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Four Corners Property Trust, Inc.

Four Corners Property Trust, Inc.FCPT财报

NYSE · 金融 · 房地产投资信托

Four Corners Property Trust, Inc. is a publicly traded real estate investment trust that acquires, owns, and manages a portfolio of high-quality net-leased commercial properties. Its assets are primarily restaurant and retail locations across the United States, with tenants largely operating in stable consumer-facing industry segments with proven operational performance.

What changed in Four Corners Property Trust, Inc.'s 10-K — 2024 vs 2025

Top changes in Four Corners Property Trust, Inc.'s 2025 10-K

173 paragraphs added · 176 removed · 149 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

31 edited+2 added−9 removed48 unchanged
The tenants under our leases may have the ability to self-insure or use a captive provider with respect to its insurance obligations. We believe that the amount and scope of insurance coverage provided by our policies and the policies maintained by our 7 tenants are customary for similarly situated companies in our industry.
The tenants under our leases may have the ability to self-insure or use a captive provider with respect to its insurance obligations. We believe that the amount and scope of insurance coverage provided by our policies and the policies maintained by our tenants are customary for similarly situated companies in our industry.
We do not intend our website to be an active link or to otherwise incorporate the information contained on our website into this report or other filings with the SEC. Our filings can also be obtained for free on the SEC’s Internet website at www.sec.gov. We are providing our website address solely for the information of investors.
We do not intend our website to be an active link or to otherwise incorporate the information contained on our website into this report or other filings with the SEC. Our filings can also be obtained for free on the SEC’s Internet website at www.sec.gov. We are providing our website address solely for the information of investors. 8
In addition to maintenance requirements, the tenant is also generally responsible for insurance 4 required to be carried under the leases, taxes levied on or with respect to the properties, payment of common area maintenance charges and all utilities and other services necessary or appropriate for the properties and the business conducted on the properties.
In addition to maintenance requirements, the tenant is also generally responsible for insurance required to be carried under the leases, taxes levied on or with respect to the properties, payment of common area maintenance charges and all utilities and other services necessary or appropriate for the properties and the business conducted on the properties.
However, we cannot make any assurances that Darden or any other tenants in the future will maintain the required insurance coverages, and the failure by any of them to do so could have a material adverse effect on us.
However, we cannot make any assurances that Darden or any 7 other tenants in the future will maintain the required insurance coverages, and the failure by any of them to do so could have a material adverse effect on us.
See “Risk Factors - Risks Related to Our Business - We are dependent on our major tenants successfully operating their businesses, and a failure to do so could have a material adverse effect on our business, financial position or results of operations.” 6 Franchise Agreements Pursuant to the Franchise Agreements, Darden grants the right and license to our subsidiary, Kerrow, to operate the Kerrow Restaurant Operating Business.
See “ Risk Factors - Risks Related to Our Business - We are dependent on our major tenants successfully operating their businesses, and a failure to do so could have a material adverse effect on our business, financial position or results of operations. ” 6 Franchise Agreements Pursuant to the Franchise Agreements, Darden grants the right and license to our subsidiary, Kerrow, to operate the Kerrow Restaurant Operating Business.
We expect that future investments in properties, including any improvements or renovations of currently owned or newly- acquired properties, will be financed, in whole or in part, with cash flow from our operations, borrowings under our $250 million revolving credit facility, or the proceeds from issuances of common stock, preferred stock, debt or other securities.
We expect that future investments in properties, including any improvements or renovations of currently owned or newly- acquired properties, will be financed, in whole or in part, with cash flow from our operations, borrowings under our $350 million revolving credit facility, or the proceeds from issuances of common stock, preferred stock, debt or other securities.
As of December 31, 2024, we hold an investment grade rating of BBB from Fitch Ratings and an investment grade rating of Baa3 from Moody’s Investor Service. Flexible UPREIT Structure We operate in what is commonly referred to as an UPREIT structure, in which substantially all of our properties and assets are held through FCPT OP.
As of December 31, 2025, we hold an investment grade rating of BBB from Fitch Ratings and an investment grade rating of Baa3 from Moody’s Investor Service. Flexible UPREIT Structure We operate in what is commonly referred to as an UPREIT structure, in which substantially all of our properties and assets are held through FCPT OP.
(2) We have estimated Darden current quarter EBITDAR coverage using latest FCPT portfolio reported sales results for the quarter ended November 2024 and Darden brand average margins reported for the same period. (3) Lease term remaining is defined as the lease term weighted by the annual cash base rent.
(2) We have estimated Darden current quarter EBITDAR coverage using latest FCPT portfolio reported sales results for the quarter ended November 2025 and Darden brand average margins reported for the same period. (3) Lease term remaining is defined as the lease term weighted by the annual cash base rent.
Two of these restaurants are subject to ground leases to third parties. 5 The following table summarizes the rental properties by brand as of December 31, 2024: Brand Number of FCPT Properties and Leasehold Interests Total Square Feet (000s) Annual Cash Base Rent $(000s) % Total Cash Base Rent (1) Avg.
Two of these restaurants are subject to ground leases to third parties. 5 The following table summarizes the rental properties by brand as of December 31, 2025: Brand Number of FCPT Properties and Leasehold Interests Total Square Feet (000s) Annual Cash Base Rent $(000s) % Total Cash Base Rent (1) Avg.
Darden is currently the primary source of our revenues, and its financial condition and ability and willingness to satisfy its obligations under the leases and its willingness to renew the leases upon expiration of the initial base term thereof significantly impacts our revenues and our ability to service our indebtedness and make distributions to our shareholders.
Darden is currently the significant source of our revenues, and its financial condition and ability and willingness to satisfy its obligations under the leases and its willingness to renew the leases upon expiration of the initial base term thereof significantly impacts our revenues and our ability to service our indebtedness and make distributions to our shareholders.
We believe that we have operated in conformity with the requirements for qualification and taxation as a REIT for the taxable year ended December 31, 2024, and we intend to continue to operate in a manner that will enable us to maintain our qualification as a REIT.
We believe that we have operated in conformity with the requirements for qualification and taxation as a REIT for the taxable year ended December 31, 2025, and we intend to continue to operate in a manner that will enable us to maintain our qualification as a REIT.
As of February 13, 2025, we have not been notified by any governmental authority of, nor is management aware of, any non-compliance with the ADA that management believes would have a material adverse effect on our business, financial position or results of operations. Other Regulations State and local fire, life-safety and similar entities regulate the use of the properties.
As of February 12, 2026, we have not been notified by any governmental authority of, nor is management aware of, any non-compliance with the ADA that management believes would have a material adverse effect on our business, financial position or results of operations. Other Regulations State and local fire, life-safety and similar entities regulate the use of the properties.
The leases in place with Darden provide for a weighted average remaining initial term of approximately 5.7 years as of December 31, 2024, with no purchase options provided that Darden will have a right of first offer with respect to our sale of any property, if there is no default under the lease, and we will be prohibited from selling any Properties to (i) any nationally recognized casual or fine dining brand restaurant or entity operating the same or (ii) any other regionally recognized casual or fine dining brand restaurant or entity operating the same, with 25 or more units.
The leases in place with Darden provide for a weighted average remaining initial term of approximately 4.8 years as of December 31, 2025, with no purchase options provided that Darden will have a right of first offer with respect to our sale of any property, if there is no default under the lease, and we will be prohibited from selling any Properties to (i) any nationally recognized casual or fine dining brand restaurant or entity operating the same or (ii) any other regionally recognized casual or fine dining brand restaurant or entity operating the same, with 25 or more units.
As of February 13, 2025, we have not been notified by any governmental authority of, nor is management aware of, any non-compliance or liability with respect to environmental laws that management believes would have a material adverse effect on our business, financial position or results of operations.
As of February 12, 2026, we have not been notified by any governmental authority of, nor is management aware of, any non-compliance or liability with respect to environmental laws that management believes would have a material adverse effect on our business, financial position or results of operations.
These properties were held for investment, with an aggregate leasable area of approximately 8.0 million square feet, and had a weighted average remaining lease term of 7.3 years before any lease renewals. An additional seven properties, representing the Kerrow Restaurant Operating Business, are operated by Kerrow subject to franchise agreements with Darden (“Franchise Agreements”).
