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gains, in order to qualify to be taxed as a REIT (assuming that certain other requirements are also satisfied) so that U.S. federal corporate income tax does not apply to earnings that we distribute. To the extent that we satisfy this distribution requirement and qualify for taxation as a REIT but distribute less than 100% of our REIT taxable income, determined without regard to the dividends paid deduction and including any net capital gains, we will be subject to U.S. federal corporate income tax on our undistributed net taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we distribute to our shareholders in a calendar year is less than a minimum amount specified under U.S. federal income tax laws. We intend to make distributions to our shareholders to comply with the REIT requirements of the Code.

While the Company's Board of Directors declared a cash dividend of $0.70 for the first quarter of 2020, quarterly dividends of $0.60 per share on the Company's common stock were declared for both the second, third and fourth quarters. These dividends consisted of a combination of cash and shares of the Company's common stock. The cash component of the dividend (other than cash paid in lieu of fractional shares) did not exceed 20% in the aggregate, or $0.12 per share, with the balance, or $0.48 per share, payable in shares of the Company's common stock. This quarterly dividend level reflected the impact of the COVID-19 closures on the Company's business.

LIBOR Transition

The majority of our debt is at fixed rates and our exposure to variable interest rates is currently limited to our revolving credit facility and our Term Loan A-2. Both of these debt instruments are indexed to LIBOR which is expected to be phased out during late 2021 through mid-2023. The discontinuance of LIBOR would affect our interest expense and earnings. The borrowings under our Amended Credit Facility will be subject to the expected LIBOR transition. LIBOR is currently expected
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to transition to a new standard rate, the Secured Overnight Financing Rate (“SOFR”). We are currently monitoring the transition and cannot be certain whether SOFR will become the standard rate for our variable rate debt.

Outlook


Based on our current level of operations and anticipated earnings, we believe that cash generated from operations and cash on hand, together with amounts available under our senior unsecured credit facility,Amended Credit Facility, will be adequate to meet our anticipated debt service requirements, capital expenditures, working capital needs and dividend requirements. During 2020, we refinanced our near term debt obligations and as such have no significant obligations coming due until 2023 and we issued common shares in advance of the planned 2021 closing of the Bally's transaction. We also announced a project to move our Hollywood Casino Baton Rouge property landside in early 2022. On December 15, 2020, we announced that Penn had exercised its option to acquire the gaming operations at Hollywood Casino Perryville for $31.1 million and that we entered into an agreement to sell the gaming operations of Hollywood Casino Baton Rouge for $28.2 million to Casino Queen. The Company will retain ownership of the real estate assets at Hollywood Casino Baton Rouge and will simultaneously enter into the Casino Queen Master Lease. Rent under the Casino Queen Master Lease will be adjusted upon completion of the project to reflect a yield of 8.25% on the Company's project costs. Both transactions are expected to close in the second half of 2021, subject to regulatory approvals and other customary closing conditions.

In addition, we expect the majority of our future growth to come from acquisitions of gaming and other properties to lease to third parties. If we consummate significant acquisitions in the future, our cash requirements may increase significantly and we would likely need to raise additional proceeds through a combination of either common equity (including under our ATM Program) and/or debt offerings. Our future operating performance and our ability to service or refinance our debt will be subject to future economic conditions and to financial, business and other factors, many of which are beyond our control. See "Risk Factors-Risks Related to Our Capital Structure" of this Annual Report on Form 10-K for a discussion of the risk related to our capital structure.


Commitments and Contingencies
Contractual Cash Obligations
The following table presents our contractual obligations at December 31, 2018:
 Payments Due By Period
 Total 2019 2020 - 2021 2022 - 2023 2024 and After
 (in thousands)
Senior unsecured credit facility 
  
  
  
  
Principal$927,000
 $—
 $525,000
 $402,000
 $—
Interest (1)
131,495
 41,879
 65,977
 23,639
 —
4.875% senior unsecured notes due 2020 
  
  
  
  
Principal1,000,000
 —
 1,000,000
 —
 —
Interest97,500
 48,750
 48,750
 —
 —
4.375% senior unsecured notes due 2021         
   Principal400,000
 —
 400,000
 —
 —
   Interest43,750
 17,500
 26,250
 —
 —
5.375% senior unsecured notes due 2023 
  
  
  
  
Principal500,000
 —
 —
 500,000
 —
Interest134,375
 26,875
 53,750
 53,750
 —
5.25% senior unsecured notes due 2025         
Principal850,000
 —
 —
 —
 850,000
Interest290,063
 44,625
 89,250
 89,250
 66,938
5.375% senior unsecured notes due 2026         
   Principal975,000
 —
 —
 —
 975,000
   Interest393,048
 52,406
 104,813
 104,813
 131,016
5.75% senior unsecured notes due 2028         
   Principal500,000
 —
 —
 —
 500,000
   Interest273,125
 28,750
 57,500
 57,500
 129,375
5.30% senior unsecured notes due 2029         
   Principal750,000
 —
 —
 —
 750,000
   Interest409,535
 31,910
 79,500
 79,500
 218,625
Capital lease obligations1,112
 123
 264
 291
 434
Operating leases (2)
616,886
 15,519
 30,201
 30,031
 541,135
Other liabilities reflected in the Company's consolidated balance sheets (3)
542
 542
 —
 —
 —
Total$8,293,431
 $308,879
 $2,481,255
 $1,340,774
 $4,162,523


(1)
The interest rates associated with the variable rate components of our senior unsecured credit facility are estimated, reflected of forward LIBOR curves plus the spread over LIBOR of 150 basis points. The contractual amounts to be paid on our variable rate obligations are affected by changes in market interest rates and changes in our spreads which are based on our leverage ratios. Future changes in such ratios will impact the contractual amounts to be paid.

(2)    The Company's contractual obligations related to operating leases includes the fixed payments due under those ground        leases for which the Company subleases the land to our tenants who are responsible for payment directly to the
landlord, as we are considered the primary obligor under these leases.

(3)    Primarily represents liabilities associated with reward programs at our TRS Properties that can be redeemed for free
play, merchandise or services.

Other Commercial Commitments
The following table presents our material commercial commitments as of December 31, 2018 for the following future periods:
 Total Amounts Committed 2019 2020 - 2021 2022 - 2023 2024 and After
 (in thousands)
Letters of Credit (1)
$395
 $395
 —
 —
 —
Total$395
 $395
 —
 —
 —

(1)
The available balance under the revolving credit portion of our senior unsecured credit facility is reduced by outstanding letters of credit.
Off-Balance Sheet Arrangements
We had no off-balance sheet arrangements as of December 31, 2018 and 2017.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
We face market risk exposure in the form of interest rate risk. These market risks arise from our debt obligations. We have no international operations. Our exposure to foreign currency fluctuations is not significant to our financial condition or results of operations.
 
GLPI’s primary market risk exposure is interest rate risk with respect to its indebtedness of $5,903.1$5,799.9 million at December 31, 2018.2020. Furthermore, $4,975.0$5,375.0 million of our obligations are the senior unsecured notes that have fixed interest rates with maturity dates ranging from two and one-half years to ten years. An increase in interest rates could make the financing of any acquisition by GLPI more costly, as well as increase the costs of its variable rate debt obligations. Rising interest rates could also limit GLPI’s ability to refinance its debt when it matures or cause GLPI to pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness. GLPI may manage, or hedge, interest rate risks related to its borrowings by means of interest rate swap agreements. GLPI also expects to manage its exposure to interest rate risk by maintaining a mix of fixed and variable rates for its indebtedness. However, the provisions of the Code applicable to REITs substantially limit GLPI’s ability to hedge its assets and liabilities.
 
The table below provides information at December 31, 20182020 about our financial instruments that are sensitive to changes in interest rates. For debt obligations, the table presents notional amounts maturing in each fiscal year and the related weighted-average interest rates by maturity dates. Notional amounts are used to calculate the contractual payments to be exchanged by maturity date and the weighted-average interest rates for our variable rate debt are based on implied forward LIBOR rates at December 31, 2018.2020.
 
 1/01/21- 12/31/211/01/22- 12/31/221/01/23- 12/31/231/01/24- 12/31/241/01/25 12/31/25ThereafterTotalFair Value at 12/31/2020
 (in thousands)
Long-term debt:        
Fixed rate$— $— $500,000 $400,000 $850,000 $3,625,000 $5,375,000 $6,026,840 
Average interest rate5.38 %3.35 %5.25 %4.88 %  
Variable rate$— $— $424,019 $— $— $— $424,019 $424,019 
Average interest rate (1) 
2.02 %   
57
 01/01/19- 12/31/19 1/01/20- 12/31/20 1/01/21- 12/31/21 1/01/22- 12/31/22 1/01/23- 12/31/23 Thereafter Total Fair Value at 12/31/2018
 (in thousands)
Long-term debt: 
  
  
  
  
  
  
  
Fixed rate$—
 $1,000,000
 $400,000
 $—
 $500,000
 $3,075,000
 $4,975,000
 $4,958,455
Average interest rate

 4.88% 4.38% 
 5.38% 5.38%  
  
                
Variable rate$—
 $—
 $525,000
 $—
 $402,000
 $—
 $927,000
 $909,308
Average interest rate (1) 


 
 4.29% 

 4.14%  
  
  
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(1) Estimated rate, reflective of forward LIBOR plus the spread over LIBOR applicable to variable-rate borrowing. For considerations surrounding the phase out of LIBOR refer to the Liquidity and Capital Resources discussion in this Annual Report on Form 10-K.

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ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the shareholdersShareholders and the Board of Directors of
Gaming and Leisure Properties, Inc. and Subsidiaries


Opinion on the Financial Statements


We have audited the accompanying consolidated balance sheets of Gaming and Leisure Properties, Inc. and Subsidiaries (the "Company") as of December 31, 20182020 and 2017,2019, the related consolidated statements of income, changes in shareholders’ equity (deficit), and cash flows, for each of the three years in the period ended December 31, 2018,2020, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 20182020 and 2017,2019, and the results of theirits operations and theirits cash flows for each of the three years in the period ended December 31, 2018,2020, in conformity with accounting principles generally accepted in the United States of America.


We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2018,2020, based on criteria established in Internal Control - -- Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 13, 2019,19, 2021, expressed an unqualified opinion on the Company's internal control over financial reporting.


Basis for Opinion


These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Lease Classification - Lease Term - See Note 14 to the financial statements
Critical Audit Matter Description
The Company performs a lease classification test upon the entry into any new tenant lease or lease modification to determine if the Company will account for the lease as an operating, sales-type lease, or direct financing lease. The accounting guidance under ASC 842 is complex and requires the use of judgments and assumptions by management to determine the proper accounting treatment of a lease. The lease classification tests and the resulting calculations require subjective judgments, such as determining the likelihood a tenant will exercise all renewal options, in order to determine the lease term. A slight change in estimate or judgment can result in a material difference in the financial statement presentation.

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Given the significant judgments made by management to determine the expected lease term, we performed audit procedures to assess the reasonableness of such judgments, which required a high degree of auditor judgment.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the judgments surrounding the determination of lease term for any new or reassessed lease included the following, among others:
•We tested the effectiveness of the controls over management’s assessment of the likelihood a tenant would exercise all renewal options.
•We evaluated the significant judgments management made to determine the expected lease term by:
◦Evaluating the significance of the leased assets to the tenant’s operations by examining available information including tenant’s financial statements.

◦Evaluating the Company’s historical pattern of tenant lease modifications by examining both confirming and contradictory evidence.

◦Obtaining lease agreements to examine material lease provisions considered by management in their analysis.

/s/ DELOITTEDeloitte & TOUCHE LLPTouche



New York, New York
February 13, 201919, 2021


We have served as the Company's auditor since 2016.












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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Balance Sheets
(amounts in thousands, except share and per share data) 
December 31, 2018 December 31, 2017December 31, 2020December 31, 2019
   
Assets   Assets
Real estate investments, net$7,331,460
 $3,662,045
Real estate investments, net$7,287,158 $7,100,555 
Land rights, net673,207
 640,148
Property and equipment, used in operations, net100,884
 108,293
Property and equipment, used in operations, net80,618 94,080 
Mortgage loans receivable303,684
 —
Investment in direct financing lease, net—
 2,637,639
Assets held for saleAssets held for sale61,448 0 
Real estate of Tropicana Las Vegas, netReal estate of Tropicana Las Vegas, net304,831 0 
Real estate loansReal estate loans0 303,684 
Right-of-use assets and land rights, netRight-of-use assets and land rights, net769,197 838,734 
Cash and cash equivalents25,783
 29,054
Cash and cash equivalents486,451 26,823 
Prepaid expenses30,967
 8,452
Prepaid expenses2,098 4,228 
Goodwill16,067
 75,521
Goodwill0 16,067 
Other intangible assets9,577
 9,577
Other intangible assets0 9,577 
Loan receivable13,000
 13,000
Deferred tax assets5,178
 4,478
Deferred tax assets, netDeferred tax assets, net5,690 6,056 
Other assets67,486
 58,675
Other assets36,877 34,494 
Total assets$8,577,293
 $7,246,882
Total assets$9,034,368 $8,434,298 
   
Liabilities   Liabilities
Accounts payable$2,511
 $715
Accounts payable$375 $1,006 
Accrued expenses30,297
 7,913
Accrued expenses398 6,239 
Accrued interest45,261
 33,241
Accrued interest72,285 60,695 
Accrued salaries and wages17,010
 10,809
Accrued salaries and wages5,849 13,821 
Gaming, property, and other taxes42,879
 35,399
Gaming, property, and other taxes146 944 
Lease liabilitiesLease liabilities152,203 183,971 
Long-term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts5,853,497
 4,442,880
Long-term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts5,754,689 5,737,962 
Deferred rental revenue293,911
 232,023
Deferred rental revenue333,061 328,485 
Deferred tax liabilities261
 244
Deferred tax liabilities359 279 
Other liabilities26,059
 25,411
Other liabilities39,985 26,651 
Total liabilities6,311,686
 4,788,635
Total liabilities6,359,350 6,360,053 
   
Commitments and Contingencies (Note 11)

 

Commitments and Contingencies (Note 13)Commitments and Contingencies (Note 13)00
   
Shareholders’ equity   Shareholders’ equity
   
Preferred stock ($.01 par value, 50,000,000 shares authorized, no shares issued or outstanding at December 31, 2018 and December 31, 2017)—
 —
Common stock ($.01 par value, 500,000,000 shares authorized, 214,211,932 and 212,717,549 shares issued and outstanding at December 31, 2018 and December 31, 2017, respectively)2,142
 2,127
Preferred stock ($.01 par value, 50,000,000 shares authorized, 0 shares issued or outstanding at December 31, 2020 and December 31, 2019)Preferred stock ($.01 par value, 50,000,000 shares authorized, 0 shares issued or outstanding at December 31, 2020 and December 31, 2019)0 0 
Common stock ($.01 par value, 500,000,000 shares authorized, 232,452,220 and 214,694,165 shares issued and outstanding at December 31, 2020 and December 31, 2019, respectively)Common stock ($.01 par value, 500,000,000 shares authorized, 232,452,220 and 214,694,165 shares issued and outstanding at December 31, 2020 and December 31, 2019, respectively)2,325 2,147 
Additional paid-in capital3,952,503
 3,933,829
Additional paid-in capital4,284,789 3,959,383 
Accumulated deficit(1,689,038) (1,477,709)Accumulated deficit(1,612,096)(1,887,285)
Total shareholders’ equity2,265,607
 2,458,247
Total shareholders’ equity2,675,018 2,074,245 
Total liabilities and shareholders’ equity$8,577,293
 $7,246,882
Total liabilities and shareholders’ equity$9,034,368 $8,434,298 
 
See accompanying notesNotes to the consolidated financial statements.Consolidated Financial Statements.



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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Income
(in thousands, except per share data)
 
Year ended December 31,202020192018
Revenues  
Rental income$1,031,036 $996,166 $747,654 
Income from direct financing lease0 0 81,119 
Interest income from real estate loans19,130 28,916 6,943 
Real estate taxes paid by tenants0 0 87,466 
Total income from real estate1,050,166 1,025,082 923,182 
Gaming, food, beverage and other102,999 128,391 132,545 
Total revenues1,153,165 1,153,473 1,055,727 
Operating expenses   
Gaming, food, beverage and other56,698 74,700 77,127 
Real estate taxes0 0 88,757 
Land rights and ground lease expense29,041 42,438 28,358 
General and administrative68,572 65,385 70,819 
(Gains) losses from dispositions of properties(41,393)92 309 
Depreciation230,973 240,435 137,093 
Loan impairment charges0 13,000 0 
  Goodwill impairment charges0 0 59,454 
Total operating expenses343,891 436,050 461,917 
Income from operations809,274 717,423 593,810 
Other income (expenses)   
Interest expense(282,142)(301,520)(247,684)
Interest income569 756 1,827 
   Losses on debt extinguishment(18,113)(21,014)(3,473)
Total other expenses(299,686)(321,778)(249,330)
Income before income taxes509,588 395,645 344,480 
Income tax expense3,877 4,764 4,964 
Net income$505,711 $390,881 $339,516 
Earnings per common share:  
Basic earnings per common share$2.31 $1.82 $1.59 
Diluted earnings per common share$2.30 $1.81 $1.58 
Year ended December 31, 2018 2017 2016
       
Revenues  
  
  
Rental income $747,654
 $671,190
 $567,444
Income from direct financing lease 81,119
 74,333
 48,917
Interest income from mortgaged real estate 6,943
 —
 —
Real estate taxes paid by tenants 87,466
 83,698
 67,843
Total income from real estate 923,182
 829,221
 684,204
Gaming, food, beverage and other 132,545
 142,086
 144,051
Total revenues 1,055,727
 971,307
 828,255
       
Operating expenses  
  
  
Gaming, food, beverage and other 77,127
 80,487
 82,463
Real estate taxes 88,757
 84,666
 69,448
Land rights and ground lease expense 28,358
 24,005
 14,799
General and administrative 71,128
 63,151
 71,368
Depreciation 137,093
 113,480
 109,554
  Goodwill impairment charges 59,454
 —
 —
Total operating expenses 461,917
 365,789
 347,632
Income from operations 593,810
 605,518
 480,623
       
Other income (expenses)  
  
  
Interest expense (247,684) (217,068) (185,896)
Interest income 1,827
 1,935
 2,123
   Losses on debt extinguishment (3,473) —
 —
Total other expenses (249,330) (215,133) (183,773)
       
Income before income taxes 344,480
 390,385
 296,850
Income tax expense 4,964
 9,787
 7,545
Net income $339,516
 $380,598
 $289,305
       
Earnings per common share:  
  
  
Basic earnings per common share $1.59
 $1.80
 $1.62
Diluted earnings per common share $1.58
 $1.79
 $1.60


 
See accompanying notesNotes to the consolidated financial statements.Consolidated Financial Statements.



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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Changes in Shareholders’ Equity (Deficit)
(in thousands, except share data)


Common StockAdditional
Paid-In
Capital		Accumulated
Deficit		Total
Shareholders’
Equity
Common Stock 
Additional
Paid-In
Capital
 
Accumulated
Deficit
 
Total
Shareholders’
Equity (Deficit)
 SharesAmount
Shares Amount 
Balance, December 31, 2015115,594,321
 $1,156
 $935,220
 $(1,189,890) $(253,514)
Issuance of common stock86,074,167
 861
 2,693,939
 —
 2,694,800
Stock option activity5,870,282
 59
 115,416
 —
 115,475
Restricted stock activity138,057
 1
 16,154
 —
 16,155
Dividends paid ($2.32 per common share)—
 —
 —
 (428,352) (428,352)
Net income—
 —
 —
 289,305
 289,305
Balance, December 31, 2016207,676,827
 2,077
 3,760,729
 (1,328,937) 2,433,869
Issuance of common stock3,864,872
 38
 139,376
 —
 139,414
Stock option activity1,013,984
 10
 20,993
 —
 21,003
Restricted stock activity161,866
 2
 12,731
 —
 12,733
Dividends paid ($2.50 per common share)—
 —
 —
 (529,370) (529,370)
Net income—
 —
 —
 380,598
 380,598
Balance, December 31, 2017212,717,549
 2,127
 3,933,829
 (1,477,709) 2,458,247
Balance, December 31, 2017212,717,549 $2,127 $3,933,829 $(1,477,709)$2,458,247 
Stock option activity1,007,750
 10
 19,805
 —
 19,815
Stock option activity1,007,750 10 19,805 — 19,815 
Restricted stock activity486,633
 5
 (1,131) —
 (1,126)Restricted stock activity486,633 5 (1,131)— (1,126)
Dividends paid ($2.57 per common share)—
 —
 —
 (550,435) (550,435)Dividends paid ($2.57 per common share)0 0 0 (550,435)(550,435)
Adoption of new revenue standard—
 —
 —
 (410) (410)Adoption of new revenue standard— — — (410)(410)
Net income—
 —
 —
 339,516
 339,516
Net income— — — 339,516 339,516 
Balance, December 31, 2018214,211,932
 $2,142
 $3,952,503
 $(1,689,038) $2,265,607
Balance, December 31, 2018214,211,932 2,142 3,952,503 (1,689,038)2,265,607 
ATM Program offering costs, net of issuance of common stockATM Program offering costs, net of issuance of common stock1,500 0 (255)— (255)
Stock option activityStock option activity26,799 0 592 — 592 
Restricted stock activityRestricted stock activity453,934 5 6,543 — 6,548 
Dividends paid ($2.74 per common share)Dividends paid ($2.74 per common share)— — — (589,128)(589,128)
Net incomeNet income— — — 390,881 390,881 
Balance, December 31, 2019Balance, December 31, 2019214,694,165 2,147 3,959,383 (1,887,285)2,074,245 
Issuance of common stock, net of costsIssuance of common stock, net of costs9,207,971 92 320,781 320,873 
Restricted stock activityRestricted stock activity528,285 5 4,706 4,711 
Dividends paid ($2.50 per common share)Dividends paid ($2.50 per common share)8,021,799 81 (81)(230,522)(230,522)
Net incomeNet income— — — 505,711 505,711 
Balance, December 31, 2020Balance, December 31, 2020232,452,220 $2,325 $4,284,789 $(1,612,096)$2,675,018 
 
See accompanying notesNotes to the consolidated financial statements.Consolidated Financial Statements.



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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(in thousands)
Year ended December 31,202020192018
Operating activities  
Net income$505,711 $390,881 $339,516 
Adjustments to reconcile net income to net cash provided by operating activities:  
Depreciation and amortization242,995 258,971 148,365 
Amortization of debt issuance costs, bond premiums and discounts10,503 11,455 12,167 
(Gains) losses on dispositions of property(41,393)92 309 
Deferred income taxes451 (755)(522)
Stock-based compensation20,004 16,198 11,152 
Straight-line rent adjustments4,576 34,574 61,888 
Deferred rent recognized(337,500)0 0 
Losses on debt extinguishment18,113 21,014 3,473 
Loan and goodwill impairment charges0 13,000 59,454 
(Increase) decrease,  
Prepaid expenses and other assets(6,628)(6,070)(673)
(Decrease), increase  
Accounts payable and accrued expenses(1,252)(1,775)1,670 
Accrued interest11,590 15,434 12,020 
Accrued salaries and wages(5,908)(3,189)6,201 
Gaming, property and other taxes and other liabilities6,815 472 (587)
Net cash provided by operating activities428,077 750,302 654,433 
Investing activities  
Capital project expenditures(474)0 (20)
Capital maintenance expenditures(3,130)(3,017)(4,284)
Proceeds from sale of property and equipment15 200 3,211 
Acquisition of real estate assets(5,898)0 (1,243,466)
   Originations of real estate loans0 0 (303,684)
   Collections of principal payments on investment in direct financing lease0 0 38,459 
Net cash used in investing activities(9,487)(2,817)(1,509,784)
Financing activities  
Dividends paid(230,522)(589,128)(550,435)
Taxes paid for shares withheld on restricted stock award vestings(15,293)(9,058)7,537 
Proceeds from issuance of common stock, net320,873 (255)0 
Proceeds from issuance of long-term debt2,076,383 1,358,853 2,593,405 
Financing costs(11,641)(10,029)(32,426)
Repayments of long-term debt(2,060,884)(1,477,949)(1,164,117)
Premium and related costs paid on tender of senior unsecured notes(15,747)(18,879)(1,884)
Net cash provided by (used in) financing activities63,169 (746,445)852,080 
Net increase (decrease) in cash and cash equivalents, including cash classified within assets held for sale481,759 1,040 (3,271)
Less decrease in cash classified within assets held for sale(22,131)0 0 
Net increase/decrease in cash and cash equivalents459,628 1,040 (3,271)
Cash and cash equivalents at beginning of period26,823 25,783 29,054 
Cash and cash equivalents at end of period$486,451 $26,823 $25,783 

Year ended December 31, 2018 2017 2016
Operating activities  
  
  
Net income $339,516
 $380,598
 $289,305
Adjustments to reconcile net income to net cash provided by operating activities:  
  
  
Depreciation and amortization 148,365
 123,835
 115,717
Amortization of debt issuance costs, bond premiums and original issuance discounts 12,167
 13,026
 15,146
Losses (gains) on dispositions of property 309
 530
 (455)
Deferred income taxes (522) (561) (1,535)
Stock-based compensation 11,152
 15,636
 18,312
Straight-line rent adjustments 61,888
 65,971
 58,673
Losses on debt extinguishment 3,473
 —
 —
Goodwill impairment charges 59,454
 —
 —
       
(Increase) decrease,  
  
  
Prepaid expenses and other assets (673) (5,332) 7,565
(Decrease), increase  
  
  
Accounts payable 1,796
 (421) 506
Accrued expenses (126) 411
 (4,672)
Accrued interest 12,020
 (502) 16,120
Accrued salaries and wages 6,201
 190
 (3,100)
Gaming, property and other taxes (149) (517) 913
Other liabilities (438) 5,847
 1,875
Net cash provided by operating activities 654,433
 598,711
 514,370
Investing activities  
  
  
Capital project expenditures (20) (78) (330)
Capital maintenance expenditures (4,284) (3,178) (3,111)
Proceeds from sale of property and equipment 3,211
 934
 1,134
Principal payments on loan receivable —
 13,200
 3,150
Acquisition of real estate assets (1,243,466) (83,252) (3,267,992)
   Originations of mortgage loans receivable (303,684) —
 —
   Collections of principal payments on investment in direct financing lease 38,459
 73,072
 48,533
Net cash (used in) provided by investing activities (1,509,784) 698
 (3,218,616)
Financing activities  
  
  
Dividends paid (550,435) (529,370) (428,352)
Proceeds from exercise of options, net of taxes paid related to shares withheld for tax purposes on restricted stock award vestings 7,537
 18,157
 113,484
Proceeds from issuance of common stock, net of issuance costs —
 139,414
 870,810
Proceeds from issuance of long-term debt 2,593,405
 100,000
 2,552,000
Financing costs (32,426) —
 (31,911)
Repayments of long-term debt (1,164,117) (335,112) (377,104)
Premium and related costs paid on tender of senior unsecured notes (1,884) —
 —
Net cash provided by (used in) financing activities 852,080
 (606,911) 2,698,927
Net decrease in cash and cash equivalents (3,271) (7,502) (5,319)
Cash and cash equivalents at beginning of period 29,054
 36,556
 41,875
Cash and cash equivalents at end of period $25,783
 $29,054
 $36,556
See Note 18 20 to the Consolidated Financial Statements for supplemental cash flow information and noncash investing and financing activities.information.

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Gaming and Leisure Properties, Inc.
Notes to the Consolidated Financial Statements
 
1.Business and Basis of Presentation
 
Gaming and Leisure Properties, Inc. ("GLPI") is a self-administered and self-managed Pennsylvania real estate investment trust ("REIT"). GLPI (together with its subsidiaries, the "Company") was incorporated on February 13, 2013, as a wholly-owned subsidiary of Penn National Gaming, Inc. ("Penn"). On November 1, 2013, Penn contributed to GLPI, through a series of internal corporate restructurings, substantially all of the assets and liabilities associated with Penn’s real property interests and real estate development business, as well as the assets and liabilities of Hollywood Casino Baton Rouge and Hollywood Casino Perryville which(which are referred to as the "TRS Properties,"Properties") and then spun-off GLPI to holders of Penn's common and preferred stock in a tax-free distribution (the "Spin-Off"). The assets and liabilities of GLPI were recorded at their respective historical carrying values at the time of the Spin-Off in accordance with the provisions of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 505-60 - Spinoffs and Reverse Spinoffs ("("ASC 505").


The Company elected on its United States ("U.S.") federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and GLPI, together with anits indirect wholly-owned subsidiary, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. (d/b/a Hollywood Casino Baton Rouge) and Penn Cecil Maryland, Inc. (d/b/a Hollywood Casino Perryville) as a "taxable REIT subsidiary" ("TRS") effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a TRS, which together with the TRS Properties and GLP Holdings, Inc. is the Company's TRS Segment (the "TRS Segment"). In connection with the Spin-Off, Penn allocated its accumulated earnings and profits (as determined for U.S. federal income tax purposes) for periods prior to the consummation of the Spin-Off between Penn and GLPI. In connection with its election to be taxed as a REIT for U.S. federal income tax purposes, GLPI declared a special dividend to its shareholders to distribute any accumulated earnings and profits relating to the real property assets and attributable to any pre-REIT years, including any earnings and profits allocated to GLPI in connection with the Spin-Off, to comply with certain REIT qualification requirements.


GLPI’s primary business consists of acquiring, financing, and owning real estate property to be leased to gaming operators in triple-net lease arrangements. As of December 31, 2020, GLPI’s portfolio consisted of interests in 48 gaming and related facilities, including the TRS Properties, the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with 7 gaming and related facilities operated by Caesars, the real property associated with 4 gaming and related facilities operated by Boyd and the real property associated with the Casino Queen Holding Company Inc. ("Casino Queen") in East St. Louis, Illinois.  These facilities, including our corporate headquarters building, are geographically diversified across 16 states and contain approximately 24.3 million square feet. As of December 31, 2020, the Company's properties were 100% occupied. GLPI expects to continue growing its portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming operators under prudent terms.

Penn Master Lease and Casino Queen Lease

As a result of the Spin-Off, GLPI owns substantially all of Penn’s former real property assets (as of the consummation of the Spin-Off) and leases back most of those assets to Penn for use by its subsidiaries, under a unitary master lease, a triple-net operating lease with an initialthe term of 15 years (expiringwhich expires October 31, 2028)2033, with no purchase option, followed by fourthree remaining 5-year renewal options (exercisable by Penn)the tenant) on the same terms and conditions (the "Penn Master Lease"), and GLPI also owns and operates the TRS Properties through an indirect wholly-owned subsidiary, GLP Holdings, Inc. Segment. GLPI leases the Casino Queen property in East St. Louis back to its operators on a triple-net basis on terms similar to those in the Penn Master Lease (the "Casino Queen Lease").

Amended Pinnacle Master Lease, Boyd Master Lease and Belterra Park Lease

In April 2016, the Company acquired substantially all of the real estate assets of Pinnacle Entertainment, Inc. ("Pinnacle") for approximately $4.8 billion. GLPI originally leased these assets back to Pinnacle, under a unitary triple-net lease with an initialthe term of 10 years (expiringwhich expires on April 30, 2026)2031, with no purchase option, followed by fivefour remaining 5-year renewal options (exercisable by Pinnacle)the tenant) on the same terms and conditions (the "Pinnacle Master Lease"). On October 15, 2018, the Company completed its previously announced transactions with Penn, Pinnacle and Boyd Gaming Corporation ("Boyd") to accommodate Penn's acquisition of the majority of Pinnacle's operations, pursuant to a definitive agreement and plan of merger between Penn and Pinnacle, dated December 17, 2017 (the "Penn-Pinnacle Merger"). Concurrent with the Penn-Pinnacle Merger, the Company amended the Pinnacle Master Lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd (the "Amended Pinnacle Master Lease") and entered into a new unitary triple-net master lease agreement with Boyd (the "Boyd Master Lease") for these properties on terms similar to the Company’s existing master leases.Amended Pinnacle Master Lease. The Boyd Master Lease has an initial term of
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10 years (from the original April 2016 commencement date of the Pinnacle Master Lease and expiring April 30, 2026), with no purchase option, followed by 5 5-year renewal options (exercisable by the tenant) on the same terms and conditions. The Company also purchased the real estate assets of Plainridge Park Casino ("Plainridge Park") from Penn for $250.0 million, exclusive of transaction fees and taxes, and added this property to the Amended Pinnacle Master Lease. The Amended Pinnacle Master Lease was assumed by Penn at the consummation of the Penn-Pinnacle Merger. The Company also entered into a mortgage loan agreement with Boyd in connection with Boyd's acquisition of Belterra Park Gaming & Entertainment Center ("Belterra Park"), whereby the Company loaned Boyd $57.7 million. See Note 4 for further details surroundingmillion (the "Belterra Park Loan"). In May 2020, the original Pinnacle acquisitionCompany acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to a long-term lease (the "Belterra Park Lease") with a Boyd affiliate operating the property.The Belterra Park Lease rent terms are consistent with the Boyd Master Lease.The annual rent is comprised of a fixed component, part of which is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met and a component that is based on the performance of the facilities which is adjusted, subject to certain floors, every two years to an amount equal to 4% of the average annual net revenues of Belterra Park during the preceding two years in excess of a contractual baseline.

The Meadows Lease

The real estate assets of the Meadows are leased to Penn pursuant to the Meadows Lease. The Meadows Lease commenced on September 9, 2016 and has an initial term of 10 years, with no purchase option, and the subsequent acquisitionoption to renew for three successive 5-year terms and one 4-year term (exercisable by the tenant) on the same terms and conditions. The Meadows Lease contains a fixed component, subject to annual escalators, and a component that is based on the performance of Pinnaclethe facility, which is reset every two years to an amount determined by Penn.multiplying (i) 4% by (ii) the average annual net revenues of the facility for the trailing two-year period. The Meadows Lease contains an annual escalator provision for up to 5% of the base rent, if certain rent coverage ratio thresholds are met, which remains at 5% until the earlier of ten years or the year in which total rent is $31 million, at which point the escalator will be reduced to 2% annually thereafter.


GLPI’s primary business consists of acquiring, financing,Amended and owning real estate property to be leased to gaming operators in triple-net lease arrangements. As of December 31, 2018, GLPI’s portfolio consisted of interests in 46 gaming and related facilities, including the TRS Properties, the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with 6 gaming and related facilities operated by Eldorado (including one mortgaged facility), the real property associated with 4 gaming and related facilities operated by Boyd (including one mortgaged facility) and the real property associated with the Casino Queen in East St. Louis, Illinois.  These facilities are geographically diversified across 16 states and contain approximately 23.5 million square feet. As of December 31, 2018, the Company's properties were 100% occupied.Restated Caesars Master Lease


GLPI expects to grow its portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming operators under prudent terms. In addition to the acquisition of Plainridge Park described above, onOn October 1, 2018, the

Company closed its previously announced transaction to acquire certain real property assets from Tropicana Entertainment Inc. (“Tropicana”("Tropicana") and certain of its affiliates pursuant to a Purchase and Sale Agreement (the “Real"Real Estate Purchase Agreement”Agreement") dated April 15, 2018 between Tropicana and GLP Capital L.P. ("GLP Capital"), the operating partnership of GLPI, (“GLP Capital”), which was subsequently amended on October 1, 2018 (as amended, the “Amended"Amended Real Estate Purchase Agreement”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”"GLP Assets") from Tropicana for an aggregate cash purchase price of $964.0 million, exclusive of transaction fees and taxes (the "Tropicana Acquisition"). Concurrent with the Tropicana Acquisition, Eldorado Resorts, Inc. (now doing business as Caesars Entertainment Corporation (NASDAQ: CZR) ("Eldorado"Caesars")) 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, EldoradoCaesars and a wholly-owned subsidiary of Eldorado (the "Tropicana Merger Agreement")Caesars and leased the GLP Assets from the Company pursuant to the terms of a new unitary triple-net master lease with a 15-yearan initial term of 15 years, with no purchase option, followed by four4 successive 5 -year5-year renewal periods (exercisable by Eldorado)the tenant) on the same terms and conditions (the “Eldorado"Caesars Master Lease”Lease"). Additionally,On June 15, 2020, the Company amended and restated the Caesars Master Lease (as amended, the "Amended and Restated Caesars Master Lease") to, (i) extend the initial term of 15 years to 20 years, with renewals of up to an additional 20 years at the option of Caesars, (ii) remove the variable rent component in its entirety commencing with the third lease year, (iii) in the third lease year increase annual land base rent to approximately $23.6 million and annual building base rent to approximately $62.1 million, (iv) provide fixed escalation percentages that delay the escalation of building base rent until the commencement of the fifth lease year with building base rent increasing annually by 1.25% in the fifth and sixth lease year, 1.75% in the seventh and eighth lease years and 2% in the ninth lease year and each lease year thereafter, (v) subject to the satisfaction of certain conditions, permit Caesars to elect to replace the Tropicana Evansville and/or Tropicana Greenville properties under the Amended and Restated Caesars Master Lease with one or more of Caesars Gaming Scioto Downs, The Row in Reno, Isle Casino Racing Pompano Park, Isle Casino Hotel – Black Hawk, Lady Luck Casino – Black Hawk, Isle Casino Waterloo ("Waterloo"), Isle Casino Bettendorf ("Bettendorf") or Isle of Capri Casino Boonville, provided that the aggregate value of such new property, individually or collectively, is at least equal to the value of Tropicana Evansville or Tropicana Greenville, as applicable (vi) permit Caesars to elect to sell its interest in Belle of Baton Rouge and sever it from the Amended and Restated Caesars Master Lease (with no change to the rent obligation to the Company), subject to the satisfaction of certain conditions, and (vii) provide certain relief under the operating, capital expenditure and financial covenants thereunder in the event of facility closures due to pandemics, governmental restrictions and certain other instances of unavoidable delay. The effectiveness of the Amended and Restated Caesars Master Lease was subject to the review of certain gaming regulatory agencies and the expiration of applicable gaming regulatory advance notice periods which were received on July 23, 2020. On December 18, 2020, the Company and Caesars completed an Exchange Agreement with subsidiaries of Caesars in which Caesars transferred
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to the Company the real estate assets of Waterloo and Bettendorf in exchange for the transfer by the Company to Caesars of the real property assets of Tropicana Evansville, plus a cash payment of $5.7 million. This resulted in a non-cash gain of $41.4 million which represented the difference between the fair value of the properties received compared to the carrying value of Tropicana Evansville and the cash payment made.

Lumière Place Lease

On October 1, 2018 the Company madeentered into a mortgage loan to Eldorado in the amount of $246.0 millionagreement with Caesars in connection with Eldorado’sCaesars’s acquisition of Lumière Place (togetherCasino ("Lumière Place"), whereby the Company loaned Caesars $246.0 million (the "CZR loan"). The CZR loan bore interest at a rate equal to (i) 9.09% until October 1, 2019 and (ii) 9.27% until its maturity. On the one-year anniversary of the CZR loan, the mortgage evidenced by a deed of trust on the Lumière Place property terminated and the loan became unsecured. On June 24, 2020, the Company received approval from the Missouri Gaming Commission to own the Lumière Place property in satisfaction of the CZR loan. On September 29, 2020, the transaction closed and we entered into a new triple net lease with Caesars (the "Lumière Place Lease") the initial term of which expires on October 31, 2033, with 4 separate renewal options of five years each, exercisable at the tenants' option. The Lumière Place Lease's rent is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met.

Tropicana Las Vegas

On April 16, 2020, the Company and certain of its subsidiaries acquired the real property associated with the Tropicana AcquisitionLas Vegas Casino Hotel Resort ("Tropicana Las Vegas") from Penn in exchange for $307.5 million of rent credits to be applied against future rent obligations. This asset has been placed in our TRS Segment. See Note 7 for further details related to this transaction.

Morgantown Lease

On October 1, 2020, the "Tropicana Transactions"Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits which were fully utilized by Penn in the fourth quarter of 2020. The Company is leasing the land back to an affiliate of Penn for an initial annual rent of $3.0 million, provided, however, that (i) on the opening date and on each anniversary thereafter the rent shall be increased by 1.5% annually (on a prorated basis for the remainder of the lease year in which the gaming facility opens) for each of the following three lease years and (ii) commencing on the fourth anniversary of the opening date and for each anniversary thereafter, (a) if the Consumer Price Index ("the CPI") increase is at least 0.5% for any lease year, the rent for such lease year shall increase by 1.25% of rent as of the immediately preceding lease year, and (b) if the CPI increase is less than 0.5% for such lease year, then the rent shall not increase for such lease year subject to escalation provisions following the opening of the property (the "Morgantown Lease").

In the first quarter of 2020, it became clear that there was a global outbreak of a new strain of novel coronavirus COVID-19 ("COVID-19"). The global, domestic and local response to the COVID-19 outbreak continues to evolve. Responses to the COVID-19 outbreak have included mandates from federal, state, and/or local authorities that required temporary closures of or imposed limitations on the operations of non-essential businesses. All of the Company's tenants' casino operations, in addition to the Company's two TRS Properties, were closed in mid-March. Our properties began reopening at limited capacity in May and by early July nearly all had resumed operations at limited capacity. However, in the fourth quarter, increased spread of COVID-19 led some jurisdictions to impose temporary closures once again. As of the date of this filing, only one of our properties remains closed.
The consolidated financial statements include the accounts of GLPI and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
The preparation of financial statements in conformity with GAAPU.S. Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses for the reporting periods. Actual results may differ from those estimates. 

2.    New Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In May 2017, the Financial Accounting Standards Board ("FASB") issued ASU No. 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting ("ASU 2017-09"). This ASU provides clarity about which changesCertain prior period amounts have been reclassified to conform to the termscurrent period presentation, specifically gains and losses from dispositions of properties were previously classified within General and administrative expenses and are now presented separately on the Consolidated Statements of Income.


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2.Summary of Significant Accounting Policies

Real Estate Investments
Real estate investments primarily represent land and buildings leased to the Company's tenants. The Company records the acquisition of real estate assets at fair value, including acquisition and closing costs. The cost of properties developed by the Company include costs of construction, property taxes, interest and other miscellaneous costs incurred during the development period until the project is substantially complete and available for occupancy. The Company considers the period of future benefit of the asset to determine the appropriate useful lives. Depreciation is computed using a straight-line method over the estimated useful lives of the buildings and building improvements which are generally between 10 to 31 years.
The Company continually monitors events and circumstances that could indicate that the carrying amount of its real estate investments may not be recoverable or conditionsrealized. The factors considered by the Company in performing these assessments include evaluating whether the tenant is current on its lease payments, the tenant’s rent coverage ratio, the financial stability of the tenant and its parent company, and any other relevant factors. When indicators of potential impairment suggest that the carrying value of a share-based payment award requirereal estate investment may not be recoverable, the application of modification accounting. Specifically, ASU 2017-09 clarifies that changes to the terms or conditions of an award should be accounted for as a modification unless all of the following are met: 1)Company estimates the fair value of the modified awardinvestment by calculating the undiscounted future cash flows from the use and eventual disposition of the investment. This amount is compared to the asset's carrying value. If the Company determines the carrying amount is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP. The Company groups its real estate investments together by lease, the lowest level for which identifiable cash flows are available, in evaluating impairment. In assessing the recoverability of the carrying value, the Company must make assumptions regarding future cash flows and other factors. The factors considered by the Company in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the effect of obsolescence, demand, competition and other factors. If these estimates or the related assumptions change in the future, the Company may be required to record an impairment loss.
Property and Equipment Used in Operations
Property and equipment are stated at cost, less accumulated depreciation and represent assets used by the Company's TRS Properties and certain corporate assets. Maintenance and repairs that neither add materially to the value of the asset nor appreciably prolong its useful life are charged to expense as incurred. Gains or losses on the disposal of property and equipment are included in the determination of income.
Depreciation of property and equipment is recorded using the straight-line method over the following estimated useful lives:
Land improvements15 to 34 years
Building and improvements5 to 31 years
Furniture, fixtures, and equipment3 to 31 years
Leasehold improvements are depreciated over the shorter of the estimated useful life of the improvement or the related lease term. The estimated useful lives are determined based on the nature of the assets as well as the Company's current operating strategy.
The Company reviews the carrying value of its property and equipment for possible impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable based upon the estimated undiscounted future cash flows expected to result from its use and eventual disposition. If the Company determines the carrying amount is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP. In estimating expected future cash flows for determining whether an asset is impaired, assets are grouped at the individual property level. In assessing the recoverability of the carrying value of property and equipment, the Company must make assumptions regarding future cash flows and other factors. The factors considered by the Company in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the effect of obsolescence, demand, competition and other factors. If these estimates or the related assumptions change in the future, the Company may be required to record an impairment loss for these assets.
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Real Estate Loans and Other Loans Receivable
The Company may periodically loan funds to casino owner-operators for the purchase of gaming related real estate and/or operations. Loans for the purchase of real estate assets of gaming-related properties are classified as real estate loans on the Company's consolidated balance sheets, while loans for an operator's general operations are classified as loans receivable on the Company's consolidated balance sheets. Loans receivable are recorded on the Company's consolidated balance sheets at carrying value which approximates fair value since collection of principal is reasonably assured. Interest income related to real estate loans is recorded as interest income from real estate loans within the Company's consolidated statements of income in the period earned, whereas interest income related to other loans receivable is recorded as non-operating interest income within the Company's consolidated statements of income in the period earned.
Prior to the adoption of Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"), the Company evaluated loans for impairment when it was probable that it would not be able to collect all amounts due according to the contractual terms of the agreement. All amounts due under the contractual terms of the agreement means that both contractual interest payments and contractual principal payments will be collected as scheduled in the loan agreement. Indicators of impairment may include delinquent payments, a decline in the credit worthiness of a debtor, or a decline in the underlying property/tenant’s performance. The Company measures loan impairment based upon the present value of expected future cash flows discounted at the loan’s original effective interest rate. The determination of whether loans are impaired involves judgments and assumptions based on objective and subjective factors. If an impairment occurs, the Company will reduce the carrying value of the loan and record a corresponding charge to net income.
The Company's adoption of Accounting Standards Update ASU 2016-13 on January 1, 2020 (as described in Note 3) did not result in the Company recording any allowances against its real estate loans for expected losses. The Company has no outstanding loans as of December 31, 2020. See Note 8 for further details.
Lease Assets and Lease Liabilities
The Company determines whether a contract is or contains a lease at its inception. A lease is defined as the right to control the use of identified property, plant, or equipment for a period of time in exchange for consideration. Right-of-use assets and lease liabilities are recorded on the Company's consolidated balance sheet at the lease commencement date for operating leases in which the Company acts as lessee. Right-of-use assets represent the Company's rights to use underlying assets for the term of the lease and lease liabilities represent the Company's future obligations under the lease agreement. Right-of-use assets and lease liabilities are recognized at the lease commencement date based upon the estimated present value of the lease payments. As the rate implicit in the Company's leases (in which the Company acts as lessee) cannot readily be determined, the Company utilizes its own estimated incremental borrowing rates to determine the present value of its lease payments. Consideration is given to the Company's recent debt issuances, as well as publicly available data for instruments with similar characteristics, including tenor, when determining the incremental borrowing rates of the Company's leases.
The Company includes options to extend a lease in its lease term when it is reasonably certain that the Company will exercise those renewal options. In the instance of the Company's ground leases associated with its tenant occupied properties, the Company has included all available renewal options in the lease term, as it intends to renew these leases indefinitely. The Company accounts for the lease and nonlease components (as necessary) of its leases of all classes of underlying assets as a single lease component. Leases with a term of 12 months or less are not recorded on the Company's consolidated balance sheet.
Land rights, net represent the Company's rights to land subject to long-term ground leases. The Company obtained ground lease rights through the acquisition of several of its rental properties and immediately subleased the land to its tenants. These land rights represent the below market value of the related ground leases. The Company assessed the acquired ground leases to determine if the lease terms were favorable or unfavorable, given market conditions at the acquisition date. Because the market rents to be received under the Company's triple-net tenant leases were greater than the rents to be paid under the acquired ground leases, the Company concluded that the ground leases were below market and were therefore required to be recorded as a definite lived asset (land rights) on its books.
Right-of-use assets and land rights are monitored for potential impairment in much the same way as the Company's real estate assets, using the impairment model in ASC 360 - Property, Plant and Equipment. If the Company determines the carrying amount of a right-of-use asset or land right is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP.
Cash and Cash Equivalents
The Company considers all cash balances and highly-liquid investments with original maturities of three months or less to be cash and cash equivalents.
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Prepaid Expenses and Other Assets
Prepaid expenses consist of expenditures for goods or services before the goods are used or the services are received. These amounts are deferred and charged to operations as the benefits are realized and primarily consist of prepayments for insurance, property taxes and other contracts that will be expensed during the subsequent year. It also includes transaction costs that will be allocated to purchase price upon the closing of an asset acquisition. Other assets primarily consists of accounts receivable and deferred compensation plan assets (See Note 13 for further details on the deferred compensation plan).
Goodwill and Intangible Assets
The Company's goodwill and intangible assets are the result of the contribution of Hollywood Casino Baton Rouge and Hollywood Casino Perryville in connection with the Spin-Off. The Company's goodwill resides on the books of its Hollywood Casino Baton Rouge subsidiary, while the other intangible asset represents a gaming license on the books of its Hollywood Casino Perryville subsidiary. Both subsidiaries are members of the TRS Segment and are considered separate reporting units under ASC 350 - Intangibles - Goodwill and Other ("ASC 350"). Goodwill is tested at the reporting unit level, which is an operating segment or one level below an operating segment for which discrete financial information is available
Under ASC 350, the Company is required to test goodwill for impairment at least annually and whenever events or circumstances indicate that it is more likely than not that goodwill may be impaired. The Company has elected to perform its annual goodwill impairment test as of October 1 of each year. In accordance with ASC 350, the Company tests goodwill for impairment subsequent to testing its other long-lived assets for impairment.
In accordance with ASC 350, the Company considers its Hollywood Casino Perryville gaming license an indefinite-lived intangible asset that does not require amortization based on the Company's future expectations to operate this casino indefinitely, as well as the gaming industry's historical experience in renewing these intangible assets at minimal cost with various state gaming commissions. Rather, the Company's gaming license is tested annually, or more frequently if indicators of impairment exist, for impairment by comparing the fair value of the original award immediately beforerecorded asset to its carrying amount. If the original award is modified, 2) the vesting conditionscarrying amount of the modifiedindefinite-life intangible asset exceeds its fair value, an impairment loss is recognized.
The Company calculates the fair value of its gaming license using the Greenfield Method under the income approach. The Greenfield Method estimates the fair value of the gaming license assuming the Company built a casino with similar utility to that of the existing facility. The method assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. As such the value of the license is a function of the following items:
•Projected revenues and operating cash flows;
•Theoretical construction costs and duration;
•Pre-opening expenses;
•Discounting that reflects the level of risk associated with receiving future cash flows attributable to the license; and
•Remaining useful life of the license
The evaluation of goodwill and indefinite-lived intangible assets requires the use of estimates about future operating results to determine the estimated fair value of the reporting unit and the indefinite-lived intangible assets. The Company must make various assumptions and estimates in performing its impairment testing. The implied fair value includes estimates of future cash flows that are based on reasonable and supportable assumptions, which represent the Company's best estimates of the cash flows expected to result from the use of the assets. Changes in estimates, increases in the Company's cost of capital, reductions in transaction multiples, changes in operating and capital expenditure assumptions or application of alternative assumptions and definitions could produce significantly different results. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from the Company's estimates. If the Company's ongoing estimates of future cash flows are not met, the Company may have to record impairment charges in future accounting periods. The Company's estimates of cash flows are based on the current regulatory and economic climates, as well as recent operating information and budgets. These estimates could be negatively impacted by changes in federal, state or local regulations, economic downturns, or other events.
Forecasted cash flows can be significantly impacted by the local economy in which the Company's subsidiaries operate. For example, increases in unemployment rates can result in decreased customer visitations and/or lower customer spend per visit. In addition, new legislation which approves gaming in nearby jurisdictions or further expands gaming in jurisdictions in which the Company operates can result in increased competition for the property. This generally has a negative effect on profitability once competitors become established, as a certain level of cannibalization occurs absent an overall
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increase in customer visitations. Lastly, increases in gaming taxes approved by state regulatory bodies can negatively impact forecasted cash flows.
Assumptions and estimates about future cash flow levels are complex and subjective. They are sensitive to changes in underlying assumptions and can be affected by a variety of factors, including external factors, such as industry, geopolitical and economic trends, and internal factors, such as changes in the Company's business strategy, which may reallocate capital and resources to different or new opportunities which management believes will enhance the Company's overall value but may be to the detriment of its existing operations.
The Company reclassified its goodwill and other intangible assets into Assets held for sale at December 31, 2020. See Note 6 for additional discussion.
Debt Issuance Costs and Bond Premiums and Discounts
Debt issuance costs that are incurred by the Company in connection with the issuance of debt are deferred and amortized to interest expense over the contractual term of the underlying indebtedness. In accordance with ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, the Company records long-term debt net of unamortized debt issuance costs on its consolidated balance sheets. Similarly, the Company records long-term debt net of any unamortized bond premiums and original issuance discounts on its consolidated balance sheets. Any original issuance discounts or bond premiums are also amortized to interest expense over the contractual term of the underlying indebtedness.
Fair Value of Financial Assets and Liabilities

Fair value is defined as the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are classified based upon the level of judgment associated with the inputs used to measure their fair value. ASC 820 - Fair Value Measurements and Disclosures ("ASC 820") establishes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach, and cost approach). The levels of the hierarchy related to the subjectivity of the valuation inputs are described below:

•Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. 

•Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly quoted intervals. 

•Level 3: Unobservable inputs that reflect the reporting entity's own assumptions, as there is little, if any, related market activity.

        The Company's assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy.

Revenue Recognition

The Company recognizes rental revenue from tenants, including rental abatements, lease incentives and contractually fixed increases attributable to operating leases, on a straight-line basis over the term of the related leases when collectability is reasonably assured in accordance with ASC 842 - Leases. Additionally, percentage rent that is fixed and determinable at the lease inception date is recorded on a straight-line basis over the lease term, resulting in the recognition of deferred rental revenue on the Company’s consolidated balance sheets. Deferred rental revenue is amortized to rental revenue on a straight-line basis over the remainder of the lease term. The lease term includes the initial non-cancelable lease term and any reasonably assured renewable periods. Contingent rental income that is not fixed and determinable at lease inception is recognized only when the lessee achieves the specified target. Recognition of rental income commences when control of the facility has been transferred to the tenant.

Additionally, in accordance with ASC 842, the Company records revenue for the ground lease rent paid by its tenants with an offsetting expense in land rights and ground lease expense within the consolidated statement of income as the Company has concluded that as the lessee it is the primary obligor under the ground leases. The Company subleases these ground leases back to its tenants, who are responsible for payment directly to the landlord.
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The Company may periodically loan funds to casino owner-operators for the purchase of gaming related real estate. Interest income related to real estate loans is recorded as revenue from real estate within the Company's consolidated statements of income in the period earned.
Gaming revenue generated by the TRS Properties mainly consists of revenue from slot machines and to a lesser extent, table game and poker revenue. Gaming revenue from slot machines is the aggregate net difference between gaming wins and losses with liabilities recognized for funds deposited by customers before gaming play occurs, for "ticket-in, ticket-out" coupons in the customers’ possession, and for accruals related to the anticipated payout of progressive jackpots. Progressive slot machines, which contain base jackpots that increase at a progressive rate based on the number of coins played, are charged to revenue as the amount of the jackpots increase. Table game gaming revenue is the aggregate of table drop adjusted for the change in aggregate table chip inventory. Table drop is the total dollar amount of the currency, coins, chips, tokens, outstanding counter checks (markers), and front money that are removed from the live gaming tables. Gaming revenue is recognized net of certain sales incentives, including promotional allowances in accordance with ASC 606 - Revenues from Contracts with Customers. The Company also defers a portion of the revenue received from customers (who participate in the points-based loyalty programs) at the time of play until a later period when the points are redeemed or forfeited. Other revenues at the TRS Properties are derived from the properties' dining, retail and certain other ancillary activities and revenue for these activities is recognized as services are performed.

Stock-Based Compensation
The Company's Amended 2013 Long Term Incentive Compensation Plan (the "2013 Plan") provides for the Company to issue restricted stock awards, including performance-based restricted stock awards, and other equity or cash based awards to employees. Any director, employee or consultant shall be eligible to receive such awards.
The Company accounts for stock compensation under ASC 718 - Compensation - Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. This expense is recognized ratably over the requisite service period following the date of grant. The fair value of the Company's time-based restricted stock awards is equivalent to the closing stock price on the day prior to grant. The Company utilizes a third-party valuation firm to measure the fair value of performance-based restricted stock awards at grant date using the Monte Carlo model.
The unrecognized compensation cost relating to restricted stock awards and performance-based restricted stock awards is recognized as expense over the awards’ remaining vesting periods.