These properties were held for investment, with an aggregate leasable area of approximately 8.8 million square feet, and had a weighted average remaining lease term of 6.9 years before any lease renewals. An additional seven properties, representing the Kerrow Restaurant Operating Business, are operated by Kerrow subject to franchise agreements with Darden (“Franchise Agreements”).
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 to us. Our Portfolio At December 31, 2024, our investment portfolio included 1,198 rental properties located in 47 states, all within the continental United States.
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 to us. Our Portfolio At December 31, 2025, our investment portfolio included 1,303 rental properties located in 48 states, all within the continental United States.
Our principal sources of liquidity will be our cash generated through operations, our revolving credit facility which has an undrawn capacity as of December 31, 2024 of $245.0 million, our ability to access the public equity markets, and our ability to access bank and private placement debt markets.
Our principal sources of liquidity will be our cash generated through operations, our revolving credit facility which has an undrawn capacity as of December 31, 2025 of $350 million, our ability to access the public equity markets, and our ability to access bank and private placement debt markets.
On September 17, 2024, the Company terminated the prior ATM program (the "prior ATM program") and entered into a new ATM program (the "ATM program" together with the prior ATM program, the "ATM programs"), pursuant to which shares of the Company’s common stock having an aggregate gross sales price of up to $500.0 million through sales agents and forward sellers.
On October 30, 2025, the Company terminated the prior ATM program (the "prior ATM program") and entered into a new ATM program (the "ATM program" together with the prior ATM program, the "ATM programs"), pursuant to which shares of the Company’s common stock having an aggregate gross sales price of up to $500.0 million through sales agents and forward sellers.
Human Capital Resources and Management As of February 13, 2025, we had 536 employees, of which 498 were employed at our Kerrow Restaurant Operating Business. None of these employees are represented by a labor union. Our human capital development goals and initiatives are focused on enhancing employee growth, satisfaction and wellness while maintaining a diverse and thriving culture.
Human Capital Resources and Management As of February 12, 2026, we had 496 employees, of which 451 were employed at our Kerrow Restaurant Operating Business. None of these employees are represented by a labor union. Our human capital development goals and initiatives are focused on enhancing employee growth, satisfaction and wellness while maintaining a diverse and thriving culture.
Our properties are leased to our tenants on a net lease basis with a weighted average remaining lease term of approximately 7.3 years before any renewals and an average annual rent escalation of 1.4% through December 31, 2029 (weighted by annualized base rent), thereby providing a long-term, stable income stream.
Our properties are leased to our tenants on a net lease basis with a weighted average remaining lease term of approximately 6.9 years before any renewals and an average annual rent escalation of 1.5% through December 31, 2030 (weighted by annualized base rent), thereby providing a long-term, stable income stream.
Additionally, as of December 31, 2024, restaurant properties and non-restaurant retail properties accounted for 77.3% and 22.7%, respectively, of our total revenues. Acquiring restaurant properties while also acquiring non-restaurant retail properties allows us to leverage our experience with the restaurant industry and accelerate our diversified growth and, in doing so, reduce our concentration with Darden.
Additionally, as of December 31, 2025, restaurant properties and non-restaurant retail properties accounted for 74% and 26%, respectively, of our total revenues. Acquiring restaurant properties while also acquiring non-restaurant retail properties allows us to leverage our experience with the restaurant industry and accelerate our diversified growth and, in doing so, reduce our concentration with Darden.
Item 1. B usiness. Unless the context indicates otherwise, all references to “FCPT,” the “Company,” “we,” “our” or “us” include Four Corners Property Trust, Inc. and all of its consolidated subsidiaries. History We were incorporated as a Maryland corporation on July 2, 2015 as a wholly owned indirect subsidiary of Darden Restaurants, Inc.
Item 1. B usiness. Unless the context indicates otherwise, all references to “FCPT,” the “Company,” “we,” “our” or “us” include Four Corners Property Trust, Inc. and all of its consolidated subsidiaries. History The Company was incorporated in Maryland in July 2015. The Company was formed as a wholly owned subsidiary of Darden Restaurants, Inc.
Pursuant to these transactions, we acquired 87 rental properties and ground leasehold interests, aggregating 546.6 thousand square feet. 3 As of December 31, 2024, our lease portfolio had the following characteristics: • 1,198 free-standing properties located in 47 states and representing an aggregate leasable area of 8.0 million square feet; • 99.6% occupancy (based on leasable square footage); • An average remaining lease term of 7.3 years (weighted by annualized base rent); • An average annual rent escalation of 1.4% through December 31, 2029 (weighted by annualized base rent); and • 56% investment-grade tenancy (weighted by annualized base rent).
Pursuant to these transactions, we acquired 105 rental properties and ground leasehold interests, aggregating 713.9 thousand square feet. 3 As of December 31, 2025, our lease portfolio had the following characteristics: • 1,303 free-standing properties located in 48 states and representing an aggregate leasable area of 8.8 million square feet; • 99.6% occupancy (based on leasable square footage); • An average remaining lease term of 6.9 years (weighted by annualized base rent); • An average annual rent escalation of 1.5% 1 through December 31, 2030 (weighted by annualized base rent); and • 53% investment-grade tenancy (weighted by annualized base rent).
The following table summarizes the diversification of FCPT’s lease portfolio by state as of December 31, 2024: State # of Leases % of Annual Base Rent Texas 96 9.9% Florida 88 8.7% Ohio 85 6.7% Illinois 82 6.7% Georgia 73 6.1% Indiana 78 5.4% Tennessee 43 4.4% Michigan 63 4.1% 39 other states (none greater than 3%) 612 48.0% Total 1,220 100% Leases with Darden The estimated annual cash rent based on current rates for the leases in place with Darden is approximately $114.6 million, with average annual rent escalations of 1.5% through December 31, 2029.
The following table summarizes the diversification of FCPT’s lease portfolio by state as of December 31, 2025: State # of Leases % of Annual Base Rent Texas 108 10.0% Florida 90 8.3% Ohio 91 6.7% Illinois 89 6.6% Georgia 79 6.0% Indiana 79 5.0% Tennessee 55 5.0% Michigan 64 3.8% Alabama 54 3.5% 39 other states (none greater than 3%) 616 45.2% Total 1,325 100% Leases with Darden The estimated annual cash rent based on current rates for the leases in place with Darden is approximately $118.2 million, with average annual rent escalations of 1.5% through December 31, 2030.
We seek to improve the probability of successful tenant renewal at the end of initial lease terms by acquiring properties that have high levels of operator profitability compared to rent payments and have absolute rent levels that generally reflect market rates.
We seek to improve the probability of successful tenant renewal at the end of initial lease terms by acquiring properties that have high levels of operator profitability compared to rent payments and have absolute rent levels that reflect market rates. In 2025, FCPT engaged in various real estate transactions for a total investment of $325.5 million, including capitalized transaction costs.
As of December 31, 2024, properties in our leasing portfolio were located in 47 different states across the continental United States, comprised of 163 unique tenant brands, and no concentrations of 10% or greater of total rental revenue in any one state.
As of December 31, 2025, properties in our leasing portfolio were located in 48 different states across the continental United States, comprised of 179 unique tenant brands, and our properties in only one state, Texas, individually accounted for 10% or more of our total revenue at 10.0% of our total revenue.
Under the leases, the tenant is typically responsible for maintaining the properties in accordance with prudent industry practice and in compliance with all federal and state standards. The maintenance responsibilities include, among others, maintaining the building, building systems including roofing systems and other improvements.
Leases owned for less than one year are included based on the annualized first month’s rent. 4 the properties in accordance with prudent industry practice and in compliance with all federal and state standards. The maintenance responsibilities include, among others, maintaining the building, building systems including roofing systems and other improvements.
Business Overview We are a Maryland corporation and a real estate investment trust (“REIT”) which owns, acquires and leases properties for use in the restaurant and retail industries.
("Darden") and became an independent publicly traded company four months later following the completion of its separation from Darden in November 2015. Business Overview We are a real estate investment trust (“REIT”) which owns, acquires and leases properties for use in the restaurant and retail industries.
Compensation and Benefits Our compensation program is designed to, among other things, attract, retain and incentivize talented and experienced individuals. We use a mix of competitive salaries and other benefits to attract and retain these individuals. We offer competitive compensation and benefits, including, but not limited to, retirement savings plans and medical, dental and vision coverage.
We offer competitive compensation and benefits, including, but not limited to, retirement savings plans and medical, dental and vision coverage.