See Note 15 for further information related to stock-based compensation.
Income Taxes
The TRS Segment is able to engage in activities resulting in income that would not be qualifying income for a REIT. As a result, certain activities of the Company which occur within its TRS Segment are subject to federal and state income taxes. 
The Company accounts for income taxes in accordance with ASC 740 - Income Taxes ("ASC 740"). Under ASC 740, deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and are measured at the prevailing enacted tax rates that will be in effect when these differences are settled or realized. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized. The realizability of the deferred tax assets is evaluated by assessing the valuation allowance and by adjusting the amount of the allowance, if any, as necessary. The factors used to assess the likelihood of realization are the sameforecast of future taxable income.
ASC 740 also creates a single model to address uncertainty in tax positions, and clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in an enterprise's financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not have any uncertain tax positions for the three years ended December 31, 2020.
The Company is required under ASC 740 to disclose its accounting policy for classifying interest and penalties, the amount of interest and penalties charged to expense each period, as well as the vesting conditionscumulative amounts recorded in the consolidated balance sheets. If and when they occur, the Company will classify any income tax-related penalties and interest accrued related to unrecognized tax benefits in taxes on income within the consolidated statements of income. During the original award immediately beforeyears ended December 31, 2020, 2019 and 2018, the original award is modifiedCompany recognized 0 penalties and 3) the classificationinterest, net of the modified award as an equity instrument or a liability instrument is the same as the classificationdeferred income taxes.
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The Company adopted ASU 2017-09elected on its U.S. federal income tax return for its taxable year that began on January 1, 20182014 to be treated as a REIT and doesthe Company, together with an indirect wholly-owned subsidiary of the Company, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. and Penn Cecil Maryland, Inc. as a "taxable REIT subsidiary" effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a “taxable REIT subsidiary”.
The Company continues to be organized and to operate in a manner that will permit the Company to qualify as a REIT. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of its annual REIT taxable income to shareholders. As a REIT, the Company generally will not expect ASU 2017-09be subject to significantly impactfederal, state or local income tax on income that it distributes as dividends to its accountingshareholders, except in those jurisdictions that do not allow a deduction for share-based payment awards,such distributions. If the Company fails to qualify as changesa REIT in any taxable year, it will be subject to awards' termsU.S. federal, state and conditions subsequentlocal income tax, including any applicable alternative minimum tax, on its taxable income at regular corporate income tax rates, and dividends paid to its shareholders would not be deductible by the Company in computing taxable income. Any resulting corporate liability could be substantial and could materially and adversely affect the Company's net income and net cash available for distribution to shareholders. Unless the Company was entitled to relief under certain Internal Revenue Code provisions, the Company also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which it failed to qualify to be taxed as a REIT.
Earnings Per Share
The Company calculates earnings per share ("EPS") in accordance with ASC 260 - Earnings Per Share. Basic EPS is computed by dividing net income applicable to common stock by the weighted-average number of common shares outstanding during the period, excluding net income attributable to participating securities (unvested restricted stock awards). Diluted EPS reflects the additional dilution for all potentially-dilutive securities such as stock options, unvested restricted shares and unvested performance-based restricted shares. See Note 17 for further details on the Company's earnings per share calculations.

Segment Information
Consistent with how the Company’s Chief Operating Decision Maker (as such term is defined in ASC 280 - Segment Reporting) reviews and assesses the Company’s financial performance, the Company has 2 reportable segments, GLP Capital, L.P. (a wholly-owned subsidiary of GLPI through which GLPI owns substantially all of its real estate assets) and the TRS Segment. The GLP Capital reportable segment consists of the leased real property and represents the majority of the Company’s business. The TRS Segment consists of Hollywood Casino Perryville and Hollywood Casino Baton Rouge, as well as the real estate of Tropicana Las Vegas. See Note 19 for further information with respect to the grant dateCompany’s segments.
Concentration of Credit Risk
Concentrations of credit risk arise when a number of operators, tenants, or obligors related to the Company's investments are unusualengaged in similar business activities, or activities in the same geographic region, or have similar economic features that would cause their ability to meet contractual obligations, including those to the Company, to be similarly affected by changes in economic conditions. Additionally, concentrations of credit risk may arise when revenues of the Company are derived from a small number of tenants. As of December 31, 2020, substantially all of the Company's real estate properties were leased to Penn, Caesars and infrequentBoyd. During the year ended December 31, 2020, approximately 78%, 11% and 10% of the Company's collective income from real estate was derived from tenant leases and real estate loans with Penn, Caesars and Boyd, respectively. Revenues from our tenants are reported in nature.the Company's GLP Capital, L.P. reportable segment. Penn, Caesars and Boyd are publicly traded companies that are subject to the informational filing requirements of the Securities Exchange Act of 1934, as amended, and are required to file periodic reports on Form 10-K and Form 10-Q and current reports on Form 8-K with the Securities and Exchange Commission ("SEC"). Readers are directed to Penn, Caesars and Boyd's respective websites for further financial information on these companies. Other than the Company's tenant concentration, management believes the Company's portfolio was reasonably diversified by geographical location and did not contain any other significant concentrations of credit risk. As of December 31, 2020, the Company's portfolio of 48 properties is diversified by location across 16 states.

Financial instruments that subject the Company to credit risk consist of cash and cash equivalents, accounts receivable, real estate loans and other loans receivable. The Company's policy is to limit the amount of credit exposure to any one financial institution and place investments with financial institutions evaluated as being creditworthy, or in short-term money market and tax-free bond funds which are exposed to minimal interest rate and credit risk. At times, the Company has bank deposits and overnight repurchase agreements that exceed federally-insured limits.

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3.    New Accounting Pronouncements

Accounting Pronouncements Adopted in 2020

In January 2017,August 2018, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying2018-15, Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (a consensus of the Definition of a BusinessFASB Emerging Issues Task Force) ("ASU 2017-01"2018-15"). This ASU provides clarifyingclarifies that entities should follow the guidance on what constitutesfor capitalizing implementation costs incurred to develop or obtain internal-use software to account for implementation costs of cloud computing arrangements that are service contracts. ASU 2018-15 does not change the accounting for the service component of a business acquisition versus an asset acquisition. Specifically, the new guidance lays out a screen to more easily determine if a setcloud computing arrangement. The Company's adoption of integrated assets and activities does in fact represent a business. Under the ASU 2017-01, when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the assets do not represent a business. ASU 2017-01 is effective for annual reporting periods beginning after December 15, 2017. The Company adopted ASU 2017-012018-15 on January 1, 2018 with no2020 did not have an impact to the Company's accounting treatment ofon its acquisitions.consolidated financial statements.


In AugustJune 2016, the FASB issued ASU No. 2016-15, Statement2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, a Consensus of the FASB Emerging Issues Task Force ("Credit Losses on Financial Instruments ("ASU 2016-15"2016-13"). This ASU provides clarifying guidanceintroduces a new model for estimating credit losses for certain types of financial instruments, including mortgage, real estate and other loans receivable, amongst other financial instruments.  ASU 2016-13 sets forth an "expected credit loss" impairment model to replace the current "incurred loss" method of recognizing credit losses, which is intended to improve financial reporting by requiring timely recording of credit losses on the presentation of certain cash receiptsloans and cash payments in the statement of cash flows.other financial instruments. ASU 2016-152016-13 is effective for annual reporting periodsfiscal years beginning after December 15, 2017.2019, with early adoption permitted for fiscal years beginning after December 15, 2018. The Company adopted ASU 2016-15 on January 1, 2018, with no impact to its presentation of cash receipts and payments on its consolidated statements of cash flows.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"). This new standard replaces all preceding U.S. GAAP guidance on this topic and eliminates all industry-specific guidance. ASU 2014-09 provides a unified five-step model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects

the consideration for which the entity expects to be entitled in exchange for those goods or services. The Company adopted ASU 2014-09 on January 1, 2018 using the modified retrospective approach and recorded a cumulative adjustment to retained earnings of approximately $410,000 at the adoption date.

The majority of the Company's revenue recognition policies were not impacted by the new revenue standard, as leases (the source of the Company's majority of revenues) are excluded from ASU 2014-09. Only the accounting treatment for the customer loyalty programs at the TRS properties was impacted by the adoption of ASU 2014-09. See Note 12 for further details on the adoption impact of ASU 2014-09 at the TRS Properties.this pronouncement was immaterial.


Accounting Pronouncements Not Yet AdoptedFair Value of Financial Assets and Liabilities


In August 2018,Fair value is defined as the FASB issued ASU No. 2018-15, Intangiblesprice that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are classified based upon the level of judgment associated with the inputs used to measure their fair value. ASC 820 - GoodwillFair Value Measurements and OtherDisclosures ("ASC 820") establishes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach, and cost approach). The levels of the hierarchy related to the subjectivity of the valuation inputs are described below:

•Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. 

•Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly quoted intervals. 

•Level 3: Unobservable inputs that reflect the reporting entity's own assumptions, as there is little, if any, related market activity.

        The Company's assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy.

Revenue Recognition

The Company recognizes rental revenue from tenants, including rental abatements, lease incentives and contractually fixed increases attributable to operating leases, on a straight-line basis over the term of the related leases when collectability is reasonably assured in accordance with ASC 842 - Internal Use Software (Subtopic 350-40: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing ArrangementLeases. Additionally, percentage rent that is fixed and determinable at the lease inception date is recorded on a Service Contract (a consensusstraight-line basis over the lease term, resulting in the recognition of deferred rental revenue on the Company’s consolidated balance sheets. Deferred rental revenue is amortized to rental revenue on a straight-line basis over the remainder of the FASB Emerging Issues Task Force) ("ASU 2018-15"). This ASU clarifieslease term. The lease term includes the initial non-cancelable lease term and any reasonably assured renewable periods. Contingent rental income that entities should followis not fixed and determinable at lease inception is recognized only when the guidancelessee achieves the specified target. Recognition of rental income commences when control of the facility has been transferred to the tenant.

Additionally, in accordance with ASC 842, the Company records revenue for capitalizing implementation costs incurredthe ground lease rent paid by its tenants with an offsetting expense in land rights and ground lease expense within the consolidated statement of income as the Company has concluded that as the lessee it is the primary obligor under the ground leases. The Company subleases these ground leases back to develop or obtain internal-use softwareits tenants, who are responsible for payment directly to accountthe landlord.
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The Company may periodically loan funds to casino owner-operators for implementation coststhe purchase of cloud computing arrangementsgaming related real estate. Interest income related to real estate loans is recorded as revenue from real estate within the Company's consolidated statements of income in the period earned.
Gaming revenue generated by the TRS Properties mainly consists of revenue from slot machines and to a lesser extent, table game and poker revenue. Gaming revenue from slot machines is the aggregate net difference between gaming wins and losses with liabilities recognized for funds deposited by customers before gaming play occurs, for "ticket-in, ticket-out" coupons in the customers’ possession, and for accruals related to the anticipated payout of progressive jackpots. Progressive slot machines, which contain base jackpots that increase at a progressive rate based on the number of coins played, are charged to revenue as the amount of the jackpots increase. Table game gaming revenue is the aggregate of table drop adjusted for the change in aggregate table chip inventory. Table drop is the total dollar amount of the currency, coins, chips, tokens, outstanding counter checks (markers), and front money that are removed from the live gaming tables. Gaming revenue is recognized net of certain sales incentives, including promotional allowances in accordance with ASC 606 - Revenues from Contracts with Customers. The Company also defers a portion of the revenue received from customers (who participate in the points-based loyalty programs) at the time of play until a later period when the points are redeemed or forfeited. Other revenues at the TRS Properties are derived from the properties' dining, retail and certain other ancillary activities and revenue for these activities is recognized as services are performed.

Stock-Based Compensation
The Company's Amended 2013 Long Term Incentive Compensation Plan (the "2013 Plan") provides for the Company to issue restricted stock awards, including performance-based restricted stock awards, and other equity or cash based awards to employees. Any director, employee or consultant shall be eligible to receive such awards.
The Company accounts for stock compensation under ASC 718 - Compensation - Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. This expense is recognized ratably over the requisite service contracts. ASU 2018-15 doesperiod following the date of grant. The fair value of the Company's time-based restricted stock awards is equivalent to the closing stock price on the day prior to grant. The Company utilizes a third-party valuation firm to measure the fair value of performance-based restricted stock awards at grant date using the Monte Carlo model.
The unrecognized compensation cost relating to restricted stock awards and performance-based restricted stock awards is recognized as expense over the awards’ remaining vesting periods.

See Note 15 for further information related to stock-based compensation.
Income Taxes
The TRS Segment is able to engage in activities resulting in income that would not changebe qualifying income for a REIT. As a result, certain activities of the Company which occur within its TRS Segment are subject to federal and state income taxes. 
The Company accounts for income taxes in accordance with ASC 740 - Income Taxes ("ASC 740"). Under ASC 740, deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and are measured at the prevailing enacted tax rates that will be in effect when these differences are settled or realized. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized. The realizability of the deferred tax assets is evaluated by assessing the valuation allowance and by adjusting the amount of the allowance, if any, as necessary. The factors used to assess the likelihood of realization are the forecast of future taxable income.
ASC 740 also creates a single model to address uncertainty in tax positions, and clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements by prescribing the service component ofminimum recognition threshold a cloud computing arrangement. ASU 2018-15tax position is effective for fiscal years beginning after December 15, 2019, with early adoption permitted.required to meet before being recognized in an enterprise's financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company doesdid not expecthave any uncertain tax positions for the adoptionthree years ended December 31, 2020.
The Company is required under ASC 740 to disclose its accounting policy for classifying interest and penalties, the amount of ASU 2018-15interest and penalties charged to have a significant impactexpense each period, as well as the cumulative amounts recorded in the consolidated balance sheets. If and when they occur, the Company will classify any income tax-related penalties and interest accrued related to unrecognized tax benefits in taxes on income within the consolidated statements of income. During the years ended December 31, 2020, 2019 and 2018, the Company recognized 0 penalties and interest, net of deferred income taxes.
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The Company elected on its consolidated financial statements.U.S. federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and the Company, together with an indirect wholly-owned subsidiary of the Company, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. and Penn Cecil Maryland, Inc. as a "taxable REIT subsidiary" effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a “taxable REIT subsidiary”.

In January 2017, the FASB issued ASU No. 2017-04, Intangibles - GoodwillThe Company continues to be organized and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). This ASU simplifies an entity's goodwill impairment test by eliminating Step 2 from the test. The new guidance also amends the definition of impairment to a condition that exists when the carrying amount of goodwill exceeds its fair value. By eliminating Step 2 from the test, entities are no longer required to determine the implied fair value of goodwill by computing the fair value (at impairment testing date) of all assets and liabilitiesoperate in a manner similar to that required in conjunction with business combinations. Upon the adoption of ASU 2017-04, an impairment charge is simply recorded as the difference between carrying value and fair value, when carrying value exceeds fair value. ASU 2017-04 is effective for annual reporting periods beginning after December 15, 2019 and early adoption is permitted. The Company expects the adoption of ASU 2017-04 to simplify the analysis required under the goodwill impairment test.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instrument ("ASU 2016-13"). This ASU introduces a new model for estimating credit losses for certain types of financial instruments, including mortgage and other loans receivable, amongst other financial instruments.  ASU 2016-13 sets forth an "expected credit loss" impairment model to replace the current "incurred loss" method of recognizing credit losses, which is intended to improve financial reporting by requiring timely recording of credit losses on loans and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for fiscal years beginning after December 15, 2018. The Company does not expect the adoption of ASU 2016-13 to have a significant impact on its consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"). This ASU primarily provides new guidance for lessees on the accounting treatment of operating leases. Under the new guidance, lessees are required to recognize assets and liabilities arising from operating leases on the balance sheet. ASU 2016-02 also aligns lessor accounting with the revenue recognition guidance in Topic 606 of the Accounting Standards Codification. Generally speaking, ASU 2016-02 will more significantly impact the accounting for leases in which GLPI is the lessee by requiringpermit the Company to recordqualify as a rightREIT. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of use assetits annual REIT taxable income to shareholders. As a REIT, the Company generally will not be subject to federal, state or local income tax on income that it distributes as dividends to its shareholders, except in those jurisdictions that do not allow a deduction for such distributions. If the Company fails to qualify as a REIT in any taxable year, it will be subject to U.S. federal, state and lease liabilitylocal income tax, including any applicable alternative minimum tax, on its consolidated balance sheetstaxable income at regular corporate income tax rates, and dividends paid to its shareholders would not be deductible by the Company in computing taxable income. Any resulting corporate liability could be substantial and could materially and adversely affect the Company's net income and net cash available for these leases. distribution to shareholders. Unless the Company was entitled to relief under certain Internal Revenue Code provisions, the Company also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which it failed to qualify to be taxed as a REIT.
Earnings Per Share
The Company calculates earnings per share ("EPS") in accordance with ASC 260 - Earnings Per Share. Basic EPS is computed by dividing net income applicable to common stock by the weighted-average number of common shares outstanding during the period, excluding net income attributable to participating securities (unvested restricted stock awards). Diluted EPS reflects the additional dilution for all potentially-dilutive securities such as stock options, unvested restricted shares and unvested performance-based restricted shares. See Note 17 for further details on the Company's accounting treatmentearnings per share calculations.

Segment Information
Consistent with how the Company’s Chief Operating Decision Maker (as such term is defined in ASC 280 - Segment Reporting) reviews and assesses the Company’s financial performance, the Company has 2 reportable segments, GLP Capital, L.P. (a wholly-owned subsidiary of GLPI through which GLPI owns substantially all of its triple-net tenant leases, which arereal estate assets) and the primary sourceTRS Segment. The GLP Capital reportable segment consists of revenues to the Company is not significantly impacted byleased real property and represents the adoptionmajority of ASU 2016-02, other than to eliminatethe Company’s business. The TRS Segment consists of Hollywood Casino Perryville and Hollywood Casino Baton Rouge, as well as the real estate tax gross-up discussed below.

ASU 2016-02 is effectiveof Tropicana Las Vegas. See Note 19 for annual reporting periods beginning after December 15, 2018 and was originally required to be adopted on a modified retrospective basis, meaning the new leasing model would need to be appliedfurther information with respect to the earliest year presented in the financial statements and thereafter. However, in July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements ("ASU 2018-11") which permits companies to apply the transition provisions of the lease accounting standard at its effective date (i.e. comparative financial statements are not required). Furthermore, in December 2018, the FASB issued ASU No. 2018-20, Leases (Topic 842):Narrow Scope Improvements for Lessors ("ASU 2018-20"). ASU 2018-20 clarifies that lessor costs paid directly to a third-party by a lessee on behalf of the lessor, are no longer required to be recognized in the lessor's financial statements. Therefore, upon the adoption of ASU 2016-02, the Company will no longer gross-up its financial statements for real estate taxes paid directly to third-parties by its tenants. The Company notes, however, that ground leases for which the tenant pays the landlord directly on the Company's behalf are still required to be grossed-up within its consolidated financial statements upon the adoption of ASU 2016-02 as these are not considered lessor

costs. On January 1, 2019, the Company prospectively adopted ASU 2016-02 using the new transition option available under ASU 2018-11 and recorded a right-of-use asset and related lease liability of approximately $180 million on its consolidated balance sheet to represent its future lease obligations.

3.Summary of Significant Accounting Policies
Cash and Cash Equivalents
The Company considers all cash balances and highly-liquid investments with original maturities of three months or less to be cash and cash equivalents.Company’s segments.
Concentration of Credit Risk
Concentrations of credit risk arise when a number of operators, tenants, or obligors related to the Company's investments are engaged in similar business activities, or activities in the same geographic region, or have similar economic features that would cause their ability to meet contractual obligations, including those to the Company, to be similarly affected by changes in economic conditions. Additionally, concentrations of credit risk may arise when revenues of the Company are derived from a small number of tenants. As of December 31, 2018,2020, substantially all of the Company's real estate properties were leased to Penn, EldoradoCaesars and Boyd. During the year ended December 31, 2018,2020, approximately 93%78%, 11% and 10% of the Company's collective income from real estate (excluding real estate taxes and ground leases paid by tenants) was derived from tenant leases with Penn and its acquiree Pinnacle, whereas approximately 3% and 2% of the Company's collective income from real estate (excluding real estate taxes and ground leases paid by tenants) was derived from tenant leases and mortgagereal estate loans with EldoradoPenn, Caesars and Boyd, respectively. Figures for Eldorado and Boyd represent partial years of revenue as both leases commenced in the fourth quarter of 2018. Revenues from our tenants are reported in the Company's GLP Capital, L.P. reportable segment. Penn, EldoradoCaesars and Boyd are publicly traded companies that are subject to the informational filing requirements of the Securities Exchange Act of 1934, as amended, and are required to file periodic reports on Form 10-K and Form 10-Q and current reports on Form 8-K with the Securities and Exchange Commission ("SEC"). Readers are directed to Penn, EldoradoCaesars and Boyd's respective websites for further financial information on these companies. Other than the Company's tenant concentration, management believes the Company's portfolio was reasonably diversified by geographical location and did not contain any other significant concentrations of credit risk. As of December 31, 2018,2020, the Company's portfolio of 4648 properties is diversified by location across 16 states.
Financial instruments that subject the Company to credit risk consist of cash and cash equivalents, accounts receivable, mortgagereal estate loans receivable and other loans receivable.
The Company's policy is to limit the amount of credit exposure to any one financial institution and place investments with financial institutions evaluated as being creditworthy, or in short-term money market and tax-free bond funds which are exposed to minimal interest rate and credit risk. At times, the Company has bank deposits and overnight repurchase agreements that exceed federally-insured limits.
Prepaid Expenses

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3.    New Accounting Pronouncements

Accounting Pronouncements Adopted in 2020

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other Assets- Internal Use Software (Subtopic 350-40: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (a consensus of the FASB Emerging Issues Task Force) ("ASU 2018-15"). This ASU clarifies that entities should follow the guidance for capitalizing implementation costs incurred to develop or obtain internal-use software to account for implementation costs of cloud computing arrangements that are service contracts. ASU 2018-15 does not change the accounting for the service component of a cloud computing arrangement. The Company's adoption of ASU 2018-15 on January 1, 2020 did not have an impact on its consolidated financial statements.
Prepaid expenses consist
In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of expendituresCredit Losses on Financial Instruments ("ASU 2016-13"). This ASU introduces a new model for goods (other than inventories) or services before the goods are used or the services are received. These amounts are deferred and charged to operations as the benefits are realized and primarily consistestimating credit losses for certain types of prepayments for insurancefinancial instruments, including mortgage, real estate and other contracts that will be expensed duringloans receivable, amongst other financial instruments.  ASU 2016-13 sets forth an "expected credit loss" impairment model to replace the subsequent year. It also includes property taxes that were paid in advance, as well as transaction costs that will be allocatedcurrent "incurred loss" method of recognizing credit losses, which is intended to purchase price uponimprove financial reporting by requiring timely recording of credit losses on loans and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for fiscal years beginning after December 15, 2018. The impact of the closingadoption of an asset acquisition. Other assets consists primarily of accounts receivable, deposits, food and beverage inventory and deferred compensation plan assets (See Note 11 for further details on the deferred compensation plan).this pronouncement was immaterial.

Fair Value of Financial Assets and Liabilities


Fair value is defined as the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are classified based upon the level of judgment associated with the inputs used to measure their fair value. ASC 820 - Fair Value Measurements and Disclosures ("ASC 820") establishes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach, and cost approach). The levels of the hierarchy related to the subjectivity of the valuation inputs are described below:


•Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. 



•Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly quoted intervals. 


•Level 3: Unobservable inputs that reflect the reporting entity's own assumptions, as there is little, if any, related market activity.


        The Company's assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy.


Revenue Recognition

The Company recognizes rental revenue from tenants, including rental abatements, lease incentives and contractually fixed increases attributable to operating leases, on a straight-line basis over the term of the related leases when collectability is reasonably assured in accordance with ASC 842 - Leases. Additionally, percentage rent that is fixed and determinable at the lease inception date is recorded on a straight-line basis over the lease term, resulting in the recognition of deferred rental revenue on the Company’s consolidated balance sheets. Deferred rental revenue is amortized to rental revenue on a straight-line basis over the remainder of the lease term. The lease term includes the initial non-cancelable lease term and any reasonably assured renewable periods. Contingent rental income that is not fixed and determinable at lease inception is recognized only when the lessee achieves the specified target. Recognition of rental income commences when control of the facility has been transferred to the tenant.

Additionally, in accordance with ASC 842, the Company records revenue for the ground lease rent paid by its tenants with an offsetting expense in land rights and ground lease expense within the consolidated statement of income as the Company has concluded that as the lessee it is the primary obligor under the ground leases. The Company subleases these ground leases back to its tenants, who are responsible for payment directly to the landlord.
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The Company may periodically loan funds to casino owner-operators for the purchase of gaming related real estate. Interest income related to real estate loans is recorded as revenue from real estate within the Company's consolidated statements of income in the period earned.
Gaming revenue generated by the TRS Properties mainly consists of revenue from slot machines and to a lesser extent, table game and poker revenue. Gaming revenue from slot machines is the aggregate net difference between gaming wins and losses with liabilities recognized for funds deposited by customers before gaming play occurs, for "ticket-in, ticket-out" coupons in the customers’ possession, and for accruals related to the anticipated payout of progressive jackpots. Progressive slot machines, which contain base jackpots that increase at a progressive rate based on the number of coins played, are charged to revenue as the amount of the jackpots increase. Table game gaming revenue is the aggregate of table drop adjusted for the change in aggregate table chip inventory. Table drop is the total dollar amount of the currency, coins, chips, tokens, outstanding counter checks (markers), and front money that are removed from the live gaming tables. Gaming revenue is recognized net of certain sales incentives, including promotional allowances in accordance with ASC 606 - Revenues from Contracts with Customers. The Company also defers a portion of the revenue received from customers (who participate in the points-based loyalty programs) at the time of play until a later period when the points are redeemed or forfeited. Other revenues at the TRS Properties are derived from the properties' dining, retail and certain other ancillary activities and revenue for these activities is recognized as services are performed.

Stock-Based Compensation
The Company's Amended 2013 Long Term Incentive Compensation Plan (the "2013 Plan") provides for the Company to issue restricted stock awards, including performance-based restricted stock awards, and other equity or cash based awards to employees. Any director, employee or consultant shall be eligible to receive such awards.
The Company accounts for stock compensation under ASC 718 - Compensation - Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. This expense is recognized ratably over the requisite service period following the date of grant. The fair value of the Company's time-based restricted stock awards is equivalent to the closing stock price on the day prior to grant. The Company utilizes a third-party valuation firm to measure the fair value of performance-based restricted stock awards at grant date using the Monte Carlo model.
The unrecognized compensation cost relating to restricted stock awards and performance-based restricted stock awards is recognized as expense over the awards’ remaining vesting periods.

See Note 15 for further information related to stock-based compensation.
Income Taxes
The TRS Segment is able to engage in activities resulting in income that would not be qualifying income for a REIT. As a result, certain activities of the Company which occur within its TRS Segment are subject to federal and state income taxes. 
The Company accounts for income taxes in accordance with ASC 740 - Income Taxes ("ASC 740"). Under ASC 740, deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and are measured at the prevailing enacted tax rates that will be in effect when these differences are settled or realized. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized. The realizability of the deferred tax assets is evaluated by assessing the valuation allowance and by adjusting the amount of the allowance, if any, as necessary. The factors used to assess the likelihood of realization are the forecast of future taxable income.
ASC 740 also creates a single model to address uncertainty in tax positions, and clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in an enterprise's financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not have any uncertain tax positions for the three years ended December 31, 2020.
The Company is required under ASC 740 to disclose its accounting policy for classifying interest and penalties, the amount of interest and penalties charged to expense each period, as well as the cumulative amounts recorded in the consolidated balance sheets. If and when they occur, the Company will classify any income tax-related penalties and interest accrued related to unrecognized tax benefits in taxes on income within the consolidated statements of income. During the years ended December 31, 2020, 2019 and 2018, the Company recognized 0 penalties and interest, net of deferred income taxes.
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The Company elected on its U.S. federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and the Company, together with an indirect wholly-owned subsidiary of the Company, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. and Penn Cecil Maryland, Inc. as a "taxable REIT subsidiary" effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a “taxable REIT subsidiary”.
The Company continues to be organized and to operate in a manner that will permit the Company to qualify as a REIT. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of its annual REIT taxable income to shareholders. As a REIT, the Company generally will not be subject to federal, state or local income tax on income that it distributes as dividends to its shareholders, except in those jurisdictions that do not allow a deduction for such distributions. If the Company fails to qualify as a REIT in any taxable year, it will be subject to U.S. federal, state and local income tax, including any applicable alternative minimum tax, on its taxable income at regular corporate income tax rates, and dividends paid to its shareholders would not be deductible by the Company in computing taxable income. Any resulting corporate liability could be substantial and could materially and adversely affect the Company's net income and net cash available for distribution to shareholders. Unless the Company was entitled to relief under certain Internal Revenue Code provisions, the Company also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which it failed to qualify to be taxed as a REIT.
Earnings Per Share
The Company calculates earnings per share ("EPS") in accordance with ASC 260 - Earnings Per Share. Basic EPS is computed by dividing net income applicable to common stock by the weighted-average number of common shares outstanding during the period, excluding net income attributable to participating securities (unvested restricted stock awards). Diluted EPS reflects the additional dilution for all potentially-dilutive securities such as stock options, unvested restricted shares and unvested performance-based restricted shares. See Note 17 for further details on the Company's earnings per share calculations.

Segment Information
Consistent with how the Company’s Chief Operating Decision Maker (as such term is defined in ASC 280 - Segment Reporting) reviews and assesses the Company’s financial performance, the Company has 2 reportable segments, GLP Capital, L.P. (a wholly-owned subsidiary of GLPI through which GLPI owns substantially all of its real estate assets) and the TRS Segment. The GLP Capital reportable segment consists of the leased real property and represents the majority of the Company’s business. The TRS Segment consists of Hollywood Casino Perryville and Hollywood Casino Baton Rouge, as well as the real estate of Tropicana Las Vegas. See Note 19 for further information with respect to the Company’s segments.
Concentration of Credit Risk
Concentrations of credit risk arise when a number of operators, tenants, or obligors related to the Company's investments are engaged in similar business activities, or activities in the same geographic region, or have similar economic features that would cause their ability to meet contractual obligations, including those to the Company, to be similarly affected by changes in economic conditions. Additionally, concentrations of credit risk may arise when revenues of the Company are derived from a small number of tenants. As of December 31, 2020, substantially all of the Company's real estate properties were leased to Penn, Caesars and Boyd. During the year ended December 31, 2020, approximately 78%, 11% and 10% of the Company's collective income from real estate was derived from tenant leases and real estate loans with Penn, Caesars and Boyd, respectively. Revenues from our tenants are reported in the Company's GLP Capital, L.P. reportable segment. Penn, Caesars and Boyd are publicly traded companies that are subject to the informational filing requirements of the Securities Exchange Act of 1934, as amended, and are required to file periodic reports on Form 10-K and Form 10-Q and current reports on Form 8-K with the Securities and Exchange Commission ("SEC"). Readers are directed to Penn, Caesars and Boyd's respective websites for further financial information on these companies. Other than the Company's tenant concentration, management believes the Company's portfolio was reasonably diversified by geographical location and did not contain any other significant concentrations of credit risk. As of December 31, 2020, the Company's portfolio of 48 properties is diversified by location across 16 states.
Financial instruments that subject the Company to credit risk consist of cash and cash equivalents, accounts receivable, real estate loans and other loans receivable. The Company's policy is to limit the amount of credit exposure to any one financial institution and place investments with financial institutions evaluated as being creditworthy, or in short-term money market and tax-free bond funds which are exposed to minimal interest rate and credit risk. At times, the Company has bank deposits and overnight repurchase agreements that exceed federally-insured limits.

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3.    New Accounting Pronouncements

Accounting Pronouncements Adopted in 2020

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (a consensus of the FASB Emerging Issues Task Force) ("ASU 2018-15"). This ASU clarifies that entities should follow the guidance for capitalizing implementation costs incurred to develop or obtain internal-use software to account for implementation costs of cloud computing arrangements that are service contracts. ASU 2018-15 does not change the accounting for the service component of a cloud computing arrangement. The Company's adoption of ASU 2018-15 on January 1, 2020 did not have an impact on its consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). This ASU introduces a new model for estimating credit losses for certain types of financial instruments, including mortgage, real estate and other loans receivable, amongst other financial instruments.  ASU 2016-13 sets forth an "expected credit loss" impairment model to replace the current "incurred loss" method of recognizing credit losses, which is intended to improve financial reporting by requiring timely recording of credit losses on loans and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for fiscal years beginning after December 15, 2018. The impact of the adoption of this pronouncement was immaterial.

Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform ("ASU 2020-04"). Reference rates such as London Interbank Offered Rate ("LIBOR") are widely used in a broad range of financial instruments and other agreements. Regulators and market participants in various jurisdictions have undertaken efforts, generally referred to as "reference rate reform", to eliminate certain reference rates and introduce new reference rates that are based on a larger and more liquid population of observable transactions. As a result of this reform initiative, certain widely used rates such as LIBOR are expected to be discontinued. ASU 2020-04 provides optional expedients for applying the guidance for contract modifications or other situations affected by reference rate reform, specifically addressing the accounting for modifications of contracts within the scope of ASC Topic 310 on receivables, ASC 470 on debt, and ASC 842 on leases and ASC subtopic 815-15 on embedded derivatives. Based on the limited amount of obligations and contracts the Company currently has that references LIBOR, the Company does not anticipate any material impact from this pronouncement on its Consolidated Financial Statements.

4.Real Estate Investments
Real estate investments, net, represent investments in 45 rental properties and the corporate headquarters building and is summarized as follows:
December 31,
2020		December 31,
2019
 (in thousands)
Land and improvements$2,667,616 $2,552,285 
Building and improvements6,030,482 5,749,211 
Total real estate investments8,698,098 8,301,496 
Less accumulated depreciation(1,410,940)(1,200,941)
Real estate investments, net$7,287,158 $7,100,555 

The increase in real estate investments is primarily due to the Company acquiring the real estate of Belterra Park in satisfaction of the Belterra Park Loan in May 2020 and the acquisition of the real estate of Lumière Place in satisfaction of the CZR loan in September 2020 for $57.7 million ($11.7 million of which was allocated to land and land improvements and $46.0 million to building and improvements) and $246.0 million ($26.9 million of which was allocated to land and land improvements and $219.1 million to building and improvements), respectively. Additionally, the Exchange Transaction described in Note 1 which closed in December 2020, resulted in an increase to real estate investments of $72.6 million (net increase to land and improvements of $46.4 million and building and improvements of $26.2 million). Finally, the Company acquired the land underlying Penn's development project in Morgantown, Pennsylvania for $30.0 million.

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5.Property and Equipment Used in Operations
Property and equipment used in operations, net, consists of the following and primarily represents the assets utilized at the TRS Properties as the real estate will be leased to third party operators subsequent to the completion of the sale transactions as discussed in Note 6. 
December 31,
2020		December 31,
2019
 (in thousands)
Land and improvements$30,540 $30,492 
Building and improvements117,333 116,904 
Furniture, fixtures, and equipment (1)28,767 118,766 
Construction in progress474 120 
Total property and equipment177,114 266,282 
Less accumulated depreciation (1)(96,496)(172,202)
Property and equipment, net$80,618 $94,080 

(1) The majority of the decline at December 31, 2020 compared to the prior year is related to the reclassification of certain amounts to Assets held for sale. See Note 6 for further details.  

6. Assets Held for Sale

    On November 25, 2020, the Company entered into a definitive agreement to sell the operations of our Hollywood Casino Baton Rouge to Casino Queen for $28.2 million. The Company will retain ownership of all real estate assets at Hollywood Casino Baton Rouge and will simultaneously enter into a master lease with Casino Queen, which will include the Casino Queen property in East St. Louis that is currently leased by us to Casino Queen and the Hollywood Casino Baton Rouge facility (the "Casino Queen Master Lease"). The initial annual cash rent on the retained real estate will be approximately $21.4 million and the Casino Queen Master Lease will have an initial term of 15 years with 4 5 year renewal options exercisable by the tenant. Additionally, the Company will complete the current land side development project that is in process and the rent under the Casino Queen Master Lease will be adjusted upon delivery to reflect a yield of 8.25% on GLPI's project costs. The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the second half of 2021.

On December 11, 2020, Penn agreed to purchase from the Company the operations of our Hollywood Casino Perryville, located in Perryville, Maryland, for $31.1 million, with the closing of such purchase, subject to regulatory approvals, expected to occur during the second half of 2021. Upon closing, the Company will lease the real estate of the Perryville facility to Penn pursuant to a lease providing for initial annual rent on the retained real estate of $7.77 million, subject to escalation provisions.


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The Company has classified the operating assets of the two properties above as Assets held for sale since we expect these transactions to close within 12 months and classified the respective liabilities within Other liabilities on the Consolidated Balance Sheet which is comprised of the following. (in thousands)

Assets
Property and equipment, used in operations, net$8,780 
Right-of-use assets and land rights, net$263 
Cash and cash equivalents$22,131 
Prepaid expenses$2,473 
Goodwill$16,067 
Other intangible assets$9,577 
Other assets$2,157 
Total$61,448 
Liabilities
Accounts payable$8 
Accrued expenses$3,387 
Accrued salaries and wages$2,064 
Gaming, property and other taxes$398 
Lease liabilities$262 
Other liabilities$710 
Total which is classified in Other Liabilities$6,829 

The assets held for sale reside in the Company's TRS Segment. See Note 19 for the pre-tax income of this segment for the years ended December 31, 2020, 2019 and 2018 which is comprised solely of the properties above with the exception of $2.7 million of depreciation expense associated with Tropicana Las Vegas for the year ended December 31, 2020.

7. Acquisitions

The Company accounts for its acquisitions of real estate assets as asset acquisitions under ASC 805 - Business Combinations. Under asset acquisition accounting, transaction costs incurred to acquire the purchased assets are also included as part of the asset cost.

Pending acquisitions

On October 27, 2020, the Company entered into a series of definitive agreements pursuant to which a subsidiary of Bally's Corporation (NYSE: BALY) (Bally's) will acquire 100% of the equity interests in the Caesars subsidiary that currently operates Tropicana Evansville and the Company will reacquire the real property assets of Tropicana Evansville from Caesars for a cash purchase price of approximately $340.0 million. In addition, the Company entered into a real estate purchase agreement with Bally's pursuant to which the Company will purchase the real estate assets of the Dover Downs Hotel & Casino, located in Dover, Delaware which is currently owned and operated by Bally's, for a cash purchase price of approximately $144.0 million. At the closing of the transactions, which are expected in mid-2021, subject to regulatory approvals, the Tropicana Evansville and Dover Downs Hotel and Casino facilities will be added to a new master lease between the Company and Bally's (the “Bally's Master Lease”). The Company anticipates that the Bally's Master Lease will have an initial term of 15 years, with no purchase option, followed by 4 five-year renewal options (exercisable by the tenant) on the same terms and conditions. Rent under the Bally's Master Lease will be $40.0 million annually and is subject to an annual escalator of up to 2% determined in relation to the annual increase in the CPI. The Company expects this transaction to close in mid-2021 following the completion of customary closing conditions and regulatory approvals. On November 6, 2020, the Company issued 9.2 million common shares at $36.25 per share to partially finance the funding required for this transaction.


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Current year acquisitions

As previously discussed in Note 1, the impact of COVID-19 resulted in casino-wide closures by all of our tenants. As a result of COVID-19, on April 16, 2020, the Company and certain of its subsidiaries acquired the real property associated with the Tropicana Las Vegas from Penn in exchange for $307.5 million of rent credits, which were fully utilized in 2020 for rent due under the parties' existing leases.

An affiliate of Penn will continue to operate the casino and hotel business of the Tropicana Las Vegas pursuant to a triple net lease with GLPI for nominal rent for the earlier of two years (subject to three one-year extensions at the Company's option) or until the Tropicana Las Vegas is sold. The Company will conduct a sale process with respect to the Tropicana Las Vegas, with Penn receiving 75% of the net proceeds above $307.5 million (plus certain taxes, expenses and costs) if a sale agreement is signed during the first 12 months following closing and 50% of net proceeds above $307.5 million (plus certain taxes, expenses and costs) if a sale agreement is signed during the subsequent 12 months following closing. Penn will not be entitled to receive any net sale proceeds if the relevant sale agreement is signed at any time after 24 months from closing.

The Company recorded an initial land and building value of $226.2 million and $81.3 million, respectively. During the year ended December 31, 2020 depreciation expense of $2.7 million was recorded. Additionally, deferred rent of $307.5 million was recorded at the acquisition date, which has been fully recognized for the year ended December 31, 2020.

The Tropicana Las Vegas assets are summarized below.

December 31, 2020
(in thousands)
Land and improvements$226,160 
Building and improvements81,340 
Total real estate of Tropicana Las Vegas307,500 
Less accumulated depreciation(2,669)
Real estate of Tropicana Las Vegas , net$304,831 

On October 1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits which were fully utilized by Penn in the fourth quarter of 2020.The Company is leasing the land back to an affiliate of Penn pursuant to the Morgantown Lease for an initial annual rent of $3.0 million, subject to escalation provisions following the opening of the property.


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On October 27, 2020, the Company entered into an Exchange Agreement with subsidiaries of Caesars that own, respectively, Waterloo and Bettendorf. Pursuant to the terms of the agreement, Caesars transferred to the Company the real estate assets of the Waterloo and Bettendorf properties in exchange for the transfer by the Company to Caesars of the real property assets of the Tropicana Evansville, plus a cash payment of $5.7 million.The exchange transaction closed on December 18, 2020, which resulted in the Waterloo and Bettendorf facilities being added to the Amended and Restated Caesars Master Lease and the rent increased by $0.5 million annually. The Company recorded a non-cash gain of $41.4 million in the fourth quarter of 2020 related to the transaction, which represented the difference between the fair value of the properties received compared to the carrying value of Tropicana Evansville and the cash payment of $5.7 million. The following table summarizes the fair value of the assets acquired in the Exchange Agreement and the carrying value of the Tropicana Evansville assets that were transferred to Caesars. (in thousands):

BettendorfWaterlooTotal
Land$29,636 $64,262 $93,898 
Building and improvements85,150 77,958 163,108 
Total real estate investments$114,786 $142,220 $257,006 
Less: Evansville Land and improvements(47,439)
Less: Evansville Buildings and improvements, net(136,858)
Less: Evansville Right of use assets and land rights, net(55,456)
Add: Evansville, Operating Lease Liabilities29,795 

Prior Year Acquisitions

2018

On October 15, 2018, in conjunction with the Penn-Pinnacle Merger the Company acquired the real property assets of Plainridge Park from Penn for approximately $250.9 million. This property was added to the Amended Pinnacle Master Lease via the fourth amendment to the Pinnacle Master Lease and is leased to Penn which will continue to operate the property. The initial annual cash rent of $25.0 million for Plainridge Park will not be subject to rent escalators or adjustments.

Also in conjunction with the Penn-Pinnacle Merger, the Pinnacle Master Lease was amended via the fourth amendment to such lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd and to increase fixed rent under the lease by an additional $13.9 million annually. The Company entered into the Boyd Master Lease for these properties on terms similar to the Company’s existing master leases. As a result of the fourth amendment to the Pinnacle Master Lease, the Company reassessed the lease's classification and determined the new lease agreement qualified for operating lease treatment under ASC 840. Therefore, subsequent to the Penn-Pinnacle Merger, the Amended Pinnacle Master Lease is treated as an operating lease in its entirety, the building assets of $2.6 billion previously recorded as an investment in direct financing lease on the Company's consolidated balance sheet were recorded as real estate assets on the Company's consolidated balance sheet and all rent received under the Amended Pinnacle Master Lease is recorded as rental income on the Company's consolidated statement of income. The Amended Pinnacle Master Lease was assumed by Penn at the consummation of the Penn-Pinnacle Merger.

On October 1, 2018, the Company acquired the real property assets of five casino properties from Tropicana and certain of its affiliates for approximately $992.5 million, pursuant to the Real Estate Purchase Agreement dated April 15, 2018 between Tropicana and GLP Capital, which was subsequently amended on October 1, 2018. 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 and the rights to six long-term ground leases for land on which the operations of the acquired Tropicana properties reside. Concurrent with the Tropicana Acquisition, Caesars acquired the operating assets of these properties from Tropicana pursuant to the Tropicana Merger Agreement and leased the GLP Assets from the Company pursuant to the terms of a new unitary triple-net master lease with an initial term of 15 years, with no purchase option, followed by 4 successive 5-year renewal periods (exercisable by the tenant) on the same terms and conditions. Initial annual rent under the Caesars Master Lease was $87.6 million and is subject to annual rent escalators and biennial percentage rent adjustments.
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Purchase price allocations are primarily based on the fair values of assets acquired and liabilities assumed at the time of acquisition. The following table summarizes the purchase price allocation of the assets acquired in the Tropicana Acquisition (in thousands):
Real estate investments, net$948,217 
Land rights, net44,331 
Total purchase price$992,548 

8. Receivables

Real Estate Loans

As discussed in Note 1, the Company historically had the CZR loan outstanding which was utilized by Caesars in connection with its acquisition of Lumière Place. On June 24, 2020, the Company received approval from the Missouri Gaming Commission to own the Lumière Place real estate in satisfaction of the CZR loan, subject to the Lumière Place Lease, and closed this transaction on September 29, 2020.

On October 15, 2018, Boyd purchased the real estate assets of Belterra Park from Pinnacle for a cash purchase price of $57.7 million, exclusive of transaction fees. Financing for the transaction was provided by the Company in the form of the Belterra Park Loan. The Belterra Park Loan's initial interest rate was equal to 11.11% and the loan matures in connection with the expiration of the Boyd Master Lease (as may be extended at the tenant's option to April 30, 2051). In May 2020, the Company acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to the Belterra Park Lease.

Other Loans Receivable

In January 2014, the Company completed the asset acquisition of the real property associated with the Casino Queen in East St. Louis, Illinois. GLPI leases the property back to Casino Queen on a triple-net basis on terms similar to those in the Company's existing master leases. The Casino Queen Lease has an initial term of 15 years and the tenant has an option to renew it at the same terms and conditions for 4 successive 5-year periods.  

Simultaneously with the Casino Queen acquisition, GLPI provided Casino Queen with a $43.0 million, five-year term loan at 7% interest, prepayable at any time, which, together with the sale proceeds, completely refinanced and retired all of Casino Queen’s outstanding long-term debt obligations. On March 13, 2017, the outstanding principal and interest on this loan was repaid in full and GLPI simultaneously provided a new unsecured $13.0 million, 5.5-year term loan (the "Casino Queen Loan") to CQ Holding Company, Inc., an affiliate of Casino Queen ("CQ Holding Company"), to partially finance its acquisition of Lady Luck Casino in Marquette, Iowa. The Casino Queen Loan bears an interest rate of 15% and is prepayable at any time.

On June 12, 2018, the Company received a Notice of Event of Default under the senior credit agreement of CQ Holding Company from the secured lender under such agreement, which reported a covenant default under its senior secured agreement. Under the terms of that agreement, when an event of default occurs, CQ Holding Company is prohibited from making cash payments to unsecured lenders such as GLPI. Therefore, beginning in June 2018 the interest due from CQ Holding Company under the Company's unsecured loan was paid in kind. In addition to the covenant violation noted above under its senior credit agreement, CQ Holding Company also had a payment default under the senior credit agreement. Furthermore, the Company notified Casino Queen of events of default under the Company's unsecured loan with CQ Holding Company, related to financial covenant violations during the year ended December 31, 2018.
At December 31, 2018, active negotiations for the sale of Casino Queen's operations were taking place. Despite the payment and covenant defaults noted above, at that time, full payment of the principal was still expected, due to the anticipation that the operations were to be sold in the near term for an amount allowing for repayment of the full $13.0 million of loan principal due to GLPI. However, the paid-in-kind interest due to the Company at December 31, 2018 was not expected to be collected, resulting in an impairment charge of $1.5 million during the fourth quarter of 2018. The Company did not recognize the paid-in-kind interest income due to the Company for the quarter ended December 31, 2018 and took a charge for the previously recognized paid-in-kind interest income through the Company’s consolidated statement of earnings as a reversal of the paid-in-kind interest income recognized earlier in the year.
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During 2019, the operating results of Casino Queen continued to decline, the secured debt of Casino Queen was sold to a third-party casino operator at a discount and the Company no longer expected the loan to be repaid. Therefore, the Company recorded an impairment charge of $13.0 million through the Consolidated Statement of Income for the year ended December 31, 2019 to reflect the write-off of the Casino Queen Loan.
    Casino Queen was closed in mid-March due to COVID-19 and Casino Queen was in payment default on their lease starting in April 2020. The Company entered into a deferred rental agreement with Casino Queen and received all delinquent rental payments in the fourth quarter of 2020.


9. Lease Assets and Lease Liabilities

Lease Assets

The Company is subject to various operating leases as lessee for both real estate and equipment, the majority of which are ground leases related to properties the Company leases to its tenants under triple-net operating leases. These ground leases may include fixed rent, as well as variable rent based upon an individual property’s performance or changes in an index such as the CPI and have maturity dates ranging from 2028 to 2108, when considering all renewal options. For certain of these ground leases, the Company’s tenants are responsible for payment directly to the third-party landlord. Under ASC 842, the Company is required to gross-up its consolidated financial statements for these ground leases as the Company is considered the primary obligor. In conjunction with the adoption of ASU 2016-02 on January 1, 2019, the Company recorded right-of-use assets and related lease liabilities on its consolidated balance sheet to represent its rights to use the underlying leased assets and its future lease obligations, respectively, including for those ground leases paid directly by our tenants. Because the right-of-use asset relates, in part, to the same leases which resulted in the land right assets the Company recorded on its consolidated balance sheet in conjunction with the Company's assumption of below market leases at the time it acquired the related land and building assets, the Company is required to report the right-of-use assets and land rights in the aggregate on the consolidated balance sheet.

Land rights, net represent the Company's rights to land subject to long-term ground leases. The Company obtained ground lease rights through the acquisition of several of its rental properties and immediately subleased the land to its tenants. These land rights represent the below market value of the related ground leases. The Company assessed the acquired ground leases to determine if the lease terms were favorable or unfavorable, given market conditions at the acquisition date. Because the market rents to be received under the Company's triple-net tenant leases were greater than the rents to be paid under the acquired ground leases, the Company concluded that the ground leases were below market and were therefore required to be recorded as a definite lived asset (land rights) on its books.

Components of the Company's right-of use assets and land rights, net are detailed below (in thousands):
December 31, 2020December 31, 2019
Right-of-use assets - operating leases (1)
$151,339 $184,063 
Land rights, net617,858 654,671 
Right-of-use assets and land rights, net$769,197 $838,734 

(1) In addition, there is $0.3 million of operating lease right-of-use assets included in assets held for sale.

As described in Note 8, on December 18, 2020, the Company and Caesars completed an Exchange Agreement in which the Company transferred to Caesars the real property assets of Tropicana Evansville. In connection with the exchange, the Company removed the land right and right of use asset related to the long-term ground lease at this property which totaled $24.8 million and $30.7 million, respectively, at the closing of the transaction along with the lease liability of $29.8 million it had recorded on its Consolidated Balance Sheet for this lease.

On June 30, 2019, the Resorts Casino Tunica property was closed by the Company's tenant, resulting in the acceleration of $6.3 million of land right amortization expense related to the long-term ground lease at this property and bringing the net book value of this land right to 0 at December 31, 2019. Subsequent to the property's closure, the Company entered into an agreement to terminate the long-term ground lease for the Resorts Casino Tunica property, which became effective in February 2020. In connection with the exercised termination option, the Company remeasured the lease liability and adjusted the right-of-use asset it had recorded on its consolidated balance sheet for this lease to align with the new termination date.
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Land Rights

The land rights are amortized over the individual lease term of the related ground lease, including all renewal options, which ranged from 10 years to 92 years at their respective acquisition dates. Land rights net, consist of the following:

December 31,
2020		December 31,
2019
(in thousands)
Land rights$667,751 $694,077 
Less accumulated amortization(49,893)(39,406)
Land rights, net$617,858 $654,671 

As of December 31, 2020, estimated future amortization expense related to the Company’s land rights by fiscal year is as follows (in thousands):

Year ending December 31,
2021$11,372 
202211,372 
202311,372 
202411,372 
202511,372 
Thereafter560,998 
Total$617,858 

Lease Liabilities

At December 31, 2020, maturities of the Company's operating lease liabilities were as follows (in thousands):

Year ending December 31,
2021$11,079 
202211,082 
202311,081 
202411,034 
202510,984 
Thereafter569,957 
Total lease payments$625,217 
Less: interest(473,014)
Present value of lease liabilities (1)
$152,203 

(1) In addition, there is $0.3 million of lease liabilities included in other liabilities related to liabilities held for sale.

Lease Expense

Operating lease costs represent the entire amount of expense recognized for operating leases that are recorded on the Consolidated Balance Sheet. Variable lease costs are not included in the measurement of the lease liability and include both lease payments tied to a property's performance and changes in an index such as the CPI that are not determinable at lease commencement, while short-term lease costs are costs for those operating leases with a term of 12 months or less.

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The components of lease expense were as follows:
Year Ended December 31, 2020Year Ended December 31, 2019
(in thousands)
Operating lease cost$13,907 $15,482 
Variable lease cost (1)
3,364 9,048 
Short-term lease cost625 1,060 
Amortization of land right assets12,022 18,536 
Total lease cost$29,918 $44,126 

(1)Variable lease costs for the year ended December 31, 2020 included a true up of the monthly rental payments paid by our tenants on certain ground leases that are based on estimated current year annual performance which were impacted by casino closures due to COVID-19. As discussed previously, under ASC 842, the Company is required to gross up its financial statements by recording both expense and revenue (recorded within rental income on the Consolidated Statements of Income) for these payments since the Company is considered the primary obligor.

Amortization expense related to the land right intangibles, as well as variable lease costs and the majority of the Company's operating lease costs are recorded within land rights and ground lease expense in the consolidated statements of income. The Company's short-term lease costs as well as a small portion of operating lease costs are recorded in both gaming, food, beverage and other expense and general and administrative expense in the consolidated statements of income. Amortization expense related to the land right intangibles totaled $11.3 million for the year ended December 31, 2018. Other lease costs totaled $18.9 million for the year ended December 31, 2018.

Supplemental Disclosures Related to Leases

Supplemental balance sheet information related to the Company's operating leases was as follows:
December 31, 2020
Weighted average remaining lease term - operating leases56.41 years
Weighted average discount rate - operating leases6.7%

In addition, the weighted average remaining lease term and the weighted average discount rate for those operating leases included in assets held for sale and other liabilities is 1.79 years and 4.0%, respectively.

Supplemental cash flow information related to the Company's operating leases was as follows:
Year Ended December 31, 2020Year Ended December 31, 2019
(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
  Operating cash flows from operating leases (1) (2)
$1,600 $2,226 
Right-of-use assets obtained in exchange for new lease obligations:
   Operating leases (2)
$95 $293 

(1) The Company's cash paid for operating leases is significantly less than the lease cost for the same period due to the majority of the Company's ground lease rent being paid directly to the landlords by the Company's tenants. Although GLPI expends no cash related to these leases, they are required to be grossed up in the Company's financial statements under ASC 842.

(2) In addition, there is $0.2 million and $0.3 million related to assets held for sale and other liabilities for operating cash flows from cash paid for amounts included in the measurement of lease liabilities and right-of-use assets obtained for new lease obligations, respectively for the year ended December 31, 2020.

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10. Goodwill and Intangible Assets

Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. The only goodwill of the Company is recorded on the books of Hollywood Casino Baton Rouge, in connection with Penn's purchase of this entity prior to the Spin-Off. The original assets and liabilities of GLPI, including goodwill and intangible assets were recorded at their respective historical carrying values at the time of the Spin-Off in accordance with the provisions of ASC 505. There is no goodwill recorded on the Company's GLP Capital segment, which holds the Company's REIT operations.

During the year ended December 31, 2018, the Company recorded a goodwill impairment charge of $59.5 million in connection with its operations at Hollywood Casino Baton Rouge. This charge was driven by general market deterioration in the Baton Rouge region and the smoking ban at all Baton Rouge, Louisiana casinos that went into effect during the second quarter of 2018, both of which significantly impacted the Company's forecasted cash flows for this reporting unit. Subsequent to conducting its impairment tests on other long-lived assets, the Company performed Step 1 of the goodwill impairment test, which indicated a potential impairment. Step 1 of the goodwill impairment test involved the determination of the fair value of the Baton Rouge reporting unit and its comparison to the reporting unit's carrying amount. Using a discounted cash flow model, which relied on projected EBITDA to determine the reporting unit's future cash flows, the Company calculated a fair value that was less than the reporting unit's carrying value and proceeded to Step 2. In Step 2 of the goodwill impairment test, the Company performed a fair value allocation as if the reporting unit had been acquired in a business combination and assigned the fair value of the reporting unit calculated in Step 1 to all assets and liabilities of the reporting unit, including any unrecognized intangible assets. Any residual fair value was allocated to goodwill to arrive at the implied fair value of goodwill. After completing the Step 2 allocation, the Company determined the goodwill on its Baton Rouge reporting unit had an implied fair value of $16.1 million and recorded the impairment charge of $59.5 million during the fourth quarter of 2018. There have been no changes in the carrying value of goodwill of $16.1 million for the years ended December 31, 2020 and 2019. As described in Note 6, the Company's goodwill balance at December 31, 2020 has been reclassified to Assets held for sale.

In accordance with ASC 350, the Company considers its gaming license at the Hollywood Casino Perryville property an indefinite-lived intangible asset that does not require amortization based on future expectations to operate this casino indefinitely, as well as the gaming industry's historical experience in renewing these intangible assets at minimal cost with various state gaming commissions. Rather, the Company's gaming license is tested annually, or more frequently if indicators of impairment exist, for impairment by comparing the fair value of the recorded asset to its carrying amount. If the carrying amount of the indefinite-life intangible asset exceeds its fair value, an impairment loss is recognized. Hollywood Casino Perryville's gaming license will expire in September 2025, fifteen years from the casino's opening date. The Company expects to expense any costs related to the gaming license renewal as incurred. The Company conducts its annual impairment assessment of the gaming license on October 1st using the Greenfield Method which estimates the fair value of the gaming license assuming the Company built a casino with similar utility to that of the existing facility. This method also assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. Based upon these assumptions and the Company's current forecasted cash flows for this reporting unit, the gaming license was not impaired. At both December 31, 2020 and 2019, the gaming license had a carrying value of $9.6 million. As described in Note 6, the Company's other intangible assets balance at December 31, 2020 has been reclassified to Assets held for sale.