Rent Per Square Foot ($) Tenant EBITDAR Coverage (2) Lease Term Remaining (Yrs) (3) Olive Garden 314 2,674 $ 82,061 34.2 % $ 31 5.8 x 5.8 LongHorn Steakhouse 116 650 23,232 9.7 % 36 5.8 x 4.6 Other Brands - Restaurant 427 2,123 71,112 29.6 % 33 3.2 x 9.2 Other Brands - Retail 315 2,364 54,460 22.7 % 23 2.7 x 8.2 Other Brands - Darden 26 230 9,306 3.9 % 40 3.4 x 8.0 Total 1,198 8,041 $ 240,172 100.0 % $ 30 4.9 x 7.3 (1) Current scheduled minimum contractual rent as of December 31, 2024.
Rent Per Square Foot ($) Tenant EBITDAR Coverage (2) Lease Term Remaining (Yrs) (3) Olive Garden 316 2,689 $83,748 31.7% $31 6.0x 4.8 LongHorn Steakhouse 118 662 23,878 9.0% $36 5.9x 3.6 Other Brands - Restaurant 459 2,217 77,292 29.3% $35 3.5x 8.9 Other Brands - Retail 379 2,914 68,685 26.0% $24 3.1x 8.4 Other Brands - Darden 31 273 10,599 4.0% $39 3.2x 7.1 Total 1,303 8,755 $264,202 100.0% $30 5.1x 6.9 (1) Current scheduled minimum contractual rent as of December 31, 2025.
We aim to develop our employees by providing internal training, leadership coaching programs and providing tuition assistance and course reimbursement for career-enhancing education and licensure requirements. We encourage both formal and informal mentorship to provide employees with critical developmental feedback, including by conducting annual performance and professional development planning opportunities.
Several of our human capital development initiatives include the following: Training and Development We support the continual development of our employees through various training and education programs throughout their tenure at the Company. We aim to develop our employees by providing internal training, leadership coaching programs and providing tuition assistance and course reimbursement for career-enhancing education and licensure requirements.
Removed
(together with its consolidated subsidiaries “Darden”), for the purpose of owning, acquiring and leasing properties on a net basis, for use in the restaurant and related food service industries.
Added
Under the leases, the tenant is typically responsible for maintaining 1 Previously, annual rent escalation was calculated assuming expiring leases remained flat. In light of 1) our historical experience of renewals often at contractual rent increases, and 2) an increased number of leases coming due in the next 5 year timeframe.
Removed
On November 9, 2015, Darden completed a spin-off of FCPT pursuant to which Darden contributed to us (i) 100% of the equity interest in entities that owned 418 properties in which Darden operates Olive Garden, LongHorn Steakhouse and other branded restaurants (the “Properties” or “Property”) and (ii) six LongHorn Steakhouse restaurants, including the properties or interests associated with such restaurants, located in the San Antonio, Texas area (the “Kerrow Restaurant Operating Business”).
Added
We encourage both formal and informal mentorship to provide employees with critical developmental feedback, including by conducting annual performance and professional development planning opportunities. Compensation and Benefits Our compensation program is designed to, among other things, attract, retain and incentivize talented and experienced individuals. We use a mix of competitive salaries and other benefits to attract and retain these individuals.
Removed
In exchange, we issued to Darden all of our common stock and paid to Darden $315.0 million in cash.
Removed
Subsequently, Darden distributed all of our outstanding shares of common stock pro rata to holders of Darden common stock whereby each Darden shareholder received one share of our common stock for every three shares of Darden common stock held at the close of business on the record date as well as cash in lieu of any fractional shares of our common stock which they would have otherwise received (the “Spin-Off”).
Removed
In 2024, FCPT engaged in various real estate transactions for a total investment of $273.0 million, including capitalized transaction costs.
Removed
Several of our human capital development initiatives include the following: Diversity, Equity and Inclusion In alignment with our values, we believe people are our greatest asset and we embrace a recruitment process that strives to attract top-tier, diverse talent.
Removed
We provide equal employment opportunities to all individuals and seek to cultivate an inclusive culture that respects and appreciates diversity of experience, ideas and opinions. The basis for recruitment, hiring, development, training, compensation and advancement at the Company is qualifications, performance, skills and experience.
Removed
We endeavor to maintain a workplace that is free from discrimination or harassment on the basis of color, race, sex, national origin, ethnicity, religion, age, disability, sexual orientation, gender identification or expression or any other status protected by applicable law.
Removed
We conduct annual training to prevent harassment and discrimination and monitor employee conduct year-round, including by providing employees with access to an anonymous whistleblower hotline to report any violations. Training and Development We support the continual development of our employees through various training and education programs throughout their tenure at the Company.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

59 edited+10 added−8 removed222 unchanged
While the tenants under our leases generally indemnify, defend and hold us harmless for the foregoing liabilities, there can be no assurance that the respective tenant will have sufficient assets, income or access to financing to enable it to satisfy its payment obligations to us under its lease.
While the tenants under our leases generally indemnify, defend and hold us harmless for the foregoing liabilities, there can be no assurance that the respective tenant will have sufficient assets, income or access to financing to enable it to satisfy its payment obligations to us under its lease.
Risks Related to Our Organizational Structure 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.
Risks Related to Our Organizational Structure 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 addition, subject to certain exceptions, rents received or accrued by us from Darden will not be treated as qualifying rent for purposes of the REIT gross income requirements if we or a beneficial or constructive owner of 10% or more of our stock beneficially 20 or constructively owns 10% or more of the total combined voting power of all classes of Darden stock entitled to vote or 10% or more of the total value of all classes of Darden stock.
In addition, subject to certain exceptions, rents received or accrued by us from Darden will not be treated as qualifying rent for purposes of the REIT gross income requirements if we or a beneficial or constructive owner of 10% or more of our stock beneficially or constructively owns 10% or more of the total combined voting power of all classes of Darden stock entitled to vote or 10% or more of the total value of all classes of Darden stock.
Numerous sources can cause these types of incidents, including: physical or electronic security breaches; viruses, ransomware or other malware; 15 hardware vulnerabilities such as Meltdown and Spectre; accident or human error by our own personnel or third parties; criminal activity or malfeasance (including by our own personnel); fraud or impersonation scams perpetrated against us or our partners or tenants; or security events impacting our third-party service providers or our partners or tenants.
Numerous sources can cause these types of incidents, including: physical or electronic security breaches; viruses, ransomware or other malware; hardware vulnerabilities such as Meltdown and Spectre; accident or human error by our own personnel or third parties; criminal activity or malfeasance (including by our own personnel); fraud or impersonation scams perpetrated against us or our partners or tenants; or security events impacting our third-party service providers or our partners or tenants.
The Amended Loan Agreement provides for borrowings of up to $940 million and consists of (1) a revolving credit facility in an aggregate principal amount of $350 million and (2) a term loan facility in an aggregate principal amount of $590 million comprised of (i) a $100 million term credit facility with a maturity date of November 9, 2026, (ii) a $90 million term credit facility with a maturity date of February 1, 2027, (iii) a $85 million term credit facility with a maturity date of March 14, 2027, (iv) a $90 million term credit facility with a maturity date of February 1, 2028, and (v) a $225 million term credit facility with a maturity date of February 1, 2029.
The Amended Loan Agreement provides for borrowings of up to $940 million and consists of (1) a revolving credit facility in an aggregate principal amount of $350 million and (2) a term loan facility in an aggregate principal amount of $590 million comprised of (i) a $100 million term credit facility with a maturity date of November 9, 2026 (the "Term Loan A-2 Facility"), (ii) a $90 million term credit facility with a maturity date of February 1, 2027, (iii) a $85 million term credit facility with a maturity date of March 14, 2027 (the "Term Loan A-5 Facility"), (iv) a $90 million term credit facility with a maturity date of February 1, 2028, and (v) a $225 million term credit facility with a maturity date of February 1, 2029 (the "Term Loan A-1 Facility").
In order for us to qualify as a REIT, not more than 50% in value of our outstanding shares of stock may be owned, beneficially or constructively, by five or fewer individuals at any time during the last half of each taxable year after the first year for which we elect to 18 be subject to tax and qualify as a REIT.
In order for us to qualify as a REIT, not more than 50% in value of our outstanding shares of stock may be owned, beneficially or constructively, by five or fewer individuals at any time during the last half of each taxable year after the first year for which we elect to be subject to tax and qualify as a REIT.
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.
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 21 subject to U.S. federal corporate income tax on our undistributed net taxable income.
The franchising services include licensing the right to use and display certain trademarks, utilize trade secrets and purchase proprietary products from Darden in connection with the operation of the Kerrow Restaurant Operating Business. Other services provided pursuant to the Franchise Agreements are marketing services, training and access to certain LongHorn operating 10 procedures.
The franchising services include licensing the right to use and display certain trademarks, utilize trade secrets and purchase proprietary products from Darden in connection with the operation of the Kerrow Restaurant Operating Business. Other services provided pursuant to the Franchise Agreements are marketing services, training and access to certain LongHorn operating procedures.
Similarly, we may be required to incur or maintain debt we would otherwise not incur so we can allocate the debt to the contributors to maintain their tax bases. These restrictions could limit our ability to sell or refinance an asset at a time, or on terms, that would be favorable absent such restrictions.
Similarly, we may be required to incur or maintain debt we would otherwise not incur so we can allocate the debt to the contributors to maintain their tax bases. These restrictions could limit our 22 ability to sell or refinance an asset at a time, or on terms, that would be favorable absent such restrictions.
In addition, the effect of inflation on interest rates could increase our financing costs over time, either through near-term borrowings on our floating-rate line of credit or refinancing of our existing borrowings that may incur higher interest expenses related to the issuance of new debt.
In addition, the effect of inflation on interest rates could increase our financing costs over time, either through near-term borrowings on our floating-rate line of credit or refinancing of our existing borrowings that may incur 12 higher interest expenses related to the issuance of new debt.
As a result, during inflationary periods in which the 12 inflation rate exceeds the annual rent escalation percentages within our lease contracts, we may not adequately mitigate the impact of inflation, which may adversely affect our business, financial condition, results of operations, and cash flows.
As a result, during inflationary periods in which the inflation rate exceeds the annual rent escalation percentages within our lease contracts, we may not adequately mitigate the impact of inflation, which may adversely affect our business, financial condition, results of operations, and cash flows.
Interest rate increases would increase our interest costs for any new debt and our variable rate debt obligations pursuant to the Amended Loan Agreement, which could, in turn, make the financing of any acquisition more expensive as well as lower our current period earnings.
Interest rate increases would increase our interest 18 costs for any new debt and our variable rate debt obligations pursuant to the Amended Loan Agreement, which could, in turn, make the financing of any acquisition more expensive as well as lower our current period earnings.
The remainder of our investments (other than government securities, qualified real estate assets and securities issued by a TRS) generally 21 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.
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.
Also, the law relating 22 to the tax treatment of other entities, or an investment in other entities, could change, making an investment in such other entities more attractive relative to an investment in a REIT. Item 1B. Unresolved Staff Comments. Not applicable.
Also, the law relating to the tax treatment of other entities, or an investment in other entities, could change, making an investment in such other entities more attractive relative to an investment in a REIT. Item 1B. Unresolved Staff Comments. Not applicable.
For these reasons, if Darden were to experience a material and adverse effect on its business, financial position or results of operations, our business, financial position or results of operations could also be materially and adversely affected.
For these reasons, if Darden were to experience a material 10 and adverse effect on its business, financial position or results of operations, our business, financial position or results of operations could also be materially and adversely affected.
Internal control over financial reporting is complex and may be revised over time to adapt to changes in our business, or changes in applicable accounting rules.
Internal control over financial reporting is complex and may 16 be revised over time to adapt to changes in our business, or changes in applicable accounting rules.
We have entered into interest rate swaps to effectively fix $435 million of our variable-rate indebtedness, and we may enter into other hedging transactions. Because tenants are typically required to pay all property operating expenses, increases in property-level expenses at our leased properties generally do not affect us.
We have entered into interest rate swaps to effectively fix $560 million of our variable-rate indebtedness, and we may enter into other hedging transactions. Because tenants are typically required to pay all property operating expenses, increases in property-level expenses at our leased properties generally do not affect us.
As of December 31, 2024, no other executive officer or director of FCPT owns common stock of Darden. Risks Related to Our Common Stock The market price and trading volume of our common stock may be volatile and may face negative pressure including as a result of future sales or distributions of our common stock.
As of December 31, 2025, no other executive officer or director of FCPT owns common stock of Darden. Risks Related to Our Common Stock The market price and trading volume of our common stock may be volatile and may face negative pressure including as a result of future sales or distributions of our common stock.
Risks Related to Our Taxation as a REIT • If we do not qualify 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 would reduce the amount of cash available for distribution to our stockholders. • We could fail to qualify as a REIT if income we receive from Darden and other tenants is not treated as qualifying income. • REIT distribution requirements could adversely affect our ability to execute our business plan. 9 We attempt to mitigate the foregoing risks.
Risks Related to Our Taxation as a REIT • If we do not qualify 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 would reduce the amount of cash available for distribution to our stockholders. • We could fail to qualify as a REIT if income we receive from Darden and other tenants is not treated as qualifying income. • REIT distribution requirements could adversely affect our ability to execute our business plan.
Properties in our leasing portfolio and the Kerrow Restaurant Operating Business are located in 47 states, and if one of our properties experiences a loss that is uninsured or that exceeds policy coverage limits, we could lose the capital invested in the damaged property 13 as well as the anticipated future cash flows from the property.
Properties in our leasing portfolio and the Kerrow Restaurant Operating Business are located in 48 states, and if one of our properties experiences a loss that is uninsured or that exceeds policy coverage limits, we could lose the capital invested in the damaged property as well as the anticipated future cash flows from the property.
Therefore, we are subject to risks associated with having a highly concentrated property brand base. As of December 31, 2024, our restaurant properties include 314 Olive Garden restaurants. As a result, our success, at least in the short-term, is dependent on the continued success of the Olive Garden brand and, to a lesser extent, Darden’s other restaurant brands.
Therefore, we are subject to risks associated with having a highly concentrated property brand base. As of December 31, 2025, our restaurant properties include 316 Olive Garden restaurants. As a result, our success, at least in the short-term, is dependent on the continued success of the Olive Garden brand and, to a lesser extent, Darden’s other restaurant brands.
Although our properties have an average annual rent escalation of 1.4% through December 31, 2029, the impact of the current rate of inflation may not be adequately offset by some of our rent escalations, and it is possible that the resetting of rents from our renewal and re-leasing activities would not fully offset the impact of the current inflation rate.
Although our properties have an average annual rent escalation of 1.5% 1 through December 31, 2030, the impact of the current rate of inflation may not be adequately offset by some of our rent escalations, and it is possible that the resetting of rents from our renewal and re-leasing activities would not fully offset the impact of the current inflation rate.
Our leases typically contain provisions, such as rent escalators, designed to mitigate the adverse impact of inflation on our results of operations. As of December 31, 2024, we had $520 million of variable-rate debt, excluding the impact of interest rates swaps in effect.
Our leases typically contain provisions, such as rent escalators, designed to mitigate the adverse impact of inflation on our results of operations. As of December 31, 2025, we had $590 million of variable-rate debt, excluding the impact of interest rates swaps in effect.
We are dependent on our major tenants successfully operating their businesses, and a failure to do so could have a material adverse effect on our business, financial position or results of operations. For the year ended December 31, 2024, Darden and Brinker International, Inc. (“Brinker”) constituted approximately 47.7% and 7.2%, respectively, of our annual cash base rent.
We are dependent on our major tenants successfully operating their businesses, and a failure to do so could have a material adverse effect on our business, financial position or results of operations. For the year ended December 31, 2025, Darden and Brinker International, Inc. (“Brinker”) constituted approximately 44.7% and 6.6%, respectively, of our annual cash base rent.
Our portfolio has some geographic concentration, which makes us more susceptible to adverse events in these areas. Our properties are located throughout the United States with the highest concentration located in the state of Texas, where 9.9% of our annualized base rent was derived as of December 31, 2024.
Our portfolio has some geographic concentration, which makes us more susceptible to adverse events in these areas. Our properties are located throughout the United States with the highest concentration located in the state of Texas, where 10.0% of our annualized base rent was derived as of December 31, 2025.