11. Fair Value of Financial Assets and Liabilities

Assets and Liabilities Measured at Fair Value on a Recurring Basis
 
The following methods and assumptions are used to estimate the fair value of each class of financial instruments for which it is practicable to estimate:


Cash and Cash Equivalents
 
The fair value of the Company’s cash and cash equivalents approximates the carrying value of the Company’s cash and cash equivalents, due to the short maturity of the cash equivalents.


Deferred Compensation Plan Assets


The Company's deferred compensation plan assets consist of open-ended mutual funds and as such the fair value measurement of the assets is considered a Level 1 measurement as defined under ASC 820. Deferred compensation plan assets are included within other assets on the consolidated balance sheets.


Mortgage
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Real Estate Loans Receivable


The fair value of the mortgagereal estate loans receivable approximates the carrying value of the Company's mortgagereal estate loans, receivable, as collection on the outstanding loan balances is reasonably assured. The fair value measurement of the loan receivablereal estate loans is considered a Level 3 measurement as defined under ASC 820.


Long-term Debt
 
The fair value of the senior unsecured notes and senior unsecured credit facility isSenior Notes are estimated based on quoted prices in active markets and as such is aare Level 1 measurementmeasurements as defined under ASC 820. The fair value of the obligations in our Amended Credit Facility is based on indicative pricing from market information (Level 2 inputs).
 
The estimated fair values of the Company’s financial instruments are as follows (in thousands):
 December 31, 2020December 31, 2019
 Carrying
Amount		Fair
Value		Carrying
Amount		Fair
Value
Financial assets:    
Cash and cash equivalents (1)
$486,451 $486,451 $26,823 $26,823 
Deferred compensation plan assets35,514 35,514 28,855 28,855 
Real estate loans0 0 303,684 303,684 
Financial liabilities:    
Long-term debt:    
Senior unsecured credit facility424,019 424,019 495,000 493,533 
Senior unsecured notes5,375,000 6,026,840 5,290,174 5,707,996 
 December 31, 2018 December 31, 2017
 
Carrying
Amount
 
Fair
Value
 
Carrying
Amount
 
Fair
Value
Financial assets: 
  
  
  
Cash and cash equivalents$25,783
 $25,783
 $29,054
 $29,054
Deferred compensation plan assets22,709
 22,709
 22,617
 22,617
Mortgage loans receivable303,684
 303,684
 —
 —
Financial liabilities: 
  
  
  
Long-term debt: 
  
  
  
Senior unsecured credit facility927,000
 909,308
 1,055,000
 1,045,600
Senior unsecured notes4,975,000
 4,958,455
 3,425,000
 3,574,688


(1) In addition, there is $22.1 million in cash and cash equivalents in assets held for sale.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
Certain assets andThere were no liabilities are measured at fair value on a nonrecurring basis in periods subsequent to initial recognition. Assets measured at fair value on a nonrecurring basis during the yearyears ended December 31, 2018 are categorized in the table below based upon the lowest level of significant input to the valuation.2020 and 2019. There were no assets measured at fair value on a nonrecurring basis during the year ended December 31, 2017 or liabilities2020; however, assets measured at fair value on a nonrecurring basis during the years ended December 31, 2018 and 2017.

 Level 1 Level 2 Level 3 Total Impairment Charges Recorded during the Year Ended December 31, 2018
 (in thousands)
Assets:       
Goodwill$—
 $—
 $16,067
 $59,454
Loan receivable—
 —
 13,000
 1,500
Total assets measured at fair value on a nonrecurring basis$—
 $—
 $29,067
 $60,954
Goodwill

During the year ended December 31, 2018, the Company recorded goodwill impairment charges of $59.5 million on its Baton Rouge reporting unit, resulting from a significant reduction in the long-term earnings forecast of this property. The Company utilized the income approach to measure the fair value of goodwill, which involves a number of key assumptions, such as cash flow forecasts and discount rates. See Note 9 for additional information regarding the calculation of the impairment charge.2019 are described below.

Loan ReceivableRevenue Recognition


During the fourth quarter of 2018, the Company recorded an impairment charge of $1.5 million related to the paid-in-kind interest income on its loan receivable with Casino Queen. The Company determined, based upon factsrecognizes rental revenue from tenants, including rental abatements, lease incentives and circumstances existingcontractually fixed increases attributable to operating leases, on a straight-line basis over the term of the related leases when collectability is reasonably assured in accordance with ASC 842 - Leases. Additionally, percentage rent that is fixed and determinable at December 31, 2018, that the paid-in-kind interest due tolease inception date is recorded on a straight-line basis over the Company at December 31, 2018 is not expected to be collected. Therefore,lease term, resulting in the Company did not recognize the paid-in-kind interest income due to the Company for the quarter ended December 31, 2018 and took a charge for the previously recognized paid-in-kind interest income throughrecognition of deferred rental revenue on the Company’s consolidated statement of earnings asbalance sheets. Deferred rental revenue is amortized to rental revenue on a reversalstraight-line basis over the remainder of the paid-in-kind interestlease term. The lease term includes the initial non-cancelable lease term and any reasonably assured renewable periods. Contingent rental income that is not fixed and determinable at lease inception is recognized earlier inonly when the year. See Note 8 for further details surroundinglessee achieves the Casino Queen loan.
Real Estate Investments
Real estate investments primarily represent land and buildings leasedspecified target. Recognition of rental income commences when control of the facility has been transferred to the Company's tenants. The Company records the acquisition of real estate assets at fair value, including acquisition and closing costs. The cost of properties developed by the Company include costs of construction, property taxes, interest and other miscellaneous costs incurred during the development period until the project is substantially complete and available for occupancy. The Company considers the period of future benefit of the asset to determine the appropriate useful lives. Depreciation is computed using a straight-line method over the estimated useful lives of the buildings and building improvements which are generally between 10 to 31 years.tenant.
The Company continually monitors events and circumstances that could indicate that the carrying amount of its real estate investments may not be recoverable or realized. When indicators of potential impairment suggest that the carrying value of a real estate investment may not be recoverable, the Company estimates the fair value of the investment by calculating the undiscounted future cash flows from the use and eventual disposition of the investment. This amount is compared to the asset's carrying value. If the Company determines the carrying amount is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated
Additionally, in accordance with GAAP. The Company groups its real estate investments together by lease, the lowest level for which identifiable cash flows are available, in evaluating impairment. In assessing the recoverability of the carrying value,ASC 842, the Company must make assumptions regarding future cash flows and other factors. The factors considered byrecords revenue for the Company in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the effect of obsolescence, demand, competition and other factors. If these estimates or the related assumptions change in the future, the Company may be required to record an impairment loss.
Land Rights
Land rights represent the Company's rights to land subject to long-term ground leases. The Company records land rights at the acquisition date fair value of the long-term rights purchased from sellers. Essentially, land rights represent the below market value of the related ground leases. Land rights are amortized over the individual lease term of each ground lease including all renewal options. Amortizationrent paid by its tenants with an offsetting expense related to the land rights is recorded withinin land rights and ground lease expense inwithin the Company's consolidated statementsstatement of income. Land rights are monitored for potential impairment in much the same wayincome as the Company's real estate assets. IfCompany has concluded that as the lessee it is the primary obligor under the ground leases. The Company determines the carrying amount of a land right is not recoverable, it would recognize an impairment charge equivalentsubleases these ground leases back to its tenants, who are responsible for payment directly to the amount required to reduce the carrying valuelandlord.
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Table of the asset to its estimated fair value, calculated in accordance with GAAP.Contents

Property and Equipment Used in Operations
Property and equipment are stated at cost, less accumulated depreciation and represent assets used by the Company's TRS operations and certain corporate assets. Maintenance and repairs that neither add materially to the value of the asset nor appreciably prolong its useful life are charged to expense as incurred. Gains or losses on the disposal of property and equipment are included in the determination of income.
Depreciation of property and equipment is recorded using the straight-line method over the following estimated useful lives:
Land improvements15 years
Building and improvements5 to 31 years
Furniture, fixtures, and equipment3 to 31 years
Leasehold improvements are depreciated over the shorter of the estimated useful life of the improvement or the related lease term. The estimated useful lives are determined based on the nature of the assets as well as the Company's current operating strategy.
The Company reviews the carrying value of its property and equipment for possible impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable based upon the estimated undiscounted future cash flows expected to result from its use and eventual disposition. If the Company determines the carrying amount is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP. In estimating expected future cash flows for determining whether an asset is impaired, assets are grouped at the individual property level. In assessing the recoverability of the carrying value of property and equipment, the Company must make assumptions regarding future cash flows and other factors. The factors considered by the Company in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the effect of obsolescence, demand, competition and other factors. If these estimates or the related assumptions change in the future, the Company may be required to record an impairment loss for these assets.
Mortgage Loans Receivable
The Company may periodically loan funds to casino owner-operators via secured mortgage loans for the purchase of gaming related properties. Mortgage loans are recorded on the Company's consolidated balance sheets at carrying value which approximates fair value. If the collectability of an outstanding mortgage balance is not reasonably assured, the Company will assess the loan's carrying value for potential impairment. If it is determined the loan is in fact impaired it will be written down or off completely. At December 31, 2018, the Company does not have any allowances recorded against its mortgage loans receivable as the collection of the remaining principal and interest payments is reasonable assured.real estate. Interest income related to mortgagereal estate loans receivable is recorded as revenue from mortgaged real estate within the Company's consolidated statements of income in the period earned.
InvestmentsGaming revenue generated by the TRS Properties mainly consists of revenue from slot machines and to a lesser extent, table game and poker revenue. Gaming revenue from slot machines is the aggregate net difference between gaming wins and losses with liabilities recognized for funds deposited by customers before gaming play occurs, for "ticket-in, ticket-out" coupons in Direct Financing Leases
As discussed in Note 8, priorthe customers’ possession, and for accruals related to the Penn-Pinnacle Merger, the Pinnacle Master Lease was bifurcated between an operating lease andanticipated payout of progressive jackpots. Progressive slot machines, which contain base jackpots that increase at a direct financing lease, with the land assets qualifying for operating lease treatment and the building assets triggering direct financing lease treatment. This net investment in direct financing lease was unwound in conjunction with the Penn-Pinnacle Merger, via the fourth amendment to the Pinnacle Master. As a result of this amendment, the Company reassessed the lease's classification and determined the new lease agreement qualified for operating lease treatment under ASC 840 - Leases ("ASC 840"). Therefore, subsequent to the Penn-Pinnacle Merger, the Pinnacle Master Lease is treated as an operating lease in its entirety and the building assets previously recorded as an investment in direct financing leaseprogressive rate based on the Company's consolidated balance sheet were recordednumber of coins played, are charged to revenue as real estate assets on the Company's consolidated balance sheet. At December 31, 2017,amount of the Company's investmentjackpots increase. Table game gaming revenue is the aggregate of table drop adjusted for the change in direct financing lease representedaggregate table chip inventory. Table drop is the buildingtotal dollar amount of the currency, coins, chips, tokens, outstanding counter checks (markers), and front money that are removed from the live gaming tables. Gaming revenue is recognized net of certain sales incentives, including promotional allowances in accordance with ASC 606 - Revenues from Contracts with Customers. The Company also defers a portion of the real estate assets acquiredrevenue received from customers (who participate in the original Pinnacle transaction.
Goodwill andpoints-based loyalty programs) at the time of play until a later period when the points are redeemed or forfeited. Other Intangible Assets
The Company's goodwill and intangible assets are the result of the contribution of Hollywood Casino Baton Rouge and Hollywood Casino Perryville in connection with the Spin-Off. The Company's goodwill resides on the books of its Hollywood Casino Baton Rouge subsidiary, while the other intangible asset represents a gaming license on the books of its Hollywood Casino Perryville subsidiary. Both subsidiaries are members ofrevenues at the TRS Properties segmentare derived from the properties' dining, retail and certain other ancillary activities and revenue for these activities is recognized as services are considered separate reporting unitsperformed.

Stock-Based Compensation
The Company's Amended 2013 Long Term Incentive Compensation Plan (the "2013 Plan") provides for the Company to issue restricted stock awards, including performance-based restricted stock awards, and other equity or cash based awards to employees. Any director, employee or consultant shall be eligible to receive such awards.
The Company accounts for stock compensation under ASC 350718 - IntangiblesCompensation - Goodwill and Other ("ASC 350"). Goodwill is tested at the reporting

unit level,Stock Compensation, which is an operating segment or one level below an operating segment for which discrete financial information is available
Under ASC 350,requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. This expense is requiredrecognized ratably over the requisite service period following the date of grant. The fair value of the Company's time-based restricted stock awards is equivalent to test goodwill for impairment at least annually and whenever events or circumstances indicate that it is more likely than not that goodwill may be impaired.the closing stock price on the day prior to grant. The Company has electedutilizes a third-party valuation firm to perform its annual goodwill impairment test as of October 1 of each year. In accordance with ASC 350, the Company tests goodwill for impairment subsequent to testing its other long-lived assets for impairment.
ASC 350 prescribes a two-step goodwill impairment test, the first step which involves the determination ofmeasure the fair value of each reporting unit and its comparison toperformance-based restricted stock awards at grant date using the carrying amount. In order to determine the fair value of the Baton Rouge reporting unit, the Company utilizes a discounted cash flow model, which relies on projected EBITDA to determine the reporting unit's future cash flows. If the carrying amount exceeds the fair value in step 1, then step 2 of the impairment test is performed to determine the implied fair value of goodwill. If the implied fair value of goodwill is less than the goodwill allocated to the reporting unit, an impairment loss is recognized.Monte Carlo model.
In accordance with ASC 350, the Company considers its Hollywood Casino Perryville gaming license an indefinite-lived intangible asset that does not require amortization based on the Company's future expectations to operate this casino indefinitely, as well as the gaming industry's historical experience in renewing these intangible assets at minimal cost with various state gaming commissions. Rather, the Company's gaming license is tested annually, or more frequently if indicators of impairment exist, for impairment by comparing the fair value of the recorded asset to its carrying amount. If the carrying amount of the indefinite-life intangible asset exceeds its fair value, an impairment loss is recognized. Hollywood Casino Perryville's gaming license will expire in September 2025, fifteen years from the casino's opening date. The Company expects to expense any costs related to the gaming license renewal as incurred.
The Company calculates the fair value of its gaming license using the Greenfield Method under the income approach. The Greenfield Method estimates the fair value of the gaming license assuming the Company built a casino with similar utilityunrecognized compensation cost relating to that of the existing facility. The method assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. As such the value of the licenserestricted stock awards and performance-based restricted stock awards is a function of the following items:
Projected revenues and operating cash flows;
Theoretical construction costs and duration;
Pre-opening expenses;
Discounting that reflects the level of risk associated with receiving future cash flows attributable to the license; and
Remaining useful life of the license
The evaluation of goodwill and indefinite-lived intangible assets requires the use of estimates about future operating results to determine the estimated fair value of the reporting unit and the indefinite-lived intangible assets. The Company must make various assumptions and estimates in performing its impairment testing. The implied fair value includes estimates of future cash flows that are based on reasonable and supportable assumptions, which represent the Company's best estimates of the cash flows expected to result from the use of the assets. Changes in estimates, increases in the Company's cost of capital, reductions in transaction multiples, changes in operating and capital expenditure assumptions or application of alternative assumptions and definitions could produce significantly different results. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from the Company's estimates. If the Company's ongoing estimates of future cash flows are not met, the Company may have to record additional impairment charges in future accounting periods. The Company's estimates of cash flows are based on the current regulatory and economic climates,recognized as well as recent operating information and budgets. These estimates could be negatively impacted by changes in federal, state or local regulations, economic downturns, or other events.
Forecasted cash flows can be significantly impacted by the local economy in which the Company's subsidiaries operate. For example, increases in unemployment rates can result in decreased customer visitations and/or lower customer spend per visit. In addition, new legislation which approves gaming in nearby jurisdictions or further expands gaming in jurisdictions in which the Company operates can result in increased competition for the property. This generally has a negative effect on profitability once competitors become established, as a certain level of cannibalization occurs absent an overall increase in customer visitations. Lastly, increases in gaming taxes approved by state regulatory bodies can negatively impact forecasted cash flows.
Assumptions and estimates about future cash flow levels are complex and subjective. They are sensitive to changes in underlying assumptions and can be affected by a variety of factors, including external factors, such as industry, geopolitical and economic trends, and internal factors, such as changes in the Company's business strategy, which may reallocate capital and

resources to different or new opportunities which management believes will enhance the Company's overall value but may be to the detriment of its existing operations. For further information on the Company's evaluation of its goodwill and gaming license for impairment during the year ended December 31, 2018, see Note 9.
Debt Issuance Costs
Debt issuance costs that are incurred by the Company in connection with the issuance of debt are deferred and amortized to interest expense over the contractual term of the underlying indebtedness. In accordance with ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, the Company records long-term debt net of unamortized debt issuance costs on its consolidated balance sheets. Similarly, the Company records long-term debt net of any unamortized bond premiums and original issuance discounts on its consolidated balance sheets.awards’ remaining vesting periods.
Loans Receivable
The Company may periodically loan fundsSee Note 15 for further information related to tenants. Loans are made at prevailing market interest rates and recorded on the Company's consolidated balance sheets at carrying value which approximates fair value. If the collectability of an outstanding loan balance is not reasonably assured, the Company will assess the loan's carrying value for potential impairment. If it is determined the loan is in fact impaired it will be written down or off completely.stock-based compensation.
Income Taxes
The TRS Properties areSegment is able to engage in activities resulting in income that would not be qualifying income for a REIT. As a result, certain activities of the Company which occur within its TRS PropertiesSegment are subject to federal and state income taxes. 
The Company accounts for income taxes in accordance with ASC 740 - Income Taxes ("ASC 740"). Under ASC 740, deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and are measured at the prevailing enacted tax rates that will be in effect when these differences are settled or realized. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized. The realizability of the deferred tax assets is evaluated by assessing the valuation allowance and by adjusting the amount of the allowance, if any, as necessary. The factors used to assess the likelihood of realization are the forecast of future taxable income.
ASC 740 also creates a single model to address uncertainty in tax positions, and clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in an enterprise's financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not have any uncertain tax positions for the three years ended December 31, 2018.2020.
The Company is required under ASC 740 to disclose its accounting policy for classifying interest and penalties, the amount of interest and penalties charged to expense each period, as well as the cumulative amounts recorded in the consolidated balance sheets. If and when they occur, the Company will classify any income tax-related penalties and interest accrued related to unrecognized tax benefits in taxes on income within the consolidated statements of income. During the years ended December 31, 20182020, 2019 and 2017,2018, the Company recognized no0 penalties and interest, net of deferred income taxes and during the year ended December 31, 2016, the Company recognized $1 thousandtaxes.
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Table of penalties and interest, net of deferred income taxes.Contents
The Company elected on its U.S. federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and the Company, together with an indirect wholly-owned subsidiary of the Company, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. and Penn Cecil Maryland, Inc. as a "taxable REIT subsidiary" effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a “taxable REIT subsidiary”.
The Company continues to be organized and to operate in a manner that will permit the Company to qualify as a REIT. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of its annual REIT taxable income to shareholders. As a REIT, the Company generally will not be subject to federal, state or local income tax on income that it distributes as dividends to its shareholders, except in those jurisdictions that do not allow a deduction for such distributions. If the Company fails to qualify as a REIT in any taxable year, it will be subject to U.S. federal, state and local income tax, including any applicable alternative minimum tax, on its taxable income at regular corporate income tax rates, and dividends paid to its shareholders would not be deductible by the Company in computing taxable income. Any resulting corporate liability could be substantial and could materially and adversely affect the Company's net income and net cash available for distribution to shareholders. Unless the Company was entitled to relief under certain Internal Revenue Code provisions, the Company also would be disqualified from re-electing to be taxed as a REIT for the 4four taxable years following the year in which it failed to qualify to be taxed as a REIT.

Earnings Per Share
The Company calculates earnings per share ("EPS") in accordance with ASC 260 - Earnings Per Share. Basic EPS is computed by dividing net income applicable to common stock by the weighted-average number of common shares outstanding during the period, excluding net income attributable to participating securities (unvested restricted stock awards). Diluted EPS reflects the additional dilution for all potentially-dilutive securities such as stock options, unvested restricted shares and unvested performance-based restricted shares. See Note 17 for further details on the Company's earnings per share calculations.

Segment Information
Consistent with how the Company’s Chief Operating Decision Maker (as such term is defined in ASC 280 - Segment Reporting) reviews and assesses the Company’s financial performance, the Company has 2 reportable segments, GLP Capital, L.P. (a wholly-owned subsidiary of GLPI through which GLPI owns substantially all of its real estate assets) and the TRS Segment. The GLP Capital reportable segment consists of the leased real property and represents the majority of the Company’s business. The TRS Segment consists of Hollywood Casino Perryville and Hollywood Casino Baton Rouge, as well as the real estate of Tropicana Las Vegas. See Note 19 for further information with respect to the Company’s segments.
Concentration of Credit Risk
Concentrations of credit risk arise when a number of operators, tenants, or obligors related to the Company's investments are engaged in similar business activities, or activities in the same geographic region, or have similar economic features that would cause their ability to meet contractual obligations, including those to the Company, to be similarly affected by changes in economic conditions. Additionally, concentrations of credit risk may arise when revenues of the Company are derived from a small number of tenants. As of December 31, 2020, substantially all of the Company's real estate properties were leased to Penn, Caesars and Boyd. During the year ended December 31, 2020, approximately 78%, 11% and 10% of the Company's collective income from real estate was derived from tenant leases and real estate loans with Penn, Caesars and Boyd, respectively. Revenues from our tenants are reported in the Company's GLP Capital, L.P. reportable segment. Penn, Caesars and Boyd are publicly traded companies that are subject to the informational filing requirements of the Securities Exchange Act of 1934, as amended, and are required to file periodic reports on Form 10-K and Form 10-Q and current reports on Form 8-K with the Securities and Exchange Commission ("SEC"). Readers are directed to Penn, Caesars and Boyd's respective websites for further financial information on these companies. Other than the Company's tenant concentration, management believes the Company's portfolio was reasonably diversified by geographical location and did not contain any other significant concentrations of credit risk. As of December 31, 2020, the Company's portfolio of 48 properties is diversified by location across 16 states.
Financial instruments that subject the Company to credit risk consist of cash and cash equivalents, accounts receivable, real estate loans and other loans receivable. The Company's policy is to limit the amount of credit exposure to any one financial institution and place investments with financial institutions evaluated as being creditworthy, or in short-term money market and tax-free bond funds which are exposed to minimal interest rate and credit risk. At times, the Company has bank deposits and overnight repurchase agreements that exceed federally-insured limits.

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3.    New Accounting Pronouncements

Accounting Pronouncements Adopted in 2020

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (a consensus of the FASB Emerging Issues Task Force) ("ASU 2018-15"). This ASU clarifies that entities should follow the guidance for capitalizing implementation costs incurred to develop or obtain internal-use software to account for implementation costs of cloud computing arrangements that are service contracts. ASU 2018-15 does not change the accounting for the service component of a cloud computing arrangement. The Company's adoption of ASU 2018-15 on January 1, 2020 did not have an impact on its consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). This ASU introduces a new model for estimating credit losses for certain types of financial instruments, including mortgage, real estate and other loans receivable, amongst other financial instruments.  ASU 2016-13 sets forth an "expected credit loss" impairment model to replace the current "incurred loss" method of recognizing credit losses, which is intended to improve financial reporting by requiring timely recording of credit losses on loans and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for fiscal years beginning after December 15, 2018. The impact of the adoption of this pronouncement was immaterial.

Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform ("ASU 2020-04"). Reference rates such as London Interbank Offered Rate ("LIBOR") are widely used in a broad range of financial instruments and other agreements. Regulators and market participants in various jurisdictions have undertaken efforts, generally referred to as "reference rate reform", to eliminate certain reference rates and introduce new reference rates that are based on a larger and more liquid population of observable transactions. As a result of this reform initiative, certain widely used rates such as LIBOR are expected to be discontinued. ASU 2020-04 provides optional expedients for applying the guidance for contract modifications or other situations affected by reference rate reform, specifically addressing the accounting for modifications of contracts within the scope of ASC Topic 310 on receivables, ASC 470 on debt, and ASC 842 on leases and ASC subtopic 815-15 on embedded derivatives. Based on the limited amount of obligations and contracts the Company currently has that references LIBOR, the Company does not anticipate any material impact from this pronouncement on its Consolidated Financial Statements.

4.Real Estate Investments
Real estate investments, net, represent investments in 45 rental properties and the corporate headquarters building and is summarized as follows:
December 31,
2020		December 31,
2019
 (in thousands)
Land and improvements$2,667,616 $2,552,285 
Building and improvements6,030,482 5,749,211 
Total real estate investments8,698,098 8,301,496 
Less accumulated depreciation(1,410,940)(1,200,941)
Real estate investments, net$7,287,158 $7,100,555 

The increase in real estate investments is primarily due to the Company acquiring the real estate of Belterra Park in satisfaction of the Belterra Park Loan in May 2020 and the acquisition of the real estate of Lumière Place in satisfaction of the CZR loan in September 2020 for $57.7 million ($11.7 million of which was allocated to land and land improvements and $46.0 million to building and improvements) and $246.0 million ($26.9 million of which was allocated to land and land improvements and $219.1 million to building and improvements), respectively. Additionally, the Exchange Transaction described in Note 1 which closed in December 2020, resulted in an increase to real estate investments of $72.6 million (net increase to land and improvements of $46.4 million and building and improvements of $26.2 million). Finally, the Company acquired the land underlying Penn's development project in Morgantown, Pennsylvania for $30.0 million.

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Table of Contents
5.Property and Equipment Used in Operations
Property and equipment used in operations, net, consists of the following and primarily represents the assets utilized at the TRS Properties as the real estate will be leased to third party operators subsequent to the completion of the sale transactions as discussed in Note 6. 
December 31,
2020		December 31,
2019
 (in thousands)
Land and improvements$30,540 $30,492 
Building and improvements117,333 116,904 
Furniture, fixtures, and equipment (1)28,767 118,766 
Construction in progress474 120 
Total property and equipment177,114 266,282 
Less accumulated depreciation (1)(96,496)(172,202)
Property and equipment, net$80,618 $94,080 

(1) The majority of the decline at December 31, 2020 compared to the prior year is related to the reclassification of certain amounts to Assets held for sale. See Note 6 for further details.  

6. Assets Held for Sale

    On November 25, 2020, the Company entered into a definitive agreement to sell the operations of our Hollywood Casino Baton Rouge to Casino Queen for $28.2 million. The Company will retain ownership of all real estate assets at Hollywood Casino Baton Rouge and will simultaneously enter into a master lease with Casino Queen, which will include the Casino Queen property in East St. Louis that is currently leased by us to Casino Queen and the Hollywood Casino Baton Rouge facility (the "Casino Queen Master Lease"). The initial annual cash rent on the retained real estate will be approximately $21.4 million and the Casino Queen Master Lease will have an initial term of 15 years with 4 5 year renewal options exercisable by the tenant. Additionally, the Company will complete the current land side development project that is in process and the rent under the Casino Queen Master Lease will be adjusted upon delivery to reflect a yield of 8.25% on GLPI's project costs. The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the second half of 2021.

On December 11, 2020, Penn agreed to purchase from the Company the operations of our Hollywood Casino Perryville, located in Perryville, Maryland, for $31.1 million, with the closing of such purchase, subject to regulatory approvals, expected to occur during the second half of 2021. Upon closing, the Company will lease the real estate of the Perryville facility to Penn pursuant to a lease providing for initial annual rent on the retained real estate of $7.77 million, subject to escalation provisions.


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The Company has classified the operating assets of the two properties above as Assets held for sale since we expect these transactions to close within 12 months and classified the respective liabilities within Other liabilities on the Consolidated Balance Sheet which is comprised of the following. (in thousands)

Assets
Property and equipment, used in operations, net$8,780 
Right-of-use assets and land rights, net$263 
Cash and cash equivalents$22,131 
Prepaid expenses$2,473 
Goodwill$16,067 
Other intangible assets$9,577 
Other assets$2,157 
Total$61,448 
Liabilities
Accounts payable$8 
Accrued expenses$3,387 
Accrued salaries and wages$2,064 
Gaming, property and other taxes$398 
Lease liabilities$262 
Other liabilities$710 
Total which is classified in Other Liabilities$6,829 

The assets held for sale reside in the Company's TRS Segment. See Note 19 for the pre-tax income of this segment for the years ended December 31, 2020, 2019 and 2018 which is comprised solely of the properties above with the exception of $2.7 million of depreciation expense associated with Tropicana Las Vegas for the year ended December 31, 2020.

7. Acquisitions

The Company accounts for its acquisitions of real estate assets as asset acquisitions under ASC 805 - Business Combinations. Under asset acquisition accounting, transaction costs incurred to acquire the purchased assets are also included as part of the asset cost.

Pending acquisitions

On October 27, 2020, the Company entered into a series of definitive agreements pursuant to which a subsidiary of Bally's Corporation (NYSE: BALY) (Bally's) will acquire 100% of the equity interests in the Caesars subsidiary that currently operates Tropicana Evansville and the Company will reacquire the real property assets of Tropicana Evansville from Caesars for a cash purchase price of approximately $340.0 million. In addition, the Company entered into a real estate purchase agreement with Bally's pursuant to which the Company will purchase the real estate assets of the Dover Downs Hotel & Casino, located in Dover, Delaware which is currently owned and operated by Bally's, for a cash purchase price of approximately $144.0 million. At the closing of the transactions, which are expected in mid-2021, subject to regulatory approvals, the Tropicana Evansville and Dover Downs Hotel and Casino facilities will be added to a new master lease between the Company and Bally's (the “Bally's Master Lease”). The Company anticipates that the Bally's Master Lease will have an initial term of 15 years, with no purchase option, followed by 4 five-year renewal options (exercisable by the tenant) on the same terms and conditions. Rent under the Bally's Master Lease will be $40.0 million annually and is subject to an annual escalator of up to 2% determined in relation to the annual increase in the CPI. The Company expects this transaction to close in mid-2021 following the completion of customary closing conditions and regulatory approvals. On November 6, 2020, the Company issued 9.2 million common shares at $36.25 per share to partially finance the funding required for this transaction.


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Current year acquisitions

As previously discussed in Note 1, the impact of COVID-19 resulted in casino-wide closures by all of our tenants. As a result of COVID-19, on April 16, 2020, the Company and certain of its subsidiaries acquired the real property associated with the Tropicana Las Vegas from Penn in exchange for $307.5 million of rent credits, which were fully utilized in 2020 for rent due under the parties' existing leases.

An affiliate of Penn will continue to operate the casino and hotel business of the Tropicana Las Vegas pursuant to a triple net lease with GLPI for nominal rent for the earlier of two years (subject to three one-year extensions at the Company's option) or until the Tropicana Las Vegas is sold. The Company will conduct a sale process with respect to the Tropicana Las Vegas, with Penn receiving 75% of the net proceeds above $307.5 million (plus certain taxes, expenses and costs) if a sale agreement is signed during the first 12 months following closing and 50% of net proceeds above $307.5 million (plus certain taxes, expenses and costs) if a sale agreement is signed during the subsequent 12 months following closing. Penn will not be entitled to receive any net sale proceeds if the relevant sale agreement is signed at any time after 24 months from closing.

The Company recorded an initial land and building value of $226.2 million and $81.3 million, respectively. During the year ended December 31, 2020 depreciation expense of $2.7 million was recorded. Additionally, deferred rent of $307.5 million was recorded at the acquisition date, which has been fully recognized for the year ended December 31, 2020.

The Tropicana Las Vegas assets are summarized below.

December 31, 2020
(in thousands)
Land and improvements$226,160 
Building and improvements81,340 
Total real estate of Tropicana Las Vegas307,500 
Less accumulated depreciation(2,669)
Real estate of Tropicana Las Vegas , net$304,831 

On October 1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits which were fully utilized by Penn in the fourth quarter of 2020.The Company is leasing the land back to an affiliate of Penn pursuant to the Morgantown Lease for an initial annual rent of $3.0 million, subject to escalation provisions following the opening of the property.


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On October 27, 2020, the Company entered into an Exchange Agreement with subsidiaries of Caesars that own, respectively, Waterloo and Bettendorf. Pursuant to the terms of the agreement, Caesars transferred to the Company the real estate assets of the Waterloo and Bettendorf properties in exchange for the transfer by the Company to Caesars of the real property assets of the Tropicana Evansville, plus a cash payment of $5.7 million.The exchange transaction closed on December 18, 2020, which resulted in the Waterloo and Bettendorf facilities being added to the Amended and Restated Caesars Master Lease and the rent increased by $0.5 million annually. The Company recorded a non-cash gain of $41.4 million in the fourth quarter of 2020 related to the transaction, which represented the difference between the fair value of the properties received compared to the carrying value of Tropicana Evansville and the cash payment of $5.7 million. The following table summarizes the fair value of the assets acquired in the Exchange Agreement and the carrying value of the Tropicana Evansville assets that were transferred to Caesars. (in thousands):

BettendorfWaterlooTotal
Land$29,636 $64,262 $93,898 
Building and improvements85,150 77,958 163,108 
Total real estate investments$114,786 $142,220 $257,006 
Less: Evansville Land and improvements(47,439)
Less: Evansville Buildings and improvements, net(136,858)
Less: Evansville Right of use assets and land rights, net(55,456)
Add: Evansville, Operating Lease Liabilities29,795 

Prior Year Acquisitions

2018

On October 15, 2018, in conjunction with the Penn-Pinnacle Merger the Company acquired the real property assets of Plainridge Park from Penn for approximately $250.9 million. This property was added to the Amended Pinnacle Master Lease via the fourth amendment to the Pinnacle Master Lease and is leased to Penn which will continue to operate the property. The initial annual cash rent of $25.0 million for Plainridge Park will not be subject to rent escalators or adjustments.

Also in conjunction with the Penn-Pinnacle Merger, the Pinnacle Master Lease was amended via the fourth amendment to such lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd and to increase fixed rent under the lease by an additional $13.9 million annually. The Company entered into the Boyd Master Lease for these properties on terms similar to the Company’s existing master leases. As a result of the fourth amendment to the Pinnacle Master Lease, the Company reassessed the lease's classification and determined the new lease agreement qualified for operating lease treatment under ASC 840. Therefore, subsequent to the Penn-Pinnacle Merger, the Amended Pinnacle Master Lease is treated as an operating lease in its entirety, the building assets of $2.6 billion previously recorded as an investment in direct financing lease on the Company's consolidated balance sheet were recorded as real estate assets on the Company's consolidated balance sheet and all rent received under the Amended Pinnacle Master Lease is recorded as rental income on the Company's consolidated statement of income. The Amended Pinnacle Master Lease was assumed by Penn at the consummation of the Penn-Pinnacle Merger.

On October 1, 2018, the Company acquired the real property assets of five casino properties from Tropicana and certain of its affiliates for approximately $992.5 million, pursuant to the Real Estate Purchase Agreement dated April 15, 2018 between Tropicana and GLP Capital, which was subsequently amended on October 1, 2018. 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 and the rights to six long-term ground leases for land on which the operations of the acquired Tropicana properties reside. Concurrent with the Tropicana Acquisition, Caesars acquired the operating assets of these properties from Tropicana pursuant to the Tropicana Merger Agreement and leased the GLP Assets from the Company pursuant to the terms of a new unitary triple-net master lease with an initial term of 15 years, with no purchase option, followed by 4 successive 5-year renewal periods (exercisable by the tenant) on the same terms and conditions. Initial annual rent under the Caesars Master Lease was $87.6 million and is subject to annual rent escalators and biennial percentage rent adjustments.
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Purchase price allocations are primarily based on the fair values of assets acquired and liabilities assumed at the time of acquisition. The following table summarizes the purchase price allocation of the assets acquired in the Tropicana Acquisition (in thousands):
Real estate investments, net$948,217 
Land rights, net44,331 
Total purchase price$992,548 

8. Receivables

Real Estate Loans

As discussed in Note 1, the Company historically had the CZR loan outstanding which was utilized by Caesars in connection with its acquisition of Lumière Place. On June 24, 2020, the Company received approval from the Missouri Gaming Commission to own the Lumière Place real estate in satisfaction of the CZR loan, subject to the Lumière Place Lease, and closed this transaction on September 29, 2020.

On October 15, 2018, Boyd purchased the real estate assets of Belterra Park from Pinnacle for a cash purchase price of $57.7 million, exclusive of transaction fees. Financing for the transaction was provided by the Company in the form of the Belterra Park Loan. The Belterra Park Loan's initial interest rate was equal to 11.11% and the loan matures in connection with the expiration of the Boyd Master Lease (as may be extended at the tenant's option to April 30, 2051). In May 2020, the Company acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to the Belterra Park Lease.

Other Loans Receivable

In January 2014, the Company completed the asset acquisition of the real property associated with the Casino Queen in East St. Louis, Illinois. GLPI leases the property back to Casino Queen on a triple-net basis on terms similar to those in the Company's existing master leases. The Casino Queen Lease has an initial term of 15 years and the tenant has an option to renew it at the same terms and conditions for 4 successive 5-year periods.  

Simultaneously with the Casino Queen acquisition, GLPI provided Casino Queen with a $43.0 million, five-year term loan at 7% interest, prepayable at any time, which, together with the sale proceeds, completely refinanced and retired all of Casino Queen’s outstanding long-term debt obligations. On March 13, 2017, the outstanding principal and interest on this loan was repaid in full and GLPI simultaneously provided a new unsecured $13.0 million, 5.5-year term loan (the "Casino Queen Loan") to CQ Holding Company, Inc., an affiliate of Casino Queen ("CQ Holding Company"), to partially finance its acquisition of Lady Luck Casino in Marquette, Iowa. The Casino Queen Loan bears an interest rate of 15% and is prepayable at any time.

On June 12, 2018, the Company received a Notice of Event of Default under the senior credit agreement of CQ Holding Company from the secured lender under such agreement, which reported a covenant default under its senior secured agreement. Under the terms of that agreement, when an event of default occurs, CQ Holding Company is prohibited from making cash payments to unsecured lenders such as GLPI. Therefore, beginning in June 2018 the interest due from CQ Holding Company under the Company's unsecured loan was paid in kind. In addition to the covenant violation noted above under its senior credit agreement, CQ Holding Company also had a payment default under the senior credit agreement. Furthermore, the Company notified Casino Queen of events of default under the Company's unsecured loan with CQ Holding Company, related to financial covenant violations during the year ended December 31, 2018.
At December 31, 2018, active negotiations for the sale of Casino Queen's operations were taking place. Despite the payment and covenant defaults noted above, at that time, full payment of the principal was still expected, due to the anticipation that the operations were to be sold in the near term for an amount allowing for repayment of the full $13.0 million of loan principal due to GLPI. However, the paid-in-kind interest due to the Company at December 31, 2018 was not expected to be collected, resulting in an impairment charge of $1.5 million during the fourth quarter of 2018. The Company did not recognize the paid-in-kind interest income due to the Company for the quarter ended December 31, 2018 and took a charge for the previously recognized paid-in-kind interest income through the Company’s consolidated statement of earnings as a reversal of the paid-in-kind interest income recognized earlier in the year.
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During 2019, the operating results of Casino Queen continued to decline, the secured debt of Casino Queen was sold to a third-party casino operator at a discount and the Company no longer expected the loan to be repaid. Therefore, the Company recorded an impairment charge of $13.0 million through the Consolidated Statement of Income for the year ended December 31, 2019 to reflect the write-off of the Casino Queen Loan.
    Casino Queen was closed in mid-March due to COVID-19 and Casino Queen was in payment default on their lease starting in April 2020. The Company entered into a deferred rental agreement with Casino Queen and received all delinquent rental payments in the fourth quarter of 2020.


9. Lease Assets and Lease Liabilities

Lease Assets

The Company is subject to various operating leases as lessee for both real estate and equipment, the majority of which are ground leases related to properties the Company leases to its tenants under triple-net operating leases. These ground leases may include fixed rent, as well as variable rent based upon an individual property’s performance or changes in an index such as the CPI and have maturity dates ranging from 2028 to 2108, when considering all renewal options. For certain of these ground leases, the Company’s tenants are responsible for payment directly to the third-party landlord. Under ASC 842, the Company is required to gross-up its consolidated financial statements for these ground leases as the Company is considered the primary obligor. In conjunction with the adoption of ASU 2016-02 on January 1, 2019, the Company recorded right-of-use assets and related lease liabilities on its consolidated balance sheet to represent its rights to use the underlying leased assets and its future lease obligations, respectively, including for those ground leases paid directly by our tenants. Because the right-of-use asset relates, in part, to the same leases which resulted in the land right assets the Company recorded on its consolidated balance sheet in conjunction with the Company's assumption of below market leases at the time it acquired the related land and building assets, the Company is required to report the right-of-use assets and land rights in the aggregate on the consolidated balance sheet.

Land rights, net represent the Company's rights to land subject to long-term ground leases. The Company obtained ground lease rights through the acquisition of several of its rental properties and immediately subleased the land to its tenants. These land rights represent the below market value of the related ground leases. The Company assessed the acquired ground leases to determine if the lease terms were favorable or unfavorable, given market conditions at the acquisition date. Because the market rents to be received under the Company's triple-net tenant leases were greater than the rents to be paid under the acquired ground leases, the Company concluded that the ground leases were below market and were therefore required to be recorded as a definite lived asset (land rights) on its books.

Components of the Company's right-of use assets and land rights, net are detailed below (in thousands):
December 31, 2020December 31, 2019
Right-of-use assets - operating leases (1)
$151,339 $184,063 
Land rights, net617,858 654,671 
Right-of-use assets and land rights, net$769,197 $838,734 

(1) In addition, there is $0.3 million of operating lease right-of-use assets included in assets held for sale.

As described in Note 8, on December 18, 2020, the Company and Caesars completed an Exchange Agreement in which the Company transferred to Caesars the real property assets of Tropicana Evansville. In connection with the exchange, the Company removed the land right and right of use asset related to the long-term ground lease at this property which totaled $24.8 million and $30.7 million, respectively, at the closing of the transaction along with the lease liability of $29.8 million it had recorded on its Consolidated Balance Sheet for this lease.

On June 30, 2019, the Resorts Casino Tunica property was closed by the Company's tenant, resulting in the acceleration of $6.3 million of land right amortization expense related to the long-term ground lease at this property and bringing the net book value of this land right to 0 at December 31, 2019. Subsequent to the property's closure, the Company entered into an agreement to terminate the long-term ground lease for the Resorts Casino Tunica property, which became effective in February 2020. In connection with the exercised termination option, the Company remeasured the lease liability and adjusted the right-of-use asset it had recorded on its consolidated balance sheet for this lease to align with the new termination date.
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Land Rights

The land rights are amortized over the individual lease term of the related ground lease, including all renewal options, which ranged from 10 years to 92 years at their respective acquisition dates. Land rights net, consist of the following:

December 31,
2020		December 31,
2019
(in thousands)
Land rights$667,751 $694,077 
Less accumulated amortization(49,893)(39,406)
Land rights, net$617,858 $654,671 

As of December 31, 2020, estimated future amortization expense related to the Company’s land rights by fiscal year is as follows (in thousands):

Year ending December 31,
2021$11,372 
202211,372 
202311,372 
202411,372 
202511,372 
Thereafter560,998 
Total$617,858 

Lease Liabilities

At December 31, 2020, maturities of the Company's operating lease liabilities were as follows (in thousands):

Year ending December 31,
2021$11,079 
202211,082 
202311,081 
202411,034 
202510,984 
Thereafter569,957 
Total lease payments$625,217 
Less: interest(473,014)
Present value of lease liabilities (1)
$152,203 

(1) In addition, there is $0.3 million of lease liabilities included in other liabilities related to liabilities held for sale.

Lease Expense

Operating lease costs represent the entire amount of expense recognized for operating leases that are recorded on the Consolidated Balance Sheet. Variable lease costs are not included in the measurement of the lease liability and include both lease payments tied to a property's performance and changes in an index such as the CPI that are not determinable at lease commencement, while short-term lease costs are costs for those operating leases with a term of 12 months or less.

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The components of lease expense were as follows:
Year Ended December 31, 2020Year Ended December 31, 2019
(in thousands)
Operating lease cost$13,907 $15,482 
Variable lease cost (1)
3,364 9,048 
Short-term lease cost625 1,060 
Amortization of land right assets12,022 18,536 
Total lease cost$29,918 $44,126 

(1)Variable lease costs for the year ended December 31, 2020 included a true up of the monthly rental payments paid by our tenants on certain ground leases that are based on estimated current year annual performance which were impacted by casino closures due to COVID-19. As discussed previously, under ASC 842, the Company is required to gross up its financial statements by recording both expense and revenue (recorded within rental income on the Consolidated Statements of Income) for these payments since the Company is considered the primary obligor.

Amortization expense related to the land right intangibles, as well as variable lease costs and the majority of the Company's operating lease costs are recorded within land rights and ground lease expense in the consolidated statements of income. The Company's short-term lease costs as well as a small portion of operating lease costs are recorded in both gaming, food, beverage and other expense and general and administrative expense in the consolidated statements of income. Amortization expense related to the land right intangibles totaled $11.3 million for the year ended December 31, 2018. Other lease costs totaled $18.9 million for the year ended December 31, 2018.

Supplemental Disclosures Related to Leases

Supplemental balance sheet information related to the Company's operating leases was as follows:
December 31, 2020
Weighted average remaining lease term - operating leases56.41 years
Weighted average discount rate - operating leases6.7%

In addition, the weighted average remaining lease term and the weighted average discount rate for those operating leases included in assets held for sale and other liabilities is 1.79 years and 4.0%, respectively.

Supplemental cash flow information related to the Company's operating leases was as follows:
Year Ended December 31, 2020Year Ended December 31, 2019
(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
  Operating cash flows from operating leases (1) (2)
$1,600 $2,226 
Right-of-use assets obtained in exchange for new lease obligations:
   Operating leases (2)
$95 $293 

(1) The Company's cash paid for operating leases is significantly less than the lease cost for the same period due to the majority of the Company's ground lease rent being paid directly to the landlords by the Company's tenants. Although GLPI expends no cash related to these leases, they are required to be grossed up in the Company's financial statements under ASC 842.

(2) In addition, there is $0.2 million and $0.3 million related to assets held for sale and other liabilities for operating cash flows from cash paid for amounts included in the measurement of lease liabilities and right-of-use assets obtained for new lease obligations, respectively for the year ended December 31, 2020.

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10. Goodwill and Intangible Assets

Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. The only goodwill of the Company is recorded on the books of Hollywood Casino Baton Rouge, in connection with Penn's purchase of this entity prior to the Spin-Off. The original assets and liabilities of GLPI, including goodwill and intangible assets were recorded at their respective historical carrying values at the time of the Spin-Off in accordance with the provisions of ASC 505. There is no goodwill recorded on the Company's GLP Capital segment, which holds the Company's REIT operations.

During the year ended December 31, 2018, the Company recorded a goodwill impairment charge of $59.5 million in connection with its operations at Hollywood Casino Baton Rouge. This charge was driven by general market deterioration in the Baton Rouge region and the smoking ban at all Baton Rouge, Louisiana casinos that went into effect during the second quarter of 2018, both of which significantly impacted the Company's forecasted cash flows for this reporting unit. Subsequent to conducting its impairment tests on other long-lived assets, the Company performed Step 1 of the goodwill impairment test, which indicated a potential impairment. Step 1 of the goodwill impairment test involved the determination of the fair value of the Baton Rouge reporting unit and its comparison to the reporting unit's carrying amount. Using a discounted cash flow model, which relied on projected EBITDA to determine the reporting unit's future cash flows, the Company calculated a fair value that was less than the reporting unit's carrying value and proceeded to Step 2. In Step 2 of the goodwill impairment test, the Company performed a fair value allocation as if the reporting unit had been acquired in a business combination and assigned the fair value of the reporting unit calculated in Step 1 to all assets and liabilities of the reporting unit, including any unrecognized intangible assets. Any residual fair value was allocated to goodwill to arrive at the implied fair value of goodwill. After completing the Step 2 allocation, the Company determined the goodwill on its Baton Rouge reporting unit had an implied fair value of $16.1 million and recorded the impairment charge of $59.5 million during the fourth quarter of 2018. There have been no changes in the carrying value of goodwill of $16.1 million for the years ended December 31, 2020 and 2019. As described in Note 6, the Company's goodwill balance at December 31, 2020 has been reclassified to Assets held for sale.

In accordance with ASC 350, the Company considers its gaming license at the Hollywood Casino Perryville property an indefinite-lived intangible asset that does not require amortization based on future expectations to operate this casino indefinitely, as well as the gaming industry's historical experience in renewing these intangible assets at minimal cost with various state gaming commissions. Rather, the Company's gaming license is tested annually, or more frequently if indicators of impairment exist, for impairment by comparing the fair value of the recorded asset to its carrying amount. If the carrying amount of the indefinite-life intangible asset exceeds its fair value, an impairment loss is recognized. Hollywood Casino Perryville's gaming license will expire in September 2025, fifteen years from the casino's opening date. The Company expects to expense any costs related to the gaming license renewal as incurred. The Company conducts its annual impairment assessment of the gaming license on October 1st using the Greenfield Method which estimates the fair value of the gaming license assuming the Company built a casino with similar utility to that of the existing facility. This method also assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. Based upon these assumptions and the Company's current forecasted cash flows for this reporting unit, the gaming license was not impaired. At both December 31, 2020 and 2019, the gaming license had a carrying value of $9.6 million. As described in Note 6, the Company's other intangible assets balance at December 31, 2020 has been reclassified to Assets held for sale.

11. Fair Value of Financial Assets and Liabilities

Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following methods and assumptions are used to estimate the fair value of each class of financial instruments for which it is practicable to estimate:

Cash and Cash Equivalents
The fair value of the Company’s cash and cash equivalents approximates the carrying value of the Company’s cash and cash equivalents, due to the short maturity of the cash equivalents.

Deferred Compensation Plan Assets

The Company's deferred compensation plan assets consist of open-ended mutual funds and as such the fair value measurement of the assets is considered a Level 1 measurement as defined under ASC 820. Deferred compensation plan assets are included within other assets on the consolidated balance sheets.

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Real Estate Loans

The fair value of the real estate loans approximates the carrying value of the Company's real estate loans, as collection on the outstanding loan balances is reasonably assured. The fair value measurement of the real estate loans is considered a Level 3 measurement as defined under ASC 820.

Long-term Debt
The fair value of the Senior Notes are estimated based on quoted prices in active markets and as such are Level 1 measurements as defined under ASC 820. The fair value of the obligations in our Amended Credit Facility is based on indicative pricing from market information (Level 2 inputs).
The estimated fair values of the Company’s financial instruments are as follows (in thousands):
 December 31, 2020December 31, 2019
 Carrying
Amount		Fair
Value		Carrying
Amount		Fair
Value
Financial assets:    
Cash and cash equivalents (1)
$486,451 $486,451 $26,823 $26,823 
Deferred compensation plan assets35,514 35,514 28,855 28,855 
Real estate loans0 0 303,684 303,684 
Financial liabilities:    
Long-term debt:    
Senior unsecured credit facility424,019 424,019 495,000 493,533 
Senior unsecured notes5,375,000 6,026,840 5,290,174 5,707,996 

(1) In addition, there is $22.1 million in cash and cash equivalents in assets held for sale.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
There were no liabilities measured at fair value on a nonrecurring basis during the years ended December 31, 2020 and 2019. There were no assets measured at fair value on a nonrecurring basis during the year ended December 31, 2020; however, assets measured at fair value on a nonrecurring basis during the year ended December 31, 2019 are described below.
Revenue RecognitionSenior Unsecured Notes


    At December 31, 2020, the Company had an outstanding balance of $5,375.0 million of senior unsecured notes (the "Senior Notes").

In the first quarter of 2020, the Company redeemed all $215.2 million aggregate principal amount of the Company’s outstanding 4.875% senior unsecured notes due in November 2020 and all $400 million aggregate principal amount of the Company’s outstanding 4.375% senior unsecured notes due in April 2021, incurring a loss on the early extinguishment of debt related to the redemption of $17.3 million, primarily for call premium charges and debt issuance write-offs.

On June 25, 2020, the Company issued $500 million of 4.00% senior unsecured notes due January 2031 at an issue price equal to 98.827% of the principal amount to repay indebtedness under its Revolver. On August 18, 2020 the Company issued an additional $200 million of 4.00% senior unsecured notes due January 2031 at an issue price equal to 103.824% of the principal amount to repay Term Loan A-1 indebtedness, incurring a loss on the early extinguishment of debt of $0.8 million, related to debt issuance write-offs. These bond offerings have extended the maturities of our long-term debt.

On August 29, 2019, the Company issued $400 million of 3.35% Senior Unsecured Notes maturing on September 1, 2024 at an issue price equal to 99.899% of the principal amount (the "2024 Notes") and $700 million of 4.00% Senior Unsecured Notes maturing on January 15, 2030 at an issue price equal to 99.751% of the principal amount (the "2030 Notes"). Interest on the 2024 Notes is payable semi-annually on March 1 and September 1 of each year, commencing on March 1, 2020. Interest on the 2030 Notes is payable semi-annually on January 15 and July 15 of each year, commencing on January 15, 2020. The net proceeds from the sale of the 2024 Notes and 2030 Notes were used to (i) finance the Company's cash tender offer to purchase its 4.875% Senior Unsecured Notes due 2020 (described below) (ii) repay outstanding borrowings under the Company's revolving credit facility and (iii) repay a portion of the outstanding borrowings under the Company's Term Loan A-1 facility.

On September 12, 2019, the Company completed a cash tender offer (the "2019 Tender Offer") to purchase its $1,000 million aggregate principal amount 4.875% Senior Unsecured Notes due 2020 (the "2020 Notes"). The Company received early tenders from the holders of approximately $782.6 million in aggregate principal of the 2020 Notes, or approximately 78% of its
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outstanding 2020 Notes, in connection with the 2019 Tender Offer at a price of 102.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date. Subsequent to the early tender deadline, an additional $2.2 million in aggregate principal of the 2020 Notes was tendered at a price of 99.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date, for a total redemption of $784.8 million of the 2020 Notes. The Company recorded a loss on the early extinguishment of debt related to the 2019 Tender Offer, of approximately $21.0 million, for the difference between the reacquisition price of the tendered 2020 Notes and their net carrying value.
The Company recognizes rental revenuemay redeem the Senior Notes of any series at any time, and from tenants,time to time, at a redemption price of 100% of the principal amount of the Senior Notes redeemed, plus a "make-whole" redemption premium described in the indenture governing the Senior Notes, together with accrued and unpaid interest to, but not including, rental abatements, lease incentivesthe redemption date, except that if Senior Notes of a series are redeemed 90 or fewer days prior to their maturity, the redemption price will be 100% of the principal amount of the Senior Notes redeemed, together with accrued and contractually fixed increases attributableunpaid interest to, operating leases,but not including, the redemption date. If GLPI experiences a change of control accompanied by a decline in the credit rating of the Senior Notes of a particular series, the Company will be required to give holders of the Senior Notes of such series the opportunity to sell their Senior Notes of such series at a price equal to 101% of the principal amount of the Senior Notes of such series, together with accrued and unpaid interest to, but not including, the repurchase date. The Senior Notes also are subject to mandatory redemption requirements imposed by gaming laws and regulations. 
The Senior Notes were issued by GLP Capital, L.P. and GLP Financing II, Inc. (the "Issuers"), two wholly-owned subsidiaries of GLPI, and are guaranteed on a straight-linesenior unsecured basis overby GLPI. The guarantees of GLPI are full and unconditional. The Senior Notes are the Issuers' senior unsecured obligations and rank pari passu in right of payment with all of the Issuers' senior indebtedness, including the Credit Facility, and senior in right of payment to all of the Issuers' subordinated indebtedness, without giving effect to collateral arrangements.
The Senior Notes contain covenants limiting the Company’s ability to: incur additional debt and use its assets to secure debt; merge or consolidate with another company; and make certain amendments to the Penn Master Lease. The Senior Notes also require the Company to maintain a specified ratio of unencumbered assets to unsecured debt. These covenants are subject to a number of important and significant limitations, qualifications and exceptions.
At December 31, 2020, the Company was in compliance with all required financial covenants under its Senior Notes.

Finance Lease Liability

The Company assumed the finance lease obligations related to certain assets at its Aurora, Illinois property. GLPI recorded the asset and liability associated with the finance lease on its consolidated balance sheet. The original term of the related leases when collectabilityfinance lease is reasonably assured. Additionally, percentage rent30 years and it will terminate in 2026.
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Summarized financial information for Subsidiary Issuers and Parent Guarantor
As of December 31, 2020As of December 31, 2019
Real estate investments, net$2,720,767 $2,514,806 
Real estate loans— 246,000 
Right-of-use assets and land rights, net121,866 181,593 
Cash and cash equivalents480,066 4,281 
Long term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts5,754,689 5,737,962 
Accrued interest72,285 60,695 
Lease liabilities58,654 89,856 
Deferred rental revenue265,891 271,837 
For the year ended December 31, 2020For the year ended December 31, 2019
Revenues$580,428 $575,451 
Income from operations446,708 384,170 
Interest expense(282,142)(301,520)
Net income146,323 61,734 


The financial information presented above is that is fixedof the subsidiary issuers and determinable atparent guarantor and the lease inception date is recordedfinancial information of non-issuer subsidiaries has been excluded. The financial information of subsidiary issuers and the parent guarantor has been presented on a straight-line basis overcombined basis; however, the lease term, resultingonly asset on the parent guarantor balance sheet is its investment in subsidiaries which is not included in the recognition of deferred rental revenue on the Company’s consolidated balance sheets. Deferred rental revenue is amortized to rental revenue on a straight-line basis over the remainder of the lease term. The lease term includes the initial non-cancelable lease term and any reasonably assured renewable periods. Contingent rental income that is not fixed and determinable at lease inception is recognized only when the lessee achieves the specified target. Recognition of rental income commences when control of the facility has been transferred to the tenant.

The Company recognizes income from tenants subject to direct financing leases ratably over the lease term using the effective interest rate method which produces a constant periodic rate of return on the net investment in the leased property. At lease inception, the Company records an asset which represents the Company's net investment in the direct financing lease. This initial net investment is determined by aggregating the total future minimum lease payments attributable to the direct financing lease and the estimated residual value of the property, less unearned income. Over the lease term, the investment in the direct financing lease is reduced and income is recognized for the building portion of rent. Furthermore, as the net investment in direct financing lease includes only future minimum lease payments, percentage rent that is not fixed and determinable at the lease inception is excluded from the determination of the rent attributable to the leased assets and will therefore be recorded as income from the direct financing lease in the period earned. In conjunction with the Penn-Pinnacle Merger on October 15, 2108, the Company's only direct financing lease was unwound and the master lease it was associated with qualified for operating lease treatment in its entirety. For further details refer to Note 8.

Additionally,presentation above in accordance with ASC 606 - Revenuethe disclosure requirements.

We had no off-balance sheet arrangements at December 31, 2020 and 2019.

Distribution Requirements

We generally must distribute annually at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gains, in order to qualify to be taxed as a REIT (assuming that certain other requirements are also satisfied) so that U.S. federal corporate income tax does not apply to earnings that we distribute. To the extent that we satisfy this distribution requirement and qualify for taxation as a REIT but distribute less than 100% of our REIT taxable income, determined without regard to the dividends paid deduction and including any net capital gains, we will be subject to U.S. federal corporate income tax on our undistributed net taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we distribute to our shareholders in a calendar year is less than a minimum amount specified under U.S. federal income tax laws. We intend to make distributions to our shareholders to comply with the REIT requirements of the Code.

While the Company's Board of Directors declared a cash dividend of $0.70 for the first quarter of 2020, quarterly dividends of $0.60 per share on the Company's common stock were declared for both the second, third and fourth quarters. These dividends consisted of a combination of cash and shares of the Company's common stock. The cash component of the dividend (other than cash paid in lieu of fractional shares) did not exceed 20% in the aggregate, or $0.12 per share, with the balance, or $0.48 per share, payable in shares of the Company's common stock. This quarterly dividend level reflected the impact of the COVID-19 closures on the Company's business.

LIBOR Transition

The majority of our debt is at fixed rates and our exposure to variable interest rates is currently limited to our revolving credit facility and our Term Loan A-2. Both of these debt instruments are indexed to LIBOR which is expected to be phased out during late 2021 through mid-2023. The discontinuance of LIBOR would affect our interest expense and earnings. The borrowings under our Amended Credit Facility will be subject to the expected LIBOR transition. LIBOR is currently expected
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to transition to a new standard rate, the Secured Overnight Financing Rate (“SOFR”). We are currently monitoring the transition and cannot be certain whether SOFR will become the standard rate for our variable rate debt.

Outlook

Based on our current level of operations and anticipated earnings, we believe that cash generated from Contractsoperations and cash on hand, together with Customers ("ASC 606"),amounts available under our Amended Credit Facility, will be adequate to meet our anticipated debt service requirements, capital expenditures, working capital needs and dividend requirements. During 2020, we refinanced our near term debt obligations and as such have no significant obligations coming due until 2023 and we issued common shares in advance of the planned 2021 closing of the Bally's transaction. We also announced a project to move our Hollywood Casino Baton Rouge property landside in early 2022. On December 15, 2020, we announced that Penn had exercised its option to acquire the gaming operations at Hollywood Casino Perryville for $31.1 million and that we entered into an agreement to sell the gaming operations of Hollywood Casino Baton Rouge for $28.2 million to Casino Queen. The Company records revenue forwill retain ownership of the real estate taxes paid by its tenantsassets at Hollywood Casino Baton Rouge and will simultaneously enter into the Casino Queen Master Lease. Rent under the Casino Queen Master Lease will be adjusted upon completion of the project to reflect a yield of 8.25% on the leasedCompany's project costs. Both transactions are expected to close in the second half of 2021, subject to regulatory approvals and other customary closing conditions.

In addition, we expect the majority of our future growth to come from acquisitions of gaming and other properties to lease to third parties. If we consummate significant acquisitions in the future, our cash requirements may increase significantly and we would likely need to raise additional proceeds through a combination of either common equity (including under our ATM Program) and/or debt offerings. Our future operating performance and our ability to service or refinance our debt will be subject to future economic conditions and to financial, business and other factors, many of which are beyond our control. See "Risk Factors-Risks Related to Our Capital Structure" of this Annual Report on Form 10-K for a discussion of the risk related to our capital structure.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We face market risk exposure in the form of interest rate risk. These market risks arise from our debt obligations. We have no international operations. Our exposure to foreign currency fluctuations is not significant to our financial condition or results of operations.
GLPI’s primary market risk exposure is interest rate risk with an offsettingrespect to its indebtedness of $5,799.9 million at December 31, 2020. Furthermore, $5,375.0 million of our obligations are the senior unsecured notes that have fixed interest rates with maturity dates ranging from two and one-half years to ten years. An increase in interest rates could make the financing of any acquisition by GLPI more costly, as well as increase the costs of its variable rate debt obligations. Rising interest rates could also limit GLPI’s ability to refinance its debt when it matures or cause GLPI to pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness. GLPI may manage, or hedge, interest rate risks related to its borrowings by means of interest rate swap agreements. GLPI also expects to manage its exposure to interest rate risk by maintaining a mix of fixed and variable rates for its indebtedness. However, the provisions of the Code applicable to REITs substantially limit GLPI’s ability to hedge its assets and liabilities.
The table below provides information at December 31, 2020 about our financial instruments that are sensitive to changes in real estate taxes withininterest rates. For debt obligations, the table presents notional amounts maturing in each fiscal year and the related weighted-average interest rates by maturity dates. Notional amounts are used to calculate the contractual payments to be exchanged by maturity date and the weighted-average interest rates for our variable rate debt are based on implied forward LIBOR rates at December 31, 2020.
 1/01/21- 12/31/211/01/22- 12/31/221/01/23- 12/31/231/01/24- 12/31/241/01/25 12/31/25ThereafterTotalFair Value at 12/31/2020
 (in thousands)
Long-term debt:        
Fixed rate$— $— $500,000 $400,000 $850,000 $3,625,000 $5,375,000 $6,026,840 
Average interest rate5.38 %3.35 %5.25 %4.88 %  
Variable rate$— $— $424,019 $— $— $— $424,019 $424,019 
Average interest rate (1) 
2.02 %   
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(1) Estimated rate, reflective of forward LIBOR plus the spread over LIBOR applicable to variable-rate borrowing. For considerations surrounding the phase out of LIBOR refer to the Liquidity and Capital Resources discussion in this Annual Report on Form 10-K.
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ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and the Board of Directors of
Gaming and Leisure Properties, Inc. and Subsidiaries

Opinion on the Financial Statements

We have audited the accompanying consolidated statementbalance sheets of incomeGaming and Leisure Properties, Inc. and Subsidiaries (the "Company") as of December 31, 2020 and 2019, the Company has concluded it is the primary obligor. Similarly, the Company records revenue for the ground lease rent paid by its tenants with an offsetting expense in land rights and ground lease expense within therelated consolidated statements of income, changes in shareholders’ equity (deficit), and cash flows, for each of the three years in the period ended December 31, 2020, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company has concluded that as of December 31, 2020 and 2019, and the lessee itresults of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control -- Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 19, 2021, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the primary obligor underCompany's financial statements based on our audits. We are a public accounting firm registered with the ground leases. The Company subleases these ground leases backPCAOB and are required to its tenants, who are responsible for payment directlybe independent with respect to the landlord.Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Lease Classification - Lease Term - See Note 14 to the financial statements
Critical Audit Matter Description
The Company may periodically loan fundsperforms a lease classification test upon the entry into any new tenant lease or lease modification to casino owner-operators via secured mortgage loansdetermine if the Company will account for the purchaselease as an operating, sales-type lease, or direct financing lease. The accounting guidance under ASC 842 is complex and requires the use of gaming related properties. Interest income relatedjudgments and assumptions by management to mortgage loans receivable is recordeddetermine the proper accounting treatment of a lease. The lease classification tests and the resulting calculations require subjective judgments, such as revenue from mortgaged real estate withindetermining the Company's consolidated statements of incomelikelihood a tenant will exercise all renewal options, in order to determine the lease term. A slight change in estimate or judgment can result in a material difference in the period earned.financial statement presentation.
Gaming revenue generated
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Given the significant judgments made by management to determine the TRS Properties mainly consistsexpected lease term, we performed audit procedures to assess the reasonableness of revenue from slot machines and tosuch judgments, which required a lesser extent, table game and poker revenue. Gaming revenue from slot machines ishigh degree of auditor judgment.
How the aggregate net difference between gaming wins and losses with liabilities recognized for funds deposited by customers before gaming play occurs, for "ticket-in, ticket-out" couponsCritical Audit Matter Was Addressed in the customers’ possession, and for accrualsAudit
Our audit procedures related to the anticipated payoutjudgments surrounding the determination of progressive jackpots. Progressive slot machines, which contain base jackpots that increase atlease term for any new or reassessed lease included the following, among others:
•We tested the effectiveness of the controls over management’s assessment of the likelihood a progressive rate based ontenant would exercise all renewal options.
•We evaluated the numbersignificant judgments management made to determine the expected lease term by:
◦Evaluating the significance of coins played, are chargedthe leased assets to revenuethe tenant’s operations by examining available information including tenant’s financial statements.

◦Evaluating the Company’s historical pattern of tenant lease modifications by examining both confirming and contradictory evidence.

◦Obtaining lease agreements to examine material lease provisions considered by management in their analysis.

/s/ Deloitte & Touche


New York, New York
February 19, 2021

We have served as the amountCompany's auditor since 2016.





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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Balance Sheets
(in thousands, except share data) 
December 31, 2020December 31, 2019
Assets
Real estate investments, net$7,287,158 $7,100,555 
Property and equipment, used in operations, net80,618 94,080 
Assets held for sale61,448 0 
Real estate of Tropicana Las Vegas, net304,831 0 
Real estate loans0 303,684 
Right-of-use assets and land rights, net769,197 838,734 
Cash and cash equivalents486,451 26,823 
Prepaid expenses2,098 4,228 
Goodwill0 16,067 
Other intangible assets0 9,577 
Deferred tax assets, net5,690 6,056 
Other assets36,877 34,494 
Total assets$9,034,368 $8,434,298 
Liabilities
Accounts payable$375 $1,006 
Accrued expenses398 6,239 
Accrued interest72,285 60,695 
Accrued salaries and wages5,849 13,821 
Gaming, property, and other taxes146 944 
Lease liabilities152,203 183,971 
Long-term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts5,754,689 5,737,962 
Deferred rental revenue333,061 328,485 
Deferred tax liabilities359 279 
Other liabilities39,985 26,651 
Total liabilities6,359,350 6,360,053 
Commitments and Contingencies (Note 13)00
Shareholders’ equity
Preferred stock ($.01 par value, 50,000,000 shares authorized, 0 shares issued or outstanding at December 31, 2020 and December 31, 2019)0 0 
Common stock ($.01 par value, 500,000,000 shares authorized, 232,452,220 and 214,694,165 shares issued and outstanding at December 31, 2020 and December 31, 2019, respectively)2,325 2,147 
Additional paid-in capital4,284,789 3,959,383 
Accumulated deficit(1,612,096)(1,887,285)
Total shareholders’ equity2,675,018 2,074,245 
Total liabilities and shareholders’ equity$9,034,368 $8,434,298 
See accompanying Notes to the Consolidated Financial Statements.

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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Income
(in thousands, except per share data)
Year ended December 31,202020192018
Revenues  
Rental income$1,031,036 $996,166 $747,654 
Income from direct financing lease0 0 81,119 
Interest income from real estate loans19,130 28,916 6,943 
Real estate taxes paid by tenants0 0 87,466 
Total income from real estate1,050,166 1,025,082 923,182 
Gaming, food, beverage and other102,999 128,391 132,545 
Total revenues1,153,165 1,153,473 1,055,727 
Operating expenses   
Gaming, food, beverage and other56,698 74,700 77,127 
Real estate taxes0 0 88,757 
Land rights and ground lease expense29,041 42,438 28,358 
General and administrative68,572 65,385 70,819 
(Gains) losses from dispositions of properties(41,393)92 309 
Depreciation230,973 240,435 137,093 
Loan impairment charges0 13,000 0 
  Goodwill impairment charges0 0 59,454 
Total operating expenses343,891 436,050 461,917 
Income from operations809,274 717,423 593,810 
Other income (expenses)   
Interest expense(282,142)(301,520)(247,684)
Interest income569 756 1,827 
   Losses on debt extinguishment(18,113)(21,014)(3,473)
Total other expenses(299,686)(321,778)(249,330)
Income before income taxes509,588 395,645 344,480 
Income tax expense3,877 4,764 4,964 
Net income$505,711 $390,881 $339,516 
Earnings per common share:  
Basic earnings per common share$2.31 $1.82 $1.59 
Diluted earnings per common share$2.30 $1.81 $1.58 

See accompanying Notes to the Consolidated Financial Statements.

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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Changes in Shareholders’ Equity
(in thousands, except share data)

 Common StockAdditional
Paid-In
Capital		Accumulated
Deficit		Total
Shareholders’
Equity
 SharesAmount
Balance, December 31, 2017212,717,549 $2,127 $3,933,829 $(1,477,709)$2,458,247 
Stock option activity1,007,750 10 19,805 — 19,815 
Restricted stock activity486,633 5 (1,131)— (1,126)
Dividends paid ($2.57 per common share)0 0 0 (550,435)(550,435)
Adoption of new revenue standard— — — (410)(410)
Net income— — — 339,516 339,516 
Balance, December 31, 2018214,211,932 2,142 3,952,503 (1,689,038)2,265,607 
ATM Program offering costs, net of issuance of common stock1,500 0 (255)— (255)
Stock option activity26,799 0 592 — 592 
Restricted stock activity453,934 5 6,543 — 6,548 
Dividends paid ($2.74 per common share)— — — (589,128)(589,128)
Net income— — — 390,881 390,881 
Balance, December 31, 2019214,694,165 2,147 3,959,383 (1,887,285)2,074,245 
Issuance of common stock, net of costs9,207,971 92 320,781 320,873 
Restricted stock activity528,285 5 4,706 4,711 
Dividends paid ($2.50 per common share)8,021,799 81 (81)(230,522)(230,522)
Net income— — — 505,711 505,711 
Balance, December 31, 2020232,452,220 $2,325 $4,284,789 $(1,612,096)$2,675,018 
See accompanying Notes to the Consolidated Financial Statements.

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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(in thousands)
Year ended December 31,202020192018
Operating activities  
Net income$505,711 $390,881 $339,516 
Adjustments to reconcile net income to net cash provided by operating activities:  
Depreciation and amortization242,995 258,971 148,365 
Amortization of debt issuance costs, bond premiums and discounts10,503 11,455 12,167 
(Gains) losses on dispositions of property(41,393)92 309 
Deferred income taxes451 (755)(522)
Stock-based compensation20,004 16,198 11,152 
Straight-line rent adjustments4,576 34,574 61,888 
Deferred rent recognized(337,500)0 0 
Losses on debt extinguishment18,113 21,014 3,473 
Loan and goodwill impairment charges0 13,000 59,454 
(Increase) decrease,  
Prepaid expenses and other assets(6,628)(6,070)(673)
(Decrease), increase  
Accounts payable and accrued expenses(1,252)(1,775)1,670 
Accrued interest11,590 15,434 12,020 
Accrued salaries and wages(5,908)(3,189)6,201 
Gaming, property and other taxes and other liabilities6,815 472 (587)
Net cash provided by operating activities428,077 750,302 654,433 
Investing activities  
Capital project expenditures(474)0 (20)
Capital maintenance expenditures(3,130)(3,017)(4,284)
Proceeds from sale of property and equipment15 200 3,211 
Acquisition of real estate assets(5,898)0 (1,243,466)
   Originations of real estate loans0 0 (303,684)
   Collections of principal payments on investment in direct financing lease0 0 38,459 
Net cash used in investing activities(9,487)(2,817)(1,509,784)
Financing activities  
Dividends paid(230,522)(589,128)(550,435)
Taxes paid for shares withheld on restricted stock award vestings(15,293)(9,058)7,537 
Proceeds from issuance of common stock, net320,873 (255)0 
Proceeds from issuance of long-term debt2,076,383 1,358,853 2,593,405 
Financing costs(11,641)(10,029)(32,426)
Repayments of long-term debt(2,060,884)(1,477,949)(1,164,117)
Premium and related costs paid on tender of senior unsecured notes(15,747)(18,879)(1,884)
Net cash provided by (used in) financing activities63,169 (746,445)852,080 
Net increase (decrease) in cash and cash equivalents, including cash classified within assets held for sale481,759 1,040 (3,271)
Less decrease in cash classified within assets held for sale(22,131)0 0 
Net increase/decrease in cash and cash equivalents459,628 1,040 (3,271)
Cash and cash equivalents at beginning of period26,823 25,783 29,054 
Cash and cash equivalents at end of period$486,451 $26,823 $25,783 

See Note 20 to the Consolidated Financial Statements for supplemental cash flow information.
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Gaming and Leisure Properties, Inc.
Notes to the Consolidated Financial Statements
1.Business and Basis of Presentation
Gaming and Leisure Properties, Inc. ("GLPI") is a self-administered and self-managed Pennsylvania real estate investment trust ("REIT"). GLPI (together with its subsidiaries, the "Company") was incorporated on February 13, 2013, as a wholly-owned subsidiary of Penn National Gaming, Inc. ("Penn"). On November 1, 2013, Penn contributed to GLPI, through a series of internal corporate restructurings, substantially all of the jackpots increase. Table game gaming revenue isassets and liabilities associated with Penn’s real property interests and real estate development business, as well as the aggregateassets and liabilities of table drop adjusted forHollywood Casino Baton Rouge and Hollywood Casino Perryville (which are referred to as the change"TRS Properties") and then spun-off GLPI to holders of Penn's common and preferred stock in aggregate table chip inventory. Table drop is the total dollar amounta tax-free distribution (the "Spin-Off"). The assets and liabilities of the currency, coins, chips, tokens, outstanding counter checks (markers), and front money that are removed from the live gaming tables. Additionally, food and beverage revenue is recognized as services are performed.

Gaming revenue is recognized net of certain sales incentives, including promotional allowances in accordance with ASC 606. The Company also defers a portion of the revenue received from customers (who participate in the points based loyalty programs)GLPI were recorded at their respective historical carrying values at the time of playthe Spin-Off in accordance with the provisions of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 505-60 - Spinoffs and attributedReverse Spinoffs ("ASC 505").

The Company elected on its United States ("U.S.") federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and GLPI, together with its indirect wholly-owned subsidiary, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. (d/b/a Hollywood Casino Baton Rouge) and Penn Cecil Maryland, Inc. (d/b/a Hollywood Casino Perryville) as a "taxable REIT subsidiary" ("TRS") effective on the awarded points until a later period when the points are redeemed or forfeited. See Note 12 for a summaryfirst day of the changesfirst taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to the recognition of revenue attreat Tropicana LV, LLC as a TRS, which together with the TRS Properties relatedand GLP Holdings, Inc. is the Company's TRS Segment (the "TRS Segment"). In connection with the Spin-Off, Penn allocated its accumulated earnings and profits (as determined for U.S. federal income tax purposes) for periods prior to the adoptionconsummation of ASU 2014-09 on January 1, 2018.the Spin-Off between Penn and GLPI. In connection with its election to be taxed as a REIT for U.S. federal income tax purposes, GLPI declared a special dividend to its shareholders to distribute any accumulated earnings and profits relating to the real property assets and attributable to any pre-REIT years, including any earnings and profits allocated to GLPI in connection with the Spin-Off, to comply with certain REIT qualification requirements.


Gaming Taxes
ForGLPI’s primary business consists of acquiring, financing, and owning real estate property to be leased to gaming operators in triple-net lease arrangements. As of December 31, 2020, GLPI’s portfolio consisted of interests in 48 gaming and related facilities, including the TRS Properties, the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with 7 gaming and related facilities operated by Caesars, the real property associated with 4 gaming and related facilities operated by Boyd and the real property associated with the Casino Queen Holding Company is subjectInc. ("Casino Queen") in East St. Louis, Illinois.  These facilities, including our corporate headquarters building, are geographically diversified across 16 states and contain approximately 24.3 million square feet. As of December 31, 2020, the Company's properties were 100% occupied. GLPI expects to continue growing its portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming taxes based on gross gaming revenues in the jurisdictions in which it operates. The Company recognizes gaming tax expense based on the statutorily required percentage of revenue that is required to be paid to stateoperators under prudent terms.

Penn Master Lease and local jurisdictions in the states where wagering occurs. The Company records gaming taxes at the Company’s estimated effective gaming tax rate for the year, considering estimated taxable gaming revenue and the applicable rates. Such estimates are adjusted each interim period. If gaming tax rates change during the year, such changes are applied prospectively in the determination of gaming tax expense in future interim periods.  For the three years endedCasino Queen Lease


December 31, 2018, these expenses, which are recorded within gaming, food, beverage and other expense in the consolidated statements of income, totaled $56.0 million, $57.4 million and $57.7 million, respectively.

Earnings Per Share
The Company calculates earnings per share ("EPS") in accordance with ASC 260 - Earnings Per Share. Basic EPS is computed by dividing net income applicable to common stock by the weighted-average number of common shares outstanding during the period, excluding net income attributable to participating securities (unvested restricted stock awards). Diluted EPS reflects the additional dilution for all potentially-dilutive securities such as stock options, unvested restricted shares and unvested performance-based restricted shares.

The following table reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS for the years ended December 31, 2018, 2017 and 2016: 
 Year Ended December 31,
 2018 2017 2016
 (in thousands)
Determination of shares: 
  
  
Weighted-average common shares outstanding213,720
 210,705
 178,594
Assumed conversion of dilutive employee stock-based awards206
 644
 1,699
Assumed conversion of restricted stock awards80
 155
 171
Assumed conversion of performance-based restricted stock awards773
 1,248
 158
Diluted weighted-average common shares outstanding214,779
 212,752
 180,622

The following table presents the calculation of basic and diluted EPS for the Company’s common stock for the years ended December 31, 2018, 2017 and 2016: 
 Year Ended December 31,
 2018 2017 2016
 (in thousands, except per share amounts)
Calculation of basic EPS: 
  
  
Net income$339,516
 $380,598
 $289,305
Less: Net income allocated to participating securities(475) (622) (668)
Net income attributable to common shareholders$339,041
 $379,976
 $288,637
Weighted-average common shares outstanding213,720
 210,705
 178,594
Basic EPS$1.59
 $1.80
 $1.62
      
Calculation of diluted EPS: 
  
  
Net income$339,516
 $380,598
 $289,305
Diluted weighted-average common shares outstanding214,779
 212,752
 180,622
Diluted EPS$1.58
 $1.79
 $1.60

There were 13,335 outstanding equity based awards during the year ended December 31, 2018 and 3,483 and 23,954 outstanding equity based awards during the years ended December 31, 2017 and 2016, respectively, that were not included in the computation of diluted EPS because they were antidilutive. 

Stock-Based Compensation
The Company's Amended and Restated 2013 Long Term Incentive Compensation Plan (the "2013 Plan") provides for the Company to issue restricted stock awards, including performance-based restricted stock awards, and other equity or cash based awards to employees. Any director, employee or consultant shall be eligible to receive such awards.
The Company accounts for stock compensation under ASC 718 - Compensation - Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair valueAs a result of the award. This expense is recognized ratably over the requisite service period following the date of grant. The fair value of the Company's time-based restricted stock awards is equivalent to the closing stock price on the day of

grant. The Company utilizes a third-party valuation firm to measure the fair value of performance-based restricted stock awards at grant date using the Monte Carlo model.
The unrecognized compensation cost relating to restricted stock awards and performance-based restricted stock awards will be amortized to expense over the awards’ remaining vesting periods.

See Note 15 for further information related to stock-based compensation.

Segment Information
Consistent with how the Company’s Chief Operating Decision Maker reviews and assesses the Company’s financial performance, the Company has two reportable segments, GLP Capital, L.P. (a wholly-owned subsidiary of GLPI through whichSpin-Off, GLPI owns substantially all of Penn’s former real property assets (as of the consummation of the Spin-Off) and leases back most of those assets to Penn for use by its real estate assets) ("GLP Capital"subsidiaries, under a unitary master lease, a triple-net operating lease the term of which expires October 31, 2033, with no purchase option, followed by three remaining 5-year renewal options (exercisable by the tenant) on the same terms and conditions (the "Penn Master Lease"), and GLPI also owns and operates the TRS Properties. The GLP Capital reportable segment consistsSegment. GLPI leases the Casino Queen property in East St. Louis back to its operators on a triple-net basis on terms similar to those in the Penn Master Lease (the "Casino Queen Lease").

Amended Pinnacle Master Lease, Boyd Master Lease and Belterra Park Lease

In April 2016, the Company acquired substantially all of the leased real property and represents the majority of the Company’s business. The TRS Properties reportable segment consists of Hollywood Casino Perryville and Hollywood Casino Baton Rouge. See Note 16 for further information with respect to the Company’s segments.

Statements of Cash Flows

The Company has presented the consolidated statements of cash flows using the indirect method, which involves the reconciliation of net income to net cash flow from operating activities.

4.Acquisitions

The Company accounts for its acquisitions of real estate assets as asset acquisitionsof Pinnacle Entertainment, Inc. ("Pinnacle") for approximately $4.8 billion. GLPI originally leased these assets back to Pinnacle, under ASC 805 - Business Combinationsa unitary triple-net lease the term of which expires on April 30, 2031, with no purchase option, followed by four remaining 5-year renewal options (exercisable by the tenant) on the same terms and conditions (the "Pinnacle Master Lease"). Under asset acquisition accounting, transaction costs incurred to acquire the purchased assets are also included as part of the asset cost.

Current Year Acquisitions

On October 15, 2018, in conjunctionthe Company completed its previously announced transactions with Penn, Pinnacle and Boyd Gaming Corporation ("Boyd") to accommodate Penn's acquisition of the majority of Pinnacle's operations, pursuant to a definitive agreement and plan of merger between Penn and Pinnacle, dated December 17, 2017 (the "Penn-Pinnacle Merger"). Concurrent with the Penn-Pinnacle Merger, the Company acquired the real property assets of Plainridge Park Casino from Penn for approximately $250.9 million. This property was added to the Amended Pinnacle Master Lease via the fourth amendment toamended the Pinnacle Master Lease and is leased to Penn who will continue to operate the property. The initial annual cash rent of $25.0 million for Plainridge Park will not be subject to rent escalators or adjustments.

Also in conjunction with the Penn-Pinnacle Merger, the Pinnacle Master Lease was amended via the fourth amendment to such lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd (the "Amended Pinnacle Master Lease") and to increase fixed rent under the lease by an additional $13.9 million annually. The Company entered into a new unitary triple-net master lease agreement with Boyd (the "Boyd Master Lease") for these properties on terms similar to the Company’s existing master leases. As a resultAmended Pinnacle Master Lease. The Boyd Master Lease has an initial term of
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10 years (from the fourth amendment tooriginal April 2016 commencement date of the Pinnacle Master Lease and expiring April 30, 2026), with no purchase option, followed by 5 5-year renewal options (exercisable by the tenant) on the same terms and conditions. The Company reassessedalso purchased the lease's classificationreal estate assets of Plainridge Park Casino ("Plainridge Park") from Penn for $250.0 million, exclusive of transaction fees and determined the new lease agreement qualified for operating lease treatment under ASC 840. Therefore, subsequenttaxes, and added this property to the Penn-Pinnacle Merger, the Amended Pinnacle Master Lease is treated as an operating lease in its entirety, the building assets of $2.6 billion previously recorded as an investment in direct financing lease on the Company's consolidated balance sheet were recorded as real estate assets on the Company's consolidated balance sheet and all rent received under the Amended Pinnacle Master Lease is recorded as rental income on the Company's consolidated statement of income.Lease. The Amended Pinnacle Master Lease was assumed by Penn at the consummation of the Penn-Pinnacle Merger. The Company also entered into a mortgage loan agreement with Boyd in connection with Boyd's acquisition of Belterra Park Gaming & Entertainment Center ("Belterra Park"), whereby the Company loaned Boyd $57.7 million (the "Belterra Park Loan"). In May 2020, the Company acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to a long-term lease (the "Belterra Park Lease") with a Boyd affiliate operating the property.The Belterra Park Lease rent terms are consistent with the Boyd Master Lease.The annual rent is comprised of a fixed component, part of which is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met and a component that is based on the performance of the facilities which is adjusted, subject to certain floors, every two years to an amount equal to 4% of the average annual net revenues of Belterra Park during the preceding two years in excess of a contractual baseline.


The Meadows Lease

The real estate assets of the Meadows are leased to Penn pursuant to the Meadows Lease. The Meadows Lease commenced on September 9, 2016 and has an initial term of 10 years, with no purchase option, and the option to renew for three successive 5-year terms and one 4-year term (exercisable by the tenant) on the same terms and conditions. The Meadows Lease contains a fixed component, subject to annual escalators, and a component that is based on the performance of the facility, which is reset every two years to an amount determined by multiplying (i) 4% by (ii) the average annual net revenues of the facility for the trailing two-year period. The Meadows Lease contains an annual escalator provision for up to 5% of the base rent, if certain rent coverage ratio thresholds are met, which remains at 5% until the earlier of ten years or the year in which total rent is $31 million, at which point the escalator will be reduced to 2% annually thereafter.

Amended and Restated Caesars Master Lease

On October 1, 2018, the Company acquired theclosed its previously announced transaction to acquire certain real property assets of five casino properties from Tropicana Entertainment Inc. ("Tropicana") and certain of its affiliates for approximately $992.5 million, pursuant to the Reala Purchase and Sale Agreement (the "Real Estate Purchase AgreementAgreement") dated April 15, 2018 between Tropicana and GLP Capital L.P. ("GLP Capital"), the operating partnership of GLPI, which was subsequently amended on October 1, 2018.2018 (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, exclusive of transaction fees and the rights to six long-term ground leases for land on which the operations of the acquired Tropicana properties reside.taxes (the "Tropicana Acquisition"). Concurrent with the Tropicana Acquisition, Eldorado Resorts, Inc. (now doing business as Caesars Entertainment Corporation (NASDAQ: CZR) ("Caesars")) acquired the operating assets of these properties from Tropicana pursuant to thean Agreement and Plan of Merger dated April 15, 2018 by and among Tropicana, Merger AgreementGLP Capital, Caesars and a wholly-owned subsidiary of Caesars and leased the GLP Assets from the Company pursuant to the terms of a new unitary triple-net master lease with a 15-yearan initial term of 15 years, with no purchase option, followed by four4 successive 5-year renewal periods (exercisable by Eldorado)the tenant) on the same terms and conditions. Initialconditions (the "Caesars Master Lease"). On June 15, 2020, the Company amended and restated the Caesars Master Lease (as amended, the "Amended and Restated Caesars Master Lease") to, (i) extend the initial term of 15 years to 20 years, with renewals of up to an additional 20 years at the option of Caesars, (ii) remove the variable rent component in its entirety commencing with the third lease year, (iii) in the third lease year increase annual land base rent to approximately $23.6 million and annual building base rent to approximately $62.1 million, (iv) provide fixed escalation percentages that delay the escalation of building base rent until the commencement of the fifth lease year with building base rent increasing annually by 1.25% in the fifth and sixth lease year, 1.75% in the seventh and eighth lease years and 2% in the ninth lease year and each lease year thereafter, (v) subject to the satisfaction of certain conditions, permit Caesars to elect to replace the Tropicana Evansville and/or Tropicana Greenville properties under the EldoradoAmended and Restated Caesars Master Lease with one or more of Caesars Gaming Scioto Downs, The Row in Reno, Isle Casino Racing Pompano Park, Isle Casino Hotel – Black Hawk, Lady Luck Casino – Black Hawk, Isle Casino Waterloo ("Waterloo"), Isle Casino Bettendorf ("Bettendorf") or Isle of Capri Casino Boonville, provided that the aggregate value of such new property, individually or collectively, is $87.6 million.

Purchase price allocations are primarily based onat least equal to the fair valuesvalue of assets acquiredTropicana Evansville or Tropicana Greenville, as applicable (vi) permit Caesars to elect to sell its interest in Belle of Baton Rouge and liabilities assumed atsever it from the timeAmended and Restated Caesars Master Lease (with no change to the rent obligation to the Company), subject to the satisfaction of acquisition.certain conditions, and (vii) provide certain relief under the operating, capital expenditure and financial covenants thereunder in the event of facility closures due to pandemics, governmental restrictions and certain other instances of unavoidable delay. The following table summarizes the purchase price allocationeffectiveness of the assets acquired inAmended and Restated Caesars Master Lease was subject to the Tropicana Acquisition (in thousands):
Real estate investments, net$948,217
Land rights, net44,331
Total purchase price$992,548

Prior Year Acquisitions

2017

review of certain gaming regulatory agencies and the expiration of applicable gaming regulatory advance notice periods which were received on July 23, 2020. On May 1, 2017,December 18, 2020, the Company acquiredand Caesars completed an Exchange Agreement with subsidiaries of Caesars in which Caesars transferred
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to the Company the real estate assets of Waterloo and Bettendorf in exchange for the transfer by the Company to Caesars of the real property assets of Bally'sTropicana Evansville, plus a cash payment of $5.7 million. This resulted in a non-cash gain of $41.4 million which represented the difference between the fair value of the properties received compared to the carrying value of Tropicana Evansville and the cash payment made.

Lumière Place Lease

On October 1, 2018 the Company entered into a loan agreement with Caesars in connection with Caesars’s acquisition of Lumière Place Casino Tunica (subsequently re-branded as("Lumière Place"), whereby the Company loaned Caesars $246.0 million (the "CZR loan"). The CZR loan bore interest at a rate equal to (i) 9.09% until October 1,st Jackpot Casino) 2019 and Resorts(ii) 9.27% until its maturity. On the one-year anniversary of the CZR loan, the mortgage evidenced by a deed of trust on the Lumière Place property terminated and the loan became unsecured. On June 24, 2020, the Company received approval from the Missouri Gaming Commission to own the Lumière Place property in satisfaction of the CZR loan. On September 29, 2020, the transaction closed and we entered into a new triple net lease with Caesars (the "Lumière Place Lease") the initial term of which expires on October 31, 2033, with 4 separate renewal options of five years each, exercisable at the tenants' option. The Lumière Place Lease's rent is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met.

Tropicana Las Vegas

On April 16, 2020, the Company and certain of its subsidiaries acquired the real property associated with the Tropicana Las Vegas Casino Tunica (the "Tunica Properties"Hotel Resort ("Tropicana Las Vegas") from Penn in exchange for $82.9 million.$307.5 million of rent credits to be applied against future rent obligations. This asset has been placed in our TRS Segment. See Note 7 for further details related to this transaction.

Morgantown Lease

On October 1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits which were fully utilized by Penn in the fourth quarter of 2020. The Company acquired both Bally's Casino Tunicais leasing the land back to an affiliate of Penn for an initial annual rent of $3.0 million, provided, however, that (i) on the opening date and Resorts Casino Tunica,on each anniversary thereafter the rent shall be increased by 1.5% annually (on a prorated basis for the remainder of the lease year in which the gaming facility opens) for each of the following three lease years and (ii) commencing on the fourth anniversary of the opening date and for each anniversary thereafter, (a) if the Consumer Price Index ("the CPI") increase is at least 0.5% for any lease year, the rent for such lease year shall increase by 1.25% of rent as of the immediately preceding lease year, and (b) if the CPI increase is less than 0.5% for such lease year, then the rent shall not increase for such lease year subject to escalation provisions following the opening of the property (the "Morgantown Lease").

In the first quarter of 2020, it became clear that there was a global outbreak of a new strain of novel coronavirus COVID-19 ("COVID-19"). The global, domestic and local response to the COVID-19 outbreak continues to evolve. Responses to the COVID-19 outbreak have included mandates from federal, state, and/or local authorities that required temporary closures of or imposed limitations on the operations of non-essential businesses. All of the Company's tenants' casino operations, in addition to the Company's two TRS Properties, were closed in mid-March. Our properties began reopening at limited capacity in May and by early July nearly all had resumed operations at limited capacity. However, in the fourth quarter, increased spread of COVID-19 led some jurisdictions to impose temporary closures once again. As of the date of this filing, only one of our properties remains closed.
The consolidated financial statements include the accounts of GLPI and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
The preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses for the reporting periods. Actual results may differ from those estimates.  Certain prior period amounts have been reclassified to conform to the current period presentation, specifically gains and losses from dispositions of properties were previously classified within General and administrative expenses and are now presented separately on the Consolidated Statements of Income.


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2.Summary of Significant Accounting Policies

Real Estate Investments
Real estate investments primarily represent land and buildings leased to the Company's tenants. The Company records the acquisition of real estate assets at fair value, including acquisition and closing costs. The cost of properties developed by the Company include costs of construction, property taxes, interest and other miscellaneous costs incurred during the development period until the project is substantially complete and available for occupancy. The Company considers the period of future benefit of the asset to determine the appropriate useful lives. Depreciation is computed using a straight-line method over the estimated useful lives of the buildings and building improvements which are generally between 10 to 31 years.
The Company continually monitors events and circumstances that could indicate that the carrying amount of its real estate investments may not be recoverable or realized. The factors considered by the Company in performing these assessments include evaluating whether the tenant is current on its lease payments, the tenant’s rent coverage ratio, the financial stability of the tenant and its parent company, and any other relevant factors. When indicators of potential impairment suggest that the carrying value of a real estate investment may not be recoverable, the Company estimates the fair value of the investment by calculating the undiscounted future cash flows from the use and eventual disposition of the investment. This amount is compared to the asset's carrying value. If the Company determines the carrying amount is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP. The Company groups its real estate investments together by lease, the lowest level for which identifiable cash flows are available, in evaluating impairment. In assessing the recoverability of the carrying value, the Company must make assumptions regarding future cash flows and other factors. The factors considered by the Company in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the Resorts Hoteleffect of obsolescence, demand, competition and landother factors. If these estimates or the related assumptions change in the future, the Company may be required to record an impairment loss.
Property and Equipment Used in Operations
Property and equipment are stated at Bally's Casino Tunica. Land rights to three long-term ground leases relatedcost, less accumulated depreciation and represent assets used by the Company's TRS Properties and certain corporate assets. Maintenance and repairs that neither add materially to the Tunica Properties were also acquiredvalue of the asset nor appreciably prolong its useful life are charged to expense as incurred. Gains or losses on the disposal of property and equipment are included in the transaction. Penn purchaseddetermination of income.
Depreciation of property and equipment is recorded using the operating assetsstraight-line method over the following estimated useful lives:
Land improvements15 to 34 years
Building and improvements5 to 31 years
Furniture, fixtures, and equipment3 to 31 years
Leasehold improvements are depreciated over the shorter of the Tunica Properties directlyestimated useful life of the improvement or the related lease term. The estimated useful lives are determined based on the nature of the assets as well as the Company's current operating strategy.
The Company reviews the carrying value of its property and equipment for possible impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable based upon the estimated undiscounted future cash flows expected to result from the seller, operates both propertiesits use and leases the real property assets fromeventual disposition. If the Company underdetermines the Penn Master Lease.

2016

On September 9, 2016,carrying amount is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP. In estimating expected future cash flows for determining whether an asset is impaired, assets are grouped at the individual property level. In assessing the recoverability of the carrying value of property and equipment, the Company acquiredmust make assumptions regarding future cash flows and other factors. The factors considered by the real property assetsCompany in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the effect of obsolescence, demand, competition and other factors. If these estimates or the Meadows Racetrackrelated assumptions change in the future, the Company may be required to record an impairment loss for these assets.
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Real Estate Loans and Casino (the "Meadows") from Cannery Casino Resorts ("CCR")Other Loans Receivable
The Company may periodically loan funds to casino owner-operators for approximately $323.3 million. Concurrent with the Company's purchase of the Meadows'gaming related real estate assets, Pinnacle purchasedand/or operations. Loans for the entities holding the Meadows' gaming and racing licenses and operating assets from CCR. GLPI leases the Meadows' real property assets to Penn (following the Penn-Pinnacle Merger) under a triple-net lease with an initial termpurchase of 10 years with no purchase option and the option to renew for three successive 5-year terms and one 4-year term, at Penn's option (the "Meadows Lease").

On April 28, 2016, the Company acquired substantially all of the real estate assets of Pinnacle, adding 14gaming-related properties are classified as real estate loans on the Company's consolidated balance sheets, while loans for an operator's general operations are classified as loans receivable on the Company's consolidated balance sheets. Loans receivable are recorded on the Company's consolidated balance sheets at carrying value which approximates fair value since collection of principal is reasonably assured. Interest income related to real estate loans is recorded as interest income from real estate loans within the Company's consolidated statements of income in the period earned, whereas interest income related to other loans receivable is recorded as non-operating interest income within the Company's consolidated statements of income in the period earned.
Prior to the adoption of Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"), the Company evaluated loans for impairment when it was probable that it would not be able to collect all amounts due according to the contractual terms of the agreement. All amounts due under the contractual terms of the agreement means that both contractual interest payments and contractual principal payments will be collected as scheduled in the loan agreement. Indicators of impairment may include delinquent payments, a decline in the credit worthiness of a debtor, or a decline in the underlying property/tenant’s performance. The Company measures loan impairment based upon the present value of expected future cash flows discounted at the loan’s original effective interest rate. The determination of whether loans are impaired involves judgments and assumptions based on objective and subjective factors. If an impairment occurs, the Company will reduce the carrying value of the loan and record a corresponding charge to net income.
The Company's adoption of Accounting Standards Update ASU 2016-13 on January 1, 2020 (as described in Note 3) did not result in the Company recording any allowances against its real estate portfolio.loans for expected losses. The acquisitionCompany has no outstanding loans as of Pinnacle's real estate assets wasDecember 31, 2020. See Note 8 for further details.
Lease Assets and Lease Liabilities
The Company determines whether a contract is or contains a lease at its inception. A lease is defined as the final stepright to control the use of identified property, plant, or equipment for a period of time in a series of transactions contemplated by the July 20, 2015 merger agreement between GLPI, Gold Merger Sub, LLC, a wholly owned subsidiary of GLPI ("Merger Sub"), and Pinnacle providingexchange for the merger of Pinnacle with and into Merger Sub, with Merger Sub surviving the merger as a wholly owned subsidiary of GLPI (the "Pinnacle Merger"). Following the Pinnacle Merger, GLPI contributed all of the equity interests of Gold Merger Sub to GLP Capital, L.P., a Pennsylvania limited partnership and a wholly owned subsidiary of GLPI ("GLP Capital"). Approval of the Pinnacle Merger by GLPI shareholders and Pinnacle stockholders was obtained at separate special meetings held on March 15, 2016.

In order to effect the acquisition of the majority of Pinnacle’s real property assets, prior to the Pinnacle Merger, Pinnacle caused certain assets relating to its operating business to be transferred to, and liabilities relating thereto to be assumed by a newly formed wholly owned subsidiary of Pinnacle ("OpCo"). Immediately following the separation of its real propertyconsideration. Right-of-use assets and gaming and other operating assets, Pinnacle distributed to its stockholders all oflease liabilities are recorded on the issued and outstanding shares of common stock of OpCo. As described above, on April 28, 2016, Pinnacle merged with and into Merger Sub, as described in more detail in the joint proxy statement/prospectus filed with a Registration Statement on Form S-4 (No. 333-206649) initially filed by GLPI with the SEC on December 23, 2015 and declared effective on February 16, 2016 (the "Joint Proxy Statement/Prospectus"), completing the Pinnacle Merger. Merger Sub, as the surviving company in the Pinnacle Merger, owns substantially all of Pinnacle’s real estate assets that were retained or transferred to Pinnacle in the separation and originally leased those assets back to Pinnacle pursuant to the Pinnacle Master Lease. Subsequent to the Penn-Pinnacle Merger, a wholly-owned subsidiary of Penn operates the leased gaming facilities as a tenant under the Amended Pinnacle Master Lease Agreement.
At the effective time of the Pinnacle Merger, each share of Pinnacle common stock issued and outstanding immediately prior to the effective time of the Pinnacle Merger was converted into 0.85 of a share of GLPI common stock, with cash paid in lieu of the issuance of fractional shares of GLPI common stock. Shares of GLPI common stock were also issued to satisfy GLPI's portion of the outstanding Pinnacle employee equity and cash-based incentive awards outstandingCompany's consolidated balance sheet at the closing date. Approximately 56.0 million shares of GLPI common stock were issued as considerationlease commencement date for operating leases in the Pinnacle Merger. Additionally, GLPI repaid $2.7 billion of Pinnacle's debt and paid $226.8 million of Pinnacle's transaction expenses related to

the Pinnacle Merger. Inclusive of $28.3 million of the Company's own transaction expenses, the purchase price of the Pinnacle real estate assets was $4.8 billion.
The following tables summarize the consideration transferred in the Pinnacle Merger and the purchase price allocation to the assets acquired in the Pinnacle Merger (in thousands):
Consideration 
Cash$2,955,090
GLPI common stock1,823,991
Fair value of total consideration transferred$4,779,081
Real estate investments, net$1,422,547
Land rights, net596,920
Investment in direct financing lease, net2,759,244
Prepaid expenses111
Other assets259
Total purchase price$4,779,081
As detailed above,which the Company paid $3.0 billion in cash for the acquired Pinnacle real estate assets. In addition,acts as part of the consideration paid for the Pinnacle real estatelessee. Right-of-use assets acquired in the Pinnacle Merger, the Company issued shares of its common stock to Pinnacle stockholders and to Pinnacle to satisfy the Company's portion of Pinnacle's employee equity and cash-based incentive awards. The dollar value of the issued shares was $1.8 billion and is considered purchase price.

The real estate investments, net represent the land purchased from Pinnacle, while the land rights, net represent the Company's rights to land subjectuse underlying assets for the term of the lease and lease liabilities represent the Company's future obligations under the lease agreement. Right-of-use assets and lease liabilities are recognized at the lease commencement date based upon the estimated present value of the lease payments. As the rate implicit in the Company's leases (in which the Company acts as lessee) cannot readily be determined, the Company utilizes its own estimated incremental borrowing rates to long-term grounddetermine the present value of its lease payments. Consideration is given to the Company's recent debt issuances, as well as publicly available data for instruments with similar characteristics, including tenor, when determining the incremental borrowing rates of the Company's leases.
The Company acquiredincludes options to extend a lease in its lease term when it is reasonably certain that the Company will exercise those renewal options. In the instance of the Company's ground leases at several of the Pinnacleassociated with its tenant occupied properties, and immediately subleased the land back to Pinnacle. The investment in direct financing lease, net represented the Company's investment in the buildings and building improvements purchased from Pinnacle at the time of the original Pinnacle transaction. As detailed in Note 8, the Pinnacle Master Lease was originally bifurcated between an operating lease and direct financing lease. The accounting treatment for the buildings purchased under a direct financing lease required the Company to record its initial investmenthas included all available renewal options in the buildings as a receivable on its consolidated balance sheet, which was subsequently reduced over the lease term, as it intends to renew these leases indefinitely. The Company accounts for the lease and nonlease components (as necessary) of its estimated residual value. In conjunctionleases of all classes of underlying assets as a single lease component. Leases with the Penn-Pinnacle Merger, the direct financing lease was unwound and the Pinnacle Master Lease qualified for operating lease treatment in its entirety. For further details refer to Note 8. The purchase price allocated to prepaid expenses and other assets represents the current and long-term portionsa term of a director and officer liability insurance policy purchased from Pinnacle.

5.Real Estate Investments
Real estate investments, net, represent investments in 42 rental properties and the corporate headquarters building and is summarized as follows:
 December 31,
2018		 December 31,
2017
 (in thousands)
Land and improvements$2,552,475
 $2,057,928
Building and improvements5,762,071
 2,461,573
Total real estate investments8,314,546
 4,519,501
Less accumulated depreciation(983,086) (857,456)
Real estate investments, net$7,331,460
 $3,662,045

The increase in real estate investments was driven by the Penn-Pinnacle Merger, which resulted in the reclassification of the building assets under the Pinnacle Master Lease that were previously classified as an investment in direct financing lease12 months or less are not recorded on the Company's consolidated balance sheet to real estate investments and to a lesser extent the Tropicana Acquisition and the purchase of Plainridge Park. For further information on the Company's acquisitions see Note 4.


6. Land Rights

sheet.
Land rights, net represent the Company's rights to land subject to long-term ground leases. The Company obtained ground lease rights through the acquisition of several of its rental properties and immediately subleased the land to its tenants. These land rights represent the below market value of the related ground leases. The Company assessed the acquired ground leases to determine if the lease terms were favorable or unfavorable, given market conditions at the acquisition date. Because the market rents to be received under the Company's triple-net tenant leases were greater than the rents to be paid under the acquired ground leases, the Company concluded that the ground leases were below market and were therefore required to be recorded as a definite lived asset (land rights) on its books.

TheRight-of-use assets and land rights are amortized over the individual lease term of each ground lease, including all renewal options, which ranged from 10 years to 92 years at their respective acquisition dates. Land rights net, consists of the following:

 December 31,
2018		 December 31,
2017
 (in thousands)
Land rights$700,997
 $656,666
Less accumulated amortization(27,790) (16,518)
Land rights, net$673,207
 $640,148

Amortization expense related to the ground leases is recorded within land rights and ground lease expensemonitored for potential impairment in the consolidated statements of income and totaled $11.3 million, $10.4 million and $6.2 million for the years ended December 31, 2018, 2017 and 2016, respectively.

As of December 31, 2018, estimated future amortization expense related to the Company’s ground leases by fiscal year is as follows (in thousands):

Year ending December 31, 
2019$12,359
202012,359
202112,359
202212,359
202312,359
Thereafter611,412
Total$673,207
Details of the Company's significant ground leases are as follows: The Company leases land at the Belterra Casino Resort under two ground leases, each with an initial term of 5 years and nine automatic renewals of 5 years each. The renewal options extend the leases through 2049 and are not terminable by the Company. The first ground lease includes a base portion which is adjusted at each renewal based upon the CPI and a variable portion which is adjusted annually based upon 1.5% of gross gaming wins in excess of $100 million. The second ground lease has a fixed rent provision only.

The Company leases land at the Ameristar East Chicago property under a ground lease with an initial term of 30 years and two optional renewals of 30 years each. The lease extends through 2086 with all renewals. Rent under the lease is adjusted every 3 years based upon the CPI and does not include a variable rent provision tied to the property's performance.

The Company leases land at the River City Hotel and Casino under a ground lease with a term of 99 years that extends through 2108. The lease includes a base portion which is fixed and a variable portion which is adjusted annually based upon 2.5% of the annual gross receipts of the property less fixed rent payments made inmuch the same year.

The Company leases land atway as the L'Auberge Lakes Charles property under a ground lease with an initial term of 10 years and six optional renewals of 10 years each. The lease extends through 2075 with all renewals. Rent under the lease is adjusted annually based upon the CPI and does not include a variable rent provision tied to the property's performance.

The Company leases land at the Resorts Casino Tunica property under a ground lease with an initial term of 3 years and nine optional renewals of 5 years each. The lease extends through 2042 with all renewals. The lease has an annual fixed rent provision and does not include a variable rent provision tied to the property's performance.

The Company leases land at the 1st Jackpot Casino under two ground leases. The first ground lease has an initial term of 6 years and nine optional renewals of 6 years each. The lease extends through 2054 with all renewals. Rent under this lease is adjusted annually based upon the CPI and does not include a variable rent provision tied to the property's performance. The second ground lease has an initial term of 10 years with ten optional renewals of 5 years each. The lease extends through 2055 with all renewals. The lease has an annual fixed rent provision and a variable portion which is adjusted annually based upon net gaming revenues of up to 4%, dependent on the property's operating results.

The Company leases land at the Belle of Baton Rouge property under two ground leases. The first ground lease has an initial term of 5 years and two automatic renewals of 5 years each. The lease extends through 2028 with the automatic renewals. Rent under this lease increases by 3% every 2 years and does not include a variable portion tied to the property's performance. The second ground lease has an initial term of 17 years, followed by one automatic 3-year renewal and eight optional renewals of 10 years each. The lease extends through 2083 with all renewals. Rent under this lease is adjusted every 5 years based upon the CPI and does not include a variable rent provision tied to the property's performance.

The Company leases land at the Tropicana Evansville Casino under a ground lease with an initial term of 10 years and two optional 5-year renewals, one optional 12-year renewal, one optional 3-year renewal, and five optional 5-year renewals. The lease extends through 2055 with all renewals. The lease agreement has an annual fixed rent provision, a portion of which was prepaid at the casino's opening and the tenant receives rental credits from the landlord extending through the end of the current term. Additionally, the lease contains a variable portion which is adjusted annually based upon the annual gross receipts of the property. Rent paid to the landlord under this provision is graduated and ranges from 2% to 12% of annual gross receipts dependent on the actual revenues of the property.

The Company leases land at the Trop Casino Greenville under three ground leases. The first ground lease has an initial term of 7 years and four optional renewals of varying lengths, which extend the lease through 2038. The lease has an annual fixed rent provision, which is adjusted at each renewal based upon the CPI and does not include a variable rent provision tied to the property's performance. The second ground lease has an initial term of 20 years and six optional renewals of 5 years each. The lease extends through 2044 with all renewals. The lease has an annual fixed rent provision and does not include a variable rent provision tied to the property's performance. The third ground lease has an initial term of 6 years with nine optional renewals of 6 years each. The lease extends through 2057 with all renewals. Rent under the lease is adjusted annually based upon the CPI, with minimum annual increases of 3.3% and does not include a variable rent provision tied to the property's performance.

7.Property and Equipment Used in Operations
Property and equipment used in operations, net, consists of the following and primarily represents the assets utilized at the TRS Properties 
 December 31,
2018		 December 31,
2017
 (in thousands)
Land and improvements$30,431
 $30,276
Building and improvements116,776
 116,286
Furniture, fixtures, and equipment117,247
 114,972
Construction in progress284
 8
Total property and equipment264,738
 261,542
Less accumulated depreciation(163,854) (153,249)
Property and equipment, net$100,884
 $108,293

8. Receivables

Mortgage Loans Receivable

At December 31, 2018, the Company has financial interests in two casino properties through secured mortgage loans to the respective casino owner-operators. On October 1, 2018, Eldorado purchased theCompany's real estate assets, of Lumière Place Casinousing the impairment model in ASC 360 - Property, Plant and Hotel from Tropicana for a cash purchase price of $246.0 million, exclusive of transaction fees. Financing for the transaction was provided byEquipment. If the Company indetermines the formcarrying amount of $246.0 million secured mortgage loan on Lumière Place (the "Lumière Loan"). The Lumière Loan bears interest at a rate equal to approximately 9.00%. Until the one-year anniversary of the closing, the Lumière Loan will be secured by a first mortgage lien on Lumière Place. On the one-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 until its final maturity on the two-year anniversary of the closing. The parties anticipate that the Lumière Loan will be fully repaid onright-of-use asset or prior to maturity by way of substitution of one or more additional Eldorado properties acceptable to Eldorado and the Company, which will be transferredland right is not recoverable, it would recognize an impairment charge equivalent to the Company and addedamount required to the Eldorado Master Lease.

On October 15, 2018, Boyd purchased the real estate assets of Belterra Park from Pinnacle for a cash purchase price of $57.7 million, exclusive of transaction fees. Financing for the transaction was provided by the Company in the form of $57.7 million secured mortgage loan on Belterra Park (the "Belterra Park Loan"). The Belterra Park Loan bears interest at a rate equal to 11.11% and matures in connection with the expiration of the Boyd Master Lease (as may be extended at the tenant's option to April 30, 2051).

Investment in Direct Financing Lease, Net

At the time of the original Pinnacle transaction, the fair value assigned to the land (inclusive of the land rights) at the time of acquisition qualified for operating lease treatment, while the fair value assigned to the buildings was classified as a direct financing lease. Under ASC 840, the accounting treatment for direct financing leases required the Company to record an investment in direct financing leases on its books at lease inception and subsequently recognize interest income and a reduction in the investment for the building portion of rent. This initial net investment was determined by aggregating the total future minimum lease payments attributable to the direct financing lease and the estimated residual value of the property, less unearned income. The interest income recorded under the direct financing lease was included in income from direct financing lease on the Company's consolidated statements of income and was recognized over the original 35-year lease term using the effective interest rate method which produced a constant periodic rate of return on the net investment in the leased property. Furthermore, as the net investment in direct financing lease included only future minimum lease payments, rent that was not fixed and determinable at the lease inception was excluded from the determination of the rent attributable to the leased assets and was therefore recorded as income from direct financing lease in the period earned. The unguaranteed residual value was the Company's estimate of what it could realize upon the sale of the property at the end of the lease term.

On October 15, 2018, in conjunction with the Penn-Pinnacle Merger, the Pinnacle Master Lease was amended via the fourth amendment to such lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd. As a result of this amendment, the Company reassessed the lease's classification and determined the new lease agreement qualified for operating lease treatment under ASC 840. Therefore, subsequent to the Penn-Pinnacle Merger, the Amended Pinnacle Master Lease is treated as an operating lease in its entirety, the building assets previously recorded as an investment in direct financing lease on the Company's consolidated balance sheet were recorded as real estate assets on the Company's consolidated balance sheet and all rent received under the Amended Pinnacle Master Lease is recorded as rental income on the Company's consolidated statement of income.