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, no more than 20% of the value of our total assets can be represented by securities of one or more TRSs and no more than 25% of the value of our assets can be represented by certain debt instruments issued by “publicly offered REITs.” If we fail to comply with these requirements at the end of any calendar quarter, we must correct the failure within thirty 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.
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, no more than 25% of the value of our total assets can be represented by securities of one or more TRSs no more than 25% of the value of our total assets can be represented by securities of one or more TRSs (20% for taxable years beginning after December 31, 2017 and before January 1, 2026) and no more than 25% of the value of our assets can be represented by certain debt instruments issued by “publicly offered REITs.” If we fail to comply with these requirements at the end of any calendar quarter, we must correct the failure within thirty 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 of December 31, 2024, we are in compliance with our existing financial covenants.
As of December 31, 2025, we are in compliance with our existing financial covenants.
As of the date of this report, we have entered into a Fourth Amended and Restated Revolving Credit and Term Loan Agreement (the "Amended Loan Agreement"), which amended and restated the Loan Agreement (as defined below).
We have entered into a Fourth Amended and Restated Revolving Credit and Term Loan Agreement (the "Amended Loan Agreement"), which amended and restated the Loan Agreement (as defined below).
Therefore, our success is to some degree dependent on the restaurant industry, which could be adversely affected by economic conditions in general, changes in consumer trends and preferences and other factors over which we and any of our tenants in the restaurant industry have no control.
Therefore, our success is to some degree dependent on the restaurant industry, which could be adversely affected by economic conditions in general, new or threatened policies of governmental and regulatory agencies, changes in consumer trends and preferences and other 11 factors over which we and any of our tenants in the restaurant industry have no control.
As of December 31, 2024, our $765 million Loan Agreement bore interest at a variable rate on any amount drawn and outstanding, and borrowings under the Amended Loan Agreement bear interest at a variable rate. As of December 31, 2024, $520 million was outstanding under the Loan Agreement.
As of December 31, 2025, our $940 million Loan Agreement bore interest at a variable rate on any amount drawn and outstanding, and borrowings under the Amended Loan Agreement bear interest at a variable rate. As of December 31, 2025, $590 million was outstanding under the Loan Agreement.
Such risks, including those set forth in the summary of material risks in this Item 1A, should be carefully considered before purchasing our securities. 8 Risks Related to Our Business • Risks related to real estate ownership could reduce the value of our properties. • We are dependent on Darden, Brinker, and our other tenants to successfully operate their businesses, make rental payments to us and fulfill their obligations under their respective leases and other contracts with us. • Actual or perceived threats associated with epidemics, pandemics or public health crises, could have a material adverse effect on our and our tenants’ businesses. • A significant portion of our restaurant properties are Olive Garden properties.
Risks Related to Our Business • Risks related to real estate ownership could reduce the value of our properties. • We are dependent on Darden, Brinker, and our other tenants to successfully operate their businesses, make rental payments to us and fulfill their obligations under their respective leases and other contracts with us. • Actual or perceived threats associated with epidemics, pandemics or public health crises, could have a material adverse effect on our and our tenants’ businesses. • A significant portion of our restaurant properties are Olive Garden properties.
In 2024, we acquired 87 properties and ground leasehold interests for a total investment of $273.0 million, including capitalized transaction costs, which were added to our leasing portfolio.
In 2025, we acquired 105 properties and ground leasehold interests for a total investment of $325.5 million, including capitalized transaction costs, which were added to our leasing portfolio.
If financing is not available when needed, or is available on unfavorable terms, we may be unable to complete acquisitions or otherwise take advantage of business opportunities or respond to competitive pressures, any of which could materially and adversely affect our business, financial condition and results of operations. 17 Covenants in our debt agreements may limit our operational flexibility, and a covenant breach or default could materially and adversely affect our business, financial position or results of operations.
If financing is not available when needed, or is available on unfavorable terms, we may be unable to complete acquisitions or otherwise take advantage of business opportunities or respond to competitive pressures, any of which could materially and adversely affect our business, financial condition and results of operations.
If we incur significant additional expenses or are delayed in being able to pursue returns on our real estate investments, it may have a materially adverse effect on our ability to operate and grow our business and our ability to achieve our strategic objectives.
If we incur significant additional expenses or are delayed in being able to pursue returns on our real estate investments, it may have a materially adverse effect on our ability to operate and grow our business and our ability to achieve our strategic objectives. 1 Previously, annual rent escalation was calculated assuming expiring leases remained flat.
Risks Related to Our Taxation as a REIT If we do not qualify 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 would reduce the amount of cash available for distribution to our stockholders.
No assurance can be given that we will pay any dividends on shares of our common stock in the future. 20 Risks Related to Our Taxation as a REIT If we do not qualify 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 would reduce the amount of cash available for distribution to our stockholders.
While the tenants under our leases generally indemnify, defend and hold us harmless for the foregoing liabilities, there can be no assurance that the respective tenant will have sufficient assets, income or access to financing to enable it to satisfy its payment obligations to us under its lease.
While the tenants under our leases generally indemnify, defend and hold us harmless for the foregoing liabilities, there can be no assurance that the respective tenant will have sufficient assets, income or access to financing to enable it to satisfy its payment obligations to us under its lease. 14 Our relationship with Darden may adversely affect our ability to do business with third-party restaurant operators and other tenants.
If we want to sell a property, we cannot assure you that we will be able to dispose of it in the desired time period, or at all, or that the sale price of a property will exceed the cost of our investment in that property. 14 In addition, the properties subject to leases with Darden provide them a right of first offer with respect to our sale of any such property, provided there is no default under the lease, and we are prohibited from selling any of our properties to (i) any nationally recognized casual or fine dining brand restaurant or entity operating the same or (ii) any other regionally recognized casual or fine dining brand restaurant or entity operating the same, with 25 or more units.
In addition, the properties subject to leases with Darden provide them a right of first offer with respect to our sale of any such property, provided there is no default under the lease, and we are prohibited from selling any of our properties to (i) any nationally recognized casual or fine dining brand restaurant or entity operating the same or (ii) any other regionally recognized casual or fine dining brand restaurant or entity operating the same, with 25 or more units.
While the tenants under our leases generally indemnify, defend and hold us harmless for the foregoing liabilities, there can be no assurance that the respective tenant will have sufficient assets, income or access to financing to enable it to satisfy its payment obligations to us under its lease.
While the tenants under our leases generally indemnify, defend and hold us harmless for the foregoing liabilities, there can be no assurance that the respective tenant will have sufficient assets, income or access to financing to enable it to satisfy its payment obligations to us under its lease. 15 Our active management and operation of a restaurant business may expose us to potential liabilities beyond those traditionally associated with REITs.
The market price of our common stock may be volatile in the future. In addition, the trading volume in our common shares may fluctuate and cause significant price variations to occur.
The market price of our common stock may be volatile in the future. In addition, the trading volume in our common shares may fluctuate and cause significant price variations to occur. It is not possible to accurately predict how investors in our common stock will behave.
We or our tenants may experience uninsured or underinsured 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.
Leases owned for less than one year are included based on the annualized first month’s rent. 13 We or our tenants may experience uninsured or underinsured 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.
Our active management and operation of a restaurant business may expose us to potential liabilities beyond those traditionally associated with REITs. In addition to our real estate investment activities, we also manage and operate the Kerrow Restaurant Operating Business, which consists of seven LongHorn Steakhouse restaurants located in the San Antonio, Texas area.
In addition to our real estate investment activities, we also manage and operate the Kerrow Restaurant Operating Business, which consists of seven LongHorn Steakhouse restaurants located in the San Antonio, Texas area.
We may pay a portion of our dividends in common stock. In no event will the annual dividend be less than 90% of our REIT taxable income on an annual basis, determined without regard to the dividends paid deduction and excluding any net capital gains.
In no event will the annual dividend be less than 90% of our REIT taxable income on an annual basis, determined without regard to the dividends paid deduction and excluding any net capital gains. Our ability to pay dividends may be adversely affected by a number of factors, including the risk factors described in this Annual Report on Form 10-K.
Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may also impair our business operations. Risk factors summary An investment in our securities involves various risks.
Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may also impair our business operations. Risk factors summary An investment in our securities involves various risks. Such risks, including those set forth in the summary of material risks in this Item 1A, should be carefully considered before purchasing our securities.
Our 9.8% ownership limitation may have the effect of delaying, deferring or preventing a change in control, 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 our stockholders.