At December 31, 2017, the Company's investment in direct financing lease, net, consisted of the following and represented the building assets initially acquired from Pinnacle:

 December 31,
2017
 (in thousands)
Minimum lease payments receivable$3,263,387
Unguaranteed residual value689,811
Gross investment in direct financing lease3,953,198
Less: unearned income(1,315,559)
Investment in direct financing lease, net$2,637,639

Loan Receivable

In January 2014, the Company completed the asset acquisition of the real property associated with the Casino Queen in East St. Louis, Illinois for $140.7 million. GLPI leases the property back to Casino Queen on a triple-net basis on terms similar to those in the Master Leases. The lease has an initial term of 15 years and the tenant has an option to renew it at the same terms and conditions for four successive five-year periods (the "Casino Queen Lease").  

Simultaneously with the Casino Queen acquisition, GLPI also provided Casino Queen with a $43.0 million, five-year term loan at 7% interest, pre-payable at any time, which, together with the sale proceeds, completely refinanced and retired all

of Casino Queen’s outstanding long-term debt obligations. On March 13, 2017, the outstanding principal and interest on this loan was repaid in full and GLPI simultaneously provided a new unsecured $13.0 million, 5.5-year term loan to CQ Holding Company, Inc., an affiliate of Casino Queen, to partially finance their acquisition of Lady Luck Casino in Marquette, Iowa. The cash proceeds were net settled. The new loan bears an interest rate of 15% and is pre-payable at any time.

The Company evaluates loans for impairment when it is probable that it will not be able to collect all amounts due according to contractual terms. All amounts due under the contractual terms means that both contractual interest payments and contractual principal payments of a loan will be collected as scheduled in the loan agreement. Indicators of impairment may include delinquent payments, a decline in the credit worthiness of a debtor, or a decline in the underlying property/tenant’s performance. The Company measures loan impairment based upon the present value of expected future cash flows discounted at the loan’s original effective interest rate. The determination of whether loans are impaired involves judgments and assumptions based on objective and subjective factors. If an impairment occurs, the Company will reduce the carrying value of the loanasset to its estimated fair value, calculated in accordance with GAAP.
Cash and record a corresponding chargeCash Equivalents
The Company considers all cash balances and highly-liquid investments with original maturities of three months or less to net income.be cash and cash equivalents.
On June 12, 2018,
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Prepaid Expenses and Other Assets
Prepaid expenses consist of expenditures for goods or services before the Company received a Noticegoods are used or the services are received. These amounts are deferred and charged to operations as the benefits are realized and primarily consist of Event of Default under the Senior Credit Agreement of CQ Holding Company from Citizens Bank, N.A. ("Citizens"), which reported a covenant default under their senior secured agreement. Under the terms ofprepayments for insurance, property taxes and other contracts that agreement, when an event of default occurs, CQ Holding Company is prohibited from making cash payments to unsecured lenders such as GLPI. Therefore, the interest due from CQ Holding Company in June, September and December 2018 under the Company's unsecured loan was paid in kind in the amount of $1.5 million. In addition to the covenant violation noted above under the senior credit agreement with Citizens, CQ Holding Company also had a payment default under their senior credit agreement with Citizens. Furthermore, the Company has notified Casino Queen of Events of Default under the Company's unsecured loan with CQ Holding Company, related to financial covenant violationswill be expensed during the year ended December 31, 2018.
During the fourth quarter of 2018, the Company became aware of Casino Queen's intent to sell its operations to a third-party gaming operator. At December 31, 2018, active negotiations for the sale of Casino Queen's operations were taking place. Despite the payment and covenant defaults noted above, at this time, full payment of the principal is still expected, due to the anticipationsubsequent year. It also includes transaction costs that the operations will be sold inallocated to purchase price upon the near termclosing of an asset acquisition. Other assets primarily consists of accounts receivable and deferred compensation plan assets (See Note 13 for an amount allowing for repayment offurther details on the full $13.0 million of loan principal due to GLPI. However, the paid-in-kind interest due to the Company at December 31, 2018 is not expected to be collected, resulting in an impairment charge of $1.5 million during the fourth quarter of 2018. The Company did not recognize the paid-in-kind interest income due to the Company for the quarter ended December 31, 2018 and took a charge for the previously recognized paid-in-kind interest income through the Company’s consolidated statement of earnings as a reversal of the paid-in-kind interest income recognized earlier in the year. The Company cannot be 100% certain that the sale of Casino Queen's operations will come to fruition. The culmination of the actual transaction could result in further impairment charges for the Company. At December 31, 2018, the balance of the loan is $13.0 million. The loan balance is recorded at carrying value which approximates fair value.deferred compensation plan).
At December 31, 2018, all lease payments due from Casino Queen remain current and the Casino Queen Lease remains in compliance with all covenants.
9. Goodwill and Intangible Assets

Goodwill is an asset representingThe Company's goodwill and intangible assets are the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. The only goodwillresult of the Company is the goodwill recorded on the bookscontribution of Hollywood Casino Baton Rouge and Hollywood Casino Perryville in connection with Penn's purchase of this entity prior to the Spin-Off. The original assets and liabilities of GLPI, includingCompany's goodwill and intangible assets were recorded at their respective historical carrying values at the time of the Spin-Off in accordance with the provisions of ASC 505. There is no goodwill recordedresides on the Company's GLP Capital segment, which holds the Company's REIT operations.













Changes in the carrying amountbooks of goodwill for the years ended December 31, 2018 and 2017 are as follows:

 TRS Properties Business Segment
 (in thousands)
Balance at December 31, 2016$75,521
    Acquisitions—
    Impairment losses—
Balance at December 31, 2017$75,521
    Acquisitions—
    Impairment losses(59,454)
Balance at December 31, 2018$16,067

During the year ended December 31, 2018, the Company recorded a goodwill impairment charge of $59.5 million in connection with its operations at Hollywood Casino Baton Rouge. This charge was driven by general market deterioration inRouge subsidiary, while the Baton Rouge regionother intangible asset represents a gaming license on the books of its Hollywood Casino Perryville subsidiary. Both subsidiaries are members of the TRS Segment and are considered separate reporting units under ASC 350 - Intangibles - Goodwill and Other ("ASC 350"). Goodwill is tested at the smoking banreporting unit level, which is an operating segment or one level below an operating segment for which discrete financial information is available
Under ASC 350, the Company is required to test goodwill for impairment at all Baton Rouge, Louisiana casinosleast annually and whenever events or circumstances indicate that went into effect duringit is more likely than not that goodwill may be impaired. The Company has elected to perform its annual goodwill impairment test as of October 1 of each year. In accordance with ASC 350, the second quarter of 2018, both of which significantly impacted the Company's forecasted cash flowsCompany tests goodwill for this reporting unit. Subsequentimpairment subsequent to conductingtesting its impairment tests on other long-lived assets including the gaming license described below, the Company performed Step 1 of the goodwill impairment test, which indicated a potentialfor impairment. Step 1 of the goodwill impairment test involved the determination of the fair value of the Baton Rouge reporting unit and its comparison to the reporting unit's carrying amount. Using a discounted cash flow model, which relied on projected EBITDA to determine the reporting unit's future cash flows, the Company calculated a fair value that was less than the reporting unit's carrying value and proceeded to Step 2. In Step 2 of the goodwill impairment test, the Company performed a fair value allocation as if the reporting unit had been acquired in a business combination and assigned the fair value of the reporting unit calculated in Step 1 to all assets and liabilities of the reporting unit, including any unrecognized intangible assets. Any residual fair value was allocated to goodwill to arrive at the implied fair value of goodwill. After completing the Step 2 allocation, the Company determined the goodwill on its Baton Rouge reporting unit had an implied fair value of $16.1 million and recorded the impairment charge of $59.5 million during the fourth quarter of 2018.
In accordance with ASC 350, the Company considers its gaming license at the Hollywood Casino Perryville propertygaming license an indefinite-lived intangible asset that does not require amortization based on the Company's future expectations to operate this casino indefinitely, as well as the gaming industry's historical experience in renewing these intangible assets at minimal cost with various state gaming commissions. Rather, the Company's gaming license is tested annually, or more frequently if indicators of impairment exist, for impairment by comparing the fair value of the recorded asset to its carrying amount. If the carrying amount of the indefinite-life intangible asset exceeds its fair value, an impairment loss is recognized. Hollywood Casino Perryville's
The Company calculates the fair value of its gaming license will expire in September 2025, fifteen years from the casino's opening date. The Company expects to expense any costs related to the gaming license renewal as incurred. The Company conducted its annual impairment assessment of the gaming license on October 1, 2018 using the Greenfield Method whichunder the income approach. The Greenfield Method estimates the fair value of the gaming license assuming the Company built a casino with similar utility to that of the existing facility. ThisThe method also assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. Based upon theseAs such the value of the license is a function of the following items:
•Projected revenues and operating cash flows;
•Theoretical construction costs and duration;
•Pre-opening expenses;
•Discounting that reflects the level of risk associated with receiving future cash flows attributable to the license; and
•Remaining useful life of the license
The evaluation of goodwill and indefinite-lived intangible assets requires the use of estimates about future operating results to determine the estimated fair value of the reporting unit and the indefinite-lived intangible assets. The Company must make various assumptions and estimates in performing its impairment testing. The implied fair value includes estimates of future cash flows that are based on reasonable and supportable assumptions, which represent the Company's best estimates of the cash flows expected to result from the use of the assets. Changes in estimates, increases in the Company's cost of capital, reductions in transaction multiples, changes in operating and capital expenditure assumptions or application of alternative assumptions and definitions could produce significantly different results. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from the Company's estimates. If the Company's ongoing estimates of future cash flows are not met, the Company may have to record impairment charges in future accounting periods. The Company's estimates of cash flows are based on the current regulatory and economic climates, as well as recent operating information and budgets. These estimates could be negatively impacted by changes in federal, state or local regulations, economic downturns, or other events.
Forecasted cash flows can be significantly impacted by the local economy in which the Company's subsidiaries operate. For example, increases in unemployment rates can result in decreased customer visitations and/or lower customer spend per visit. In addition, new legislation which approves gaming in nearby jurisdictions or further expands gaming in jurisdictions in which the Company operates can result in increased competition for the property. This generally has a negative effect on profitability once competitors become established, as a certain level of cannibalization occurs absent an overall
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increase in customer visitations. Lastly, increases in gaming taxes approved by state regulatory bodies can negatively impact forecasted cash flows for this reporting unit,flows.
Assumptions and estimates about future cash flow levels are complex and subjective. They are sensitive to changes in underlying assumptions and can be affected by a variety of factors, including external factors, such as industry, geopolitical and economic trends, and internal factors, such as changes in the gaming license was not impaired. At both December 31, 2018Company's business strategy, which may reallocate capital and 2017,resources to different or new opportunities which management believes will enhance the gaming license had a carryingCompany's overall value of $9.6 million.















10.Long-term Debt
Long-term debt, net of current maturities and unamortized debt issuance costs is as follows: 
 December 31,
2018		 December 31,
2017
 (in thousands)
Unsecured $1,175 million revolver$402,000
 $—
Unsecured term loan A—
 230,000
Unsecured term loan A-1525,000
 825,000
$550 million 4.375% senior unsecured notes due November 2018—
 550,000
$1,000 million 4.875% senior unsecured notes due November 20201,000,000
 1,000,000
$400 million 4.375% senior unsecured notes due April 2021400,000
 400,000
$500 million 5.375% senior unsecured notes due November 2023500,000
 500,000
$850 million 5.250% senior unsecured notes due June 2025850,000
 —
$975 million 5.375% senior unsecured notes due April 2026975,000
 975,000
$500 million 5.750% senior unsecured notes due June 2028500,000
 —
$750 million 5.30% senior unsecured notes due January 2029750,000
 —
Capital lease1,112
 1,230
Total long-term debt5,903,112
 4,481,230
Less: unamortized debt issuance costs, bond premiums and original issuance discounts(49,615) (38,350)
Total long-term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts$5,853,497
 $4,442,880

The following is a schedule of future minimum repayments of long-term debt as of December 31, 2018 (in thousands): 

2019$123
20201,000,129
2021925,135
2022142
2023902,149
Over 5 years3,075,434
Total minimum payments$5,903,112

Senior Unsecured Credit Facility

The Company's senior unsecured credit facility (the "Credit Facility"), consists of a $1,175 million revolving credit facility and a $525 million Term Loan A-1 facility. On May 21, 2018, the Company entered into the second amendmentbut may be to the Credit Facility, which increased the Company's revolving commitments to an aggregate principal amountdetriment of $1,100 million, eliminated the Term Loan A facility, required the Company to repay a portion of the Term Loan A-1 facility and extended the maturity date of the revolving credit facility. On October 10, 2018, the Company entered into the third amendment to the Credit Facility, which further increased the Company's revolving commitments to an aggregate principal amount of $1,175 million. The revolving credit facility matures on May 21, 2023 and the Term Loan A-1 facility matures on April 28, 2021.

its existing operations.
The Company recorded a loss onreclassified its goodwill and other intangible assets into Assets held for sale at December 31, 2020. See Note 6 for additional discussion.
Debt Issuance Costs and Bond Premiums and Discounts
Debt issuance costs that are incurred by the early extinguishmentCompany in connection with the issuance of debt relatedare deferred and amortized to interest expense over the second amendment tocontractual term of the Credit Facility,underlying indebtedness. In accordance with ASU 2015-03, Interest - Imputation of approximately $1.0 million forInterest (Subtopic 835-30): Simplifying the proportional amountPresentation of Debt Issuance Costs, the Company records long-term debt net of unamortized debt issuance costs on its consolidated balance sheets. Similarly, the Company records long-term debt net of any unamortized bond premiums and original issuance discounts on its consolidated balance sheets. Any original issuance discounts or bond premiums are also amortized to interest expense over the contractual term of the underlying indebtedness.
Fair Value of Financial Assets and Liabilities

Fair value is defined as the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are classified based upon the level of judgment associated with the extinguished Term Loan A facilityinputs used to measure their fair value. ASC 820 - Fair Value Measurements and Disclosures ("ASC 820") establishes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach, and cost approach). The levels of the hierarchy related to the bankssubjectivity of the valuation inputs are described below:

•Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. 

•Level 2: Inputs other than quoted prices that are no longer participatingobservable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly quoted intervals. 

•Level 3: Unobservable inputs that reflect the Credit Facility.reporting entity's own assumptions, as there is little, if any, related market activity.


At December 31, 2018,        The Company's assessment of the Credit Facility hadsignificance of a gross outstanding balance of $927 million. Additionally, at December 31, 2018, the Company was contingently obligated under letters of credit issued pursuantparticular input to the Credit Facility with face amounts aggregating approximately $0.4 million, resulting in $772.6 million of available borrowing capacity under the revolving credit facility as of December 31, 2018.

The interest rates payable on the loans are, at the Company's option, equal to either a LIBOR rate or a base rate plus an applicable margin, which ranges from 1.0% to 2.0% per annum for LIBOR loans and 0.0% to 1.0% per annum for base rate

loans, in each case, depending on the credit ratings assigned to the Credit Facility. At December 31, 2018, the applicable margin was 1.50% for LIBOR loans and 0.50% for base rate loans. In addition, the Company is required to pay a commitment fee on the unused portion of the commitments under the revolving facility at a rate that ranges from 0.15% to 0.35% per annum, depending on the credit ratings assigned to the Credit Facility. At December 31, 2018, the commitment fee rate was 0.25%. The Company is not required to repay any loans under the Credit Facility prior to maturity on May 21, 2023fair value measurement requires judgment and may prepay all or any portionaffect the valuation of assets and liabilities and their placement within the loans under the Credit Facility prior to maturity without premium or penalty, subject to reimbursement of any LIBOR breakage costs of the lenders. The Company's wholly owned subsidiary, GLP Capital is the primary obligor under the Credit Facility, which is guaranteed by GLPI.fair value hierarchy.


The Credit Facility contains customary covenants that, among other things, restrict, subject to certain exceptions, the ability of GLPI and its subsidiaries to grant liens on their assets, incur indebtedness, sell assets, make investments, engage in acquisitions, mergers or consolidations or pay certain dividends and other restricted payments. The Credit Facility contains the following financial covenants, which are measured quarterly on a trailing four-quarter basis: a maximum total debt to total asset value ratio, a maximum senior secured debt to total asset value ratio, a maximum ratio of certain recourse debt to unencumbered asset value and a minimum fixed charge coverage ratio. In addition, GLPI is required to maintain a minimum tangible net worth and its status as a REIT on and after the effective date of its election to be treated as a REIT, which the Company elected on its 2014 U.S. federal income tax return. GLPI is permitted to pay dividends to its shareholders as may be required in order to maintain REIT status, subject to the absence of payment or bankruptcy defaults. GLPI is also permitted to make other dividends and distributions subject to pro forma compliance with the financial covenants and the absence of defaults. The Credit Facility also contains certain customary affirmative covenants and events of default, including the occurrence of a change of control and termination of the Penn Master Lease (subject to certain replacement rights). The occurrence and continuance of an event of default under the Credit Facility will enable the lenders under the Credit Facility to accelerate the loans and terminate the commitments thereunder. At December 31, 2018, the Company was in compliance with all required financial covenants under the Credit Facility.

Senior Unsecured Notes


At December 31, 2018,2020, the Company had an outstanding balance of $4,975$5,375.0 million of senior unsecured notes consisting(the "Senior Notes").

In the first quarter of 2020, the Company redeemed all $215.2 million aggregate principal amount of the following:Company’s outstanding 4.875% senior unsecured notes due in November 2020 and all $400 million aggregate principal amount of the Company’s outstanding 4.375% senior unsecured notes due in April 2021, incurring a loss on the early extinguishment of debt related to the redemption of $17.3 million, primarily for call premium charges and debt issuance write-offs.

On September 26, 2018,June 25, 2020, the Company issued $750$500 million of 5.30%4.00% senior unsecured notes maturing ondue January 15, 20292031 at an issue price equal to 99.985%98.827% of the principal amount and $350to repay indebtedness under its Revolver. On August 18, 2020 the Company issued an additional $200 million of 5.25%4.00% senior unsecured notes maturing on June 1, 2025due January 2031 at an issue price equal to 102.148%103.824% of the principal amount to repay Term Loan A-1 indebtedness, incurring a loss on the early extinguishment of debt of $0.8 million, related to debt issuance write-offs. These bond offerings have extended the maturities of our long-term debt.

On August 29, 2019, the Company issued $400 million of 3.35% Senior Unsecured Notes maturing on September 1, 2024 at an issue price equal to 99.899% of the principal amount (the "New 2025"2024 Notes"). The New 2025 and $700 million of 4.00% Senior Unsecured Notes will become partmaturing on January 15, 2030 at an issue price equal to 99.751% of the same series as, and are expected to be fungible with, the Company's previously issued 5.25% senior notes due 2025, $500 million aggregate principal amount of which were originally issued on May 21, 2018 (the "Initial 2025"2030 Notes"). Interest on the notes maturing in 20252024 Notes is payable semi-annually on JuneMarch 1 and DecemberSeptember 1 of each year, commencing on DecemberMarch 1, 2018 and is deemed to accrue from May 21, 2018, the issuance date of the Initial 2025 Notes.2020. Interest on the notes maturing in 20292030 Notes is payable semi-annually on January 15 and July 15 of each year, commencing on January 15, 2019.2020. The net proceeds from the sale of the New 20252024 Notes and 2030 Notes were used to (i) finance the notes maturing in 2029, together with funds availableCompany's cash tender offer to purchase its 4.875% Senior Unsecured Notes due 2020 (described below) (ii) repay outstanding borrowings under the Company's revolving credit facility were used in October 2018 to (i) finance GLPI’s acquisitionand (iii) repay a portion of the real property assets of Plainridge Park Casino from Penn and its issuance of a secured mortgage loan to Boyd in connection with Boyd’s acquisition ofoutstanding borrowings under the real property assets of Belterra Park Gaming & Entertainment Center, (ii) finance GLPI’s acquisition of substantially all the real property assets of five gaming facilities owned by Tropicana and its issuance of a mortgage loan to Eldorado in connection with Eldorado’s acquisition of substantially all the real property assets of Lumière Place, and (iii) pay the estimated transaction fees and expenses associated with the transactions.Company's Term Loan A-1 facility.


On May 21, 2018,September 12, 2019, the Company completed a cash tender offer (the "Tender"2019 Tender Offer") to purchase any and all of the outstanding $550its $1,000 million aggregate principal of its 4.375% senior unsecured notesamount 4.875% Senior Unsecured Notes due 2018.2020 (the "2020 Notes"). The Company received early tenders from the holders of approximately $393.5$782.6 million in aggregate principal of these notes,the 2020 Notes, or approximately 72%,78% of its
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outstanding 2020 Notes, in connection with the 2019 Tender Offer at a price of 100.396%102.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date. Subsequent to the early tender deadline, an additional $2.2 million in aggregate principal of the 2020 Notes was tendered at a price of 99.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date, for a total redemption of $784.8 million of the 2020 Notes. The Company recorded a loss on the early extinguishment of debt related to the 2019 Tender Offer, of approximately $2.5$21.0 million, for the proportional amount of unamortized debt issuance costs associated with the tendered notes and the difference between the reaquisitionreacquisition price of the tendered notes2020 Notes and their net carrying value. On August 16, 2018, the Company redeemed the remaining notes for 100% of the principal amount and accrued and unpaid interest to, but not including the redemption date.

Also on May 21, 2018, the Company issued $500 million of 5.25% senior unsecured notes maturing on June 1, 2025 and $500 million of 5.75% senior unsecured notes maturing on June 1, 2028. Interest is payable semi-annually on June 1 and December 1 of each year, commencing on December 1, 2018. The net proceeds from the sale of these notes were used (i) to

prepay and extinguish the outstanding borrowings under the Term Loan A facility under the Credit Facility and to repay a portion of the outstanding borrowings under the Term Loan A-1 facility, (ii) to finance the tender offer of the 2018 Notes, (iii) to redeem the remaining 2018 Notes and (iv) to pay fees and expenses to amend the Company's Credit Facility, as described above.

On April 28, 2016, in connection with the acquisition of Pinnacle, the Company issued $400 million of 4.375% senior unsecured notes maturing on April 15, 2021 and $975 million of 5.375% senior unsecured notes maturing on April 15, 2026. Interest on these notes is payable semi-annually on April 15 and October 15 of each year. The net proceeds from the sale of these notes were used (i) to finance the repayment, redemption and/or discharge of certain Pinnacle debt obligations that the Company assumed in the Pinnacle Merger, (ii) to pay transaction-related fees and expenses related to the Pinnacle Merger and (iii) for general corporate purposes.

On October 30 and 31, 2013, the Company issued $2,050 million aggregate principal amount of senior unsecured notes: $550 million of 4.375% senior unsecured notes that matured in 2018; $1,000 million of 4.875% senior unsecured notes maturing on November 1, 2020; and $500 million of 5.375% senior unsecured notes maturing on November 1, 2023. Interest on these notes is payable semi-annually on May 1 and November 1 of each year. The net proceeds from the sale of these notes, together with borrowings under the Credit Facility were used (i) to make distributions directly and indirectly to Penn in partial exchange for the contributions of real property assets by Penn and CRC Holdings, Inc., a Penn subsidiary, to the Company in connection with the Spin-Off, (ii) to pay related fees and expenses, (iii) to partially repay amounts funded under the revolving credit facility and (iv) to fund future earnings and profits distributions and for working capital purposes.
The Company may redeem the senior unsecured notes, collectively, the "Notes"Senior Notes of any series at any time, and from time to time, at a redemption price of 100% of the principal amount of the Senior Notes redeemed, plus a "make-whole" redemption premium described in the indenture governing the Senior Notes, together with accrued and unpaid interest to, but not including, the redemption date, except that if Senior Notes of a series are redeemed 90 or fewer days prior to their maturity, the redemption price will be 100% of the principal amount of the Senior Notes redeemed, together with accrued and unpaid interest to, but not including, the redemption date. If GLPI experiences a change of control accompanied by a decline in the credit rating of the Senior Notes of a particular series, the Company will be required to give holders of the Senior Notes of such series the opportunity to sell their Senior Notes of such series at a price equal to 101% of the principal amount of the Senior Notes of such series, together with accrued and unpaid interest to, but not including, the repurchase date. The Senior Notes also are subject to mandatory redemption requirements imposed by gaming laws and regulations. 
The Senior Notes were issued by GLP Capital, L.P. and GLP Financing II, Inc. (the "Issuers"), two wholly-owned subsidiaries of GLPI, and are guaranteed on a senior unsecured basis by GLPI. The guarantees of GLPI are full and unconditional. The Senior Notes are the Issuers' senior unsecured obligations and rank pari passu in right of payment with all of the Issuers' senior indebtedness, including the Credit Facility, and senior in right of payment to all of the Issuers' subordinated indebtedness, without giving effect to collateral arrangements. See Note 19 for additional financial information on the parent guarantor and subsidiary issuers of the Notes.
The Senior Notes contain covenants limiting the Company’s ability to: incur additional debt and use its assets to secure debt; merge or consolidate with another company; and make certain amendments to the Penn Master Lease. The Senior Notes also require the Company to maintain a specified ratio of unencumbered assets to unsecured debt. These covenants are subject to a number of important and significant limitations, qualifications and exceptions.
 
At December 31, 2018,2020, the Company was in compliance with all required financial covenants under theits Senior Notes.


CapitalFinance Lease Liability


The Company assumed the capitalfinance lease obligationobligations related to certain assets at its Aurora, Illinois property. GLPI recorded the asset and liability associated with the capitalfinance lease on its consolidated balance sheet. The original term of the capitalfinance lease wasis 30 years and it will terminate in 2026.

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Summarized financial information for Subsidiary Issuers and Parent Guarantor
As of December 31, 2020As of December 31, 2019
Real estate investments, net$2,720,767 $2,514,806 
Real estate loans— 246,000 
Right-of-use assets and land rights, net121,866 181,593 
Cash and cash equivalents480,066 4,281 
Long term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts5,754,689 5,737,962 
Accrued interest72,285 60,695 
Lease liabilities58,654 89,856 
Deferred rental revenue265,891 271,837 
For the year ended December 31, 2020For the year ended December 31, 2019
Revenues$580,428 $575,451 
Income from operations446,708 384,170 
Interest expense(282,142)(301,520)
Net income146,323 61,734 





The financial information presented above is that of the subsidiary issuers and parent guarantor and the financial information of non-issuer subsidiaries has been excluded. The financial information of subsidiary issuers and the parent guarantor has been presented on a combined basis; however, the only asset on the parent guarantor balance sheet is its investment in subsidiaries which is not included in the presentation above in accordance with the disclosure requirements.



We had no off-balance sheet arrangements at December 31, 2020 and 2019.



Distribution Requirements



We generally must distribute annually at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gains, in order to qualify to be taxed as a REIT (assuming that certain other requirements are also satisfied) so that U.S. federal corporate income tax does not apply to earnings that we distribute. To the extent that we satisfy this distribution requirement and qualify for taxation as a REIT but distribute less than 100% of our REIT taxable income, determined without regard to the dividends paid deduction and including any net capital gains, we will be subject to U.S. federal corporate income tax on our undistributed net taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we distribute to our shareholders in a calendar year is less than a minimum amount specified under U.S. federal income tax laws. We intend to make distributions to our shareholders to comply with the REIT requirements of the Code.

While the Company's Board of Directors declared a cash dividend of $0.70 for the first quarter of 2020, quarterly dividends of $0.60 per share on the Company's common stock were declared for both the second, third and fourth quarters. These dividends consisted of a combination of cash and shares of the Company's common stock. The cash component of the dividend (other than cash paid in lieu of fractional shares) did not exceed 20% in the aggregate, or $0.12 per share, with the balance, or $0.48 per share, payable in shares of the Company's common stock. This quarterly dividend level reflected the impact of the COVID-19 closures on the Company's business.

LIBOR Transition

The majority of our debt is at fixed rates and our exposure to variable interest rates is currently limited to our revolving credit facility and our Term Loan A-2. Both of these debt instruments are indexed to LIBOR which is expected to be phased out during late 2021 through mid-2023. The discontinuance of LIBOR would affect our interest expense and earnings. The borrowings under our Amended Credit Facility will be subject to the expected LIBOR transition. LIBOR is currently expected
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to transition to a new standard rate, the Secured Overnight Financing Rate (“SOFR”). We are currently monitoring the transition and cannot be certain whether SOFR will become the standard rate for our variable rate debt.

Outlook

Based on our current level of operations and anticipated earnings, we believe that cash generated from operations and cash on hand, together with amounts available under our Amended Credit Facility, will be adequate to meet our anticipated debt service requirements, capital expenditures, working capital needs and dividend requirements. During 2020, we refinanced our near term debt obligations and as such have no significant obligations coming due until 2023 and we issued common shares in advance of the planned 2021 closing of the Bally's transaction. We also announced a project to move our Hollywood Casino Baton Rouge property landside in early 2022. On December 15, 2020, we announced that Penn had exercised its option to acquire the gaming operations at Hollywood Casino Perryville for $31.1 million and that we entered into an agreement to sell the gaming operations of Hollywood Casino Baton Rouge for $28.2 million to Casino Queen. The Company will retain ownership of the real estate assets at Hollywood Casino Baton Rouge and will simultaneously enter into the Casino Queen Master Lease. Rent under the Casino Queen Master Lease will be adjusted upon completion of the project to reflect a yield of 8.25% on the Company's project costs. Both transactions are expected to close in the second half of 2021, subject to regulatory approvals and other customary closing conditions.

In addition, we expect the majority of our future growth to come from acquisitions of gaming and other properties to lease to third parties. If we consummate significant acquisitions in the future, our cash requirements may increase significantly and we would likely need to raise additional proceeds through a combination of either common equity (including under our ATM Program) and/or debt offerings. Our future operating performance and our ability to service or refinance our debt will be subject to future economic conditions and to financial, business and other factors, many of which are beyond our control. See "Risk Factors-Risks Related to Our Capital Structure" of this Annual Report on Form 10-K for a discussion of the risk related to our capital structure.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We face market risk exposure in the form of interest rate risk. These market risks arise from our debt obligations. We have no international operations. Our exposure to foreign currency fluctuations is not significant to our financial condition or results of operations.
GLPI’s primary market risk exposure is interest rate risk with respect to its indebtedness of $5,799.9 million at December 31, 2020. Furthermore, $5,375.0 million of our obligations are the senior unsecured notes that have fixed interest rates with maturity dates ranging from two and one-half years to ten years. An increase in interest rates could make the financing of any acquisition by GLPI more costly, as well as increase the costs of its variable rate debt obligations. Rising interest rates could also limit GLPI’s ability to refinance its debt when it matures or cause GLPI to pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness. GLPI may manage, or hedge, interest rate risks related to its borrowings by means of interest rate swap agreements. GLPI also expects to manage its exposure to interest rate risk by maintaining a mix of fixed and variable rates for its indebtedness. However, the provisions of the Code applicable to REITs substantially limit GLPI’s ability to hedge its assets and liabilities.
The table below provides information at December 31, 2020 about our financial instruments that are sensitive to changes in interest rates. For debt obligations, the table presents notional amounts maturing in each fiscal year and the related weighted-average interest rates by maturity dates. Notional amounts are used to calculate the contractual payments to be exchanged by maturity date and the weighted-average interest rates for our variable rate debt are based on implied forward LIBOR rates at December 31, 2020.
 1/01/21- 12/31/211/01/22- 12/31/221/01/23- 12/31/231/01/24- 12/31/241/01/25 12/31/25ThereafterTotalFair Value at 12/31/2020
 (in thousands)
Long-term debt:        
Fixed rate$— $— $500,000 $400,000 $850,000 $3,625,000 $5,375,000 $6,026,840 
Average interest rate5.38 %3.35 %5.25 %4.88 %  
Variable rate$— $— $424,019 $— $— $— $424,019 $424,019 
Average interest rate (1) 
2.02 %   
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(1) Estimated rate, reflective of forward LIBOR plus the spread over LIBOR applicable to variable-rate borrowing. For considerations surrounding the phase out of LIBOR refer to the Liquidity and Capital Resources discussion in this Annual Report on Form 10-K.
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ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and the Board of Directors of
Gaming and Leisure Properties, Inc. and Subsidiaries

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Gaming and Leisure Properties, Inc. and Subsidiaries (the "Company") as of December 31, 2020 and 2019, the related consolidated statements of income, changes in shareholders’ equity (deficit), and cash flows, for each of the three years in the period ended December 31, 2020, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control -- Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 19, 2021, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Lease Classification - Lease Term - See Note 14 to the financial statements
Critical Audit Matter Description
The Company performs a lease classification test upon the entry into any new tenant lease or lease modification to determine if the Company will account for the lease as an operating, sales-type lease, or direct financing lease. The accounting guidance under ASC 842 is complex and requires the use of judgments and assumptions by management to determine the proper accounting treatment of a lease. The lease classification tests and the resulting calculations require subjective judgments, such as determining the likelihood a tenant will exercise all renewal options, in order to determine the lease term. A slight change in estimate or judgment can result in a material difference in the financial statement presentation.

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Given the significant judgments made by management to determine the expected lease term, we performed audit procedures to assess the reasonableness of such judgments, which required a high degree of auditor judgment.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the judgments surrounding the determination of lease term for any new or reassessed lease included the following, among others:
•We tested the effectiveness of the controls over management’s assessment of the likelihood a tenant would exercise all renewal options.
•We evaluated the significant judgments management made to determine the expected lease term by:
◦Evaluating the significance of the leased assets to the tenant’s operations by examining available information including tenant’s financial statements.

◦Evaluating the Company’s historical pattern of tenant lease modifications by examining both confirming and contradictory evidence.

◦Obtaining lease agreements to examine material lease provisions considered by management in their analysis.

/s/ Deloitte & Touche


New York, New York
February 19, 2021

We have served as the Company's auditor since 2016.





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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Balance Sheets
(in thousands, except share data) 
December 31, 2020December 31, 2019
Assets
Real estate investments, net$7,287,158 $7,100,555 
Property and equipment, used in operations, net80,618 94,080 
Assets held for sale61,448 0 
Real estate of Tropicana Las Vegas, net304,831 0 
Real estate loans0 303,684 
Right-of-use assets and land rights, net769,197 838,734 
Cash and cash equivalents486,451 26,823 
Prepaid expenses2,098 4,228 
Goodwill0 16,067 
Other intangible assets0 9,577 
Deferred tax assets, net5,690 6,056 
Other assets36,877 34,494 
Total assets$9,034,368 $8,434,298 
Liabilities
Accounts payable$375 $1,006 
Accrued expenses398 6,239 
Accrued interest72,285 60,695 
Accrued salaries and wages5,849 13,821 
Gaming, property, and other taxes146 944 
Lease liabilities152,203 183,971 
Long-term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts5,754,689 5,737,962 
Deferred rental revenue333,061 328,485 
Deferred tax liabilities359 279 
Other liabilities39,985 26,651 
Total liabilities6,359,350 6,360,053 
Commitments and Contingencies (Note 13)00
Shareholders’ equity
Preferred stock ($.01 par value, 50,000,000 shares authorized, 0 shares issued or outstanding at December 31, 2020 and December 31, 2019)0 0 
Common stock ($.01 par value, 500,000,000 shares authorized, 232,452,220 and 214,694,165 shares issued and outstanding at December 31, 2020 and December 31, 2019, respectively)2,325 2,147 
Additional paid-in capital4,284,789 3,959,383 
Accumulated deficit(1,612,096)(1,887,285)
Total shareholders’ equity2,675,018 2,074,245 
Total liabilities and shareholders’ equity$9,034,368 $8,434,298 
See accompanying Notes to the Consolidated Financial Statements.

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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Income
(in thousands, except per share data)
Year ended December 31,202020192018
Revenues  
Rental income$1,031,036 $996,166 $747,654 
Income from direct financing lease0 0 81,119 
Interest income from real estate loans19,130 28,916 6,943 
Real estate taxes paid by tenants0 0 87,466 
Total income from real estate1,050,166 1,025,082 923,182 
Gaming, food, beverage and other102,999 128,391 132,545 
Total revenues1,153,165 1,153,473 1,055,727 
Operating expenses   
Gaming, food, beverage and other56,698 74,700 77,127 
Real estate taxes0 0 88,757 
Land rights and ground lease expense29,041 42,438 28,358 
General and administrative68,572 65,385 70,819 
(Gains) losses from dispositions of properties(41,393)92 309 
Depreciation230,973 240,435 137,093 
Loan impairment charges0 13,000 0 
  Goodwill impairment charges0 0 59,454 
Total operating expenses343,891 436,050 461,917 
Income from operations809,274 717,423 593,810 
Other income (expenses)   
Interest expense(282,142)(301,520)(247,684)
Interest income569 756 1,827 
   Losses on debt extinguishment(18,113)(21,014)(3,473)
Total other expenses(299,686)(321,778)(249,330)
Income before income taxes509,588 395,645 344,480 
Income tax expense3,877 4,764 4,964 
Net income$505,711 $390,881 $339,516 
Earnings per common share:  
Basic earnings per common share$2.31 $1.82 $1.59 
Diluted earnings per common share$2.30 $1.81 $1.58 

See accompanying Notes to the Consolidated Financial Statements.

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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Changes in Shareholders’ Equity
(in thousands, except share data)

 Common StockAdditional
Paid-In
Capital		Accumulated
Deficit		Total
Shareholders’
Equity
 SharesAmount
Balance, December 31, 2017212,717,549 $2,127 $3,933,829 $(1,477,709)$2,458,247 
Stock option activity1,007,750 10 19,805 — 19,815 
Restricted stock activity486,633 5 (1,131)— (1,126)
Dividends paid ($2.57 per common share)0 0 0 (550,435)(550,435)
Adoption of new revenue standard— — — (410)(410)
Net income— — — 339,516 339,516 
Balance, December 31, 2018214,211,932 2,142 3,952,503 (1,689,038)2,265,607 
ATM Program offering costs, net of issuance of common stock1,500 0 (255)— (255)
Stock option activity26,799 0 592 — 592 
Restricted stock activity453,934 5 6,543 — 6,548 
Dividends paid ($2.74 per common share)— — — (589,128)(589,128)
Net income— — — 390,881 390,881 
Balance, December 31, 2019214,694,165 2,147 3,959,383 (1,887,285)2,074,245 
Issuance of common stock, net of costs9,207,971 92 320,781 320,873 
Restricted stock activity528,285 5 4,706 4,711 
Dividends paid ($2.50 per common share)8,021,799 81 (81)(230,522)(230,522)
Net income— — — 505,711 505,711 
Balance, December 31, 2020232,452,220 $2,325 $4,284,789 $(1,612,096)$2,675,018 
See accompanying Notes to the Consolidated Financial Statements.

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Gaming and Leisure Properties, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(in thousands)
Year ended December 31,202020192018
Operating activities  
Net income$505,711 $390,881 $339,516 
Adjustments to reconcile net income to net cash provided by operating activities:  
Depreciation and amortization242,995 258,971 148,365 
Amortization of debt issuance costs, bond premiums and discounts10,503 11,455 12,167 
(Gains) losses on dispositions of property(41,393)92 309 
Deferred income taxes451 (755)(522)
Stock-based compensation20,004 16,198 11,152 
Straight-line rent adjustments4,576 34,574 61,888 
Deferred rent recognized(337,500)0 0 
Losses on debt extinguishment18,113 21,014 3,473 
Loan and goodwill impairment charges0 13,000 59,454 
(Increase) decrease,  
Prepaid expenses and other assets(6,628)(6,070)(673)
(Decrease), increase  
Accounts payable and accrued expenses(1,252)(1,775)1,670 
Accrued interest11,590 15,434 12,020 
Accrued salaries and wages(5,908)(3,189)6,201 
Gaming, property and other taxes and other liabilities6,815 472 (587)
Net cash provided by operating activities428,077 750,302 654,433 
Investing activities  
Capital project expenditures(474)0 (20)
Capital maintenance expenditures(3,130)(3,017)(4,284)
Proceeds from sale of property and equipment15 200 3,211 
Acquisition of real estate assets(5,898)0 (1,243,466)
   Originations of real estate loans0 0 (303,684)
   Collections of principal payments on investment in direct financing lease0 0 38,459 
Net cash used in investing activities(9,487)(2,817)(1,509,784)
Financing activities  
Dividends paid(230,522)(589,128)(550,435)
Taxes paid for shares withheld on restricted stock award vestings(15,293)(9,058)7,537 
Proceeds from issuance of common stock, net320,873 (255)0 
Proceeds from issuance of long-term debt2,076,383 1,358,853 2,593,405 
Financing costs(11,641)(10,029)(32,426)
Repayments of long-term debt(2,060,884)(1,477,949)(1,164,117)
Premium and related costs paid on tender of senior unsecured notes(15,747)(18,879)(1,884)
Net cash provided by (used in) financing activities63,169 (746,445)852,080 
Net increase (decrease) in cash and cash equivalents, including cash classified within assets held for sale481,759 1,040 (3,271)
Less decrease in cash classified within assets held for sale(22,131)0 0 
Net increase/decrease in cash and cash equivalents459,628 1,040 (3,271)
Cash and cash equivalents at beginning of period26,823 25,783 29,054 
Cash and cash equivalents at end of period$486,451 $26,823 $25,783 

See Note 20 to the Consolidated Financial Statements for supplemental cash flow information.
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Gaming and Leisure Properties, Inc.
Notes to the Consolidated Financial Statements
1.Business and Basis of Presentation
Gaming and Leisure Properties, Inc. ("GLPI") is a self-administered and self-managed Pennsylvania real estate investment trust ("REIT"). GLPI (together with its subsidiaries, the "Company") was incorporated on February 13, 2013, as a wholly-owned subsidiary of Penn National Gaming, Inc. ("Penn"). On November 1, 2013, Penn contributed to GLPI, through a series of internal corporate restructurings, substantially all of the assets and liabilities associated with Penn’s real property interests and real estate development business, as well as the assets and liabilities of Hollywood Casino Baton Rouge and Hollywood Casino Perryville (which are referred to as the "TRS Properties") and then spun-off GLPI to holders of Penn's common and preferred stock in a tax-free distribution (the "Spin-Off"). The assets and liabilities of GLPI were recorded at their respective historical carrying values at the time of the Spin-Off in accordance with the provisions of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 505-60 - Spinoffs and Reverse Spinoffs ("ASC 505").

The Company elected on its United States ("U.S.") federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and GLPI, together with its indirect wholly-owned subsidiary, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. (d/b/a Hollywood Casino Baton Rouge) and Penn Cecil Maryland, Inc. (d/b/a Hollywood Casino Perryville) as a "taxable REIT subsidiary" ("TRS") effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a TRS, which together with the TRS Properties and GLP Holdings, Inc. is the Company's TRS Segment (the "TRS Segment"). In connection with the Spin-Off, Penn allocated its accumulated earnings and profits (as determined for U.S. federal income tax purposes) for periods prior to the consummation of the Spin-Off between Penn and GLPI. In connection with its election to be taxed as a REIT for U.S. federal income tax purposes, GLPI declared a special dividend to its shareholders to distribute any accumulated earnings and profits relating to the real property assets and attributable to any pre-REIT years, including any earnings and profits allocated to GLPI in connection with the Spin-Off, to comply with certain REIT qualification requirements.

GLPI’s primary business consists of acquiring, financing, and owning real estate property to be leased to gaming operators in triple-net lease arrangements. As of December 31, 2020, GLPI’s portfolio consisted of interests in 48 gaming and related facilities, including the TRS Properties, the real property associated with 33 gaming and related facilities operated by Penn, the real property associated with 7 gaming and related facilities operated by Caesars, the real property associated with 4 gaming and related facilities operated by Boyd and the real property associated with the Casino Queen Holding Company Inc. ("Casino Queen") in East St. Louis, Illinois.  These facilities, including our corporate headquarters building, are geographically diversified across 16 states and contain approximately 24.3 million square feet. As of December 31, 2020, the Company's properties were 100% occupied. GLPI expects to continue growing its portfolio by pursuing opportunities to acquire additional gaming facilities to lease to gaming operators under prudent terms.

Penn Master Lease and Casino Queen Lease

As a result of the Spin-Off, GLPI owns substantially all of Penn’s former real property assets (as of the consummation of the Spin-Off) and leases back most of those assets to Penn for use by its subsidiaries, under a unitary master lease, a triple-net operating lease the term of which expires October 31, 2033, with no purchase option, followed by three remaining 5-year renewal options (exercisable by the tenant) on the same terms and conditions (the "Penn Master Lease"), and GLPI also owns and operates the TRS Segment. GLPI leases the Casino Queen property in East St. Louis back to its operators on a triple-net basis on terms similar to those in the Penn Master Lease (the "Casino Queen Lease").

Amended Pinnacle Master Lease, Boyd Master Lease and Belterra Park Lease

In April 2016, the Company acquired substantially all of the real estate assets of Pinnacle Entertainment, Inc. ("Pinnacle") for approximately $4.8 billion. GLPI originally leased these assets back to Pinnacle, under a unitary triple-net lease the term of which expires on April 30, 2031, with no purchase option, followed by four remaining 5-year renewal options (exercisable by the tenant) on the same terms and conditions (the "Pinnacle Master Lease"). On October 15, 2018, the Company completed its previously announced transactions with Penn, Pinnacle and Boyd Gaming Corporation ("Boyd") to accommodate Penn's acquisition of the majority of Pinnacle's operations, pursuant to a definitive agreement and plan of merger between Penn and Pinnacle, dated December 17, 2017 (the "Penn-Pinnacle Merger"). Concurrent with the Penn-Pinnacle Merger, the Company amended the Pinnacle Master Lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd (the "Amended Pinnacle Master Lease") and entered into a new unitary triple-net master lease agreement with Boyd (the "Boyd Master Lease") for these properties on terms similar to the Company’s Amended Pinnacle Master Lease. The Boyd Master Lease has an initial term of
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10 years (from the original April 2016 commencement date of the Pinnacle Master Lease and expiring April 30, 2026), with no purchase option, followed by 5 5-year renewal options (exercisable by the tenant) on the same terms and conditions. The Company also purchased the real estate assets of Plainridge Park Casino ("Plainridge Park") from Penn for $250.0 million, exclusive of transaction fees and taxes, and added this property to the Amended Pinnacle Master Lease. The Amended Pinnacle Master Lease was assumed by Penn at the consummation of the Penn-Pinnacle Merger. The Company also entered into a mortgage loan agreement with Boyd in connection with Boyd's acquisition of Belterra Park Gaming & Entertainment Center ("Belterra Park"), whereby the Company loaned Boyd $57.7 million (the "Belterra Park Loan"). In May 2020, the Company acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to a long-term lease (the "Belterra Park Lease") with a Boyd affiliate operating the property.The Belterra Park Lease rent terms are consistent with the Boyd Master Lease.The annual rent is comprised of a fixed component, part of which is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met and a component that is based on the performance of the facilities which is adjusted, subject to certain floors, every two years to an amount equal to 4% of the average annual net revenues of Belterra Park during the preceding two years in excess of a contractual baseline.

The Meadows Lease

The real estate assets of the Meadows are leased to Penn pursuant to the Meadows Lease. The Meadows Lease commenced on September 9, 2016 and has an initial term of 10 years, with no purchase option, and the option to renew for three successive 5-year terms and one 4-year term (exercisable by the tenant) on the same terms and conditions. The Meadows Lease contains a fixed component, subject to annual escalators, and a component that is based on the performance of the facility, which is reset every two years to an amount determined by multiplying (i) 4% by (ii) the average annual net revenues of the facility for the trailing two-year period. The Meadows Lease contains an annual escalator provision for up to 5% of the base rent, if certain rent coverage ratio thresholds are met, which remains at 5% until the earlier of ten years or the year in which total rent is $31 million, at which point the escalator will be reduced to 2% annually thereafter.

Amended and Restated Caesars Master Lease

On October 1, 2018, 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. ("GLP Capital"), the operating partnership of GLPI, 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, exclusive of transaction fees and taxes (the "Tropicana Acquisition"). Concurrent with the Tropicana Acquisition, Eldorado Resorts, Inc. (now doing business as Caesars Entertainment Corporation (NASDAQ: CZR) ("Caesars")) 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, Caesars and a wholly-owned subsidiary of Caesars and leased the GLP Assets from the Company pursuant to the terms of a new unitary triple-net master lease with an initial term of 15 years, with no purchase option, followed by 4 successive 5-year renewal periods (exercisable by the tenant) on the same terms and conditions (the "Caesars Master Lease"). On June 15, 2020, the Company amended and restated the Caesars Master Lease (as amended, the "Amended and Restated Caesars Master Lease") to, (i) extend the initial term of 15 years to 20 years, with renewals of up to an additional 20 years at the option of Caesars, (ii) remove the variable rent component in its entirety commencing with the third lease year, (iii) in the third lease year increase annual land base rent to approximately $23.6 million and annual building base rent to approximately $62.1 million, (iv) provide fixed escalation percentages that delay the escalation of building base rent until the commencement of the fifth lease year with building base rent increasing annually by 1.25% in the fifth and sixth lease year, 1.75% in the seventh and eighth lease years and 2% in the ninth lease year and each lease year thereafter, (v) subject to the satisfaction of certain conditions, permit Caesars to elect to replace the Tropicana Evansville and/or Tropicana Greenville properties under the Amended and Restated Caesars Master Lease with one or more of Caesars Gaming Scioto Downs, The Row in Reno, Isle Casino Racing Pompano Park, Isle Casino Hotel – Black Hawk, Lady Luck Casino – Black Hawk, Isle Casino Waterloo ("Waterloo"), Isle Casino Bettendorf ("Bettendorf") or Isle of Capri Casino Boonville, provided that the aggregate value of such new property, individually or collectively, is at least equal to the value of Tropicana Evansville or Tropicana Greenville, as applicable (vi) permit Caesars to elect to sell its interest in Belle of Baton Rouge and sever it from the Amended and Restated Caesars Master Lease (with no change to the rent obligation to the Company), subject to the satisfaction of certain conditions, and (vii) provide certain relief under the operating, capital expenditure and financial covenants thereunder in the event of facility closures due to pandemics, governmental restrictions and certain other instances of unavoidable delay. The effectiveness of the Amended and Restated Caesars Master Lease was subject to the review of certain gaming regulatory agencies and the expiration of applicable gaming regulatory advance notice periods which were received on July 23, 2020. On December 18, 2020, the Company and Caesars completed an Exchange Agreement with subsidiaries of Caesars in which Caesars transferred
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to the Company the real estate assets of Waterloo and Bettendorf in exchange for the transfer by the Company to Caesars of the real property assets of Tropicana Evansville, plus a cash payment of $5.7 million. This resulted in a non-cash gain of $41.4 million which represented the difference between the fair value of the properties received compared to the carrying value of Tropicana Evansville and the cash payment made.

Lumière Place Lease

On October 1, 2018 the Company entered into a loan agreement with Caesars in connection with Caesars’s acquisition of Lumière Place Casino ("Lumière Place"), whereby the Company loaned Caesars $246.0 million (the "CZR loan"). The CZR loan bore interest at a rate equal to (i) 9.09% until October 1, 2019 and (ii) 9.27% until its maturity. On the one-year anniversary of the CZR loan, the mortgage evidenced by a deed of trust on the Lumière Place property terminated and the loan became unsecured. On June 24, 2020, the Company received approval from the Missouri Gaming Commission to own the Lumière Place property in satisfaction of the CZR loan. On September 29, 2020, the transaction closed and we entered into a new triple net lease with Caesars (the "Lumière Place Lease") the initial term of which expires on October 31, 2033, with 4 separate renewal options of five years each, exercisable at the tenants' option. The Lumière Place Lease's rent is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met.

Tropicana Las Vegas

On April 16, 2020, the Company and certain of its subsidiaries acquired the real property associated with the Tropicana Las Vegas Casino Hotel Resort ("Tropicana Las Vegas") from Penn in exchange for $307.5 million of rent credits to be applied against future rent obligations. This asset has been placed in our TRS Segment. See Note 7 for further details related to this transaction.

Morgantown Lease

On October 1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits which were fully utilized by Penn in the fourth quarter of 2020. The Company is leasing the land back to an affiliate of Penn for an initial annual rent of $3.0 million, provided, however, that (i) on the opening date and on each anniversary thereafter the rent shall be increased by 1.5% annually (on a prorated basis for the remainder of the lease year in which the gaming facility opens) for each of the following three lease years and (ii) commencing on the fourth anniversary of the opening date and for each anniversary thereafter, (a) if the Consumer Price Index ("the CPI") increase is at least 0.5% for any lease year, the rent for such lease year shall increase by 1.25% of rent as of the immediately preceding lease year, and (b) if the CPI increase is less than 0.5% for such lease year, then the rent shall not increase for such lease year subject to escalation provisions following the opening of the property (the "Morgantown Lease").

In the first quarter of 2020, it became clear that there was a global outbreak of a new strain of novel coronavirus COVID-19 ("COVID-19"). The global, domestic and local response to the COVID-19 outbreak continues to evolve. Responses to the COVID-19 outbreak have included mandates from federal, state, and/or local authorities that required temporary closures of or imposed limitations on the operations of non-essential businesses. All of the Company's tenants' casino operations, in addition to the Company's two TRS Properties, were closed in mid-March. Our properties began reopening at limited capacity in May and by early July nearly all had resumed operations at limited capacity. However, in the fourth quarter, increased spread of COVID-19 led some jurisdictions to impose temporary closures once again. As of the date of this filing, only one of our properties remains closed.
The consolidated financial statements include the accounts of GLPI and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
The preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses for the reporting periods. Actual results may differ from those estimates.  Certain prior period amounts have been reclassified to conform to the current period presentation, specifically gains and losses from dispositions of properties were previously classified within General and administrative expenses and are now presented separately on the Consolidated Statements of Income.