Our 9.8% ownership limitation may have the effect of delaying, deferring or preventing a change in control, 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 our stockholders. 19 Maryland law and provisions in our charter and bylaws may delay or prevent takeover attempts by third parties and therefore inhibit our stockholders from realizing a premium on their stock.
Third-party providers of corporate responsibility ratings and reports on companies have increased in number, resulting in varied and in some cases inconsistent standards. In addition, the criteria by which companies’ corporate responsibility practices are assessed are evolving, which could result in greater expectations of us and cause us to undertake costly initiatives to satisfy such new criteria.
In addition, the criteria by which companies’ corporate responsibility practices are assessed are evolving, which could result in greater expectations of us and cause us to undertake costly initiatives to satisfy such new criteria.
We may be viewed by third-party restaurant operators and other potential tenants or parties to sale-leaseback transactions as being closely affiliated with Darden.
Darden is our primary tenant in our lease portfolio, and a majority of our revenues consist of rental payments from Darden. We may be viewed by third-party restaurant operators and other potential tenants or parties to sale-leaseback transactions as being closely affiliated with Darden.
Risks Related to Our Common Stock • The market price and trading volume of our common stock may be volatile and may face negative pressure including as a result of future sales or distributions of our common stock. • We cannot assure shareholders of our ability to pay dividends in the future.
Additionally, Maryland law and provisions in our charter and bylaws may delay or prevent takeover attempts by third parties and therefore inhibit our stockholders from realizing a premium on their stock. 9 Risks Related to Our Common Stock • The market price and trading volume of our common stock may be volatile and may face negative pressure including as a result of future sales or distributions of our common stock. • We cannot assure shareholders of our ability to pay dividends in the future.
An economic downturn or other adverse events or conditions such as natural disasters in these areas, or any other area where we may have significant concentration in the future, could result in a material reduction of our cash flows or material losses to our company. 11 We intend to continue to pursue acquisitions of additional properties and seek other strategic opportunities, which may result in the use of a significant amount of management resources or significant costs, including the cost of accessing debt or equity markets, and we may not fully realize the potential benefits of such transactions.
We intend to continue to pursue acquisitions of additional properties and seek other strategic opportunities, which may result in the use of a significant amount of management resources or significant costs, including the cost of accessing debt or equity markets, and we may not fully realize the potential benefits of such transactions.
In addition, the Amended Loan Agreement contains an accordion feature allowing the facility to be increased by an additional aggregate amount not to exceed $450 million, subject to certain conditions. As of February 13, 2025, the term loan facility is fully drawn and the undrawn revolving credit facility had $350 million remaining capacity.
In addition, the Amended Loan Agreement contains an accordion feature allowing the facility to be increased by an additional aggregate amount not to exceed $450 million, subject to certain conditions.
If and when additional funds are raised through the issuance of equity securities, including our common stock, our stockholders may experience significant dilution. We cannot assure shareholders of our ability to pay dividends in the future. Our current dividend rate is $0.355 per share per quarter and $1.3900 per share over the last four quarters.
We cannot assure shareholders of our ability to pay dividends in the future. Our current dividend rate is $0.3665 per share per quarter and $1.4315 per share over the last four quarters. We may pay a portion of our dividends in common stock.
It is not possible to accurately predict how investors in our common stock will behave. 19 Any disposition by a significant stockholder of our common stock, or the perception in the market that such dispositions could occur, may cause the price of our common stock to fall.
Any disposition by a significant stockholder of our common stock, or the perception in the market that such dispositions could occur, may cause the price of our common stock to fall. Any such decline could impair our ability to raise capital through future sales of our common stock.
If our or our tenants’ reputation is damaged, it could adversely affect our business, results of operations, financial condition or ability to attract the most highly qualified employees. 16 Third-party expectations relating to environmental, social and governance factors may impose additional costs and expose us to new risks.
The proliferation of social media may increase the likelihood, speed, and magnitude of negative events. If our or our tenants’ reputation is damaged, it could adversely affect our business, results of operations, financial condition or ability to attract the most highly qualified employees.
Any such decline could impair our ability to raise capital through future sales of our common stock. Furthermore, our common stock may not qualify for investment indices, including indices specific to REITs, and any such failure may discourage new investors from investing in our common stock.
Furthermore, our common stock may not qualify for investment indices, including indices specific to REITs, and any such failure may discourage new investors from investing in our common stock. If and when additional funds are raised through the issuance of equity securities, including our common stock, our stockholders may experience significant dilution.
Therefore, our ability to generate cash from operations is dependent on the rents that we are able to charge and collect from our tenants. At any time, our tenants may experience a downturn in their respective businesses that may significantly weaken their financial condition, particularly during periods of economic uncertainty.
Therefore, our ability to generate cash from operations is dependent on the rents that we are able to charge and collect from our tenants.
There is an increasing focus from certain investors and other stakeholders concerning corporate responsibility, specifically related to environmental, social and governance factors. Some investors may use these factors to guide their investment strategies and, in some cases, may choose not to invest in our securities if they believe our policies relating to corporate responsibility are inadequate.
Some investors may use these factors to guide their investment strategies and, in some cases, may choose not to invest in our securities if they believe our policies relating to corporate responsibility are inadequate. Third-party providers of corporate responsibility ratings and reports on companies have increased in number, resulting in varied and in some cases inconsistent standards.
Our exposure to cybersecurity threats and negative consequences of cybersecurity breaches will likely increase as we store increasing amounts of tenant data. The Audit and Risk Committee of our Board of Directors oversees our risk management processes related to cybersecurity.
Our exposure to cybersecurity threats and negative consequences of cybersecurity breaches will likely increase as we store increasing amounts of tenant data. We may be required to expend significant financial resources to protect against or respond to such breaches.
In addition, we have issued $625 million of senior unsecured fixed rate notes (the “Notes”).
As of December 31, 2025, the term loan facility is fully drawn and the undrawn revolving credit facility had $350 million remaining capacity. 17 In addition, we have issued $625 million of senior unsecured fixed rate notes (the “Notes”).
The agreements governing our indebtedness contain customary covenants that may limit our operational flexibility.
Covenants in our debt agreements may limit our operational flexibility, and a covenant breach or default could materially and adversely affect our business, financial position or results of operations. The agreements governing our indebtedness contain customary covenants that may limit our operational flexibility.
Effective for taxable years beginning after December 31, 2017 and before January 1, 2026, non-corporate U.S. stockholders may deduct 20% of their dividends from REITs (excluding qualified dividend income and capital gains dividends).
Under the Tax Cuts and Jobs Act of 2017 (the “TCJA”), non-corporate U.S. stockholders generally may deduct 20% of their dividends from REITs (excluding qualified dividend income and capital gains dividends). On July 4, 2025, the One Big Beautiful Bill Act was enacted into law, which permanently extended certain provisions originally enacted under the TCJA.
Removed
Additionally, Maryland law and provisions in our charter and bylaws may delay or prevent takeover attempts by third parties and therefore inhibit our stockholders from realizing a premium on their stock.
Added
An economic downturn or other adverse events or conditions such as natural disasters in these areas, or any other area where we may have significant concentration in the future, could result in a material reduction of our cash flows or material losses to our company.
Removed
Our relationship with Darden may adversely affect our ability to do business with third-party restaurant operators and other tenants. Darden is our primary tenant in our lease portfolio, and a majority of our revenues consist of rental payments from Darden.
Added
At any time, our tenants may experience a downturn in their respective businesses that may significantly weaken their financial condition, particularly during periods of economic uncertainty or as a result of new or threatened policies of governmental and regulatory agencies.
Removed
As we recognize the increasing volume of cyber attacks, the Audit and Risk Committee meets frequently with our IT personnel and senior management to discuss recent trends in cyber risks and our strategy to defend our IT networks, business and building systems and information against cyber attacks and intrusions.
Added
In light of 1) our historical experience of renewals often at contractual rent increases, and 2) an increased number of leases coming due in the next 5 year timeframe.
Removed
Under the oversight of the Audit and Risk Committee, we employ commercially practical efforts to provide reasonable assurance such attacks are appropriately mitigated. We may be required to expend significant financial resources to protect against or respond to such breaches.
Added
If we want to sell a property, we cannot assure you that we will be able to dispose of it in the desired time period, or at all, or that the sale price of a property will exceed the cost of our investment in that property.
Removed
The proliferation of social media may increase the likelihood, speed, and magnitude of negative events.