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2.Summary of Significant Accounting Policies

Real Estate Investments
Real estate investments primarily represent land and buildings leased to the Company's tenants. The Company records the acquisition of real estate assets at fair value, including acquisition and closing costs. The cost of properties developed by the Company include costs of construction, property taxes, interest and other miscellaneous costs incurred during the development period until the project is substantially complete and available for occupancy. The Company considers the period of future benefit of the asset to determine the appropriate useful lives. Depreciation is computed using a straight-line method over the estimated useful lives of the buildings and building improvements which are generally between 10 to 31 years.
The Company continually monitors events and circumstances that could indicate that the carrying amount of its real estate investments may not be recoverable or realized. The factors considered by the Company in performing these assessments include evaluating whether the tenant is current on its lease payments, the tenant’s rent coverage ratio, the financial stability of the tenant and its parent company, and any other relevant factors. When indicators of potential impairment suggest that the carrying value of a real estate investment may not be recoverable, the Company estimates the fair value of the investment by calculating the undiscounted future cash flows from the use and eventual disposition of the investment. This amount is compared to the asset's carrying value. If the Company determines the carrying amount is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP. The Company groups its real estate investments together by lease, the lowest level for which identifiable cash flows are available, in evaluating impairment. In assessing the recoverability of the carrying value, the Company must make assumptions regarding future cash flows and other factors. The factors considered by the Company in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the effect of obsolescence, demand, competition and other factors. If these estimates or the related assumptions change in the future, the Company may be required to record an impairment loss.
Property and Equipment Used in Operations
Property and equipment are stated at cost, less accumulated depreciation and represent assets used by the Company's TRS Properties and certain corporate assets. Maintenance and repairs that neither add materially to the value of the asset nor appreciably prolong its useful life are charged to expense as incurred. Gains or losses on the disposal of property and equipment are included in the determination of income.
Depreciation of property and equipment is recorded using the straight-line method over the following estimated useful lives:
Land improvements15 to 34 years
Building and improvements5 to 31 years
Furniture, fixtures, and equipment3 to 31 years
Leasehold improvements are depreciated over the shorter of the estimated useful life of the improvement or the related lease term. The estimated useful lives are determined based on the nature of the assets as well as the Company's current operating strategy.
The Company reviews the carrying value of its property and equipment for possible impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable based upon the estimated undiscounted future cash flows expected to result from its use and eventual disposition. If the Company determines the carrying amount is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP. In estimating expected future cash flows for determining whether an asset is impaired, assets are grouped at the individual property level. In assessing the recoverability of the carrying value of property and equipment, the Company must make assumptions regarding future cash flows and other factors. The factors considered by the Company in performing this assessment include current operating results, market and other applicable trends and residual values, as well as the effect of obsolescence, demand, competition and other factors. If these estimates or the related assumptions change in the future, the Company may be required to record an impairment loss for these assets.
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Real Estate Loans and Other Loans Receivable
The Company may periodically loan funds to casino owner-operators for the purchase of gaming related real estate and/or operations. Loans for the purchase of real estate assets of gaming-related properties are classified as real estate loans on the Company's consolidated balance sheets, while loans for an operator's general operations are classified as loans receivable on the Company's consolidated balance sheets. Loans receivable are recorded on the Company's consolidated balance sheets at carrying value which approximates fair value since collection of principal is reasonably assured. Interest income related to real estate loans is recorded as interest income from real estate loans within the Company's consolidated statements of income in the period earned, whereas interest income related to other loans receivable is recorded as non-operating interest income within the Company's consolidated statements of income in the period earned.
Prior to the adoption of Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"), the Company evaluated loans for impairment when it was probable that it would not be able to collect all amounts due according to the contractual terms of the agreement. All amounts due under the contractual terms of the agreement means that both contractual interest payments and contractual principal payments will be collected as scheduled in the loan agreement. Indicators of impairment may include delinquent payments, a decline in the credit worthiness of a debtor, or a decline in the underlying property/tenant’s performance. The Company measures loan impairment based upon the present value of expected future cash flows discounted at the loan’s original effective interest rate. The determination of whether loans are impaired involves judgments and assumptions based on objective and subjective factors. If an impairment occurs, the Company will reduce the carrying value of the loan and record a corresponding charge to net income.
The Company's adoption of Accounting Standards Update ASU 2016-13 on January 1, 2020 (as described in Note 3) did not result in the Company recording any allowances against its real estate loans for expected losses. The Company has no outstanding loans as of December 31, 2020. See Note 8 for further details.
Lease Assets and Lease Liabilities
The Company determines whether a contract is or contains a lease at its inception. A lease is defined as the right to control the use of identified property, plant, or equipment for a period of time in exchange for consideration. Right-of-use assets and lease liabilities are recorded on the Company's consolidated balance sheet at the lease commencement date for operating leases in which the Company acts as lessee. Right-of-use assets represent the Company's rights to use underlying assets for the term of the lease and lease liabilities represent the Company's future obligations under the lease agreement. Right-of-use assets and lease liabilities are recognized at the lease commencement date based upon the estimated present value of the lease payments. As the rate implicit in the Company's leases (in which the Company acts as lessee) cannot readily be determined, the Company utilizes its own estimated incremental borrowing rates to determine the present value of its lease payments. Consideration is given to the Company's recent debt issuances, as well as publicly available data for instruments with similar characteristics, including tenor, when determining the incremental borrowing rates of the Company's leases.
The Company includes options to extend a lease in its lease term when it is reasonably certain that the Company will exercise those renewal options. In the instance of the Company's ground leases associated with its tenant occupied properties, the Company has included all available renewal options in the lease term, as it intends to renew these leases indefinitely. The Company accounts for the lease and nonlease components (as necessary) of its leases of all classes of underlying assets as a single lease component. Leases with a term of 12 months or less are not recorded on the Company's consolidated balance sheet.
Land rights, net represent the Company's rights to land subject to long-term ground leases. The Company obtained ground lease rights through the acquisition of several of its rental properties and immediately subleased the land to its tenants. These land rights represent the below market value of the related ground leases. The Company assessed the acquired ground leases to determine if the lease terms were favorable or unfavorable, given market conditions at the acquisition date. Because the market rents to be received under the Company's triple-net tenant leases were greater than the rents to be paid under the acquired ground leases, the Company concluded that the ground leases were below market and were therefore required to be recorded as a definite lived asset (land rights) on its books.
Right-of-use assets and land rights are monitored for potential impairment in much the same way as the Company's real estate assets, using the impairment model in ASC 360 - Property, Plant and Equipment. If the Company determines the carrying amount of a right-of-use asset or land right is not recoverable, it would recognize an impairment charge equivalent to the amount required to reduce the carrying value of the asset to its estimated fair value, calculated in accordance with GAAP.
Cash and Cash Equivalents
The Company considers all cash balances and highly-liquid investments with original maturities of three months or less to be cash and cash equivalents.
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Prepaid Expenses and Other Assets
Prepaid expenses consist of expenditures for goods or services before the goods are used or the services are received. These amounts are deferred and charged to operations as the benefits are realized and primarily consist of prepayments for insurance, property taxes and other contracts that will be expensed during the subsequent year. It also includes transaction costs that will be allocated to purchase price upon the closing of an asset acquisition. Other assets primarily consists of accounts receivable and deferred compensation plan assets (See Note 13 for further details on the deferred compensation plan).
Goodwill and Intangible Assets
The Company's goodwill and intangible assets are the result of the contribution of Hollywood Casino Baton Rouge and Hollywood Casino Perryville in connection with the Spin-Off. The Company's goodwill resides on the books of its Hollywood Casino Baton Rouge subsidiary, while the other intangible asset represents a gaming license on the books of its Hollywood Casino Perryville subsidiary. Both subsidiaries are members of the TRS Segment and are considered separate reporting units under ASC 350 - Intangibles - Goodwill and Other ("ASC 350"). Goodwill is tested at the reporting unit level, which is an operating segment or one level below an operating segment for which discrete financial information is available
Under ASC 350, the Company is required to test goodwill for impairment at least annually and whenever events or circumstances indicate that it is more likely than not that goodwill may be impaired. The Company has elected to perform its annual goodwill impairment test as of October 1 of each year. In accordance with ASC 350, the Company tests goodwill for impairment subsequent to testing its other long-lived assets for impairment.
In accordance with ASC 350, the Company considers its Hollywood Casino Perryville gaming license an indefinite-lived intangible asset that does not require amortization based on the Company's future expectations to operate this casino indefinitely, as well as the gaming industry's historical experience in renewing these intangible assets at minimal cost with various state gaming commissions. Rather, the Company's gaming license is tested annually, or more frequently if indicators of impairment exist, for impairment by comparing the fair value of the recorded asset to its carrying amount. If the carrying amount of the indefinite-life intangible asset exceeds its fair value, an impairment loss is recognized.
The Company calculates the fair value of its gaming license using the Greenfield Method under the income approach. The Greenfield Method estimates the fair value of the gaming license assuming the Company built a casino with similar utility to that of the existing facility. The method assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. As such the value of the license is a function of the following items:
•Projected revenues and operating cash flows;
•Theoretical construction costs and duration;
•Pre-opening expenses;
•Discounting that reflects the level of risk associated with receiving future cash flows attributable to the license; and
•Remaining useful life of the license
The evaluation of goodwill and indefinite-lived intangible assets requires the use of estimates about future operating results to determine the estimated fair value of the reporting unit and the indefinite-lived intangible assets. The Company must make various assumptions and estimates in performing its impairment testing. The implied fair value includes estimates of future cash flows that are based on reasonable and supportable assumptions, which represent the Company's best estimates of the cash flows expected to result from the use of the assets. Changes in estimates, increases in the Company's cost of capital, reductions in transaction multiples, changes in operating and capital expenditure assumptions or application of alternative assumptions and definitions could produce significantly different results. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from the Company's estimates. If the Company's ongoing estimates of future cash flows are not met, the Company may have to record impairment charges in future accounting periods. The Company's estimates of cash flows are based on the current regulatory and economic climates, as well as recent operating information and budgets. These estimates could be negatively impacted by changes in federal, state or local regulations, economic downturns, or other events.
Forecasted cash flows can be significantly impacted by the local economy in which the Company's subsidiaries operate. For example, increases in unemployment rates can result in decreased customer visitations and/or lower customer spend per visit. In addition, new legislation which approves gaming in nearby jurisdictions or further expands gaming in jurisdictions in which the Company operates can result in increased competition for the property. This generally has a negative effect on profitability once competitors become established, as a certain level of cannibalization occurs absent an overall
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increase in customer visitations. Lastly, increases in gaming taxes approved by state regulatory bodies can negatively impact forecasted cash flows.
Assumptions and estimates about future cash flow levels are complex and subjective. They are sensitive to changes in underlying assumptions and can be affected by a variety of factors, including external factors, such as industry, geopolitical and economic trends, and internal factors, such as changes in the Company's business strategy, which may reallocate capital and resources to different or new opportunities which management believes will enhance the Company's overall value but may be to the detriment of its existing operations.
The Company reclassified its goodwill and other intangible assets into Assets held for sale at December 31, 2020. See Note 6 for additional discussion.
Debt Issuance Costs and Bond Premiums and Discounts
Debt issuance costs that are incurred by the Company in connection with the issuance of debt are deferred and amortized to interest expense over the contractual term of the underlying indebtedness. In accordance with ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, the Company records long-term debt net of unamortized debt issuance costs on its consolidated balance sheets. Similarly, the Company records long-term debt net of any unamortized bond premiums and original issuance discounts on its consolidated balance sheets. Any original issuance discounts or bond premiums are also amortized to interest expense over the contractual term of the underlying indebtedness.
Fair Value of Financial Assets and Liabilities

Fair value is defined as the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are classified based upon the level of judgment associated with the inputs used to measure their fair value. ASC 820 - Fair Value Measurements and Disclosures ("ASC 820") establishes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach, and cost approach). The levels of the hierarchy related to the subjectivity of the valuation inputs are described below:

•Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. 

•Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly quoted intervals. 

•Level 3: Unobservable inputs that reflect the reporting entity's own assumptions, as there is little, if any, related market activity.

        The Company's assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy.

Revenue Recognition

The Company recognizes rental revenue from tenants, including rental abatements, lease incentives and contractually fixed increases attributable to operating leases, on a straight-line basis over the term of the related leases when collectability is reasonably assured in accordance with ASC 842 - Leases. Additionally, percentage rent that is fixed and determinable at the lease inception date is recorded on a straight-line basis over the lease term, resulting in the recognition of deferred rental revenue on the Company’s consolidated balance sheets. Deferred rental revenue is amortized to rental revenue on a straight-line basis over the remainder of the lease term. The lease term includes the initial non-cancelable lease term and any reasonably assured renewable periods. Contingent rental income that is not fixed and determinable at lease inception is recognized only when the lessee achieves the specified target. Recognition of rental income commences when control of the facility has been transferred to the tenant.

Additionally, in accordance with ASC 842, the Company records revenue for the ground lease rent paid by its tenants with an offsetting expense in land rights and ground lease expense within the consolidated statement of income as the Company has concluded that as the lessee it is the primary obligor under the ground leases. The Company subleases these ground leases back to its tenants, who are responsible for payment directly to the landlord.
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The Company may periodically loan funds to casino owner-operators for the purchase of gaming related real estate. Interest income related to real estate loans is recorded as revenue from real estate within the Company's consolidated statements of income in the period earned.
Gaming revenue generated by the TRS Properties mainly consists of revenue from slot machines and to a lesser extent, table game and poker revenue. Gaming revenue from slot machines is the aggregate net difference between gaming wins and losses with liabilities recognized for funds deposited by customers before gaming play occurs, for "ticket-in, ticket-out" coupons in the customers’ possession, and for accruals related to the anticipated payout of progressive jackpots. Progressive slot machines, which contain base jackpots that increase at a progressive rate based on the number of coins played, are charged to revenue as the amount of the jackpots increase. Table game gaming revenue is the aggregate of table drop adjusted for the change in aggregate table chip inventory. Table drop is the total dollar amount of the currency, coins, chips, tokens, outstanding counter checks (markers), and front money that are removed from the live gaming tables. Gaming revenue is recognized net of certain sales incentives, including promotional allowances in accordance with ASC 606 - Revenues from Contracts with Customers. The Company also defers a portion of the revenue received from customers (who participate in the points-based loyalty programs) at the time of play until a later period when the points are redeemed or forfeited. Other revenues at the TRS Properties are derived from the properties' dining, retail and certain other ancillary activities and revenue for these activities is recognized as services are performed.

Stock-Based Compensation
The Company's Amended 2013 Long Term Incentive Compensation Plan (the "2013 Plan") provides for the Company to issue restricted stock awards, including performance-based restricted stock awards, and other equity or cash based awards to employees. Any director, employee or consultant shall be eligible to receive such awards.
The Company accounts for stock compensation under ASC 718 - Compensation - Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. This expense is recognized ratably over the requisite service period following the date of grant. The fair value of the Company's time-based restricted stock awards is equivalent to the closing stock price on the day prior to grant. The Company utilizes a third-party valuation firm to measure the fair value of performance-based restricted stock awards at grant date using the Monte Carlo model.
The unrecognized compensation cost relating to restricted stock awards and performance-based restricted stock awards is recognized as expense over the awards’ remaining vesting periods.

See Note 15 for further information related to stock-based compensation.
Income Taxes
The TRS Segment is able to engage in activities resulting in income that would not be qualifying income for a REIT. As a result, certain activities of the Company which occur within its TRS Segment are subject to federal and state income taxes. 
The Company accounts for income taxes in accordance with ASC 740 - Income Taxes ("ASC 740"). Under ASC 740, deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and are measured at the prevailing enacted tax rates that will be in effect when these differences are settled or realized. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized. The realizability of the deferred tax assets is evaluated by assessing the valuation allowance and by adjusting the amount of the allowance, if any, as necessary. The factors used to assess the likelihood of realization are the forecast of future taxable income.
ASC 740 also creates a single model to address uncertainty in tax positions, and clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in an enterprise's financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not have any uncertain tax positions for the three years ended December 31, 2020.
The Company is required under ASC 740 to disclose its accounting policy for classifying interest and penalties, the amount of interest and penalties charged to expense each period, as well as the cumulative amounts recorded in the consolidated balance sheets. If and when they occur, the Company will classify any income tax-related penalties and interest accrued related to unrecognized tax benefits in taxes on income within the consolidated statements of income. During the years ended December 31, 2020, 2019 and 2018, the Company recognized 0 penalties and interest, net of deferred income taxes.
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The Company elected on its U.S. federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT and the Company, together with an indirect wholly-owned subsidiary of the Company, GLP Holdings, Inc., jointly elected to treat each of GLP Holdings, Inc., Louisiana Casino Cruises, Inc. and Penn Cecil Maryland, Inc. as a "taxable REIT subsidiary" effective on the first day of the first taxable year of GLPI as a REIT. In addition, during 2020, the Company and Tropicana LV, LLC, a wholly owned subsidiary of the Company which holds the real estate of Tropicana Las Vegas, elected to treat Tropicana LV, LLC as a “taxable REIT subsidiary”.
The Company continues to be organized and to operate in a manner that will permit the Company to qualify as a REIT. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of its annual REIT taxable income to shareholders. As a REIT, the Company generally will not be subject to federal, state or local income tax on income that it distributes as dividends to its shareholders, except in those jurisdictions that do not allow a deduction for such distributions. If the Company fails to qualify as a REIT in any taxable year, it will be subject to U.S. federal, state and local income tax, including any applicable alternative minimum tax, on its taxable income at regular corporate income tax rates, and dividends paid to its shareholders would not be deductible by the Company in computing taxable income. Any resulting corporate liability could be substantial and could materially and adversely affect the Company's net income and net cash available for distribution to shareholders. Unless the Company was entitled to relief under certain Internal Revenue Code provisions, the Company also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which it failed to qualify to be taxed as a REIT.
Earnings Per Share
The Company calculates earnings per share ("EPS") in accordance with ASC 260 - Earnings Per Share. Basic EPS is computed by dividing net income applicable to common stock by the weighted-average number of common shares outstanding during the period, excluding net income attributable to participating securities (unvested restricted stock awards). Diluted EPS reflects the additional dilution for all potentially-dilutive securities such as stock options, unvested restricted shares and unvested performance-based restricted shares. See Note 17 for further details on the Company's earnings per share calculations.

Segment Information
Consistent with how the Company’s Chief Operating Decision Maker (as such term is defined in ASC 280 - Segment Reporting) reviews and assesses the Company’s financial performance, the Company has 2 reportable segments, GLP Capital, L.P. (a wholly-owned subsidiary of GLPI through which GLPI owns substantially all of its real estate assets) and the TRS Segment. The GLP Capital reportable segment consists of the leased real property and represents the majority of the Company’s business. The TRS Segment consists of Hollywood Casino Perryville and Hollywood Casino Baton Rouge, as well as the real estate of Tropicana Las Vegas. See Note 19 for further information with respect to the Company’s segments.
Concentration of Credit Risk
Concentrations of credit risk arise when a number of operators, tenants, or obligors related to the Company's investments are engaged in similar business activities, or activities in the same geographic region, or have similar economic features that would cause their ability to meet contractual obligations, including those to the Company, to be similarly affected by changes in economic conditions. Additionally, concentrations of credit risk may arise when revenues of the Company are derived from a small number of tenants. As of December 31, 2020, substantially all of the Company's real estate properties were leased to Penn, Caesars and Boyd. During the year ended December 31, 2020, approximately 78%, 11% and 10% of the Company's collective income from real estate was derived from tenant leases and real estate loans with Penn, Caesars and Boyd, respectively. Revenues from our tenants are reported in the Company's GLP Capital, L.P. reportable segment. Penn, Caesars and Boyd are publicly traded companies that are subject to the informational filing requirements of the Securities Exchange Act of 1934, as amended, and are required to file periodic reports on Form 10-K and Form 10-Q and current reports on Form 8-K with the Securities and Exchange Commission ("SEC"). Readers are directed to Penn, Caesars and Boyd's respective websites for further financial information on these companies. Other than the Company's tenant concentration, management believes the Company's portfolio was reasonably diversified by geographical location and did not contain any other significant concentrations of credit risk. As of December 31, 2020, the Company's portfolio of 48 properties is diversified by location across 16 states.
Financial instruments that subject the Company to credit risk consist of cash and cash equivalents, accounts receivable, real estate loans and other loans receivable. The Company's policy is to limit the amount of credit exposure to any one financial institution and place investments with financial institutions evaluated as being creditworthy, or in short-term money market and tax-free bond funds which are exposed to minimal interest rate and credit risk. At times, the Company has bank deposits and overnight repurchase agreements that exceed federally-insured limits.

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3.    New Accounting Pronouncements

Accounting Pronouncements Adopted in 2020

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (a consensus of the FASB Emerging Issues Task Force) ("ASU 2018-15"). This ASU clarifies that entities should follow the guidance for capitalizing implementation costs incurred to develop or obtain internal-use software to account for implementation costs of cloud computing arrangements that are service contracts. ASU 2018-15 does not change the accounting for the service component of a cloud computing arrangement. The Company's adoption of ASU 2018-15 on January 1, 2020 did not have an impact on its consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). This ASU introduces a new model for estimating credit losses for certain types of financial instruments, including mortgage, real estate and other loans receivable, amongst other financial instruments.  ASU 2016-13 sets forth an "expected credit loss" impairment model to replace the current "incurred loss" method of recognizing credit losses, which is intended to improve financial reporting by requiring timely recording of credit losses on loans and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for fiscal years beginning after December 15, 2018. The impact of the adoption of this pronouncement was immaterial.

Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform ("ASU 2020-04"). Reference rates such as London Interbank Offered Rate ("LIBOR") are widely used in a broad range of financial instruments and other agreements. Regulators and market participants in various jurisdictions have undertaken efforts, generally referred to as "reference rate reform", to eliminate certain reference rates and introduce new reference rates that are based on a larger and more liquid population of observable transactions. As a result of this reform initiative, certain widely used rates such as LIBOR are expected to be discontinued. ASU 2020-04 provides optional expedients for applying the guidance for contract modifications or other situations affected by reference rate reform, specifically addressing the accounting for modifications of contracts within the scope of ASC Topic 310 on receivables, ASC 470 on debt, and ASC 842 on leases and ASC subtopic 815-15 on embedded derivatives. Based on the limited amount of obligations and contracts the Company currently has that references LIBOR, the Company does not anticipate any material impact from this pronouncement on its Consolidated Financial Statements.

4.Real Estate Investments
Real estate investments, net, represent investments in 45 rental properties and the corporate headquarters building and is summarized as follows:
December 31,
2020		December 31,
2019
 (in thousands)
Land and improvements$2,667,616 $2,552,285 
Building and improvements6,030,482 5,749,211 
Total real estate investments8,698,098 8,301,496 
Less accumulated depreciation(1,410,940)(1,200,941)
Real estate investments, net$7,287,158 $7,100,555 

The increase in real estate investments is primarily due to the Company acquiring the real estate of Belterra Park in satisfaction of the Belterra Park Loan in May 2020 and the acquisition of the real estate of Lumière Place in satisfaction of the CZR loan in September 2020 for $57.7 million ($11.7 million of which was allocated to land and land improvements and $46.0 million to building and improvements) and $246.0 million ($26.9 million of which was allocated to land and land improvements and $219.1 million to building and improvements), respectively. Additionally, the Exchange Transaction described in Note 1 which closed in December 2020, resulted in an increase to real estate investments of $72.6 million (net increase to land and improvements of $46.4 million and building and improvements of $26.2 million). Finally, the Company acquired the land underlying Penn's development project in Morgantown, Pennsylvania for $30.0 million.

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5.Property and Equipment Used in Operations
Property and equipment used in operations, net, consists of the following and primarily represents the assets utilized at the TRS Properties as the real estate will be leased to third party operators subsequent to the completion of the sale transactions as discussed in Note 6. 
December 31,
2020		December 31,
2019
 (in thousands)
Land and improvements$30,540 $30,492 
Building and improvements117,333 116,904 
Furniture, fixtures, and equipment (1)28,767 118,766 
Construction in progress474 120 
Total property and equipment177,114 266,282 
Less accumulated depreciation (1)(96,496)(172,202)
Property and equipment, net$80,618 $94,080 

(1) The majority of the decline at December 31, 2020 compared to the prior year is related to the reclassification of certain amounts to Assets held for sale. See Note 6 for further details.  

6. Assets Held for Sale

    On November 25, 2020, the Company entered into a definitive agreement to sell the operations of our Hollywood Casino Baton Rouge to Casino Queen for $28.2 million. The Company will retain ownership of all real estate assets at Hollywood Casino Baton Rouge and will simultaneously enter into a master lease with Casino Queen, which will include the Casino Queen property in East St. Louis that is currently leased by us to Casino Queen and the Hollywood Casino Baton Rouge facility (the "Casino Queen Master Lease"). The initial annual cash rent on the retained real estate will be approximately $21.4 million and the Casino Queen Master Lease will have an initial term of 15 years with 4 5 year renewal options exercisable by the tenant. Additionally, the Company will complete the current land side development project that is in process and the rent under the Casino Queen Master Lease will be adjusted upon delivery to reflect a yield of 8.25% on GLPI's project costs. The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the second half of 2021.

On December 11, 2020, Penn agreed to purchase from the Company the operations of our Hollywood Casino Perryville, located in Perryville, Maryland, for $31.1 million, with the closing of such purchase, subject to regulatory approvals, expected to occur during the second half of 2021. Upon closing, the Company will lease the real estate of the Perryville facility to Penn pursuant to a lease providing for initial annual rent on the retained real estate of $7.77 million, subject to escalation provisions.


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The Company has classified the operating assets of the two properties above as Assets held for sale since we expect these transactions to close within 12 months and classified the respective liabilities within Other liabilities on the Consolidated Balance Sheet which is comprised of the following. (in thousands)

Assets
Property and equipment, used in operations, net$8,780 
Right-of-use assets and land rights, net$263 
Cash and cash equivalents$22,131 
Prepaid expenses$2,473 
Goodwill$16,067 
Other intangible assets$9,577 
Other assets$2,157 
Total$61,448 
Liabilities
Accounts payable$8 
Accrued expenses$3,387 
Accrued salaries and wages$2,064 
Gaming, property and other taxes$398 
Lease liabilities$262 
Other liabilities$710 
Total which is classified in Other Liabilities$6,829 

The assets held for sale reside in the Company's TRS Segment. See Note 19 for the pre-tax income of this segment for the years ended December 31, 2020, 2019 and 2018 which is comprised solely of the properties above with the exception of $2.7 million of depreciation expense associated with Tropicana Las Vegas for the year ended December 31, 2020.

7. Acquisitions

The Company accounts for its acquisitions of real estate assets as asset acquisitions under ASC 805 - Business Combinations. Under asset acquisition accounting, transaction costs incurred to acquire the purchased assets are also included as part of the asset cost.

Pending acquisitions

On October 27, 2020, the Company entered into a series of definitive agreements pursuant to which a subsidiary of Bally's Corporation (NYSE: BALY) (Bally's) will acquire 100% of the equity interests in the Caesars subsidiary that currently operates Tropicana Evansville and the Company will reacquire the real property assets of Tropicana Evansville from Caesars for a cash purchase price of approximately $340.0 million. In addition, the Company entered into a real estate purchase agreement with Bally's pursuant to which the Company will purchase the real estate assets of the Dover Downs Hotel & Casino, located in Dover, Delaware which is currently owned and operated by Bally's, for a cash purchase price of approximately $144.0 million. At the closing of the transactions, which are expected in mid-2021, subject to regulatory approvals, the Tropicana Evansville and Dover Downs Hotel and Casino facilities will be added to a new master lease between the Company and Bally's (the “Bally's Master Lease”). The Company anticipates that the Bally's Master Lease will have an initial term of 15 years, with no purchase option, followed by 4 five-year renewal options (exercisable by the tenant) on the same terms and conditions. Rent under the Bally's Master Lease will be $40.0 million annually and is subject to an annual escalator of up to 2% determined in relation to the annual increase in the CPI. The Company expects this transaction to close in mid-2021 following the completion of customary closing conditions and regulatory approvals. On November 6, 2020, the Company issued 9.2 million common shares at $36.25 per share to partially finance the funding required for this transaction.


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Current year acquisitions

As previously discussed in Note 1, the impact of COVID-19 resulted in casino-wide closures by all of our tenants. As a result of COVID-19, on April 16, 2020, the Company and certain of its subsidiaries acquired the real property associated with the Tropicana Las Vegas from Penn in exchange for $307.5 million of rent credits, which were fully utilized in 2020 for rent due under the parties' existing leases.

An affiliate of Penn will continue to operate the casino and hotel business of the Tropicana Las Vegas pursuant to a triple net lease with GLPI for nominal rent for the earlier of two years (subject to three one-year extensions at the Company's option) or until the Tropicana Las Vegas is sold. The Company will conduct a sale process with respect to the Tropicana Las Vegas, with Penn receiving 75% of the net proceeds above $307.5 million (plus certain taxes, expenses and costs) if a sale agreement is signed during the first 12 months following closing and 50% of net proceeds above $307.5 million (plus certain taxes, expenses and costs) if a sale agreement is signed during the subsequent 12 months following closing. Penn will not be entitled to receive any net sale proceeds if the relevant sale agreement is signed at any time after 24 months from closing.

The Company recorded an initial land and building value of $226.2 million and $81.3 million, respectively. During the year ended December 31, 2020 depreciation expense of $2.7 million was recorded. Additionally, deferred rent of $307.5 million was recorded at the acquisition date, which has been fully recognized for the year ended December 31, 2020.

The Tropicana Las Vegas assets are summarized below.

December 31, 2020
(in thousands)
Land and improvements$226,160 
Building and improvements81,340 
Total real estate of Tropicana Las Vegas307,500 
Less accumulated depreciation(2,669)
Real estate of Tropicana Las Vegas , net$304,831 

On October 1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits which were fully utilized by Penn in the fourth quarter of 2020.The Company is leasing the land back to an affiliate of Penn pursuant to the Morgantown Lease for an initial annual rent of $3.0 million, subject to escalation provisions following the opening of the property.


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On October 27, 2020, the Company entered into an Exchange Agreement with subsidiaries of Caesars that own, respectively, Waterloo and Bettendorf. Pursuant to the terms of the agreement, Caesars transferred to the Company the real estate assets of the Waterloo and Bettendorf properties in exchange for the transfer by the Company to Caesars of the real property assets of the Tropicana Evansville, plus a cash payment of $5.7 million.The exchange transaction closed on December 18, 2020, which resulted in the Waterloo and Bettendorf facilities being added to the Amended and Restated Caesars Master Lease and the rent increased by $0.5 million annually. The Company recorded a non-cash gain of $41.4 million in the fourth quarter of 2020 related to the transaction, which represented the difference between the fair value of the properties received compared to the carrying value of Tropicana Evansville and the cash payment of $5.7 million. The following table summarizes the fair value of the assets acquired in the Exchange Agreement and the carrying value of the Tropicana Evansville assets that were transferred to Caesars. (in thousands):

BettendorfWaterlooTotal
Land$29,636 $64,262 $93,898 
Building and improvements85,150 77,958 163,108 
Total real estate investments$114,786 $142,220 $257,006 
Less: Evansville Land and improvements(47,439)
Less: Evansville Buildings and improvements, net(136,858)
Less: Evansville Right of use assets and land rights, net(55,456)
Add: Evansville, Operating Lease Liabilities29,795 

Prior Year Acquisitions

2018

On October 15, 2018, in conjunction with the Penn-Pinnacle Merger the Company acquired the real property assets of Plainridge Park from Penn for approximately $250.9 million. This property was added to the Amended Pinnacle Master Lease via the fourth amendment to the Pinnacle Master Lease and is leased to Penn which will continue to operate the property. The initial annual cash rent of $25.0 million for Plainridge Park will not be subject to rent escalators or adjustments.

Also in conjunction with the Penn-Pinnacle Merger, the Pinnacle Master Lease was amended via the fourth amendment to such lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd and to increase fixed rent under the lease by an additional $13.9 million annually. The Company entered into the Boyd Master Lease for these properties on terms similar to the Company’s existing master leases. As a result of the fourth amendment to the Pinnacle Master Lease, the Company reassessed the lease's classification and determined the new lease agreement qualified for operating lease treatment under ASC 840. Therefore, subsequent to the Penn-Pinnacle Merger, the Amended Pinnacle Master Lease is treated as an operating lease in its entirety, the building assets of $2.6 billion previously recorded as an investment in direct financing lease on the Company's consolidated balance sheet were recorded as real estate assets on the Company's consolidated balance sheet and all rent received under the Amended Pinnacle Master Lease is recorded as rental income on the Company's consolidated statement of income. The Amended Pinnacle Master Lease was assumed by Penn at the consummation of the Penn-Pinnacle Merger.

On October 1, 2018, the Company acquired the real property assets of five casino properties from Tropicana and certain of its affiliates for approximately $992.5 million, pursuant to the Real Estate Purchase Agreement dated April 15, 2018 between Tropicana and GLP Capital, which was subsequently amended on October 1, 2018. 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 and the rights to six long-term ground leases for land on which the operations of the acquired Tropicana properties reside. Concurrent with the Tropicana Acquisition, Caesars acquired the operating assets of these properties from Tropicana pursuant to the Tropicana Merger Agreement and leased the GLP Assets from the Company pursuant to the terms of a new unitary triple-net master lease with an initial term of 15 years, with no purchase option, followed by 4 successive 5-year renewal periods (exercisable by the tenant) on the same terms and conditions. Initial annual rent under the Caesars Master Lease was $87.6 million and is subject to annual rent escalators and biennial percentage rent adjustments.
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Purchase price allocations are primarily based on the fair values of assets acquired and liabilities assumed at the time of acquisition. The following table summarizes the purchase price allocation of the assets acquired in the Tropicana Acquisition (in thousands):
Real estate investments, net$948,217 
Land rights, net44,331 
Total purchase price$992,548 

8. Receivables

Real Estate Loans

As discussed in Note 1, the Company historically had the CZR loan outstanding which was utilized by Caesars in connection with its acquisition of Lumière Place. On June 24, 2020, the Company received approval from the Missouri Gaming Commission to own the Lumière Place real estate in satisfaction of the CZR loan, subject to the Lumière Place Lease, and closed this transaction on September 29, 2020.

On October 15, 2018, Boyd purchased the real estate assets of Belterra Park from Pinnacle for a cash purchase price of $57.7 million, exclusive of transaction fees. Financing for the transaction was provided by the Company in the form of the Belterra Park Loan. The Belterra Park Loan's initial interest rate was equal to 11.11% and the loan matures in connection with the expiration of the Boyd Master Lease (as may be extended at the tenant's option to April 30, 2051). In May 2020, the Company acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to the Belterra Park Lease.

Other Loans Receivable

In January 2014, the Company completed the asset acquisition of the real property associated with the Casino Queen in East St. Louis, Illinois. GLPI leases the property back to Casino Queen on a triple-net basis on terms similar to those in the Company's existing master leases. The Casino Queen Lease has an initial term of 15 years and the tenant has an option to renew it at the same terms and conditions for 4 successive 5-year periods.  

Simultaneously with the Casino Queen acquisition, GLPI provided Casino Queen with a $43.0 million, five-year term loan at 7% interest, prepayable at any time, which, together with the sale proceeds, completely refinanced and retired all of Casino Queen’s outstanding long-term debt obligations. On March 13, 2017, the outstanding principal and interest on this loan was repaid in full and GLPI simultaneously provided a new unsecured $13.0 million, 5.5-year term loan (the "Casino Queen Loan") to CQ Holding Company, Inc., an affiliate of Casino Queen ("CQ Holding Company"), to partially finance its acquisition of Lady Luck Casino in Marquette, Iowa. The Casino Queen Loan bears an interest rate of 15% and is prepayable at any time.

On June 12, 2018, the Company received a Notice of Event of Default under the senior credit agreement of CQ Holding Company from the secured lender under such agreement, which reported a covenant default under its senior secured agreement. Under the terms of that agreement, when an event of default occurs, CQ Holding Company is prohibited from making cash payments to unsecured lenders such as GLPI. Therefore, beginning in June 2018 the interest due from CQ Holding Company under the Company's unsecured loan was paid in kind. In addition to the covenant violation noted above under its senior credit agreement, CQ Holding Company also had a payment default under the senior credit agreement. Furthermore, the Company notified Casino Queen of events of default under the Company's unsecured loan with CQ Holding Company, related to financial covenant violations during the year ended December 31, 2018.
At December 31, 2018, active negotiations for the sale of Casino Queen's operations were taking place. Despite the payment and covenant defaults noted above, at that time, full payment of the principal was still expected, due to the anticipation that the operations were to be sold in the near term for an amount allowing for repayment of the full $13.0 million of loan principal due to GLPI. However, the paid-in-kind interest due to the Company at December 31, 2018 was not expected to be collected, resulting in an impairment charge of $1.5 million during the fourth quarter of 2018. The Company did not recognize the paid-in-kind interest income due to the Company for the quarter ended December 31, 2018 and took a charge for the previously recognized paid-in-kind interest income through the Company’s consolidated statement of earnings as a reversal of the paid-in-kind interest income recognized earlier in the year.
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During 2019, the operating results of Casino Queen continued to decline, the secured debt of Casino Queen was sold to a third-party casino operator at a discount and the Company no longer expected the loan to be repaid. Therefore, the Company recorded an impairment charge of $13.0 million through the Consolidated Statement of Income for the year ended December 31, 2019 to reflect the write-off of the Casino Queen Loan.
    Casino Queen was closed in mid-March due to COVID-19 and Casino Queen was in payment default on their lease starting in April 2020. The Company entered into a deferred rental agreement with Casino Queen and received all delinquent rental payments in the fourth quarter of 2020.


9. Lease Assets and Lease Liabilities

Lease Assets

The Company is subject to various operating leases as lessee for both real estate and equipment, the majority of which are ground leases related to properties the Company leases to its tenants under triple-net operating leases. These ground leases may include fixed rent, as well as variable rent based upon an individual property’s performance or changes in an index such as the CPI and have maturity dates ranging from 2028 to 2108, when considering all renewal options. For certain of these ground leases, the Company’s tenants are responsible for payment directly to the third-party landlord. Under ASC 842, the Company is required to gross-up its consolidated financial statements for these ground leases as the Company is considered the primary obligor. In conjunction with the adoption of ASU 2016-02 on January 1, 2019, the Company recorded right-of-use assets and related lease liabilities on its consolidated balance sheet to represent its rights to use the underlying leased assets and its future lease obligations, respectively, including for those ground leases paid directly by our tenants. Because the right-of-use asset relates, in part, to the same leases which resulted in the land right assets the Company recorded on its consolidated balance sheet in conjunction with the Company's assumption of below market leases at the time it acquired the related land and building assets, the Company is required to report the right-of-use assets and land rights in the aggregate on the consolidated balance sheet.

Land rights, net represent the Company's rights to land subject to long-term ground leases. The Company obtained ground lease rights through the acquisition of several of its rental properties and immediately subleased the land to its tenants. These land rights represent the below market value of the related ground leases. The Company assessed the acquired ground leases to determine if the lease terms were favorable or unfavorable, given market conditions at the acquisition date. Because the market rents to be received under the Company's triple-net tenant leases were greater than the rents to be paid under the acquired ground leases, the Company concluded that the ground leases were below market and were therefore required to be recorded as a definite lived asset (land rights) on its books.

Components of the Company's right-of use assets and land rights, net are detailed below (in thousands):
December 31, 2020December 31, 2019
Right-of-use assets - operating leases (1)
$151,339 $184,063 
Land rights, net617,858 654,671 
Right-of-use assets and land rights, net$769,197 $838,734 

(1) In addition, there is $0.3 million of operating lease right-of-use assets included in assets held for sale.

As described in Note 8, on December 18, 2020, the Company and Caesars completed an Exchange Agreement in which the Company transferred to Caesars the real property assets of Tropicana Evansville. In connection with the exchange, the Company removed the land right and right of use asset related to the long-term ground lease at this property which totaled $24.8 million and $30.7 million, respectively, at the closing of the transaction along with the lease liability of $29.8 million it had recorded on its Consolidated Balance Sheet for this lease.

On June 30, 2019, the Resorts Casino Tunica property was closed by the Company's tenant, resulting in the acceleration of $6.3 million of land right amortization expense related to the long-term ground lease at this property and bringing the net book value of this land right to 0 at December 31, 2019. Subsequent to the property's closure, the Company entered into an agreement to terminate the long-term ground lease for the Resorts Casino Tunica property, which became effective in February 2020. In connection with the exercised termination option, the Company remeasured the lease liability and adjusted the right-of-use asset it had recorded on its consolidated balance sheet for this lease to align with the new termination date.
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Land Rights

The land rights are amortized over the individual lease term of the related ground lease, including all renewal options, which ranged from 10 years to 92 years at their respective acquisition dates. Land rights net, consist of the following:

December 31,
2020		December 31,
2019
(in thousands)
Land rights$667,751 $694,077 
Less accumulated amortization(49,893)(39,406)
Land rights, net$617,858 $654,671 

As of December 31, 2020, estimated future amortization expense related to the Company’s land rights by fiscal year is as follows (in thousands):

Year ending December 31,
2021$11,372 
202211,372 
202311,372 
202411,372 
202511,372 
Thereafter560,998 
Total$617,858 

Lease Liabilities

At December 31, 2020, maturities of the Company's operating lease liabilities were as follows (in thousands):

Year ending December 31,
2021$11,079 
202211,082 
202311,081 
202411,034 
202510,984 
Thereafter569,957 
Total lease payments$625,217 
Less: interest(473,014)
Present value of lease liabilities (1)
$152,203 

(1) In addition, there is $0.3 million of lease liabilities included in other liabilities related to liabilities held for sale.

Lease Expense

Operating lease costs represent the entire amount of expense recognized for operating leases that are recorded on the Consolidated Balance Sheet. Variable lease costs are not included in the measurement of the lease liability and include both lease payments tied to a property's performance and changes in an index such as the CPI that are not determinable at lease commencement, while short-term lease costs are costs for those operating leases with a term of 12 months or less.

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The components of lease expense were as follows:
Year Ended December 31, 2020Year Ended December 31, 2019
(in thousands)
Operating lease cost$13,907 $15,482 
Variable lease cost (1)
3,364 9,048 
Short-term lease cost625 1,060 
Amortization of land right assets12,022 18,536 
Total lease cost$29,918 $44,126 

(1)Variable lease costs for the year ended December 31, 2020 included a true up of the monthly rental payments paid by our tenants on certain ground leases that are based on estimated current year annual performance which were impacted by casino closures due to COVID-19. As discussed previously, under ASC 842, the Company is required to gross up its financial statements by recording both expense and revenue (recorded within rental income on the Consolidated Statements of Income) for these payments since the Company is considered the primary obligor.

Amortization expense related to the land right intangibles, as well as variable lease costs and the majority of the Company's operating lease costs are recorded within land rights and ground lease expense in the consolidated statements of income. The Company's short-term lease costs as well as a small portion of operating lease costs are recorded in both gaming, food, beverage and other expense and general and administrative expense in the consolidated statements of income. Amortization expense related to the land right intangibles totaled $11.3 million for the year ended December 31, 2018. Other lease costs totaled $18.9 million for the year ended December 31, 2018.

Supplemental Disclosures Related to Leases

Supplemental balance sheet information related to the Company's operating leases was as follows:
December 31, 2020
Weighted average remaining lease term - operating leases56.41 years
Weighted average discount rate - operating leases6.7%

In addition, the weighted average remaining lease term and the weighted average discount rate for those operating leases included in assets held for sale and other liabilities is 1.79 years and 4.0%, respectively.

Supplemental cash flow information related to the Company's operating leases was as follows:
Year Ended December 31, 2020Year Ended December 31, 2019
(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
  Operating cash flows from operating leases (1) (2)
$1,600 $2,226 
Right-of-use assets obtained in exchange for new lease obligations:
   Operating leases (2)
$95 $293 

(1) The Company's cash paid for operating leases is significantly less than the lease cost for the same period due to the majority of the Company's ground lease rent being paid directly to the landlords by the Company's tenants. Although GLPI expends no cash related to these leases, they are required to be grossed up in the Company's financial statements under ASC 842.

(2) In addition, there is $0.2 million and $0.3 million related to assets held for sale and other liabilities for operating cash flows from cash paid for amounts included in the measurement of lease liabilities and right-of-use assets obtained for new lease obligations, respectively for the year ended December 31, 2020.

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10. Goodwill and Intangible Assets

Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. The only goodwill of the Company is recorded on the books of Hollywood Casino Baton Rouge, in connection with Penn's purchase of this entity prior to the Spin-Off. The original assets and liabilities of GLPI, including goodwill and intangible assets were recorded at their respective historical carrying values at the time of the Spin-Off in accordance with the provisions of ASC 505. There is no goodwill recorded on the Company's GLP Capital segment, which holds the Company's REIT operations.

During the year ended December 31, 2018, the Company recorded a goodwill impairment charge of $59.5 million in connection with its operations at Hollywood Casino Baton Rouge. This charge was driven by general market deterioration in the Baton Rouge region and the smoking ban at all Baton Rouge, Louisiana casinos that went into effect during the second quarter of 2018, both of which significantly impacted the Company's forecasted cash flows for this reporting unit. Subsequent to conducting its impairment tests on other long-lived assets, the Company performed Step 1 of the goodwill impairment test, which indicated a potential impairment. Step 1 of the goodwill impairment test involved the determination of the fair value of the Baton Rouge reporting unit and its comparison to the reporting unit's carrying amount. Using a discounted cash flow model, which relied on projected EBITDA to determine the reporting unit's future cash flows, the Company calculated a fair value that was less than the reporting unit's carrying value and proceeded to Step 2. In Step 2 of the goodwill impairment test, the Company performed a fair value allocation as if the reporting unit had been acquired in a business combination and assigned the fair value of the reporting unit calculated in Step 1 to all assets and liabilities of the reporting unit, including any unrecognized intangible assets. Any residual fair value was allocated to goodwill to arrive at the implied fair value of goodwill. After completing the Step 2 allocation, the Company determined the goodwill on its Baton Rouge reporting unit had an implied fair value of $16.1 million and recorded the impairment charge of $59.5 million during the fourth quarter of 2018. There have been no changes in the carrying value of goodwill of $16.1 million for the years ended December 31, 2020 and 2019. As described in Note 6, the Company's goodwill balance at December 31, 2020 has been reclassified to Assets held for sale.

In accordance with ASC 350, the Company considers its gaming license at the Hollywood Casino Perryville property an indefinite-lived intangible asset that does not require amortization based on future expectations to operate this casino indefinitely, as well as the gaming industry's historical experience in renewing these intangible assets at minimal cost with various state gaming commissions. Rather, the Company's gaming license is tested annually, or more frequently if indicators of impairment exist, for impairment by comparing the fair value of the recorded asset to its carrying amount. If the carrying amount of the indefinite-life intangible asset exceeds its fair value, an impairment loss is recognized. Hollywood Casino Perryville's gaming license will expire in September 2025, fifteen years from the casino's opening date. The Company expects to expense any costs related to the gaming license renewal as incurred. The Company conducts its annual impairment assessment of the gaming license on October 1st using the Greenfield Method which estimates the fair value of the gaming license assuming the Company built a casino with similar utility to that of the existing facility. This method also assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. Based upon these assumptions and the Company's current forecasted cash flows for this reporting unit, the gaming license was not impaired. At both December 31, 2020 and 2019, the gaming license had a carrying value of $9.6 million. As described in Note 6, the Company's other intangible assets balance at December 31, 2020 has been reclassified to Assets held for sale.

11. Fair Value of Financial Assets and Liabilities

Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following methods and assumptions are used to estimate the fair value of each class of financial instruments for which it is practicable to estimate:

Cash and Cash Equivalents
The fair value of the Company’s cash and cash equivalents approximates the carrying value of the Company’s cash and cash equivalents, due to the short maturity of the cash equivalents.

Deferred Compensation Plan Assets

The Company's deferred compensation plan assets consist of open-ended mutual funds and as such the fair value measurement of the assets is considered a Level 1 measurement as defined under ASC 820. Deferred compensation plan assets are included within other assets on the consolidated balance sheets.

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Real Estate Loans

The fair value of the real estate loans approximates the carrying value of the Company's real estate loans, as collection on the outstanding loan balances is reasonably assured. The fair value measurement of the real estate loans is considered a Level 3 measurement as defined under ASC 820.

Long-term Debt
The fair value of the Senior Notes are estimated based on quoted prices in active markets and as such are Level 1 measurements as defined under ASC 820. The fair value of the obligations in our Amended Credit Facility is based on indicative pricing from market information (Level 2 inputs).
The estimated fair values of the Company’s financial instruments are as follows (in thousands):
 December 31, 2020December 31, 2019
 Carrying
Amount		Fair
Value		Carrying
Amount		Fair
Value
Financial assets:    
Cash and cash equivalents (1)
$486,451 $486,451 $26,823 $26,823 
Deferred compensation plan assets35,514 35,514 28,855 28,855 
Real estate loans0 0 303,684 303,684 
Financial liabilities:    
Long-term debt:    
Senior unsecured credit facility424,019 424,019 495,000 493,533 
Senior unsecured notes5,375,000 6,026,840 5,290,174 5,707,996 

(1) In addition, there is $22.1 million in cash and cash equivalents in assets held for sale.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
There were no liabilities measured at fair value on a nonrecurring basis during the years ended December 31, 2020 and 2019. There were no assets measured at fair value on a nonrecurring basis during the year ended December 31, 2020; however, assets measured at fair value on a nonrecurring basis during the year ended December 31, 2019 are described below.
Loan Receivable

During the first quarter of 2019, the Company recorded an impairment charge of $13.0 million related to the write-off of the principal due to the Company under the Casino Queen Loan. During 2019, the operating results of Casino Queen continued to decline, the secured debt of Casino Queen was sold to a third-party casino operator at a discount and the Company no longer expected the loan to be repaid. Therefore, the remaining balance of the Casino Queen Loan was written off and an impairment charge was recorded in the Consolidated Statement of Income for the year ended December 31, 2019.


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12.Long-term Debt
Long-term debt, net of current maturities and unamortized debt issuance costs is as follows: 
December 31,
2020		December 31,
2019
 (in thousands)
Unsecured $1,175 million revolver$0 $46,000 
Unsecured term loan A-10 449,000 
Unsecured term loans A-2424,019 0 
$1,000 million 4.875% senior unsecured notes due November 20200 215,174 
$400 million 4.375% senior unsecured notes due April 20210 400,000 
$500 million 5.375% senior unsecured notes due November 2023500,000 500,000 
$400 million 3.350% senior unsecured notes due September 2024400,000 400,000 
$850 million 5.250% senior unsecured notes due June 2025850,000 850,000 
$975 million 5.375% senior unsecured notes due April 2026975,000 975,000 
$500 million 5.750% senior unsecured notes due June 2028500,000 500,000 
$750 million 5.300% senior unsecured notes due January 2029750,000 750,000 
$700 million 4.000% senior unsecured notes due January 2030700,000 700,000 
$700 million 4.00% senior unsecured notes due January 2031700,000 0 
Finance lease liability860 989 
Total long-term debt5,799,879 5,786,163 
Less: unamortized debt issuance costs, bond premiums and original issuance discounts(45,190)(48,201)
Total long-term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts$5,754,689 $5,737,962 

The following is a schedule of future minimum repayments of long-term debt as of December 31, 2020 (in thousands): 

2021$135 
2022142 
2023924,168 
2024400,156 
2025850,164 
Over 5 years3,625,114 
Total minimum payments$5,799,879 

Senior Unsecured Credit Facility

Prior to June 25, 2020, the Company's senior unsecured credit facility (the "Credit Facility"), consisted of a $1,175 million revolving credit facility (the "Revolver") with a maturity date of May 21, 2023, and a $449 million Term Loan A-1 facility with a maturity date of April 28, 2021.

The Company fully drew down on its Revolver in the first quarter of 2020 to increase its liquidity position and repay certain senior unsecured notes as described below. On June 25, 2020, the Company entered into an amendment to the Credit Facility (as amended, the "Amended Credit Facility" which extended the maturity date of approximately $224 million of outstanding Term Loan A-1 facility borrowings to May 21, 2023, which term loans are now classified as a new tranche of term loans (Term Loans A-2). Additionally, the Company borrowed incremental Term Loans A-2 totaling $200 million. Furthermore, on June 25, 2020, the Company also closed on an offering of $500 million of 4.00% unsecured senior notes due in January 2031 priced at a slight discount to par. The Company utilized the proceeds from these two financings along with cash on hand to repay all outstanding obligations under its Revolver. On August 18, 2020, the Company borrowed an additional $200 million of 4.00% unsecured senior notes due in January 2031 priced at a premium to par. The Company utilized the net proceeds from this additional borrowing to repay indebtedness under the Term Loan A-1 facility.

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At December 31, 2020, the Credit Facility had a gross outstanding balance of $424.0 million, consisting of the $424.0 million Term Loan A-2 facility. No amounts were outstanding under the Revolver. Additionally, at December 31, 2020, the Company was contingently obligated under letters of credit issued pursuant to the Credit Facility with face amounts aggregating approximately $0.4 million, resulting in $1,174.6 million of available borrowing capacity under the Revolver.

The interest rates payable on the loans are, at the Company's option, equal to either a LIBOR rate or a base rate plus an applicable margin, which ranges from 1.0% to 2.0% per annum for LIBOR loans and 0.0% to 1.0% per annum for base rate loans, in each case, depending on the credit ratings assigned to the Credit Facility. At December 31, 2020, the applicable margin was 1.50% for LIBOR loans and 0.50% for base rate loans. In addition, the Company is required to pay a commitment fee on the unused portion of the commitments under the Revolver at a rate that ranges from 0.15% to 0.35% per annum, depending on the credit ratings assigned to the Credit Facility. At December 31, 2020, the commitment fee rate was 0.25%. The Company is not required to repay any loans under the Credit Facility prior to maturity and may prepay all or any portion of the loans under the Credit Facility prior to maturity without premium or penalty, subject to reimbursement of any LIBOR breakage costs of the lenders. The Company's wholly owned subsidiary, GLP Capital, is the primary obligor under the Credit Facility, which is guaranteed by GLPI.

The Credit Facility contains customary covenants that, among other things, restrict, subject to certain exceptions, the ability of GLPI and its subsidiaries to grant liens on their assets, incur indebtedness, sell assets, make investments, engage in acquisitions, mergers or consolidations or pay certain dividends and other restricted payments. The Credit Facility contains the following financial covenants, which are measured quarterly on a trailing four-quarter basis: a maximum total debt to total asset value ratio, a maximum senior secured debt to total asset value ratio, a maximum ratio of certain recourse debt to unencumbered asset value and a minimum fixed charge coverage ratio. In addition, GLPI is required to maintain a minimum tangible net worth and its status as a REIT. GLPI is permitted to pay dividends to its shareholders as may be required in order to maintain REIT status, subject to the absence of payment or bankruptcy defaults. GLPI is also permitted to make other dividends and distributions subject to pro forma compliance with the financial covenants and the absence of defaults. The Credit Facility also contains certain customary affirmative covenants and events of default, including the occurrence of a change of control and termination of the Penn Master Lease (subject to certain replacement rights). The occurrence and continuance of an event of default under the Credit Facility will enable the lenders under the Credit Facility to accelerate the loans and terminate the commitments thereunder. At December 31, 2020, the Company was in compliance with all required financial covenants under the Credit Facility.

Senior Unsecured Notes

At December 31, 2020, the Company had an outstanding balance of $5,375.0 million of senior unsecured notes (the "Senior Notes").

In the first quarter of 2020, the Company redeemed all $215.2 million aggregate principal amount of the Company’s outstanding 4.875% senior unsecured notes due in November 2020 and all $400 million aggregate principal amount of the Company’s outstanding 4.375% senior unsecured notes due in April 2021, incurring a loss on the early extinguishment of debt related to the redemption of $17.3 million, primarily for call premium charges and debt issuance write-offs.

On June 25, 2020, the Company issued $500 million of 4.00% senior unsecured notes due January 2031 at an issue price equal to 98.827% of the principal amount to repay indebtedness under its Revolver. On August 18, 2020, the Company issued an additional $200 million of 4.00% senior unsecured notes due January 2031 at an issue price equal to 103.824% of the principal amount to repay Term Loan A-1 indebtedness, incurring a loss on the early extinguishment of debt of $0.8 million, related to debt issuance write-offs. These bond offerings have extended the maturities of our long-term debt.

On August 29, 2019, the Company issued $400 million of 3.35% Senior Unsecured Notes maturing on September 1, 2024 at an issue price equal to 99.899% of the principal amount (the "2024 Notes") and $700 million of 4.00% Senior Unsecured Notes maturing on January 15, 2030 at an issue price equal to 99.751% of the principal amount (the "2030 Notes"). Interest on the 2024 Notes is payable semi-annually on March 1 and September 1 of each year, commencing on March 1, 2020. Interest on the 2030 Notes is payable semi-annually on January 15 and July 15 of each year, commencing on January 15, 2020. The net proceeds from the sale of the 2024 Notes and 2030 Notes were used to (i) finance the Company's cash tender offer to purchase its 4.875% Senior Unsecured Notes due 2020 (described below), (ii) repay outstanding borrowings under the Company's revolving credit facility and (iii) repay a portion of the outstanding borrowings under the Company's Term Loan A-1 facility.

On September 12, 2019, the Company completed a cash tender offer (the "2019 Tender Offer") to purchase its $1,000 million aggregate principal amount 4.875% Senior Unsecured Notes due 2020 (the "2020 Notes"). The Company received early
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tenders from the holders of approximately $782.6 million in aggregate principal of the 2020 Notes, or approximately 78% of its outstanding 2020 Notes, in connection with the 2019 Tender Offer at a price of 102.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date. Subsequent to the early tender deadline, an additional $2.2 million in aggregate principal of the 2020 Notes was tendered at a price of 99.337% of the unpaid principal amount plus accrued and unpaid interest through the settlement date, for a total redemption of $784.8 million of the 2020 Notes. The Company recorded a loss on the early extinguishment of debt related to the 2019 Tender Offer, of approximately $21.0 million, for the difference between the reacquisition price of the tendered 2020 Notes and their net carrying value.
The Company may redeem the Senior Notes of any series at any time, and from time to time, at a redemption price of 100% of the principal amount of the Senior Notes redeemed, plus a "make-whole" redemption premium described in the indenture governing the Senior Notes, together with accrued and unpaid interest to, but not including, the redemption date, except that if Senior Notes of a series are redeemed 90 or fewer days prior to their maturity, the redemption price will be 100% of the principal amount of the Senior Notes redeemed, together with accrued and unpaid interest to, but not including, the redemption date. If GLPI experiences a change of control accompanied by a decline in the credit rating of the Senior Notes of a particular series, the Company will be required to give holders of the Senior Notes of such series the opportunity to sell their Senior Notes of such series at a price equal to 101% of the principal amount of the Senior Notes of such series, together with accrued and unpaid interest to, but not including, the repurchase date. The Senior Notes also are subject to mandatory redemption requirements imposed by gaming laws and regulations. 
The Senior Notes were issued by GLP Capital, L.P. and GLP Financing II, Inc. (the "Issuers"), 2 wholly-owned subsidiaries of GLPI, and are guaranteed on a senior unsecured basis by GLPI. The guarantees of GLPI are full and unconditional. The Senior Notes are the Issuers' senior unsecured obligations and rank pari passu in right of payment with all of the Issuers' senior indebtedness, including the Credit Facility, and senior in right of payment to all of the Issuers' subordinated indebtedness, without giving effect to collateral arrangements.
The Senior Notes contain covenants limiting the Company’s ability to: incur additional debt and use its assets to secure debt; merge or consolidate with another company; and make certain amendments to the Penn Master Lease. The Senior Notes also require the Company to maintain a specified ratio of unencumbered assets to unsecured debt. These covenants are subject to a number of important and significant limitations, qualifications and exceptions.
At December 31, 2020, the Company was in compliance with all required financial covenants under its Senior Notes.

Finance Lease Liability

The Company assumed the finance lease obligations related to certain assets at its Aurora, Illinois property. GLPI recorded the asset and liability associated with the finance lease on its consolidated balance sheet. The original term of the finance lease is 30 years and it will terminate in 2026.

13.Commitments and Contingencies
 
Separation and Distribution Agreements


Pursuant to a Separation and Distribution Agreement between Penn and GLPI, any liability arising from or relating to legal proceedings involving the businesses and operations of Penn’s real property holdings prior to the Spin-Off (other than any liability arising from or relating to legal proceedings where the dispute arises from the operation or ownership of the TRS Properties) will be retained by Penn, and Penn will indemnify GLPI (and its subsidiaries, directors, officers, employees and agents and certain other related parties) against any losses it may incur arising from or relating to such legal proceedings. Similarly, pursuant to a Separation and Distribution Agreement between Pinnacle's operating company and GLPI (as successor to Pinnacle Entertainment), any liability arising from or relating to legal proceedings involving the business and operations of Pinnacle's real property holdings prior to the Pinnacle Merger will be retained by Pinnacle, and Pinnacle will indemnify GLPI (and its subsidiaries, directors, officers, employees and agents and certain other related parties) against any losses it may incur arising from or relating to such legal proceedings. Effective October 15, 2018, Penn assumed all obligations of Pinnacle as pursuant to a merger of Pinnacle with and into a subsidiary of Penn. There can be no assurance that Penn will be able to fully satisfy these indemnification obligations. Moreover, even if the Company ultimately succeeds in recovering from Penn any amounts for which the Company is liable, it may be temporarily required to bear those losses.