Added
In addition, the risk of a security breach or disruption, including by computer hackers, foreign governments and cyber terrorists, has increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased, especially given the use of more advanced hacking tools and techniques and use of artificial intelligence that can circumvent controls, evade detection and even remove forensic evidence.
Removed
Maryland law and provisions in our charter and bylaws may delay or prevent takeover attempts by third parties and therefore inhibit our stockholders from realizing a premium on their stock.
Added
Third-party expectations relating to environmental, social and governance factors may impose additional costs and expose us to new risks. There is an increasing focus from certain investors and other stakeholders concerning corporate responsibility, specifically related to environmental, social and governance factors.
Removed
Our ability to pay dividends may be adversely affected by a number of factors, including the risk factors described in this Annual Report on Form 10-K.
Added
No amortization payments are required on the term loan prior to the maturity date. We have the option to extend the maturity date of the revolving credit facility for up to two six month periods, subject to the payment of an extension fee of 0.0625% on the aggregate amount of the then-outstanding revolving commitment.
Removed
No assurance can be given that we will pay any dividends on shares of our common stock in the future.
Added
We have the option to extend the maturity date of each of the Term Loan A-1 Facility and the Term Loan A-2 Facility by one year, subject to the payment of an extension fee of 0.125% on the then-outstanding principal amount of term loans under the Term Loan A-1 Facility and the Term Loan A-2 Facility, as applicable.
Added
We have the option to extend the maturity date of the Term Loan A-5 Facility by one year, subject to the payment of an extension fee of 0.15% on the then-outstanding principal amount of term loans under the Term Loan A-5 Facility.
Added
These extensions include the permanent allowance of the 20% deduction for “qualified REIT dividends” for non-corporate U.S. stockholders.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Key elements of our cybersecurity risk management program include but are not limited to the following: • risk assessments designed to help identify material cybersecurity risks to our critical systems and information ; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security processes; • cybersecurity awareness training of our employees, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management process for service providers and vendors based on their criticality and risk profile.
Key elements of our cybersecurity risk management program include but are not limited to the following: • risk assessments designed to help identify material cybersecurity risks to our critical systems and information ; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; 23 • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security processes; • cybersecurity awareness training of our employees, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management process for service providers and vendors based on their criticality and risk profile.
Our management team stays informed about and monitors efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel, threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us, and alerts and reports produced by security tools deployed in the IT environment. 23 Item 2.
Our management team stays informed about and monitors efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel, threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us, and alerts and reports produced by security tools deployed in the IT environment.
Added
Item 2. Properties. Please refer to “Item 1. Business.”

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Dividends The following table presents the characterizations for tax purposes of such common stock dividends for the year ended December 31, 2024.
Dividends The following table presents the characterizations for tax purposes of such common stock dividends for the year ended December 31, 2025.
Record Date Payment Date Total Distribution ($ per share) Form 1099 Box 1a Ordinary Taxable Dividend ($ per share) Form 1099 Box 1b Qualified Taxable Dividend ($ per share) Form 1099 Box 3 Return of Capital ($ per share) Form 1099 Box 5 Section 199A Dividends ($ per share) 12/29/2023 1/12/2024 $ 0.3450 $ 0.3174 $ — $ 0.0276 $ 0.3174 3/28/2024 4/15/2024 0.3450 0.3174 — 0.0276 0.3174 6/28/2024 7/15/2024 0.3450 0.3174 — 0.0276 0.3174 9/30/2024 10/15/2024 0.3450 0.3174 — 0.0276 0.3174 Totals $ 1.3800 $ 1.2696 $ — $ 0.1104 $ 1.2696 We intend to pay regular quarterly dividends to our stockholders, although future distributions will be declared and paid at the discretion of the Board of Directors and will depend upon cash generated by operating activities, our financial condition, capital requirements, annual distribution requirements under the REIT provision of the Code and such other factors as the Board of Directors deems relevant.
Record Date Payment Date Total Distribution ($ per share) Form 1099 Box 1a Ordinary Taxable Dividend ($ per share) Form 1099 Box 1b Qualified Taxable Dividend ($ per share) Form 1099 Box 3 Return of Capital ($ per share) Form 1099 Box 5 Section 199A Dividends ($ per share) 12/31/2024 1/15/2025 $ 0.3550 $ 0.3371 $ — $ 0.0179 $ 0.3371 3/31/2025 4/15/2025 0.3550 0.3371 — 0.0179 0.3371 6/30/2025 7/15/2025 0.3550 0.3371 — 0.0179 0.3371 9/30/2025 10/15/2025 0.3550 0.3371 — 0.0179 0.3371 Totals $ 1.4200 $ 1.3484 $ — $ 0.0716 $ 1.3484 We intend to pay regular quarterly dividends to our stockholders, although future distributions will be declared and paid at the discretion of the Board of Directors and will depend upon cash generated by operating activities, our financial condition, capital requirements, annual distribution requirements under the REIT provision of the Code and such other factors as the Board of Directors deems relevant.
Holders As of February 13, 2025, there were approximately 5,124 registered holders of record of our common stock. Sales of Unregistered Securities None. Purchases of Equity Securities by the Company and Affiliated Purchasers None.
Holders As of February 12, 2026, there were approximately 4,826 registered holders of record of our common stock. Sales of Unregistered Securities None. Purchases of Equity Securities by the Company and Affiliated Purchasers None.
Also, see Item 12—“Security Ownership of Certain Owners and Management and Related Stockholder Matters.” Equity Compensation Plan For information about our equity compensation plan, please see Note 11 of our consolidated financial statements, included in Part II, Item 8 of this Annual Report on Form 10-K. 25 Performance Graph The following performance graph compares the cumulative total shareholder return on the Company’s common stock over the last five years, based on the market price of the common stock and assuming reinvestments of dividends, with (i) the cumulative total return of the S&P 500 Index, (ii) the cumulative total return of the MSCI US REIT Index (“RMZ”) and (iii) the cumulative total return of Dow Jones Industrial Average.
Performance Graph The following performance graph compares the cumulative total shareholder return on the Company’s common stock over the last five years, based on the market price of the common stock and assuming reinvestments of dividends, with (i) the cumulative total return 25 of the S&P 500 Index, (ii) the cumulative total return of the MSCI US REIT Index (“RMZ”) and (iii) the cumulative total return of Dow Jones Industrial Average.
Added
Also, see Item 12—“Security Ownership of Certain Owners and Management and Related Stockholder Matters.” Equity Compensation Plan For information about our equity compensation plan, please see Note 11 of our consolidated financial statements, included in Part II, Item 8 of this Annual Report on Form 10-K.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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(2) Assumes the issuance of common shares for OP units held by non-controlling interests. Non-GAAP Definitions The certain non-GAAP financial measures included above management believes are helpful in understanding our business, as further described below. Our definition and calculation of non-GAAP financial measures may differ from those of other REITs and 34 therefore may not be comparable.
(2) Assumes the issuance of common shares for OP units held by non-controlling interests. 34 Non-GAAP Definitions The certain non-GAAP financial measures included above management believes are helpful in understanding our business, as further described below. Our definition and calculation of non-GAAP financial measures may differ from those of other REITs and therefore may not be comparable.
However, subject to certain exceptions, we may also elect, in our sole discretion, to cash settle or net share settle all or any portion of our obligations under any forward sale agreement, in which case we may not receive any proceeds (in the case of cash settlement) or will not receive any proceeds (in the case of net share settlement), and we may owe cash (in the case of cash settlement) or shares of our common stock (in the case of net share settlement) to the relevant forward purchaser. 33 During 2024, the Company had the following activity under its ATM programs, the net proceeds of which were employed to fund acquisitions and for general corporate purposes.
However, subject to certain exceptions, we may also elect, in our sole discretion, to cash settle or net share settle all or any portion of our obligations under any forward sale agreement, in which case we may not receive any proceeds (in the case of cash settlement) or will not receive any proceeds (in the case of net share settlement), and we may owe cash (in the case of cash settlement) or shares of our common stock (in the case of net share settlement) to the relevant forward purchaser. 33 During 2025, the Company had the following activity under its ATM programs, the net proceeds of which were employed to fund acquisitions and for general corporate purposes.