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Litigation


The Company is subject to various legal and administrative proceedings relating to personal injuries, employment matters, commercial transactions, and other matters arising in the normal course of business. The Company does not believe that the final outcome of these matters will have a material adverse effect on the Company’s consolidated financial position or results of operations. In addition, the Company maintains what it believes is adequate insurance coverage to further mitigate the risks of such proceedings. However, such proceedings can be costly, time consuming, and unpredictable and, therefore, no assurance can be given that the final outcome of such proceedings may not materially impact the Company’s financial condition or results of operations. Further, no assurance can be given that the amount or scope of existing insurance coverage will be sufficient to cover losses arising from such matters. 
Operating Lease Commitments
As part of the Spin-Off, Penn assigned to GLPI various leases for the land and buildings acquired in connection with the Spin-Off. The lease agreements contain base lease payments and, in some instances, a percentage rent based on a percent of adjusted gaming wins, as described in the respective leases. The portion of the rent that is fixed and determinable is included in the schedule below as a future commitment, while the portion of the rent that is variable is excluded from future commitments as the amounts are not fixed and determinable at December 31, 2018 and therefore considered contingent rent. The following is a description of the more significant lease contracts assigned to GLPI at the Spin-Off:
The Company leases land at the Boomtown Casino Biloxi under two ground leases. The first ground lease has a term of 99 years. The annual rental payments under the first ground lease are increased every 5 years by 15%. The second ground lease has an initial term of 10 years and is automatically extended for additional 10-year terms unless notice is provided to the landlord within 180 days of the current term's end date. The annual rental payments under the second ground lease are increased every 5 years by 4%. Neither of the leases include a variable rent provision tied to the property's performance
The Company has an operating lease for the land utilized in connection with the operations of Hollywood Casino Tunica in Tunica, Mississippi. The lease has a five-year initial term and nine five-year renewals at the tenant's option. The lease agreement has an annual fixed rent provision, as well as an annual revenue-sharing provision, which is equal to the result obtained by subtracting the fixed rent provision from 4% of gross revenues.
The Company has an operating lease with the City of Bangor for the land utilized in connection with the operations of Hollywood Casino Bangor. Rent under the lease is adjusted every 5 years based upon the CPI and does not include a variable rent provision tied to the property's performance. The initial term of the lease is 15 years, with three ten-year renewal options.
The Company leases land at the Argosy Casino Alton under a ground lease with a 30-year initial term and two optional renewals of 10 years each. The lease agreement contains a fixed rent provision and does not include a variable portion tied to the property's performance.
The Company leases land at Hollywood Casino Aurora under a ground lease with a 49-year initial term and five optional renewals of 10 years each. The lease agreement contains a fixed rent provision which is adjusted annually based upon the CPI and does not include a variable rent provision tied to the property's performance.

The Company also obtained ground lease rights through the acquisition of several of its rental properties and immediately subleased the land to its tenants. The Company records revenue for the ground lease rent paid by its tenants with an offsetting expense in land rights and ground lease expense within the consolidated statements of income as the Company has concluded that as the lessee it is the primary obligor under these ground leases. However, the Company subleases these ground leases back to its tenants, who are responsible for payment directly to the landlord. The portion of the ground lease rent that is fixed and determinable is included in the schedule below as a future commitment, while the portion of the ground lease rent that is variable is excluded from future commitments as the amounts are not fixed and determinable at December 31, 2018 and therefore considered contingent rent. Details of the acquired ground leases are below:
During October 2018, the Company acquired the real estate assets of five properties from Tropicana, including the rights to land subject to long-term ground leases. The Company assumed six ground leases related to the acquired Tropicana Properties and immediately subleased the land to Eldorado, who is responsible for payment directly to the landlord. For those ground leases with optional renewal terms extending beyond the 15-year lease term of the Eldorado Master Lease, the Company has included only the renewals that align most closely to the 2033 termination date of the Eldorado Master Lease in the schedule below, as it cannot be reasonably assured it will renew ground leases for land subleased to Eldorado beyond the term of the Eldorado Master Lease. The following is a description of the lease contracts assumed from the acquisition of the Tropicana Properties:
The Company leases land at the Belle of Baton Rouge property under two ground leases. The first ground lease has an initial term of 5 years and two automatic renewals of 5 years each. The lease extends through 2028 with the automatic renewals. Rent under this lease increases by 3% every 2 years and does not include a variable portion tied to the property's performance. The second ground lease has an initial term of 17 years, followed by one automatic 3-year renewal and eight optional renewals of 10 years each. The lease extends through 2083 with all renewals. Rent under this lease is adjusted every 5 years based upon the CPI and does not include a variable rent provision tied to the property's performance.

The Company leases land at the Tropicana Evansville Casino under a ground lease with an initial term of 10 years and two optional 5-year renewals, one optional 12-year renewal, one optional 3-year renewal, and five optional 5-year renewals. The lease extends through 2055 with all renewals. The lease agreement has an annual fixed rent provision, a portion of which was prepaid at the casino's opening and the tenant receives rental credits from the landlord extending through the end of the current term. Additionally, the lease contains a variable portion which is adjusted annually based upon the annual gross receipts of the property. Rent paid to the landlord under this provision is graduated and ranges from 2% to 12% of annual gross receipts dependent on the actual revenues of the property.

The Company leases land at the Trop Casino Greenville under three ground leases. The first ground lease has an initial term of 7 years and four optional renewals of varying lengths, which extend the lease through 2038. The lease has an annual fixed rent provision, which is adjusted at each renewal based upon the CPI and does not include a variable rent provision tied to the property's performance. The second ground lease has an initial term of 20 years and six optional renewals of 5 years each. The lease extends through 2044 with all renewals. The lease has an annual fixed rent provision and does not include a variable rent provision tied to the property's performance. The third ground lease has an initial term of 6 years with nine optional renewals of 6 years each. The lease extends through 2057 with all renewals. Rent under the lease is adjusted annually based upon the CPI, with minimum annual increases of 3.3% and does not include a variable rent provision tied to the property's performance.

During May 2017, the Company acquired the real estate assets of the Tunica Properties, including the rights to land subject to long-term ground leases. The Company assumed three ground leases related to the acquired Tunica Properties and immediately subleased the land to Penn, who is responsible for payment directly to the landlord. For those ground leases with optional renewal terms extending beyond the 35-year lease term of the Penn Master Lease, the Company has included only the renewals that align most closely to the 2048 termination date of the Penn Master Lease in the schedule below, as it cannot be reasonably assured it will renew ground leases for land subleased to Penn beyond the term of the Penn Master Lease. The following is a description of the lease contracts assumed from the acquisition of the Tunica Properties:

The Company leases land at the Resorts Casino Tunica property under a ground lease with an initial term of 3 years and nine optional renewals of 5 years each. The lease extends through 2042 with all renewals. The lease has an annual fixed rent provision and does not include a variable portion.

The Company leases land at the 1st Jackpot Casino under two ground leases. The first ground lease has an initial term of 6 years and nine optional renewals of 6 years each. The lease extends through 2054 with all renewals. Rent under this lease is adjusted annually based upon the CPI and does not include a variable portion. The second lease has an initial term of 10 years with ten optional renewals of 5 years each. The lease extends through 2055 with all renewals. The lease has an annual

fixed rent provision and a variable portion which is adjusted annually based upon net gaming revenues of up to 4%, dependent on the property's operating results.

During April 2016, the Company acquired the majority of the real estate assets of Pinnacle, including the rights to land subject to long-term ground leases. The Company assumed ground leases at several of the acquired Pinnacle properties and immediately subleased the land back to Pinnacle. Subsequent to the Penn-Pinnacle Merger in October 2018, Penn assumed the ground leases at the Ameristar East Chicago, River City Hotel and Casino and L'Auberge Lakes Charles properties and Boyd assumed the ground leases at the Belterra Casino Resort property. Penn and Boyd are responsible for payment directly to the respective landlords at these properties. For those ground leases with optional renewal terms extending beyond the 10-year lease term of the Amended Pinnacle Master Lease and the Boyd Master Lease, the Company has included only the renewals that align most closely to the 2026 termination date of the Amended Pinnacle Master Lease and the Boyd Master Lease in the schedule below, as it cannot be reasonably assured it will renew ground leases for land subleased to Penn and Boyd beyond the terms of the Amended Pinnacle Master Lease and the Boyd Master Lease. The following is a description of the significant lease contracts originally assumed from Pinnacle:

The Company leases land at the Belterra Casino Resort under two ground leases, each with an initial term of 5 years and nine automatic renewals of 5 years each. The renewal options extend the leases through 2049 and are not terminable by the Company. The first ground lease includes a base portion which is adjusted at each renewal based upon the CPI and a variable portion which is adjusted annually based upon 1.5% of gross gaming wins in excess of $100 million. The second ground lease has a fixed rent provision only.

The Company leases land at the Ameristar East Chicago property under a ground lease with an initial term of 30 years and two optional renewals of 30 years each. The lease extends through 2086 with all renewals. Rent under the lease is adjusted every 3 years based upon the CPI and does not include a variable rent provision tied to the property's performance.

The Company leases land at the River City Hotel and Casino under a ground lease with a term of 99 years that extends through 2108. The lease includes a base portion which is fixed and a variable portion which is adjusted annually based upon 2.5% of the annual gross receipts of the property less fixed rent payments made in the same year.

The Company leases land at the L'Auberge Lakes Charles property under a ground lease with an initial term of 10 years and six optional renewals of 10 years each. The lease extends through 2075 with all renewals. Rent under the lease is adjusted annually based upon the CPI and does not include a variable rent provision tied to the property's performance.
In addition, the Company is liable under numerous operating leases for equipment and other miscellaneous assets, which expire at various dates through 2023.
Total rental expense under these agreements was $18.9 million, $15.8 million and $11.0 million for the years ended December 31, 2018, 2017 and 2016. This includes rent expense under the leases assigned to the Company at Spin-Off, leases for equipment and miscellaneous assets and the fixed and variable rent under the ground leases discussed above.
The future minimum lease commitments, as of inception of the lease, relating to noncancelable operating leases at December 31, 2018 are as follows (in thousands):
Year ending December 31, (1)

2019$15,519
202015,159
202115,042
202215,026
202315,005
Thereafter541,135
Total$616,886
(1) The above table excludes contingent rent in accordance with ASC 840.



Employee Benefit Plans
The Company maintains a defined contribution plan under the provisions of Section 401(k) of the Internal Revenue Code of 1986, as amended, which covers all eligible employees. The plan enables participating employees to defer a portion of their salary and/or their annual bonus in a retirement fund to be administered by the Company. The Company makes a discretionary match contribution of 50% of employees' elective salary deferrals, up to a maximum of 6% of eligible employee compensation. The matching contributions for the defined contribution plan were $0.3 million for each of the years ended December 31, 2018, 20172020, 2019 and 2016.2018.
The Company maintains a non-qualified deferred compensation plan that covers most management and other highly-compensated employees. The plan allows the participants to defer, on a pre-tax basis, a portion of their base annual salary and/or their annual bonus, and earn tax-deferred earnings on these deferrals. The plan also provides for matching Company contributions that vest over a five-year period. The Company has established a Trust, and transfers to the Trust, on a periodic basis, an amount necessary to provide for its respective future liabilities with respect to participant deferral and Company contribution amounts. The Company's matching contributions for the non-qualified deferred compensation plan for the years ended December 31, 2018, 20172020, 2019 and 20162018 were $0.7 million, $0.6 million and $0.7 million, respectively. The Company's deferred compensation liability, which was included in other liabilities within the consolidated balance sheet, was $22.8$32.4 million and $22.7$25.2 million at December 31, 20182020 and 2017,2019, respectively. Assets held in the Trust were $22.7$35.5 million and $22.6$28.9 million at December 31, 20182020 and 2017,2019, respectively, and are included in other assets within the consolidated balance sheet.
Labor Agreements
Some of Hollywood Casino Perryville's employees are currently represented by labor unions. The Seafarers Entertainment and Allied Trade Union represents 145129 of Hollywood Casino Perryville's employees under an agreement that expires in February 2020.January 2032. Additionally, Local No. 27 United Food and Commercial Workers and United Industrial Service Transportation Professional and Government Workers of North America and Local No. 27 United Food and Commercial Workers represent certain employees under collective bargaining agreements that expire in 2020,2021 and 2033, respectively, neither of which represents more than 50 of Hollywood Casino Perryville's employees. If the Company fails to renew or modify existing agreements on satisfactory terms, this failure could have a material adverse effect on Hollywood Casino Perryville's business, financial condition and results of operations. There can be no assurance that Hollywood Casino Perryville will be able to maintain these agreements.

12.
14. Revenue Recognition


Revenues from Real Estate

As of December 31, 2018, 202020, 19 of the Company’s real estate investment properties were leased to a subsidiary of Penn under the Penn Master Lease, an additional 12 of the Company's real estate investment properties were leased to a subsidiary of Penn under the Amended Pinnacle Master Lease, 56 of the Company's real estate investment properties were leased to a subsidiary of EldoradoCaesars under the EldoradoAmended and Restated Caesars Master Lease and 3 of the Company's real estate investment properties were leased to a subsidiary of Boyd under the Boyd Master Lease. Additionally, the Meadows real estate assets are leased to Penn pursuant to the Meadows Lease, the land under a single property triple-net leasePenn development facility subject to the Morgantown Lease and the Casino Queen real estate assets are leased back to the operator under an additionalthe Casino Queen Lease. Finally, the Company has single property triple-net lease.triple net leases with Caesars under the Lumière Place Lease and Boyd under the Belterra Park Lease.


The obligations under the Penn Master Lease and Amended Pinnacle Master LeasesLease, as well as the Meadows Lease and Morgantown Lease are guaranteed by Penn and, with respect to each lease, jointly and severally by most of Penn's subsidiaries that occupy and operate the facilities leased under these master leases. A defaultcovered by Penn or its subsidiaries with regard to any facility undersuch lease. Similarly, the Penn Master Lease will cause a default with regard to the Penn Master Lease and a default by Penn or its subsidiaries with regard to any facilityobligations under the Amended Pinnacle Master Lease will cause a default with regard to the Amended Pinnacle Master Lease. The obligations under the Eldoradoand Restated Caesars Master Lease are jointly and severally guaranteed by EldoradoCaesars and by most of Eldorado'sCaesars subsidiaries that occupy and operate the facilities
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leased under the Eldorado Master Lease. A default by Eldorado or its subsidiaries with regard to any facility under the Eldorado Master Lease will cause a default with regard to the Eldorado Master Lease.facilities. The obligations under the Boyd Master LeasesLease are jointly and severally guaranteed by most of Boyd's subsidiaries that occupy and operate the facilities leased under the Boyd Master Lease. A default by Boyd or its subsidiaries with regard to any facility under the Boyd Master Lease will cause a default with regard to the Boyd Master Lease.

The rent structure under the Penn Master Lease includes a fixed component, a portion of which is subject to an annual 2% escalator if certain rent coverage ratio thresholds are met, and a component that is based on the performance of the facilities, which is prospectively adjusted, subject to certain floors (i) every five years to an amount equal to 4% of the average net revenues of all facilities under the Penn Master Lease (other than Hollywood Casino Columbus and Hollywood Casino Toledo) during the preceding five years in excess of a contractual baseline, and (ii) monthly by an amount equal to 20% of the net revenues of Hollywood Casino Columbus and Hollywood Casino Toledo during the preceding month.month in excess of a contractual baseline, although Hollywood Casino Toledo has a monthly percentage rent floor which equals $22.9 million annually.



Similar to the Penn Master Lease, the Amended Pinnacle Master Lease also includes a fixed component, a portion of which is subject to an annual 2% escalator if certain rent coverage ratio thresholds are met and a component that is based on the performance of the facilities, which is prospectively adjusted, subject to certain floors every two years to an amount equal to 4% of the average annual net revenues of all facilities under the Amended Pinnacle Master Lease during the preceding two years.

years in excess of a contractual baseline. The EldoradoAmended Pinnacle Master Lease includesreset on May 1, 2020 which resulted in an annual decline of $5.0 million.

On July 23, 2020, the Amended and Restated Caesars Master Lease became effective as described more fully in Note 1. This modification was accounted for as a fixed component,new lease which the Company concluded continued to meet the criteria for operating lease treatment. As a portionresult, the existing deferred revenue at the time of the amendment is being recognized to the income statement over the Amended and Restated Caesars Master Lease's new initial lease term, which is subjectnow expires in September 2038. The Company has concluded the renewal options of up to an annual 2% escalator ifadditional 20 years at the tenants' option are not reasonably certain rent coverage ratio thresholds are metof being exercised as failure to renew would not result in a significant penalty to the tenant. In addition, the guaranteed fixed escalations in the new initial lease term will be recognized on a straight line basis.

On December 18, 2020, following the receipt of required regulatory approvals, the Company and a component that is based onCaesars completed an Exchange Agreement with subsidiaries of Caesars in which Caesars transferred to the performanceCompany the real estate assets of Waterloo and Bettendorf in exchange for the transfer by the Company to Caesars of the real property assets of Tropicana Evansville, plus a cash payment of $5.7 million. The Waterloo and Bettendorf facilities were added to the Amended and Restated Caesars Master Lease and the rent was increased by $520,000 annually. This Exchange Transaction resulted in a reconsideration of the Amended and Restated Caesars Master Lease which resulted in the continuation of operating lease treatment for accounting classification purposes. Additionally, a non cash gain of $41.4 million was recorded in other income which reflected the fair value of the Waterloo and Bettendorf facilities which is adjusted, subject to certain floors every two years to an amount equal to 4%exceeded the net book value of the average annual net revenuesTropicana Evansville property and the $5.7 million payment at the date of all facilities under the Eldorado Master Lease during the preceding two years.exchange.


 The Boyd Master Lease includes a fixed component, a portion of which is subject to an annual 2% escalator if certain rent coverage ratio thresholds are met, and a component that is based on the performance of the facilities, which is adjusted, subject to certain floors every two years to an amount equal to 4% of the average annual net revenues of all facilities under the Boyd Master Lease during the preceding two years.years in excess of a contractual baseline.


In May 2020, the Company acquired the real estate of Belterra Park in satisfaction of the Belterra Park Loan, subject to the Belterra Park Lease with a Boyd affiliate operating the property.The Belterra Park Lease rent terms are consistent with the Boyd Master Lease.The annual rent is comprised of a fixed component, part of which is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met and a component that is based on the performance of the facilities which is adjusted, every two years to an amount equal to 4% of the average annual net revenues of Belterra Park during the preceding two years in excess of a contractual baseline.

On September 29, 2020, the Company acquired the real estate of Lumière Place in satisfaction of the CZR loan, subject to the Lumière Place Lease, the initial term of which expires on October 31, 2033, with 4 separate renewal options of five years each, exercisable at the tenants' option. The Lumière Place Lease's rent is subject to an annual escalator of up to 2% if certain rent coverage ratio thresholds are met.

The Meadows Lease contains a fixed component, subject to annual escalators, and a component that is based on the performance of the facility, which is reset every two years to a fixedan amount determined by multiplying (i) 4% by (ii) the average annual net revenues of the facility for the trailing two-year period. The Meadows Lease contains an annual escalator provision for up to 5% of the base rent, if certain rent coverage ratio thresholds are met, which remains at 5% until the earlier of ten years or the year in which total rent is $31.0 million, at which point the escalator will be reduced to 2% annually thereafter.


The Morgantown Lease became effective on October 1, 2020 whereby the Company is leasing the land under Penn's
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gaming facility under construction for an initial cash rent of $3.0 million, provided, however, that (i) on the opening date and on each anniversary thereafter the rent shall be increased by 1.5% annually (on a prorated basis for the remainder of the lease year in which the gaming facility opens) for each of the following three lease years and (ii) commencing on the fourth anniversary of the opening date and for each anniversary thereafter, (a) if the CPI increase is at least 0.5% for any lease year, the rent for such lease year shall increase by 1.25% of rent as of the immediately preceding lease year, and (b) if the CPI increase is less than 0.5% for such lease year, then the rent shall not increase for such lease year.

The rent structure under the Casino Queen Lease also includes a fixed component, a portion of which is subject to an annual 2% escalator if certain rent coverage ratio thresholds are met, and a component that is based on the performance of the facility, which is reset every five years to a fixedan amount equal to the greater of (i) the annual amount of non-fixed rent applicable for the lease year immediately preceding such rent reset year and (ii) an amount equal to 4% of the average annual net revenues of the facility for the trailing fivefive-year period.

Furthermore, the Company's master leases provide for a floor on the percentage rent described above, should the Company's tenants acquire or commence operating a competing facility within a restricted area (typically 60 miles from a property under the existing master lease with such tenant). These clauses provide landlord protections by basing the percentage rent floor for any affected facility on the net revenues of such facility for the calendar year period.immediately preceding the year in which the competing facility is acquired or first operated by the tenant. In June 2019, a percentage rent floor was triggered on Penn's Hollywood Casino Toledo property, as a result of Penn's purchase of the operations of the Greektown Casino-Hotel in Detroit, Michigan.


In addition to rent, as triple-net lessees, all of the Company's tenants are required to pay the following executory costs: (1) all facility maintenance, (2) all insurance required in connection with the leased properties and the business conducted on the leased properties, including coverage of the landlord's interests, (3) taxes levied on or with respect to the leased properties (other than taxes on the income of the lessor) and (4) all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties.


The Company determined, based on facts and circumstances prevailing at the time of each lease's inception, that neither Penn nor Casino Queen could continue as a going concern without the property(ies) that are leased to itthem under the respective master lease agreement (inPenn Master Lease and the instance of Penn) and single property lease (in the instance of Casino Queen) with the Company.Queen Master Lease. At lease inception, all of Casino Queen's revenues and substantially all of Penn's revenues were generated from operations in connection with the leased properties. There are also various legal restrictions in the jurisdictions in which Penn, and Casino Queen operate that limit the availability and location of gaming facilities, which makes relocation or replacement of the leased gaming facilities restrictive and potentially impracticable or unavailable. Moreover, under the terms of the master lease,Penn Master Lease, Penn must make renewal elections with respect to all of the leased property together; the tenant is not entitled to selectively renew certain of the leased property while not renewing other property. Accordingly, the Company concluded that failure by Penn or Casino Queen to renew the leasePenn Master Lease or Casino Queen Lease, respectively, would impose a significant penalty on such tenant such that renewal of all lease renewal options appearsappeared at lease inception to be reasonably assured. Therefore, the Company concluded that the term of the Penn Master Lease and the Casino Queen Lease is 35 years, equal to the initial 15-year term plus all four4 of the 5-year renewal options.


As discussed in Note 4, onOn October 15, 2018, in conjunction with the Penn-Pinnacle Merger, the Pinnacle Master Lease was amended via theby a fourth amendment to such lease to allow for the sale of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd. As a result of this amendment, the Company reassessed the lease's classification and determined the new lease agreementAmended Pinnacle Master Lease qualified for operating lease treatment under ASC 840. Therefore, subsequent to the Penn-Pinnacle Merger, the Amended Pinnacle Master Lease is treated as an operating lease in its entirety. Because the properties under the Amended Pinnacle Master Lease dodid not represent a meaningful portion of Penn's business at the time Penn assumed the lease,Amended Pinnacle Master Lease, the Company has concluded that the lease term of the Amended Pinnacle Master Lease is 10 years, equal to the initial 10-year term only.


Also as described in Note 4, subsequent to purchasing the majority of Pinnacle's real estate assets and leasing them back to Pinnacle,In connection with Penn exercising its first renewal option on October 1, 2020, the Company entered intoreassessed the Amended Pinnacle Master Lease as the lease term now concludes on May 1, 2031. The Company continued to conclude that each individual lease component within the Amended Pinnacle Master Lease meets the definition of an operating lease. The deferred rent and fixed minimum lease payments at October 1, 2020 are being recognized on a separate triple-netstraight-line basis over the new initial lease with Pinnacle to leaseterm ending on May 1, 2031.

Because the Meadows real estate assets to

Pinnacle. Because this lease involved onlyLease was a single property within Pinnacle's portfolio,lease operated by a large multi-property operator, GLPI concluded it was not reasonably assured at lease inception that Pinnaclethe operator would elect to exercise allany lease renewal options. Therefore, the Company concluded that the lease term of the Meadows Lease is 10 years, equal to the initial 10-year term only. In
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conjunction with the Penn-Pinnacle Merger, Penn assumed the Meadows Lease.Lease from Pinnacle. The accounting for the Meadows Lease, including the lease term was not impacted by the change in tenant. Based upon similar fact patterns, the Company concluded it was not reasonably assured at lease inception that EldoradoCaesars or Boyd would elect to exercise all lease renewal options under their respective master leases. Thethe Caesars Master Lease and the Boyd Master Lease as the earnings from these properties under both master leases dodid not represent a significantmeaningful portion of either tenant's business at lease inception; therefore the Company has concluded that the lease term of the EldoradoAmended and Restated Caesars Master Lease is 15was its remaining initial lease term which was extended by 5 years when the Amended and theRestated Caesars Master Lease became effective on July 23, 2020. The lease term of the Boyd Master Lease is 10 years, equal to the initial termsterm of such master lease.

The Belterra Park Lease, Morgantown Lease and Lumière Park Lease are single property leases only.operated by large-multi-property operators and as such the Company concluded it was not reasonably assured at lease inception that the operator would elect to exercise any renewal options, as such the lease term of these leases is equal to their initial terms.


Details of the Company's rental income for the year ended December 31, 2020 was as follows (in thousands):
Year Ended December 31, 2020
Building base rent (1)
$676,929 
Land base rent194,939 
Percentage rent148,647 
Total cash rental income (2)
$1,020,515 
Straight-line rent adjustments(4,576)
Ground rent in revenue14,905 
Other rental revenue192 
Total rental income$1,031,036 

(1) Building base rent is subject to the annual rent escalators described above.
(2) Cash rental income includes rent credits of $337.5 million related to the Tropicana Las Vegas and Morgantown transactions with Penn. See Note 7 for further details.

As of December 31, 2018,2020, the future minimum rental income from the Company's rental properties under non-cancelable operating leases, including any reasonably assured rentalrenewal periods, was as follows (in thousands):
Year ending December 31,Future Rental Payments Receivable Straight-Line Rent Adjustments Future Base Ground Rents Receivable Future Income to be Recognized Related to Operating LeasesYear ending December 31,Future Rental Payments ReceivableStraight-Line Rent AdjustmentsFuture Base Ground Rents ReceivableFuture Income to be Recognized Related to Operating Leases
2019$959,797
 $(34,574) $13,403
 $938,626
2020920,129
 (2,567) 13,408
 930,970
2021854,210
 21,786
 13,414
 889,410
2021$1,015,479 $3,312 $9,462 $1,028,253 
2022854,210
 21,786
 13,420
 889,416
2022987,785 22,180 9,468 1,019,433 
2023854,210
 21,786
 13,425
 889,421
2023962,333 30,927 9,473 1,002,733 
20242024930,017 30,053 9,480 969,550 
20252025931,378 28,927 9,486 969,791 
Thereafter11,146,434
 265,694
 471,598
 11,883,726
Thereafter12,488,695 217,662 78,558 12,784,915 
Total$15,588,990
 $293,911
 $538,668
 $16,421,569
Total$17,315,687 $333,061 $125,927 $17,774,675 
The table above presents the cash rent the Company expects to receive from its tenants, offset by adjustments to recognize this rent on a straight-line basis over the lease term. The Company also includes the future non-cash revenue it expects to recognize from the fixed portion of tenant paid ground leases in the table above. For further details on these tenant paid ground leases, refer to Note 11.
For the years ended December 31, 2018, 2017 and 2016, GLPI recognized $48.9 million, $46.8 million and $43.8 million, respectively, in contingent rental income from Hollywood Casino Columbus and Hollywood Casino Toledo related to clause (ii) in the paragraph above. The expected future minimum rental income from these properties, as well as any anticipated future rent based on the performance of the Company's leased facilities that resets after a certain passage of time are excluded from the table above as they are considered contingent rental income under ASC 840. Any anticipated future rent escalations are also excluded from the table above.9.
The Company has financial interests in twomay periodically loan funds to casino properties through secured mortgage loans toowner-operators for the respective casino owner-operators.purchase of real estate. Interest income related to mortgagereal estate loans receivable is recorded as revenue from mortgaged real estate within the Company's consolidated statements of income in the period earned. During the yearyears ended December 31, 2018,2020 and 2019, the Company recognized interest income from these real estate loans of $6.9 million.$19.1 million and $28.9 million, respectively.

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Gaming, Food, Beverage and Other Revenues
Gaming revenue generated by the TRS Properties mainly consists of revenue from slot machines, and to a lesser extent, table game and poker revenue. Gaming revenue from slot machines is the aggregate net difference between gaming wins and losses with liabilities recognized for funds deposited by customers before gaming play occurs, for "ticket-in, ticket-out" coupons in the customers’ possession, and for accruals related to the anticipated payout of progressive jackpots. Progressive slot machines, which contain base jackpots that increase at a progressive rate based on the number of coins played, are charged to revenue as the amount of the jackpots increases. Table game gaming revenue is the aggregate of table drop adjusted for the change in aggregate table chip inventory. Table drop is the total dollar amount of the currency, coins, chips, tokens, outstanding counter checks (markers), and front money that are removed from the live gaming tables. Additionally, food and beverage revenue is recognized as services are performed.

On January 1, 2018, thenet of certain sales incentives, including promotional allowances in accordance with ASC 606. The Company adopted ASU 2014-09, which altered the recognition of revenue at the TRS Properties related to the customer loyalty programs. Specifically, the recognition of revenue associated with these points-based programs was impacted by eliminating the current accrual for the cost of the points awarded at the time of play and instead deferring thealso defers a portion of the revenue received from customers (who participate in the customerpoints-based loyalty programs) at the time of play and attributed to the awarded points until a later period when suchthe points are redeemed or forfeited. The revenue deferral is calculated by allocating a portion ofOther revenues at our TRS Properties are derived from our dining, retail and certain other ancillary activities. During the transaction price to the points based upon their retail value. Under the former guidance, the cost of the points was recorded as an operating expense through the gaming, food, beverage and other expense line item of the Company's consolidated statement of income. Under ASU 2014-09, promotional allowances representing the retail value of food, beverages and other services

furnished to guests without charge are no longer presented as a separate line item on the consolidated statements of income, rather they are presented on a net basis within gaming, food, beverage and other revenue. This change has no impact to total revenues and is for presentation purposes only. The impact of adopting ASU 2014-09 was immaterial to the Company's total revenue for the yearyears ended December 31, 2018.

The following table discloses2020 and 2019, the components ofCompany recognized gaming, food, beverage and other revenue withinof $103.0 million and $128.4 million, respectively.

15.    Stock-Based Compensation
As of December 31, 2020, the consolidated statementsCompany had 4,111,073 shares available for future issuance under the Amended 2013 Long Term Incentive Compensation Plan (the "2013 Plan"). The 2013 Plan provides for the Company to issue restricted stock awards, including performance-based restricted stock awards and other equity or cash based awards to employees. Any director, employee or consultant shall be eligible to receive such awards. The Company issues new authorized common shares to satisfy stock option exercises and restricted stock award releases.
As of incomeDecember 31, 2020, there was $3.2 million of total unrecognized compensation cost for restricted stock awards that will be recognized over the grants' remaining weighted average vesting period of 1.59 years. For the years ended December 31, 2020, 2019 and 2018, the Company recognized $9.3 million, $7.5 million and $4.7 million, respectively, of compensation expense associated with these awards. The total fair value of awards released during the years ended December 31, 2020, 2019 and 2018, was $13.7 million, $10.1 million and $10.0 million, respectively.

The following table contains information on restricted stock award activity for the years ended December 31, 2020 and 2019:

 Number of
Award
Shares		Weighted Average Grant-Date Fair Value
Outstanding at December 31, 2018299,642 $33.53 
Granted317,290 $22.69 
Released(299,961)$21.47 
Canceled0 $0 
Outstanding at December 31, 2019316,971 $34.10 
Granted275,456 $28.29 
Released(331,868)$25.65 
Canceled(7,999)$38.46 
Outstanding at December 31, 2020252,560 $38.72 

Performance-based restricted stock awards have a three-year cliff vesting with the amount of restricted shares vesting at the end of the three-year period determined based upon the Company’s performance as measured against its peers. More specifically, the percentage of shares vesting at the end of the measurement period will be based on the Company’s three-year total shareholder return measured against the three-year total shareholder return of the companies included in the MSCI US REIT index and the Company's stock performance ranking among a group of triple-net REIT peer companies. The triple-net measurement group includes publicly traded REITs, which the Company believes derive at least 75% of revenues from triple-net leases and meet a minimum market capitalization. As of December 31, 2020, there was $9.0 million of total unrecognized compensation cost for performance-based restricted stock awards, which will be recognized over the awards' remaining weighted average vesting period of 1.73 years.  For the years ended December 31, 2020, 2019 and 2018, 2017the Company recognized $10.7 million, $8.7 million and 2016:    $6.4 million, respectively, of compensation expense associated with these awards. The total fair value of performance-based stock awards released during the years ended December 31, 2020, 2019, and 2018 was $23.4 million, $14.7 million, and $20.1 million respectively.

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 Year Ended December 31,
 2018 2017 2016
 (in thousands)
Slot machines$111,315
 $118,998
 $119,390
Table games15,528
 17,218
 18,069
Poker1,114
 1,182
 1,135
Food, beverage and other8,762
 9,468
 11,067
Promotional allowances(4,174) (4,780) (5,610)
Total gaming, food, beverage and other revenue$132,545
 $142,086
 $144,051
The following table contains information on performance-based restricted stock award activity for the years ended December 31, 2020 and 2019:


Number of  Performance-Based Award SharesWeighted Average Grant-Date Fair Value
Outstanding at December 31, 20181,342,000 $18.60 
Granted512,000 $17.85 
Released(447,334)$17.22 
Canceled(23,332)$18.63 
Outstanding at December 31, 20191,383,334 $18.77 
Granted504,000 $23.62 
Released(561,667)$18.51 
Canceled(131,673)$20.74 
Outstanding at December 31, 20201,193,994 $20.72 
13.
16.    Income Taxes
The Company elected on its U.S. federal income tax return for its taxable year that began on January 1, 2014 to be treated as a REIT. The benefits of the intended REIT conversion on the Company's tax provision and effective income tax rate are reflected in the tables below. Deferred tax assets and liabilities are provided for the effects of temporary differences between the tax basis of an asset or liability and its reported amount in the consolidated balance sheets. These temporary differences result in taxable or deductible amounts in future years. As a result of the Tax Cuts and Jobs Act, the corporate tax rate was permanently lowered from the previous maximum rate of 35% to 21%, effective for tax years including or commencing January 1, 2018. As a result of the reduction of the corporate tax rate, U.S. generally accepted accounting principles required companies to re-value their deferred tax assets and liabilities as of the date of the enactment, with resulting tax effects accounted for in the reported period of enactment. As such, the Company revalued its net deferred tax asset at December 31, 2017. This revaluation resulted in a reduction in the value of its net deferred tax asset of approximately $1.8 million, which was recorded as additional income tax expense in the Company’s consolidated statement of income for the year ended December 31, 2017.
The components of the Company's deferred tax assets and liabilities related to its TRS, are as follows:
Year ended December 31,20202019
 (in thousands)
Deferred tax assets:  
Accrued expenses$1,508 $1,597 
Property and equipment6,443 5,844 
Interest expense1,170 596 
Net operating losses310 0 
Gross deferred tax assets9,431 8,037 
Less: valuation allowance(1,731)0 
Net deferred tax assets7,700 8,037 
Deferred tax liabilities:  
Property and equipment(556)(624)
Intangibles(1,813)(1,636)
Net deferred tax liabilities(2,369)(2,260)
Net:$5,331 $5,777 

The carrying amounts of deferred tax assets have been reduced by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized. In assessing the requirement for, and amount of, a valuation allowance in accordance with the more likely than not standard for all periods, the Company gives appropriate consideration to all positive and negative evidence related to the realization of the deferred tax assets.

As of December 31, 2020, the valuation allowance against deferred tax assets was $1.7 million.The valuation allowance balance is associated mainly with net operating losses, disallowed interest expense carryforward, and other additional deferred tax assets.
93
Year ended December 31,2018 2017
 (in thousands)
Deferred tax assets: 
  
Accrued expenses$1,416
 $1,597
Property and equipment5,405
 4,823
Interest expense313
 —
Net deferred tax assets7,134
 6,420
Deferred tax liabilities: 
  
Property and equipment(757) (902)
Intangibles(1,460) (1,284)
Net deferred tax liabilities(2,217) (2,186)
Net:$4,917
 $4,234






The provision for income taxes charged to operations for years ended December 31, 2018, 20172020, 2019 and 20162018 was as follows:
Year ended December 31,2018
2017
2016Year ended December 31,202020192018
(in thousands) (in thousands)
Current tax expense 

 

 
Current tax expense   
Federal$2,856
 $7,039
 $6,004
Federal$1,111 $3,005 $2,856 
State2,630
 3,309
 3,076
State2,315 2,514 2,630 
Total current5,486
 10,348
 9,080
Total current3,426 5,519 5,486 
Deferred tax (benefit) expense 

 

 
Deferred tax (benefit) expense   
Federal(512) (166) (1,324)Federal467 (667)(512)
State(10) (395) (211)State(16)(88)(10)
Total deferred(522) (561) (1,535)Total deferred451 (755)(522)
Total provision$4,964
 $9,787
 $7,545
Total provision$3,877 $4,764 $4,964 
The following tables reconcile the statutory federal income tax rate to the actual effective income tax rate for the years ended December 31, 2018, 20172020, 2019 and 2016:2018:
Year ended December 31,2018
2017
2016Year ended December 31,202020192018
Percent of pretax income 

 

 
Percent of pretax income   
U.S. federal statutory income tax rate21.0 % 35.0 % 35.0 %U.S. federal statutory income tax rate21.0 %21.0 %21.0 %
State and local income taxes0.6 % 0.6 % 0.7 %State and local income taxes0.4 %0.5 %0.6 %
Federal tax rate change— % 0.5 % — %
Valuation allowanceValuation allowance0.3 %0 %0 %
REIT conversion benefit(23.8)% (33.6)% (33.2)%REIT conversion benefit(21.0)%(20.3)%(23.8)%
Goodwill impairment charges3.6 % — % — %Goodwill impairment charges0 %0 %3.6 %
Other miscellaneous itemsOther miscellaneous items0.1 %0 %0 %

1.4 % 2.5 % 2.5 %0.8 %1.2 %1.4 %


Year ended December 31,202020192018
 (in thousands)
Amount based upon pretax income   
U.S. federal statutory income tax$107,013 $83,086 $72,341 
State and local income taxes1,955 2,051 2,246 
Valuation allowance1,731 0 0 
REIT conversion benefit(106,839)(80,397)(82,151)
Goodwill impairment charges0 0 12,485 
Permanent differences16 23 19 
Other miscellaneous items1 1 24 
$3,877 $4,764 $4,964 
Year ended December 31,2018 2017 2016
 (in thousands)
Amount based upon pretax income 
  
  
U.S. federal statutory income tax$72,341
 $136,636
 $103,897
State and local income taxes2,246
 2,284
 2,039
Federal tax rate change—
 1,818
 —
REIT conversion benefit(82,151) (130,876) (98,459)
Goodwill impairment charges12,485
 —
 —
Permanent differences19
 49
 44
Other miscellaneous items24
 (124) 24
 $4,964
 $9,787
 $7,545


The Company is still subject to federal income tax examinations for its years ended December 31, 20152016 and forward.


94
14.

17. Earnings Per Share

The following table reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS for the years ended December 31, 2020, 2019 and 2018: 
 Year Ended December 31,
 202020192018
 (in thousands)
Determination of shares:  
Weighted-average common shares outstanding218,817 214,667 213,720 
Assumed conversion of employee stock-based awards0 0 206 
Assumed conversion of restricted stock awards76 117 80 
Assumed conversion of performance-based restricted stock awards880 1,002 773 
Diluted weighted-average common shares outstanding219,773 215,786 214,779 

The following table presents the calculation of basic and diluted EPS for the Company’s common stock for the years ended December 31, 2020, 2019 and 2018: 
 Year Ended December 31,
 202020192018
 (in thousands, except per share and share amounts)
Calculation of basic EPS:  
Net income$505,711 $390,881 $339,516 
Less: Net income allocated to participating securities(583)(576)(475)
Net income attributable to common shareholders$505,128 $390,305 $339,041 
Weighted-average common shares outstanding218,817 214,667 213,720 
Basic EPS$2.31 $1.82 $1.59 
Calculation of diluted EPS:  
Net income$505,711 $390,881 $339,516 
Diluted weighted-average common shares outstanding219,773 215,786 214,779 
Diluted EPS$2.30 $1.81 $1.58 
Antidilutive securities excluded from the computation of diluted earnings per share (in shares)426 0 13,335 

18.Shareholders' Equity


Common Stock


ATM Program

DuringOn August 2016,14, 2019, the Company commenced a continuous equity offering under which the Company may sell up to an aggregate of $400$600 million of its common stock from time to time through a sales agent in "at the market" offerings (the "ATM"2019 ATM Program"). Actual sales will depend on a variety of factors, including market conditions, the trading price of the

Company's common stock and determinations of the appropriate sources of funding for proposed transactions.funding. The Company may sell the shares in amounts and at times to be determined by the Company, but has no obligation to sell any of the shares in the 2019 ATM Program. The 2019 ATM Program also allows the Company to enter into forward sale agreements. In no event will the aggregate number of shares sold under the 2019 ATM Program (whether under any forward sale agreement or through a sales agent), have an aggregate sales price in excess of $400$600 million. The Company expects, that if it enters into a forward sale contract, to physically settle each forward sale agreement with the forward purchaser on one or more dates specified by the Company prior to the maturity date of that particular forward sale agreement, in which case the aggregate net cash proceeds at settlement will equal the number of shares underlying the particular forward sale agreement multiplied by the relevant forward sale price. However, the Company may also elect to cash settle or net share settle a particular forward sale agreement, in which case proceeds may or may not be received or cash may be owed to the forward purchaser.


95

In connection with the 2019 ATM Program, the Company engaged a sales agent who may receive compensation of up to 2% of the gross sales price of the shares sold. Similarly, in the event the Company enters into a forward sale agreement, it will pay the relevant forward seller a commission of up to 2% of the sales price of all borrowed shares of common stock sold during the applicable selling period of the forward sale agreement.
No shares were sold under the ATM Program during the year ended December 31, 2018. During the year ended December 31, 2017,2020, GLPI sold 3,864,8727,971 shares of its common stock at an average price of $36.22$45.90 per share under the 2019 ATM Program, which generated gross proceeds of approximately $140.0$0.4 million (net proceeds of approximately $139.4$0.2 million). Program commencement to date, the Company has sold 5,186,8719,471 shares of its common stock at an average price of $35.91$45.46 per share under the ATM Program and generated gross proceeds of approximately $186.3$0.4 million (net proceedscosts of approximately $185.0$0.1 million). The Company used the net proceeds from the ATM Program to partially fund its acquisition of the Meadows' and Tunica Properties' real estate assets. As of December 31, 2018,2020, the Company had $213.7$599.6 million remaining for issuance under the 2019 ATM Program and had not entered into any forward sale agreements.


Stock Issued in Connection with Pinnacle Transaction

On April 6, 2016,During the fourth quarter of 2020, the Company closed a public offering of 28,750,000 shares of its common stock, at a public offering price of $30.00 per share, before underwriting discount, which included 3,750,000issued 9.2 million shares of common stock issued in connection with the exercise in full of the underwriters’ option to purchase additional shares.

The Company received approximately $825.2 million in net proceeds from the offering and used the net proceeds from the offeringat $36.25 per share to partially fund its acquisition of substantially all offinance the real estate assets of Pinnacle, including the repayment, redemption and/or discharge of a portion of certain debt of Pinnacle assumed by the Company in connection with the Pinnacle Merger and the payment of transaction-related fees and expenses.

Additionally, on April 28, 2016, in connection with the Pinnacle Merger, the Company issued approximately 56.0 million shares of its common stock to Pinnacle stockholders and to Pinnacle to satisfy the Company's portion of Pinnacle's employee equity and cash-based incentive awards as considerationfunding required for the Pinnacle real estate assets.upcoming Bally's transaction. See Note 7 for further details.






















The following table lists the regular dividends declared and paid by the Company during the years ended December 31, 2018, 20172020, 2019 and 2016:2018:


Declaration DateShareholder Record DateSecurities ClassDividend Per SharePeriod CoveredDistribution Date
Dividend Amount (1)
(in thousands)
2020
February 20, 2020March 6, 2020Common Stock$0.70 First Quarter 2020March 20, 2020$150,574 
April 29, 2020May 13, 2020Common Stock$0.60 Second Quarter 2020June 26, 2020$129,071 
August 6, 2020August 17, 2020Common Stock$0.60 Third Quarter 2020September 25, 2020$130,697 
November 5, 2020November 16, 2020Common Stock$0.60 Fourth Quarter 2020December 24, 2020$137,943 
2019
February 19, 2019March 8, 2019Common Stock$0.68 First Quarter 2019March 22, 2019$145,954 
May 28, 2019June 14, 2019Common Stock$0.68 Second Quarter 2019June 28, 2019$145,978 
August 20, 2019September 6, 2019Common Stock$0.68 Third Quarter 2019September 20, 2019$145,984 
November 26, 2019December 13, 2019Common Stock$0.70 Fourth Quarter 2019December 27, 2019$150,285 
2018
February 1, 2018March 9, 2018Common Stock$0.63 First Quarter 2018March 23, 2018$134,490 
April 24, 2018June 15, 2018Common Stock$0.63 Second Quarter 2018June 29, 2018$134,631 
July 31, 2018September 7, 2018Common Stock$0.63 Third Quarter 2018September 21, 2018$134,844 
October 12, 2018December 14, 2018Common Stock$0.68 Fourth Quarter 2018December 28, 2018$145,627 
Declaration Date Shareholder Record Date Securities Class Dividend Per Share Period Covered Distribution Date Dividend Amount
            (in thousands)
2018            
February 1, 2018 March 9, 2018 Common Stock $0.63
 First Quarter 2018 March 23, 2018 $134,490
April 24, 2018 June 15, 2018 Common Stock $0.63
 Second Quarter 2018 June 29, 2018 $134,631
July 31, 2018 September 7, 2018 Common Stock $0.63
 Third Quarter 2018 September 21, 2018 $134,844
October 12, 2018 December 14, 2018 Common Stock $0.68
 Fourth Quarter 2018 December 28, 2018 $145,627
2017            
February 1, 2017 March 13, 2017 Common Stock $0.62
 First Quarter 2017 March 24, 2017 $129,007
April 25, 2017 June 16, 2017 Common Stock $0.62
 Second Quarter 2017 June 30, 2017 $131,554
July 25, 2017 September 8, 2017 Common Stock $0.63
 Third Quarter 2017 September 22, 2017 $133,936
October 19, 2017 December 1, 2017 Common Stock $0.63
 Fourth Quarter 2017 December 15, 2017 $133,942
2016            
January 29, 2016 February 22, 2016 Common Stock $0.56
 First Quarter 2016 March 25, 2016 $65,345
April 25, 2016 June 2, 2016 Common Stock $0.56
 Second Quarter 2016 June 17, 2016 $113,212
August 3, 2016 September 12, 2016 Common Stock $0.60
 Third Quarter 2016 September 23, 2016 $124,262
November 4, 2016 December 5, 2016 Common Stock $0.60
 Fourth Quarter 2016 December 16, 2016 $124,466


(1) Dividend distributed on June 26, 2020 was paid $25.8 million in cash and $103.2 million in stock (2,697,946 shares at $38.2643). Dividend distributed on September 25, 2020 was paid $26.2 million in cash and $104.5 million in stock (2,767,704 shares at $37.7635). Dividend distributed on December 24, 2020 was paid $27.6 million in cash and $110.3 million in stock (2,543,675 shares at $43.3758). For accounting purposes, since the Company is in an accumulated deficit position the value of the stock dividend was recorded at its par value.

In addition, for the years ended December 31, 2018, 20172020, 2019 and 2016,2018, dividend payments were made to or accrued for GLPI restricted stock award holders and for both GLPI and Penn unvested employee stock options in the amount of $0.8 million, $0.9 million and $1.1$0.8 million, respectively. Dividends distributed to the Company's employees on June 26, 2020 were paid $33 thousand in cash and $153 thousand in stock (4,006 shares at $38.2643). Dividends distributed to the Company's employees on September 25, 2020 were paid $32 thousand in cash and $217 thousand

96

in stock (5,746 shares at$37.7635). Dividends distributed to the Company's employees on December 24, 2020 were paid $34 thousand in cash and $118 thousand in stock (2,722 shares at $43.3758).

A summary of the Company's common stock distributions for the years ended December 31, 2018, 20172020, 2019 and 20162018 is as follows (unaudited):


Year Ended December 31,
202020192018
(in dollars per share)
Qualified dividends$0 $0.0387 $0.0391 
Non-qualified dividends2.4517 2.2649 2.2955 
Capital gains0.0025 0.0353 0.0270 
Non-taxable return of capital0.0458 0.4011 0.2084 
Total distributions per common share$2.50 $2.74 $2.57 
Percentage classified as qualified dividends0 %1.41 %1.52 %
Percentage classified as non-qualified dividends98.07 %82.66 %89.32 %
Percentage classified as capital gains0.10 %1.29 %1.05 %
Percentage classified as non-taxable return of capital1.83 %14.64 %8.11 %
100.00 %100.00 %100.00 %

97
 Year Ended December 31,
 2018 2017 2016
 (in dollars per share)
Qualified dividends$0.0391
 $0.0543
 $0.1050
Non-qualified dividends2.2955
 2.2436
 2.0746
Capital gains0.0270
 0.0371
 0.0624
Non-taxable return of capital0.2084
 0.1650
 0.0780
Total distributions per common share$2.57
 $2.50
 $2.32
      
Percentage classified as qualified dividends1.52% 2.17% 4.53%
Percentage classified as non-qualified dividends89.32% 89.75% 89.42%
Percentage classified as capital gains1.05% 1.48% 2.69%
Percentage classified as non-taxable return of capital8.11% 6.60% 3.36%
 100.00% 100.00% 100.00%


15.    Stock-Based Compensation
As of December 31, 2018, the Company had 2,556,815 shares available for future issuance under the Amended and Restated 2013 Long Term Incentive Compensation Plan (the "2013 Plan") that was approved by shareholders on October 23, 2013. The 2013 Plan provides for the Company to issue restricted stock awards, including performance-based restricted stock awards and other equity or cash based awards to employees. Any director, employee or consultant shall be eligible to receive such awards.
In connection with the Spin-Off, each outstanding option with respect to Penn common stock outstanding on the distribution date was converted into two awards, an adjusted Penn option and a GLPI option. The adjustment preserved the aggregate intrinsic value of the options. Additionally, in connection with the Spin-Off, holders of outstanding restricted stock and phantom stock units ("PSUs") with respect to Penn common stock became entitled to an additional share of restricted stock or PSU with respect to GLPI common stock for each share of Penn restricted stock or PSU held.
The adjusted options, as well as the restricted stock awards and PSUs, otherwise remain subject to their original terms, except that for purposes of the adjusted Penn awards (including in determining exercisability and the post-termination exercise period), continued service with GLPI following the distribution date shall be deemed continued service with Penn; and for purposes of the GLPI awards (including in determining exercisability and the post-termination exercise period), continued service with Penn following the distribution date shall be deemed continued service with GLPI.

The unrecognized compensation cost relating to restricted stock awards and performance-based restricted stock awards will be amortized to expense over the awards’ remaining vesting periods.
As of December 31, 2018, all outstanding stock options were fully vested and there was no remaining unrecognized compensation cost related to stock options. For the years ended December 31, 2018 and 2017, the Company recognized no compensation expense associated with these awards and recognized $20 thousand of compensation expense associated with these awards for the year ended December 31, 2016. In addition, for the year ended December 31, 2016 the Company also recognized $4.5 million of compensation expense relating to the $2.32 per share dividends paid on vested employee stock options.
The following tables contain information on stock options issued and outstanding for the year ended December 31, 2018 :
  
Number of
Option Shares
 
Weighted-
Average
Exercise
Price
 
Weighted-
Average
Remaining
Contractual
Term (in years)
 
Aggregate
Intrinsic Value
(in thousands)
Outstanding at December 31, 2017 1,040,745
 $19.80
    
Exercised (1,012,508) 19.74
    
Canceled (1,438) 17.33
    
Outstanding at December 31, 2018 26,799
 $22.09
 0.01 $272
The Company had 26,799 stock options that were exercisable at December 31, 2018 with an exercise price of $22.09 which had an intrinsic value of $0.3 million and a weighted-average remaining contractual term of 0.01 years. The aggregate intrinsic value of stock options exercised for the years ended December 31, 2018, 2017 and 2016 was $15.1 million, $14.9 million and $75.0 million, respectively. The Company issues new authorized common shares to satisfy stock option exercises and restricted stock award releases.
As of December 31, 2018, there was $5.4 million of total unrecognized compensation cost for restricted stock awards that will be recognized over the grants' remaining weighted average vesting period of 1.71 years. For the years ended December 31, 2018, 2017 and 2016, the Company recognized $4.7 million, $6.0 million and $7.3 million, respectively, of compensation expense associated with these awards. The total fair value of awards released for the years ended December 31, 2018, 2017 and 2016, was $10.0 million, $7.3 million and $5.3 million, respectively.








The following table contains information on restricted stock award activity for the years ended December 31, 2018 and 2017:


 
Number of
Award
Shares
 Weighted Average Grant-Date Fair Value
Outstanding at December 31, 2016413,242
 $30.59
Granted184,791
 $30.89
Released(251,313) $32.05
Canceled(1,976) $30.37
December 31, 2017344,744
 $29.69
Granted283,183
 $23.34
Released(273,286) $18.16
Canceled (1)
(54,999) $33.34
Outstanding at December 31, 2018299,642
 $33.53

Performance-based restricted stock awards have a three-year cliff vesting with the amount of restricted shares vesting at the end of the three-year period determined based upon the Company’s performance as measured against its peers. More specifically, the percentage of shares vesting at the end of the measurement period will be based on the Company’s three-year total shareholder return measured against the three-year return of the companies included in the MSCI US REIT index and the Company's stock performance ranking among a group of triple-net REIT peer companies. The triple-net measurement group includes publicly traded REITs deriving at least 75% of revenues from triple-net leases. As of December 31, 2018, there was $8.9 million of total unrecognized compensation cost, which will be recognized over the awards' remaining weighted average vesting period of 1.70 years.  For the years ended December 31, 2018, 2017 and 2016, the Company recognized $6.4 million, $9.7 million and $11.0 million, respectively, of compensation expense associated with these awards.

The following table contains information on performance-based restricted stock award activity for the years ended December 31, 2018 and 2017:

 Number of  Performance-Based Award Shares Weighted Average Grant-Date Fair Value
Outstanding at December 31, 20161,106,000
 $17.25
Granted558,000
 $17.95
Released—
 $—
Canceled—
 $—
December 31, 20171,664,000
 $17.49
Granted556,000
 $20.64
Released(548,000) $17.29
Canceled (1)
(330,000) $18.60
Outstanding at December 31, 20181,342,000
 $18.60

(1) The canceled shares and the resulting reversal of expense during the second quarter of 2018 are the result of the retirement of the Company's former Chief Financial Officer.










16.19.Segment Information
 
The following tables present certain information with respect to the Company’s segments. Intersegment revenues between the Company’s segments were not material in any of the periods presented below.
 
GLP Capital
TRS Segment (1)
Total
 GLP Capital TRS Properties 
Eliminations (1)
 Total(in thousands)
For the year ended December 31, 2020For the year ended December 31, 2020
Total revenuesTotal revenues$1,050,166 $102,999 $1,153,165 
Income from operationsIncome from operations792,467 16,807 809,274 
Interest expenseInterest expense266,163 15,979 282,142 
Income before income taxesIncome before income taxes508,757 831 509,588 
Income tax expenseIncome tax expense697 3,180 3,877 
Net income (loss)Net income (loss)508,060 (2,349)505,711 
DepreciationDepreciation222,041 8,932 230,973 
Capital project expendituresCapital project expenditures0 474 474 
Capital maintenance expendituresCapital maintenance expenditures186 2,944 3,130 
For the year ended December 31, 2019For the year ended December 31, 2019
Total revenuesTotal revenues$1,025,082 $128,391 $1,153,473 
Income from operationsIncome from operations694,215 23,208 717,423 
Interest expense (2)
Interest expense (2)
291,114 10,406 301,520 
Income before income taxesIncome before income taxes382,841 12,804 395,645 
Income tax expenseIncome tax expense657 4,107 4,764 
Net incomeNet income382,184 8,697 390,881 
DepreciationDepreciation232,708 7,727 240,435 
Capital project expendituresCapital project expenditures0 0 0 
Capital maintenance expendituresCapital maintenance expenditures22 2,995 3,017 
 (in thousands)
For the year ended December 31, 2018        For the year ended December 31, 2018
Total revenues $923,182
 $132,545
 $—
 $1,055,727
Total revenues$923,182 $132,545 $1,055,727 
Income (loss) from operations 630,122
 (36,312) —
 593,810
Income (loss) from operations630,122 (36,312)593,810 
Interest expense 247,684
 10,406
 (10,406) 247,684
Interest expense237,278 10,406 247,684 
Income (loss) before income taxes 391,196
 (46,716) —
 344,480
Income (loss) before income taxes391,196 (46,716)344,480 
Income tax expense 855
 4,109
 —
 4,964
Income tax expense855 4,109 4,964 
Net income (loss) 390,341
 (50,825) —
 339,516
Net income (loss)390,341 (50,825)339,516 
Depreciation 127,696
 9,397
 —
 137,093
Depreciation127,696 9,397 137,093 
Capital project expenditures 20
 —
 —
 20
Capital project expenditures20 0 20 
Capital maintenance expenditures 55
 4,229
 —
 4,284
Capital maintenance expenditures55 4,229 4,284 
        
For the year ended December 31, 2017        
Total revenues $829,221
 $142,086
 $—
 $971,307
Income from operations 578,661
 26,857
 —
 605,518
Interest expense 217,068
 10,406
 (10,406) 217,068
Income before income taxes 373,931
 16,454
 —
 390,385
Income tax expense 1,099
 8,688
 —
 9,787
Net income 372,832
 7,766
 —
 380,598
Depreciation 102,652
 10,828
 —
 113,480
Capital project expenditures 78
 —
 —
 78
Capital maintenance expenditures —
 3,178
 —
 3,178
        
For the year ended December 31, 2016        
Total revenues $684,204
 $144,051
 $—
 $828,255
Income from operations 454,682
 25,941
 —
 480,623
Interest expense 185,896
 10,406
 (10,406) 185,896
Income before income taxes 281,311
 15,539
 —
 296,850
Income tax expense 1,016
 6,529
 —
 7,545
Net income 280,295
 9,010
 —
 289,305
Depreciation 98,171
 11,383
 —
 109,554
Capital project expenditures 229
 101
 —
 330
Capital maintenance expenditures —
 3,111
 —
 3,111
        
Balance sheet at December 31, 2018        
Balance sheet at December 31, 2020Balance sheet at December 31, 2020
Total assets $8,441,345
 $135,948
 $—
 $8,577,293
Total assets$8,590,190 $444,178 $9,034,368 
        
Balance sheet at December 31, 2017        
Balance sheet at December 31, 2019Balance sheet at December 31, 2019
Total assets $7,045,747
 $201,135
 $—
 $7,246,882
Total assets$8,299,143 $135,155 $8,434,298 


(1)    Amounts inResults for the "Eliminations" column represent the eliminationyear ended December 31, 2020 include depreciation expense of $2.7 million associated with Tropicana Las Vegas.

(2)    Interest expense is net of intercompany interest payments fromeliminations of $16.0 million for the Company’s TRS Properties business segmentyear ended December 31, 2020 compared to its GLP Capital business segment.



17.    Summarized Quarterly Data (Unaudited)
The following table summarizes the quarterly results$10.4 million for each of operations for the years ended December 31, 20182019 and 2017:2018.
98

 Fiscal Quarter 
 First Second Third Fourth 
 (in thousands, except per share data) 
2018 
  
  
  
 
Total revenues$244,050
 $254,221
 $254,139
 $303,317
(1 
) 
Income from operations151,851
 153,241
 164,834
 123,884
(1 
) 
Net income96,772
 91,998
 104,815
 45,931
(2 
) 
         
Earnings per common share: 
  
  
  
 
Basic earnings per common share$0.45
 $0.43
 $0.49
 $0.21
 
Diluted earnings per common share$0.45
 $0.43
 $0.49
 $0.21
 
         
2017 
  
  
  
 
Total revenues$242,713
 $243,391
 $244,506
 $240,697
 
Income from operations150,006
 152,696
 152,699
 150,117
 
Net income93,991
 96,334
 97,014
 93,259
 
         
Earnings per common share: 
  
  
  
 
Basic earnings per common share$0.45
 $0.46
 $0.46
 $0.44
 
Diluted earnings per common share$0.45
 $0.45
 $0.45
 $0.43
 


(1)    During October 2018, the Company acquired the real property assets of five casino properties from Tropicana and
leased these assets to Eldorado under a new triple-net lease. Also during October 2018, in conjunction with the Penn-
Pinnacle Merger, the Company acquired the real property assets of Plainridge Park and added this property to the
Amended Pinnacle Master Lease. These transactions, in addition to the treatment of the Amended Pinnacle Master Lease as an operating lease in its entirety, as detailed in Note 4 were the primary drivers for the Company's improved operating results in the fourth quarter of 2018.

(2)    During the fourth quarter of 2018, the Company recorded an impairment charge of $59.5 million, related to the
goodwill recorded on the books of its subsidiary, Hollywood Casino Baton Rouge. This was the largest driver of the decrease in the Company's net income during the fourth quarter of 2018. For further information on the impairment charge see Note 9.

18.20.    Supplemental Disclosures of Cash Flow Information and Noncash Activities


Supplemental disclosures of cash flow information are as follows:


Year ended December 31,202020192018
(in thousands)
Cash paid for income taxes, net of refunds received$3,383 $5,554 $5,389 
Cash paid for interest261,127 274,530 229,779 
Year ended December 31,2018 2017 2016
 (in thousands)
Cash paid for income taxes, net of refunds received$5,389
 $11,646
 $7,362
Cash paid for interest229,779
 204,442
 154,527









Noncash Investing and Financing Activities

On January 1, 2019, in conjunction with its adoption of ASU 2016-02, the Company recorded right-of-use assets and related lease liabilities of $203 million on its consolidated balance sheet to represent its rights to underlying assets and future lease obligations. In 2020, the Company acquired from Penn the real property associated with the Tropicana Las Vegas in exchange for rent credits of $307.5 million and the land at Penn's development facility in Morgantown, Pennsylvania for rent credits of $30.0 million. For the year ended December 31, 2020, the Company also acquired the real property of Belterra Park in satisfaction of the Belterra Park Loan of $57.7 million held on the property, subject to the Belterra Park Lease and acquired the real property of Lumière Place in satisfaction of the $246.0 million CZR loan subject to the Lumière Place Lease. In addition, as described in Note 7, the Company entered into an Exchange Agreement pursuant to which Caesars transferred to the Company the real estate assets of Waterloo and Bettendorf for the real estate assets of Tropicana Evansville and a cash payment of $5.7 million.

Finally, see Note 18 for a description of the stock dividend that has been distributed in 2020. The Company did not engage in any other noncash investing and financing activities are as follows:
Year ended December 31,2018 2017 2016
 (in thousands)
Reclass of assets from investment in direct financing lease to real estate investments$2,599,180
 $—
 $—
Equity raised to partially finance the original Pinnacle transaction—
 —
 1,823,991

19.Supplementary Consolidating Financial Information of Parent Guarantor and Subsidiary Issuers
GLPI guarantees the Notes issued by its subsidiaries, GLP Capital, L.P. and GLP Financing II, Inc. Each of the subsidiary issuers is 100% owned by GLPI. The guarantees of GLPI are full and unconditional. GLPI is not subject to any material or significant restrictions on its ability to obtain funds from its subsidiaries by dividend or loan or to transfer assets from such subsidiaries, except as provided by applicable law. None of GLPI's subsidiaries guarantee the Notes.
Summarized balance sheet information as of December 31, 2018 and 2017 and summarized income statement and cash flow information forduring the years ended December 31, 2018, 20172020, 2019 and 2016 for GLPI as the parent guarantor, for GLP Capital, L.P. and GLP Financing II, Inc. as the subsidiary issuers and the other subsidiary non-issuers is presented below.2018.



99
At December 31, 2018
Consolidating Balance Sheet		 
Parent 
Guarantor
 
Subsidiary 
Issuers
 
Other 
Subsidiary 
Non-Issuers
 Eliminations Consolidated
  (in thousands)
Assets  
  
  
  
  
Real estate investments, net $—
 $2,637,404
 $4,694,056
 $—
 $7,331,460
Land rights, net —
 100,938
 572,269
 —
 673,207
Property and equipment, used in operations, net —
 18,577
 82,307
 —
 100,884
Mortgage loans receivable —
 246,000
 57,684
 —
 303,684
Investment in direct financing lease, net —
 —
 —
 —
 —
Cash and cash equivalents —
 4,632
 21,151
 —
 25,783
Prepaid expenses —
 27,071
 2,885
 1,011
 30,967
Goodwill —
 —
 16,067
 —
 16,067
Other intangible assets —
 —
 9,577
 —
 9,577
Loan receivable —
 —
 13,000
 —
 13,000
Intercompany loan receivable —
 193,595
 —
 (193,595) —
Intercompany transactions and investment in subsidiaries 2,265,607
 5,247,229
 2,697,241
 (10,210,077) —
Deferred tax assets —
 —
 5,178
 —
 5,178
Other assets —
 47,378
 20,108
 —
 67,486
Total assets $2,265,607
 $8,522,824
 $8,191,523
 $(10,402,661) $8,577,293
           
Liabilities  
  
  
  
  
Accounts payable $—
 $2,469
 $42
 $—
 $2,511
Accrued expenses —
 23,587
 6,710
 —
 30,297
Accrued interest —
 45,261
 —
 —
 45,261
Accrued salaries and wages —
 14,628
 2,382
 —
 17,010
Gaming, property, and other taxes —
 24,055
 18,824
 —
 42,879
Income taxes —
 (2) (1,009) 1,011
 —
Long-term debt, net of unamortized debt issuance costs, bond premiums and original issuance discounts —
 5,853,497
 —
 —
 5,853,497
Intercompany loan payable —
 —
 193,595
 (193,595) —
Deferred rental revenue —
 269,185
 24,726
 —
 293,911
Deferred tax liabilities —
 —
 261
 —
 261
Other liabilities —
 24,536
 1,523
 —
 26,059
Total liabilities —
 6,257,216
 247,054
 (192,584) 6,311,686
           
Shareholders’ equity (deficit)  
  
  
  
  
Preferred stock ($.01 par value, 50,000,000 shares authorized, no shares issued or outstanding at December 31, 2018) —
 —
 —
 —
 —
Common stock ($.01 par value, 500,000,000 shares authorized, 214,211,932 shares issued and outstanding at December 31, 2018) 2,142
 2,142
 2,142
 (4,284) 2,142
Additional paid-in capital 3,952,503
 3,952,506
 9,832,830
 (13,785,336) 3,952,503
Retained accumulated (deficit) earnings (1,689,038) (1,689,040) (1,890,503) 3,579,543
 (1,689,038)
Total shareholders’ equity (deficit) 2,265,607
 2,265,608
 7,944,469
 (10,210,077) 2,265,607
Total liabilities and shareholders’ equity (deficit) $2,265,607
 $8,522,824
 $8,191,523
 $(10,402,661) $8,577,293


Year ended December 31, 2018
Consolidating Statement of Income		 
Parent 
Guarantor
 
Subsidiary 
Issuers
 
Other 
Subsidiary 
Non-Issuers
 Eliminations Consolidated
  (in thousands)
Revenues  
  
  
  
  
Rental income $—
 $437,211
 $310,443
 $—
 $747,654
Income from direct financing lease —
 —
 81,119
 —
 81,119
Interest income from mortgaged real estate —
 5,590
 1,353
 —
 6,943
Real estate taxes paid by tenants —
 46,327
 41,139
 —
 87,466
Total income from real estate —
 489,128
 434,054
 —
 923,182
Gaming, food, beverage and other —
 —
 132,545
 —
 132,545
Total revenues —
 489,128
 566,599
 —
 1,055,727
Operating expenses  
  
  
  
  
Gaming, food, beverage and other —
 —
 77,127
 —
 77,127
Real estate taxes —
 46,443
 42,314
 —
 88,757
Land rights and ground lease expense —
 10,156
 18,202
 —
 28,358
General and administrative —
 49,161
 21,967
 —
 71,128
Depreciation —
 97,632
 39,461
 —
 137,093
   Goodwill impairment charges —
 —
 59,454
 —
 59,454
Total operating expenses —
 203,392
 258,525
 —
 461,917
Income from operations —
 285,736
 308,074
 —
 593,810
           
Other income (expenses)  
  
  
  
  
Interest expense —
 (247,684) —
 —
 (247,684)
Interest income —
 1,355
 472
 —
 1,827
Losses on debt extinguishment —
 (3,473) —
 —
 (3,473)
Intercompany dividends and interest —
 460,044
 10,280
 (470,324) —
Total other expenses —
 210,242
 10,752
 (470,324) (249,330)
           
Income before income taxes —
 495,978
 318,826
 (470,324) 344,480
Income tax expense —
 855
 4,109
 —
 4,964
Net income $—
 $495,123
 $314,717
 $(470,324) $339,516


Year ended December 31, 2018
Consolidating Statement of Cash Flows		 
Parent
Guarantor
 
Subsidiary
Issuers
 
Other
Subsidiary
Non-Issuers
 Eliminations Consolidated
  (in thousands)
Operating activities  
  
  
  
  
Net income $—
 $495,123
 $314,717
 $(470,324) $339,516
Adjustments to reconcile net income to net cash provided by (used in) operating activities:  
  
  
  
  
Depreciation and amortization —
 99,678
 48,687
 —
 148,365
Amortization of debt issuance costs, bond premiums and original issuance discounts —
 12,167
 —
 —
 12,167
Losses on dispositions of property —
 75
 234
 —
 309
Deferred income taxes —
 —
 (522) —
 (522)
Stock-based compensation —
 11,152
 —
 —
 11,152
Straight-line rent adjustments —
 49,166
 12,722
 —
 61,888
Losses on debt extinguishment —
 3,473
 —
 —
 3,473
Goodwill impairment charges —
 —
 59,454
 —
 59,454
           
(Increase) decrease,  
  
  
  
  
Prepaid expenses and other assets —
 (1,777) 477
 627
 (673)
Intercompany —
 66
 (66) —
 —
(Decrease) increase,  
  
  
  
  
Accounts payable —
 1,851
 (55) —
 1,796
Accrued expenses —
 (205) 79
 —
 (126)
Accrued interest —
 12,020
 —
 —
 12,020
Accrued salaries and wages —
 6,796
 (595) —
 6,201
Gaming, property and other taxes —
 (78) (71) —
 (149)
Income taxes —
 304
 323
 (627) —
Other liabilities —
 55
 (493) —
 (438)
Net cash provided by (used in) operating activities —
 689,866
 434,891
 (470,324) 654,433
Investing activities  
  
  
  
  
Capital project expenditures —
 (20) —
 —
 (20)
Capital maintenance expenditures —
 (55) (4,229) —
 (4,284)
Proceeds from sale of property and equipment —
 3,195
 16
 —
 3,211
Acquisition of real estate assets —
 (985,750) (257,716) —
 (1,243,466)
Originations of mortgage loans receivable —
 (246,000) (57,684) —
 (303,684)
Collection of principal payments on investment in direct financing lease —
 —
 38,459
 —
 38,459
Net cash used in investing activities —
 (1,228,630) (281,154) —
 (1,509,784)
Financing activities  
  
  
  
  
Dividends paid (550,435) —
 —
 —
 (550,435)
Proceeds from exercise of options, net of taxes paid related to shares withheld for tax purposes on restricted stock award vestings 7,537
 —
 —
 —
 7,537
Proceeds from issuance of long-term debt —
 2,593,405
 —
 —
 2,593,405
Financing costs —
 (32,426) —
 —
 (32,426)
Payments of long-term debt —
 (1,164,117) —
 —
 (1,164,117)
Premium and related costs paid on tender of senior unsecured notes —
 (1,884) —
 —
 (1,884)
Intercompany financing 542,898
 (858,316) (154,906) 470,324
 —
Net cash provided by (used in) financing activities —
 536,662
 (154,906) 470,324
 852,080
Net decrease in cash and cash equivalents —
 (2,102) (1,169) —
 (3,271)
Cash and cash equivalents at beginning of period —
 6,734
 22,320
 —
 29,054
Cash and cash equivalents at end of period $—
 $4,632
 $21,151
 $—
 $25,783

At December 31, 2017
Consolidating Balance Sheet		 
Parent
Guarantor
 
Subsidiary
Issuers
 
Other
Subsidiary
Non-Issuers
 Eliminations Consolidated
  (in thousands)
Assets  
  
  
  
  
Real estate investments, net $—
 $1,794,840
 $1,867,205
 $—
 $3,662,045
Land rights, net —
 58,635
 581,513
 —
 640,148
Property and equipment, used in operations, net —
 20,568
 87,725
 —
 108,293
Investment in direct financing lease, net —
 —
 2,637,639
 —
 2,637,639
Cash and cash equivalents —
 6,734
 22,320
 —
 29,054
Prepaid expenses —
 4,067
 2,746
 1,639
 8,452
Goodwill —
 —
 75,521
 —
 75,521
Other intangible assets —
 —
 9,577
 —
 9,577
Loan receivable —
 —
 13,000
 —
 13,000
Intercompany loan receivable —
 193,595
 —
 (193,595) —
Intercompany transactions and investment in subsidiaries 2,458,247
 5,087,893
 2,959,174
 (10,505,314) —
Deferred tax assets —
 —
 4,478
 —
 4,478
Other assets —
 42,485
 16,190
 —
 58,675
Total assets $2,458,247
 $7,208,817
 $8,277,088
 $(10,697,270) $7,246,882
           
Liabilities  
  
  
  
  
Accounts payable $—
 $619
 $96
 $—
 $715
Accrued expenses —
 672
 7,241
 —
 7,913
Accrued interest —
 33,241
 —
 —
 33,241
Accrued salaries and wages —
 7,832
 2,977
 —
 10,809
Gaming, property, and other taxes —
 21,135
 14,264
 —
 35,399
Income taxes —
 (306) (1,333) 1,639
 —
Long-term debt, net of unamortized debt issuance costs —
 4,442,880
 —
 —
 4,442,880
Intercompany loan payable —
 —
 193,595
 (193,595) —
Deferred rental revenue —
 220,019
 12,004
 —
 232,023
Deferred tax liabilities —
 —
 244
 —
 244
Other liabilities —
 24,478
 933
 —
 25,411
Total liabilities —
 4,750,570
 230,021
 (191,956) 4,788,635
           
Shareholders’ equity (deficit)  
  
  
  
  
Preferred stock ($.01 par value, 50,000,000 shares authorized, no shares issued or outstanding at December 31, 2017) —
 —
 —
 —
 —
Common stock ($.01 par value, 500,000,000 shares authorized, 212,717,549 shares issued and outstanding at December 31, 2017) 2,127
 2,127
 2,127
 (4,254) 2,127
Additional paid-in capital 3,933,829
 3,933,831
 9,498,755
 (13,432,586) 3,933,829
Retained accumulated (deficit) earnings (1,477,709) (1,477,711) (1,453,815) 2,931,526
 (1,477,709)
Total shareholders’ equity (deficit) 2,458,247
 2,458,247
 8,047,067
 (10,505,314) 2,458,247
Total liabilities and shareholders’ equity (deficit) $2,458,247
 $7,208,817
 $8,277,088
 $(10,697,270) $7,246,882

Year ended December 31, 2017
Consolidating Statement of Income		 
Parent
Guarantor
 
Subsidiary
Issuers
 
Other
Subsidiary
Non-
Issuers
 Eliminations Consolidated
  (in thousands)
Revenues  
  
  
  
  
Rental income $—
 $398,070
 $273,120
 $—
 $671,190
Income from direct financing lease —
 —
 74,333
 —
 74,333
Interest income from mortgaged real estate —
 —
 —
 —
 —
Real estate taxes paid by tenants —
 43,672
 40,026
 —
 83,698
Total income from real estate —
 441,742
 387,479
 —
 829,221
Gaming, food, beverage and other —
 —
 142,086
 —
 142,086
Total revenues —
 441,742
 529,565
 —
 971,307
Operating expenses  
  
  
  
  
Gaming, food, beverage and other —
 —
 80,487
 —
 80,487
Real estate taxes —
 43,755
 40,911
 —
 84,666
Land rights and ground lease expense —
 5,895
 18,110
 —
 24,005
General and administrative —
 39,863
 23,288
 —
 63,151
Depreciation —
 93,948
 19,532
 —
 113,480
Total operating expenses —
 183,461
 182,328
 —
 365,789
Income from operations —
 258,281
 347,237
 —
 605,518
           
Other income (expenses)  
  
  
  
  
Interest expense —
 (217,068) —
 —
 (217,068)
Interest income —
 —
 1,935
 —
 1,935
Intercompany dividends and interest —
 451,295
 12,318
 (463,613) —
Total other expenses —
 234,227
 14,253
 (463,613) (215,133)
           
Income before income taxes —
 492,508
 361,490
 (463,613) 390,385
Income tax expense —
 1,099
 8,688
 —
 9,787
Net income $—
 $491,409
 $352,802
 $(463,613) $380,598























Year ended December 31, 2017
Consolidating Statement of Cash Flows		 
Parent
Guarantor
 
Subsidiary
Issuers
 
Other
Subsidiary
Non-Issuers
 Eliminations Consolidated
  (in thousands)
Operating activities  
  
  
  
  
Net income $—
 $491,409
 $352,802
 $(463,613) $380,598
Adjustments to reconcile net income to net cash provided by (used in) operating activities:  
  
  
  
  
Depreciation —
 95,058
 28,777
 —
 123,835
Amortization of debt issuance costs —
 13,026
 —
 —
 13,026
Losses on dispositions of property —
 —
 530
 —
 530
Deferred income taxes —
 —
 (561) —
 (561)
Stock-based compensation —
 15,636
 —
 —
 15,636
Straight-line rent adjustments —
 56,815
 9,156
 —
 65,971
           
Decrease (increase),  
  
  
  
  
Prepaid expenses and other assets —
 (5,703) 1,268
 (897) (5,332)
     Intercompany —
 317
 (317) —
 —
(Decrease) increase, 0
 0
  
 0
  
Accounts payable —
 148
 (569) —
 (421)
Accrued expenses —
 103
 308
 —
 411
Accrued interest —
 (502) —
 —
 (502)
Accrued salaries and wages —
 (79) 269
 —
 190
Gaming, property and other taxes —
 (505) (12) —
 (517)
Income taxes —
 (325) (572) 897
 —
Other liabilities —
 6,591
 (744) —
 5,847
Net cash provided by (used in) operating activities —
 671,989
 390,335
 (463,613) 598,711
Investing activities  
  
  
  
  
Capital project expenditures —
 (78) —
 —
 (78)
Capital maintenance expenditures —
 —
 (3,178) —
 (3,178)
Proceeds from sale of property and equipment —
 10
 924
 —
 934
Principal payments on loan receivable —
 —
 13,200
 —
 13,200
Acquisition of real estate assets —
 (82,866) (386) —
 (83,252)
Collection of principal payments on investment in direct financing lease —
 —
 73,072
 —
 73,072
Net cash (used in) provided by investing activities —
 (82,934) 83,632
 —
 698
Financing activities  
  
  
  
  
Dividends paid (529,370) —
 —
 —
 (529,370)
Proceeds from exercise of options, net of taxes paid related to shares withheld for tax purposes on restricted stock award vestings 18,157
 —
 —
 —
 18,157
Proceeds from issuance of common stock, net of issuance costs 139,414
 —
 —
 —
 139,414
Proceeds from issuance of long-term debt —
 100,000
 —
 —
 100,000
Payments of long-term debt —
 (335,112) —
 —
 (335,112)
Intercompany financing 371,799
 (358,983) (476,429) 463,613
 —
Net cash (used in) provided by financing activities —
 (594,095) (476,429) 463,613
 (606,911)
Net decrease in cash and cash equivalents —
 (5,040) (2,462) —
 (7,502)
Cash and cash equivalents at beginning of period —
 11,774
 24,782
 —
 36,556
Cash and cash equivalents at end of period $—
 $6,734
 $22,320
 $—
 $29,054


Year ended December 31, 2016
Consolidating Statement of Income		 
Parent
Guarantor
 
Subsidiary
Issuers
 
Other
Subsidiary
Non-
Issuers
 Eliminations Consolidated
  (in thousands)
Revenues  
  
  
  
  
Rental income $—
 $383,553
 $183,891
 $—
 $567,444
Income from direct financing lease —
 —
 48,917
 —
 48,917
Interest income from mortgaged real estate —
 —
 —
 —
 —
Real estate taxes paid by tenants —
 41,441
 26,402
 —
 67,843
Total income from real estate —
 424,994
 259,210
 —
 684,204
Gaming, food, beverage and other —
 —
 144,051
 —
 144,051
Total revenues —
 424,994
 403,261
 —
 828,255
Operating expenses  
  
  
  
  
Gaming, food, beverage and other —
 —
 82,463
 —
 82,463
Real estate taxes —
 41,510
 27,938
 —
 69,448
Land rights and ground lease expense —
 2,685
 12,114
 —
 14,799
General and administrative —
 48,452
 22,916
 —
 71,368
Depreciation —
 93,476
 16,078
 —
 109,554
Total operating expenses —
 186,123
 161,509
 —
 347,632
Income from operations —
 238,871
 241,752
 —
 480,623
           
Other income (expenses)  
  
  
  
  
Interest expense —
 (185,896) —
 —
 (185,896)
Interest income —
 169
 1,954
 —
 2,123
Intercompany dividends and interest —
 318,047
 19,670
 (337,717) —
Total other expenses —
 132,320
 21,624
 (337,717) (183,773)
           
Income before income taxes —
 371,191
 263,376
 (337,717) 296,850
Income tax expense —
 1,016
 6,529
 —
 7,545
Net income $—
 $370,175
 $256,847
 $(337,717) $289,305






















Year ended December 31, 2016
Consolidating Statement of Cash Flows		 
Parent
Guarantor
 
Subsidiary
Issuers
 
Other
Subsidiary
Non-Issuers
 Eliminations Consolidated
  (in thousands)
Operating activities  
  
  
  
  
Net income $—
 $370,175
 $256,847
 $(337,717) $289,305
Adjustments to reconcile net income to net cash provided by (used in) operating activities:  
  
  
  
 

Depreciation and amortization —
 93,476
 22,241
 —
 115,717
Amortization of debt issuance costs —
 15,146
 —
 —
 15,146
(Gains) losses on sales of property —
 (471) 16
 —
 (455)
Deferred income taxes —
 —
 (1,535) —
 (1,535)
Stock-based compensation —
 18,312
 —
 —
 18,312
Straight-line rent adjustments —
 55,825
 2,848
 —
 58,673
           
(Increase) decrease,  
  
  
  
  
Prepaid expenses and other assets —
 6,939
 (1,554) 2,180
 7,565
     Intercompany —
 21
 (21) —
 —
Increase (decrease), 0
 0
  
 0
  
Accounts payable —
 119
 387
 —
 506
Accrued expenses —
 (4,303) (369) —
 (4,672)
Accrued interest —
 16,120
 —
 —
 16,120
Accrued salaries and wages —
 (2,817) (283) —
 (3,100)
Gaming, property and other taxes —
 899
 14
 —
 913
Income taxes —
 59
 2,121
 (2,180) —
Other liabilities —
 1,589
 286
 —
 1,875
Net cash provided by (used in) operating activities —
 571,089
 280,998
 (337,717) 514,370
Investing activities  
  
  
  
  
Capital project expenditures —
 (229) (101) —
 (330)
Capital maintenance expenditures —
 —
 (3,111) —
 (3,111)
Proceeds from sale of property and equipment —
 897
 237
 —
 1,134
Principal payments on loan receivable —
 —
 3,150
 —
 3,150
Acquisition of real estate —
 —
 (3,267,992) —
 (3,267,992)
  Collection of principal payments on investment in direct financing lease —
 —
 48,533
 —
 48,533
Net cash provided by (used in) investing activities —
 668
 (3,219,284) —
 (3,218,616)
Financing activities  
  
  
  
  
Dividends paid (428,352) —
 —
 —
 (428,352)
Proceeds from exercise of options, net of taxes paid related to shares withheld for tax purposes on restricted stock award vestings 113,484
 —
 —
 —
 113,484
Proceeds from issuance of common stock, net of issuance costs 870,810
 —
 —
 —
 870,810
Proceeds from issuance of long-term debt —
 2,552,000
 —
 —
 2,552,000
Financing costs —
 (31,911) —
 —
 (31,911)
Payments of long-term debt —
 (377,104) —
 —
 (377,104)
Intercompany financing (555,942) (2,711,684) 2,929,909
 337,717
 —
Net cash (used in) provided by financing activities —
 (568,699) 2,929,909
 337,717
 2,698,927
Net increase (decrease) in cash and cash equivalents —
 3,058
 (8,377) —
 (5,319)
Cash and cash equivalents at beginning of period —
 8,716
 33,159
 $—
 41,875
Cash and cash equivalents at end of period $—
 $11,774
 $24,782
 $—
 $36,556


SCHEDULE III
REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION
December 31, 20182020
(in thousands)


   Initial Cost to CompanyNet Capitalized Costs (Retirements) Subsequent to AcquisitionGross Amount at which Carried at Close of Period  Life on
which
Depreciation
in Latest
Income
Statement is
Computed
   Original
Date of
Construction /
Renovation		 
DescriptionLocationEncumbrancesLand and ImprovementsBuildings and
Improvements		Land and ImprovementsBuildings and
Improvements
Total (6)
Accumulated
Depreciation
Date Acquired
Rental Properties:
Hollywood Casino LawrenceburgLawrenceburg, IN $0 $15,251 $342,393 $(30)$15,222 $342,392 $357,614 $163,370 1997/200911/1/201331
Hollywood Casino AuroraAurora, IL 0 4,937 98,378 (383)4,936 97,996 102,932 72,868 1993/2002/ 201211/1/201330
Hollywood Casino JolietJoliet, IL 0 19,214 101,104 (20)19,194 101,104 120,298 64,300 1992/2003/ 201011/1/201331
Argosy Casino AltonAlton, IL 0 0 6,462 0 0 6,462 6,462 4,741 1991/199911/1/201331
Hollywood Casino ToledoToledo, OH 0 12,003 144,093 (201)11,802 144,093 155,895 45,379 201211/1/201331
Hollywood Casino ColumbusColumbus, OH 0 38,240 188,543 105 38,266 188,622 226,888 60,259 201211/1/201331
Hollywood Casino at Charles Town RacesCharles Town, WV 0 35,102 233,069 0 35,102 233,069 268,171 146,579 1997/201011/1/201331
Hollywood Casino at Penn National Race CourseGrantville, PA 0 25,500 161,810 0 25,500 161,810 187,310 88,411 2008/201011/1/201331
M ResortHenderson,  NV 0 66,104 126,689 (436)65,668 126,689 192,357 45,421 2009/201211/1/201330
Hollywood Casino BangorBangor, ME 0 12,883 84,257 0 12,883 84,257 97,140 38,102 2008/201211/1/201331
Zia Park CasinoHobbs, NM 0 9,313 38,947 0 9,313 38,947 48,260 23,174 200511/1/201331
Hollywood Casino Gulf CoastBay St. Louis, MS 0 59,388 87,352 (229)59,176 87,335 146,511 56,358 1992/2006/ 201111/1/201340
Argosy Casino RiversideRiverside, MO 0 23,468 143,301 (77)23,391 143,301 166,692 72,307 1994/200711/1/201337
Hollywood Casino TunicaTunica, MS 0 4,634 42,031 0 4,634 42,031 46,665 29,759 1994/201211/1/201331
Boomtown BiloxiBiloxi, MS 0 3,423 63,083 (137)3,286 63,083 66,369 52,448 1994/200611/1/201315
Hollywood Casino St. LouisMaryland Heights, MO 0 44,198 177,063 (3,239)40,959 177,063 218,022 98,929 1997/201311/1/201313
Hollywood Casino at Dayton RacewayDayton, OH 0 3,211 0 86,288 3,211 86,288 89,499 17,732 201411/1/201331
Hollywood Casino at Mahoning Valley Race Track (1)
Youngstown, OH 0 5,683 0 94,314 5,833 94,164 99,997 19,113 201411/1/201331
Resorts Casino TunicaTunica, MS0 0 12,860 (12,860)0 0 0 0 1994/1996/ 2005/20145/1/2017N/A
1st Jackpot Casino
Tunica, MS0 161 10,100 0 161 10,100 10,261 1,356 19955/1/201731
Ameristar Black HawkBlack Hawk, CO0 243,092 334,024 0 243,092 334,024 577,116 24,886 20004/28/201631
Ameristar East ChicagoEast Chicago, IN0 4,198 123,430 0 4,198 123,430 127,628 10,578 19974/28/201631
100

      Initial Cost to Company Net Capitalized Costs (Retirements) Subsequent to Acquisition Gross Amount at which Carried at Close of Period       
Life on
which
Depreciation
in Latest
Income
Statement is
Computed
                   
Original
Date of
Construction /
Renovation
   
Description Location Encumbrances Land and Improvements 
Buildings and
Improvements
  Land and Improvements 
Buildings and
Improvements
 
Total (5)
 
Accumulated
Depreciation
  
Date Acquired
 
Rental Properties:                        
Hollywood Casino Lawrenceburg Lawrenceburg, IN $—
 $15,251
 $342,393
 $(30) $15,222
 $342,392
 $357,614
 $137,260
 1997/2009 11/1/2013 31
Hollywood Casino Aurora Aurora, IL —
 4,937
 98,378
 (383) 4,936
 97,996
 102,932
 64,968
 1993/2002/ 2012 11/1/2013 30
Hollywood Casino Joliet Joliet, IL —
 19,214
 101,104
 (20) 19,194
 101,104
 120,298
 58,721
 1992/2003/ 2010 11/1/2013 31
Argosy Casino Alton Alton, IL —
 —
 6,462
 —
 —
 6,462
 6,462
 4,453
 1991/1999 11/1/2013 31
Hollywood Casino Toledo Toledo, OH —
 12,003
 144,093
 (201) 11,802
 144,093
 155,895
 34,842
 2012 11/1/2013 31
Hollywood Casino Columbus Columbus, OH —
 38,240
 188,543
 105
 38,266
 188,622
 226,888
 45,507
 2012 11/1/2013 31
Hollywood Casino at Charles Town Races Charles Town, WV —
 35,102
 233,069
 —
 35,102
 233,069
 268,171
 129,718
 1997/2010 11/1/2013 31
Hollywood Casino at Penn National Race Course Grantville, PA —
 25,500
 161,810
 —
 25,500
 161,810
 187,310
 74,989
 2008/2010 11/1/2013 31
M Resort Henderson,  NV —
 66,104
 126,689
 (436) 65,668
 126,689
 192,357
 35,789
 2009/2012 11/1/2013 30
Hollywood Casino Bangor Bangor, ME —
 12,883
 84,257
 —
 12,883
 84,257
 97,140
 31,965
 2008/2012 11/1/2013 31
Zia Park Casino Hobbs, NM —
 9,313
 38,947
 —
 9,313
 38,947
 48,260
 19,738
 2005 11/1/2013 31
Hollywood Casino Gulf Coast Bay St. Louis, MS —
 59,388
 87,352
 (229) 59,176
 87,335
 146,511
 50,152
 1992/2006/ 2011 11/1/2013 40
Argosy Casino Riverside Riverside, MO —
 23,468
 143,301
 (77) 23,391
 143,301
 166,692
 63,166
 1994/2007 11/1/2013 37
Hollywood Casino Tunica Tunica, MS —
 4,634
 42,031
 —
 4,634
 42,031
 46,665
 26,859
 1994/2012 11/1/2013 31
Boomtown Biloxi Biloxi, MS —
 3,423
 63,083
 (137) 3,286
 63,083
 66,369
 46,443
 1994/2006 11/1/2013 15
Hollywood Casino St. Louis Maryland Heights, MO —
 44,198
 177,063
 (3,049) 41,149
 177,063
 218,212
 75,384
 1997/2013 11/1/2013 13
Hollywood Casino at Dayton Raceway (2)
 Dayton, OH —
 3,211
 —
 86,288
 3,211
 86,288
 89,499
 12,165
 2014 11/1/2013 31
Hollywood Casino at Mahoning Valley Race Track (2)
 Youngstown, OH —
 5,683
 —
 94,314
 5,833
 94,164
 99,997
 13,018
 2014 11/1/2013 31
Resorts Casino Tunica Tunica, MS —
 —
 12,860
 —
 —
 12,860
 12,860
 2,058
 1994/1996/ 2005/2014 5/1/2017 31
1st Jackpot Casino
 Tunica, MS —
 161
 10,100
 —
 161
 10,100
 10,261
 608
 1995 5/1/2017 31
Ameristar Black Hawk (1)
 Black Hawk, CO —
 243,092
 334,024
 —
 243,092
 334,024
 577,116
 2,348
 2000 4/28/2016 31
Ameristar East Chicago (1)
 East Chicago, IN —
 4,198
 123,430
 —
 4,198
 123,430
 127,628
 998
 1997 4/28/2016 31
Belterra Casino Resort (1)
 Florence, IN —
 63,420
 172,875
 —
 63,420
 172,875
 236,295
 1,821
 2000 4/28/2016 31
Belterra Casino ResortFlorence, IN0 63,420 172,875 0 63,420 172,875 236,295 16,123 20004/28/201631
Ameristar Council BluffsCouncil Bluffs, IA0 84,009 109,027 0 84,009 109,027 193,036 9,648 19964/28/201631
L'Auberge Baton RougeBaton Rouge, LA0 205,274 178,426 0 205,274 178,426 383,700 14,158 20124/28/201631
Boomtown Bossier CityBossier City, LA0 79,022 107,067 0 79,022 107,067 186,089 8,826 20024/28/201631
L'Auberge Lake CharlesLake Charles, LA0 14,831 310,877 0 14,831 310,877 325,708 28,166 20054/28/201631
Boomtown New OrleansBoomtown, LA0 46,019 58,258 0 46,019 58,258 104,277 5,238 19944/28/201631
Ameristar VicksburgVicksburg, MS0 128,068 96,106 0 128,068 96,106 224,174 10,290 19944/28/201631
River City Casino & HotelSt Louis, MO— 8,117 221,038 — 8,117 221,038 229,155 18,138 20104/28/201631
Ameristar Kansas CityKansas City, MO0 239,111 271,598 0 239,111 271,598 510,709 24,970 19974/28/201631
Ameristar St. CharlesSt. Charles, MO0 375,597 437,908 0 375,596 437,908 813,504 33,300 19944/28/201631
Jackpot PropertiesJackpot, NV0 48,785 61,550 0 48,785 61,550 110,335 7,290 19544/28/201631
Plainridge Park CasinoPlainridge, MA0 127,068 123,850 0 127,068 123,850 250,918 8,823 201510/15/201831
Belterra Park Gaming and Entertainment Center (1)
Cincinnati, OH0 11,689 45,995 0 11,689 45,995 57,684 1,401 20135/6/202031
The Meadows Racetrack and CasinoWashington, PA0 181,532 141,370 386 181,918 141,370 323,288 24,291 20069/9/201631
Casino QueenEast St. Louis, IL0 70,716 70,014 0 70,716 70,014 140,730 18,882 19991/23/201431
Tropicana Atlantic CityAtlantic City, NJ0 166,974 392,923 0 166,974 392,923 559,897 28,061 198110/1/201831
Tropicana Evansville (2)
Evansville, IN0 47,439 146,930 (194,369)0 0 0 0 199510/1/2018N/A
Tropicana LaughlinLaughlin, NV0 20,671 80,530 0 20,671 80,530 101,201 6,428 198810/1/201827
Trop Casino GreenvilleGreenville, MS0 0 21,680 0 0 21,680 21,680 1,544 201210/1/201831
Belle of Baton RougeBaton Rouge, LA0 11,873 52,400 0 11,873 52,400 64,273 5,488 199410/1/201831
Isle Casino Waterloo (2)
Waterloo, IA0 64,263 77,958 0 64,263 77,958 142,221 105 200512/18/202031
Isle Casino Bettendorf (4)
Bettendorf, IA0 29,636 85,150 0 29,636 85,150 114,786 114 201512/18/202031
Lumiere Place (1)
St Louis, MO0 26,930 219,070 0 26,930 219,070 246,000 2,151 200510/1/202031
Hollywood Casino Morgantown (3)
Morgantown, PA0 30,253 0 0 30,253 0 30,253 0 202010/1/2020N/A
0 2,711,300 6,001,589 (30,888)2,660,070 6,021,930 8,682,000 1,409,505 
Headquarters Property:
GLPI Corporate Office (4)
Wyomissing, PA0 750 8,465 85 750 8,550 9,300 1,435 2014/20159/19/201431
Other Properties
Other owned land (5)
various0 6,798 0 0 6,798 0 6,798 0 
  $0 $2,718,848 $6,010,054 $(30,803)$2,667,618 $6,030,480 $8,698,098 $1,410,940 

Ameristar Council Bluffs (1)
 Council Bluffs, IA —
 84,009
 109,027
 —
 84,009
 109,027
 193,036
 919
 1996 4/28/2016 31
L'Auberge Baton Rouge (1)
 Baton Rouge, LA —
 205,274
 178,426
 —
 205,274
 178,426
 383,700
 1,336
 2012 4/28/2016 31
Boomtown Bossier City (1)
 Bossier City, LA —
 79,022
 107,067
 —
 79,022
 107,067
 186,089
 833
 2002 4/28/2016 31
L'Auberge Lake Charles (1)
 Lake Charles, LA —
 14,831
 310,877
 —
 14,831
 310,877
 325,708
 2,657
 2005 4/28/2016 31
Boomtown New Orleans (1)
 Boomtown, LA —
 46,019
 58,258
 —
 46,019
 58,258
 104,277
 494
 1994 4/28/2016 31
Ameristar Vicksburg (1)
 Vicksburg, MS —
 128,068
 96,106

—

128,068

96,106

224,174

971
 1994 4/28/2016 31
River City Casino & Hotel (1)
 St Louis, MO —
 8,117
 221,038
 —
 8,117
 221,038
 229,155
 1,711
 2010 4/28/2016 31
Ameristar Kansas City (1)
 Kansas City, MO —
 239,111
 271,598
 —
 239,111
 271,598
 510,709
 2,356
 1997 4/28/2016 31
Ameristar St. Charles (1)
 St. Charles, MO —
 375,597
 437,908
 —
 375,596
 437,908
 813,504
 3,141
 1994 4/28/2016 31
Jackpot Properties (1)
 Jackpot, NV —
 48,785
 61,550
 —
 48,785
 61,550
 110,335
 1,669
 1954 4/28/2016 31
Plainridge Park Casino Plainridge, MA —
 127,068
 123,850
 —
 127,068
 123,850
 250,918
 832
 2015 10/15/2018 31
The Meadows Racetrack and Casino Washington, PA —
 181,532
 141,370
 386
 181,918
 141,370
 323,288
 12,971
 2006 9/9/2016 31
Casino Queen East St. Louis, IL —
 70,716
 70,014
 —
 70,716
 70,014
 140,730
 14,348
 1999 1/23/2014 31
Tropicana Atlantic City Atlantic City, NJ —
 166,974
 392,923
 —
 166,974
 392,923
 559,897
 2,711
 1981 10/1/2018 31
Tropicana Evansville Evansville, IN —
 47,439
 146,930
 —
 47,439
 146,930
 194,369
 987
 1995 10/1/2018 31
Tropicana Laughlin Laughlin, NV —
 20,671
 80,530
 —
 20,671
 80,530
 101,201
 606
 1988 10/1/2018 27
Trop Casino Greenville Greenville, MS —
 —
 21,680
 —
 —
 21,680
 21,680
 146
 2012 10/1/2018 31
Belle of Baton Rouge Baton Rouge, LA —
 11,873
 52,400
 —
 11,873
 52,400
 64,273
 545
 1994 10/1/2018 31
    $—
 $2,548,529
 $5,573,416
 $176,531
 $2,544,928
 $5,753,547
 $8,298,475
 $982,203
      
Headquarters Property:                        
GLPI Corporate Office (3)
 Wyomissing, PA $—
 $750
 $8,465
 $58
 $750
 $8,523
 $9,273
 $883
 2014/2015 9/19/2014 31
Other Properties                        
Other owned land (4)
 various $—
 $6,798
 $—
 $—
 $6,798
 $—
 $6,798
 $—
   10/1/18 N/A
    $—
 $2,556,077

$5,581,881

$176,589

$2,552,476

$5,762,070

$8,314,546

$983,086
      



101

(1)During April 2016,2020, the Company acquired substantially all of the real estate assets of Pinnacleboth of these properties in satisfaction of previously outstanding loans, subject to the Belterra Park Lease and subsequently leased the assetsLumiere Place Lease, respectively.

(2) On December 18, 2020 Caesar's elected to replace Tropicana Evansville with Isle Casino Bettendorf and Isle Casino Waterloo as allowed under the Amended and Restated Caesars Master Lease.

(3) On October 1, 2020, the Company and Penn closed on their previously announced transaction whereby GLPI acquired the land under Penn's gaming facility under construction in Morgantown, Pennsylvania in exchange for $30.0 million in rent credits which were fully utilized by Penn in the fourth quarter of 2020. The Company is leasing the land back to Pinnacle. As discussed further in the footnotesan affiliate of Penn pursuant to the consolidated financial statements, the Pinnacle MasterMorgantown Lease was originally bifurcated betweenfor an operating lease and a direct financing lease, resulting in the land that wasinitial annual rent of $3.0 million, subject to operating lease treatment being recorded as a real estate asset onescalation provisions following the Company's consolidated balance sheet, while the building assets that triggered direct financing lease treatment were recorded as an investment in direct financing lease on the Company's consolidated balance sheet.

In conjunction with the Penn-Pinnacle Merger, on October 15, 2018, the Pinnacle Master Lease was amended via the fourth amendment to such lease to allow for the saleopening of the operating assets of Ameristar Casino Hotel Kansas City, Ameristar Casino Resort Spa St. Charles and Belterra Casino Resort from Pinnacle to Boyd. As a result of this amendment, the Company reassessed the lease's classification and determined the new lease agreement qualified for operating lease treatment under ASCproperty.


840. Therefore, subsequent to the Penn-Pinnacle Merger, the Amended Pinnacle Master Lease is treated as an operating lease in its entirety and the building assets previously recorded as an investment in direct financing lease on the Company's consolidated balance sheet were recorded as real estate assets on the Company's consolidated balance sheet.

(2)     Hollywood Casino at Dayton Raceway and Hollywood Casino at Mahoning Valley Race Course were jointly developed with Penn National Gaming, Inc. The costs capitalized subsequent to acquisition represent the capital expenditures incurred by the Company subsequent to the transfer of the development properties at Spin-Off. Both properties commenced operations and began paying rent during the year ended December 31, 2014.

(3)    (4)    The Company's corporate headquarters building was completed in October 2015. The land was purchased on September 19, 2014 and construction on the building occurred through October 2015.



(4)    (5)    This includes undeveloped land the Company owns at locations other than its tenant occupied properties.


(5)    (6)    The aggregate cost for federal income tax purposes of the properties listed above was $7.96$8.34 billion at December 31, 2018.2020. This amount includes the tax basis of all real property assets acquired from Pinnacle, including building assets. The table above excludes the real estate assets of Tropicana Las Vegas which as described in Note 7 is in our TRS Segment and was acquired for $307.5 million ($226.2 million of Land and improvements and $81.3 million in Building and Improvements) in April 2020 with accumulated depreciation at December 31, 2020 totaling $2.7 million.
































A summary of activity for real estate and accumulated depreciation for the years ended December 31, 2018, 20172020, 2019 and 20162018 is as follows:


Year Ended December 31,
202020192018
Real Estate:(in thousands)
Balance at the beginning of the period$8,301,496 $8,314,546 $4,519,501 
Acquisitions590,971 0 1,199,135 
Capital expenditures and assets placed in service0 00 
Dispositions(194,369)(13,050)(3,270)
Balance at the end of the period$8,698,098 $8,301,496 $8,314,546 
Accumulated Depreciation:
Balance at the beginning of the period$(1,200,941)$(983,086)$(857,456)
Depreciation expense(220,069)(230,716)(125,630)
Dispositions10,070 12,861 0 
Balance at the end of the period$(1,410,940)$(1,200,941)$(983,086)
4


102
 Year Ended December 31,
 2018 2017 2016
Real Estate:(in thousands)
Balance at the beginning of the period$4,519,501
 $4,495,972
 $2,750,867
Acquisitions1,199,135
 23,507
 1,745,449
Reclass of assets from investment in direct financing lease to real estate investments (1)
2,599,180
 —
 —
Capital expenditures and assets placed in service—
 32
 82
Dispositions(3,270) (10) (426)
Balance at the end of the period$8,314,546
 $4,519,501
 $4,495,972
Accumulated Depreciation:     
Balance at the beginning of the period$(857,456) $(756,881) $(660,808)
Depreciation expense(125,630) (100,576) (96,073)
Dispositions—
 1
 —
Balance at the end of the period$(983,086) $(857,456) $(756,881)




SCHEDULE IV
MORTGAGE LOANS ON REAL ESTATE
December 31, 2018
Year Ended December 31, 2020Year Ended December 31, 2019
(in thousands)
Mortgage Loans:
Balance at the beginning of the period$57,684 $303,684 
  Additions during the period:
      New mortgage loans0 0 
  Deductions during the period:
      Collections of principal0 0 
      Other deductions (1)
(57,684)(246,000)
Balance at the end of the period$0 $57,684 
(in thousands)


Description Interest Rate Final Maturity Date Periodic Payment Terms Prior Liens Face Amount of Mortgage 
Carrying Amount of Mortgage (3)
 Principal Amount of Loans Subject to Delinquent Principal or Interest
Lumière Place Loan 9.09% 
10/1/2020 (1)
 interest paid monthly —
 $246,000
 $246,000
 —
Belterra Park Loan 11.11% 
4/3/2051 (2)
 interest paid monthly —
 57,684
 57,684
 —
          $303,684
 $303,684
 —

(1)The Lumière Loan has a final maturity date of On October 1, 2020, however,2019, the one-year anniversary of the CZR Loan, the mortgage evidenced by a deed of trust on the Lumière Place property terminated and the loan may be extinguished prior to this date.became unsecured.


(2)The In May 2020, the Company acquired the real estate of Belterra Park Loan matures in connection with the expirationsatisfaction of the loan, subject to a long-term lease (the "Belterra Park Lease") with a Boyd Master Lease (as may be extended ataffiliate operating the tenant's option to April 30, 2051).

(3) The aggregate cost for federal income tax purposes of the mortgage loans listed above was approximately $304 million at December 31, 2018.property.
103
 Year Ended December 31, 2018
 (in thousands)
Mortgage Loans: 
Balance at the beginning of the period$—
  Additions during the period: 
      New mortgage loans303,684
  Deductions during the period: 
      Collections of principal—
Balance at the end of the period$303,684



ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A.    CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
The Company's management, under the supervision and with the participation of the principal executive officer and principal financial officer, has evaluated the effectiveness of the Company's disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as of December 31, 2018,2020, which is the end of the period covered by this Annual Report on Form 10-K. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well-designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on this evaluation, our principal executive officer and principal financial officer concluded that as of December 31, 20182020 the Company's disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in reports it files or submits under the Exchange Act is (i) recorded, processed, summarized, evaluated and reported, as applicable, within the time periods specified in the United States Securities and Exchange Commission's rules and forms and (ii) accumulated and communicated to the Company's management, including the Company's principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.
Management's Report on Internal Control over Financial Reporting
The Company's management is responsible for establishing and maintaining an adequate system of internal control over financial reporting, as defined in Exchange Act Rules 13a-15(f) and 15d-15(f). The Company's management conducted an assessment of the Company's internal control over financial reporting and concluded it was effective as of December 31, 2018.2020. In making this assessment, management used the criteria established by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (2013).
Deloitte & Touche LLP, the Company's independent registered accounting firm, issued an audit report on the effectiveness of the Company's internal control over financial reporting as of December 31, 2018,2020, which is included on the following page of this Annual Report on Form 10-K.
Changes in Internal Control Over Financial Reporting
There have been no changes in the Company's internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during the fiscal quarter ended December 31, 2018,2020, that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. During the year ended December 31, 2018, we implemented controls to ensure we had identified all of the Company's lease agreements and properly assessed the impact of ASU 2016-02 on our financial statements to facilitate the adoption of this new guidance on January 1, 2019. We do not expect significant changes to our internal control over financial reporting due to the adoption of the new standard.


104

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the shareholdersShareholders and the Board of Directors of
Gaming and Leisure Properties, Inc. and Subsidiaries


Opinion on Internal Control over Financial Reporting


We have audited the internal control over financial reporting of Gaming and Leisure Properties, Inc. and Subsidiaries (the "Company") as of December 31, 2018,2020, based on criteria established in Internal Control - -- Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO")(COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2018,2020, based on criteria established in Internal Control - -- Integrated Framework (2013) issued by COSO.


We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements and financial statement schedules as of and for the year ended December 31, 2018,2020, of the Company and our report dated February 13, 2019,19, 2021, expressed an unqualified opinion on those financial statements.


Basis for Opinion


The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.


We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.


Definition and Limitations of Internal Control over Financial Reporting


A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.


Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.






/s/DELOITTE Deloitte & TOUCHE LLPTouche


New York, New York
February 13, 201919, 2021



105



ITEM 9B.    OTHER INFORMATION
NoneNone.

106

PART III


ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information required by this item concerning directors is hereby incorporated by reference to the Company's definitive proxy statement for its 20192021 Annual Meeting of Shareholders (the "2019"2021 Proxy Statement"), to be filed with the U.S. Securities and Exchange Commission within 120 days after December 31, 2018,2020, pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended. Information required by this item concerning executive officers is included in Part I of this Annual Report on Form 10-K.
ITEM 11.    EXECUTIVE COMPENSATION
The information called for in this item is hereby incorporated by reference to the 20192021 Proxy Statement.


ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS
The information called for in this item is hereby incorporated by reference to the 20192021 Proxy Statement.


ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
The information called for in this item is hereby incorporated by reference to the 20192021 Proxy Statement.
ITEM 14.    PRINCIPAL ACCOUNTING FEES AND SERVICES
The information called for in this item is hereby incorporated by reference to the 20192021 Proxy Statement.

107

PART IV
ITEM 15.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a)    1. Financial Statements. The following is a list of the Consolidated Financial Statements of the Company and its subsidiaries and supplementary data filed as part of Item 8 hereof:
Report of Independent Registered Public Accounting Firm
Consolidated Balance Sheets as of December 31, 20182020 and 20172019
Consolidated Statements of Income for the years ended December 31, 2018, 20172020, 2019 and 20162018
Consolidated Statements of Changes in Shareholders' Equity (Deficit) for the years ended December 31, 2018, 20172020, 2019 and 20162018
Consolidated Statements of Cash Flows for the years ended December 31, 2018, 20172020, 2019 and 20162018
2. Financial Statement Schedules:
Schedule III. Real Estate and Accumulated Depreciation as of December 31, 20182020
Schedule IV. Mortgage Loans on Real Estate as of December 31, 20182020
3. Exhibits, Including Those Incorporated by Reference.
The exhibits to this Report are listed on the accompanying index to exhibits and are incorporated herein by reference or are filed as part of this annual report on Form 10-K.


ITEM 16.    FORM 10-K SUMMARY


None.

108

EXHIBIT INDEX
ExhibitDescription of Exhibit
2.1
2.2
Agreement and Plan of Merger, dated as of July 20, 2015, by and among Pinnacle Entertainment, Inc., Gaming and Leisure Properties, Inc. and Gold Merger Sub, LLC. (Incorporated by reference to Exhibit 2.1 to the Company's current report on Form 8-K filed on July 22, 2015).
2.3
2.4
2.5
2.6
2.7
3.1
3.2
4.1
4.2
4.3
4.4
4.5

109

ExhibitDescription of Exhibit
4.6
4.7
4.8
4.9
4.10 
4.11 
4.12 
4.104.13 
4.114.14 
4.124.15 
4.134.16 
4.144.17 
4.154.18 
10.14.19 
4.20 
110

4.21 
4.22*
10.1 
10.2
10.3
10.4
10.5

Exhibit10.6 Description of Exhibit
10.6
10.7
10.8
10.9
10.10 
10.11 
111

10.1010.12 
10.1110.13 
10.1210.14 
10.1310.15 
10.1410.16 
10.1510.17 
10.16*10.18 
10.17*10.19 
10.1810.20 
10.1910.21 
10.2010.22 
10.2110.23 

Exhibit10.24 Description of Exhibit
10.22
10.2310.25 
10.2410.26 
112

10.27 
10.2510.28 
10.2610.29 
10.2710.30 
10.2810.31 
10.2910.32 
10.3010.33 #
10.31#10.34#
10.3210.35 #
10.3310.36 #
10.3410.37 #
10.3510.38 #
10.3610.39 # *

10.40 #
Exhibit10.41 #Description of Exhibit
10.37 #
113

10.3810.42 
21*10.43 
10.44 
21*
23*22.1*
23*
31.1*
31.2*32.1*
32.1*
CEO pal Financial Officer Certification pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of The Sarbanes - Oxley Act of 2002.
32.2*101 
CFO Certification pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of The Sarbanes - Oxley Act of 2002.
101*
Interactive data files pursuant to Rule 405 of Regulation S-T:following financial information from Gaming and Leisure Properties, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2020, formatted in Inline XBRL: (i) the Consolidated Balance Sheets, at December 31, 2018 and 2017, (ii) theii) Consolidated Statements of Income, for the years ended December 31, 2018, 2017 and 2016, (iii) the Consolidated Statements of Changes in Shareholders'Shareholders’ Equity, (Deficit) for the years ended December 31, 2018, 2017 and 2016, (iv) the Consolidated Statements of Cash Flows for the years ended December 31, 2018, 2017 and 2016, and (v) the notesNotes to the Consolidated Financial Statements.
104 
The cover page from the Company's Annual Report on Form 10-K for the year ended December 31, 2020, formatted in Inline XBRL and contained in Exhibit 101.
#    Compensation plans and arrangements for executives and others.
*    Filed herewith.

114

SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
GAMING AND LEISURE PROPERTIES, INC.
By:/s/ PETER M. CARLINO
Peter M. Carlino
Chairman of the Board and
Chief Executive Officer


Dated: February 13, 201919, 2021
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
SignatureTitleDate
/s/ PETER M. CARLINOChairman of the Board and Chief Executive Officer (Principal Executive Officer and Principal Financial Officer)February 13, 201919, 2021
Peter M. Carlino
/s/  STEVEN T. SNYDERInterim Chief Financial Officer (Principal Financial Officer and Duly Authorized Officer)February 13, 2019
Steven T. Snyder
/s/ DESIREE A. BURKESenior Vice President, and Chief Accounting Officer and Treasurer (Principal Accounting Officer)February 13, 201919, 2021
Desiree A. Burke
/s/ DAVID A. HANDLERCAROL LYNTONDirectorFebruary 13, 201919, 2021
David A. HandlerCarol Lynton
/s/ JOSEPH W. MARSHALLDirectorFebruary 13, 201919, 2021
Joseph W. Marshall
/s/ JAMES B. PERRYDirectorFebruary 13, 201919, 2021
James B. Perry
/s/ BARRY F. SCHWARTZDirectorFebruary 13, 201919, 2021
Barry F. Schwartz
/s/ EARL C. SHANKSDirectorFebruary 13, 201919, 2021
Earl C. Shanks
/s/ E. SCOTT URDANGDirectorFebruary 13, 201919, 2021
E. Scott Urdang



128
115