Outstanding Balance (Dollars in thousands) Maturity Date Interest Rate December 31, 2024 Notes Payable: Senior unsecured fixed rate note, issued December 2018 Dec 2026 4.63 % $ 50,000 Senior unsecured fixed rate note, issued June 2017 Jun 2027 4.93 % 75,000 Senior unsecured fixed rate note, issued December 2018 Dec 2028 4.76 % 50,000 Senior unsecured fixed rate note, issued April 2021 Apr 2029 2.74 % 50,000 Senior unsecured fixed rate note, issued March 2020 Jun 2029 3.15 % 50,000 Senior unsecured fixed rate note, issued March 2020 Apr 2030 3.20 % 75,000 Senior unsecured fixed rate note, issued March 2022 Mar 2031 3.09 % 50,000 Senior unsecured fixed rate note, issued April 2021 Apr 2031 2.99 % 50,000 Senior unsecured fixed rate note, issued March 2022 Mar 2032 3.11 % 75,000 Senior unsecured fixed rate note, issued July 2023 Jul 2033 6.44 % 100,000 Total Notes $ 625,000 Capital Resources and Financing Strategy On a short-term basis, our principal demands for funds will be for operating expenses, distributions to shareholders and interest and principal on current and any future debt financings.
Maturity Interest Outstanding Balance ($ in thousands) Date Rate December 31, 2025 Notes Payable: Senior unsecured fixed rate note, issued December 2018 Dec 2026 4.63 % $ 50,000 Senior unsecured fixed rate note, issued June 2017 Jun 2027 4.93 % 75,000 Senior unsecured fixed rate note, issued December 2018 Dec 2028 4.76 % 50,000 Senior unsecured fixed rate note, issued April 2021 Apr 2029 2.74 % 50,000 Senior unsecured fixed rate note, issued March 2020 Jun 2029 3.15 % 50,000 Senior unsecured fixed rate note, issued March 2020 Apr 2030 3.20 % 75,000 Senior unsecured fixed rate note, issued March 2022 Mar 2031 3.09 % 50,000 Senior unsecured fixed rate note, issued April 2021 Apr 2031 2.99 % 50,000 Senior unsecured fixed rate note, issued March 2022 Mar 2032 3.11 % 75,000 Senior unsecured fixed rate note, issued July 2023 Jul 2033 6.44 % 100,000 Total Senior Unsecured Fixed Rate Notes $ 625,000 Capital Resources and Financing Strategy On a short-term basis, our principal demands for funds will be for operating expenses, distributions to shareholders and interest and principal on current and any future debt financings.
We have entered into the following interest rate swaps to hedge the interest rate variability associated with the Loan Agreement as of December 31, 2024. These hedging agreements were entered into to mitigate the interest rate risk inherent in FCPT OP’s variable rate debt and not for trading purposes.
We have entered into the following interest rate swaps to hedge the interest rate variability associated with the Loan Agreement as of December 31, 2025. These hedging agreements were entered into to mitigate the interest rate risk inherent in FCPT OP’s variable rate debt and not for trading purposes.
We expect to fund acquisitions, investments, and other capital expenditures, from borrowings under our $250 million revolving credit facility and equity securities. At times the Company may evaluate opportunities to sell certain assets and redeploy the capital into new properties.
We expect to fund acquisitions, investments, and other capital expenditures, from borrowings under our $350 million revolving credit facility and equity securities. At times the Company may evaluate opportunities to sell certain assets and redeploy the capital into new properties.
For a discussion of the year ended December 31, 2023 compared to the year ended December 31, 2022, please refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2023.
For a discussion of the year ended December 31, 2024 compared to the year ended December 31, 2023, please refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2024.
During the year ended December 31, 2024, the Company recorded an income tax benefit of $1 thousand at the Kerrow Restaurant Operating Business, compared to an income tax expense of $97 thousand for the year ended December 31, 2023, primarily due to return to provision adjustments Critical Accounting Policies and Estimates The preparation of FCPT’s consolidated financial statements in conformance with accounting principles generally accepted in the United States of America requires management to make estimates on assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as other disclosures in the financial statements.
During the year ended December 31, 2025, the Company recorded an income tax benefit of $26 thousand at the Kerrow Restaurant Operating Business, compared to an income tax expense of $1 thousand for the year ended December 31, 2024, primarily due to return to provision adjustments Critical Accounting Policies and Estimates The preparation of FCPT’s consolidated financial statements in conformance with accounting principles generally accepted in the United States of America requires management to make estimates on assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as other disclosures in the financial statements.
Real estate development and construction costs for newly constructed restaurants are capitalized in the period in which they are incurred. Gains and losses on the disposal of land, buildings and equipment are included in our accompanying consolidated statements of income (“Income Statement”).
Real estate development and construction costs for newly constructed restaurants are capitalized in the period in which they are incurred. Gains and losses on the disposal of land, buildings and equipment are included in our accompanying consolidated statements of income (“Consolidated Income Statement”).
We believe that we have operated in conformity with the requirements for qualification and taxation as a REIT for the taxable year ended December 31, 2024, and we intend to continue to operate in a manner that will enable us to maintain our qualification as a REIT.
We believe that we have operated in conformity with the requirements for qualification and taxation as a REIT for the taxable year ended December 31, 2025, and we intend to continue to operate in a manner that will enable us to maintain our qualification as a REIT.
These swaps are accounted for as cash flow hedges with all interest income and expense recorded as a component of net income and other valuation changes recorded as a component of other comprehensive income. The following table presents the swaps held as of December 31, 2024.
These swaps are accounted for as cash flow hedges with all interest income and expense recorded as a component of net income and other valuation changes recorded as a component of other comprehensive income. The following table presents the swaps held as of December 31, 2025.
In connection with the Company’s ATM program, the Company may enter into forward sale agreements with certain financial institutions acting as forward purchasers whereby, at the Company's discretion, the forward purchasers may borrow and sell shares of common stock.
In connection with the Company’s ATM programs, the Company may enter into forward sale agreements with certain financial institutions acting as forward purchasers whereby, at the Company's discretion, the forward purchasers may borrow and sell shares of common stock.
We recognize rental income on a straight-line basis to include the effect of base rent escalators, and free rent periods, if any. During the year ended December 31, 2024, amortization of above and below market rents, and lease incentives decreased rental revenue by $2.1 million, compared to $2.1 million for the year ended December 31, 2023.
We recognize rental income on a straight-line basis to include the effect of base rent escalators, and free rent periods, if any. During the year ended December 31, 2025, amortization of above and below market rents, and lease incentives decreased rental revenue by $1.9 million, compared to $2.1 million for the year ended December 31, 2024.
Restaurant Operations Restaurant revenues increased approximately $0.2 million in the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to higher net pricing, partially offset by less foot traffic as a result of city construction projects outside two locations.
Restaurant Operations Restaurant revenues increased approximately $0.5 million in the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily due to higher net pricing, partially offset by less foot traffic as a result of city construction projects outside two locations.
In this section, we discuss the results of our operations for the year ended December 31, 2024 compared to the year ended December 31, 2023.
In this section, we discuss the results of our operations for the year ended December 31, 2025 compared to the year ended December 31, 2024.
Interest expense and fees on our revolving credit facility was $1.6 million and $2.1 million for the years ended December 31, 2024 and 2023, respectively. Amortization of the term loan and revolving credit facility deferred financing costs was $1.9 million and $1.6 million for the years ended December 31, 2024 and 2023, respectively.
Interest expense and fees on our revolving credit facility was $1.0 million and $1.6 million for the years ended December 31, 2025 and 2024, respectively. Amortization of the term loan and revolving credit facility deferred financing costs was $2.5 million and $1.9 million for the years ended December 31, 2025 and 2024, respectively.
On September 17, 2024, the Company terminated the prior ATM program (as defined below) and entered into a new ATM program (the "ATM program"), pursuant to which shares of the Company’s common stock having an aggregate gross sales price of up to $500.0 million may be offered and sold (1) by the Company to, or through, a consortium of banks acting as its sales agents or (2) by a consortium of banks acting as forward sellers on behalf of any forward purchasers contemplated thereunder, in each case by means of ordinary brokers’ transactions on the NYSE or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices, by privately negotiated transactions (including block sales) or by any other methods permitted by applicable law.
On October 30, 2025, the Company entered into a new ATM program (the "ATM program"), pursuant to which shares of the Company’s common stock having an aggregate gross sales price of up to $500.0 million may be offered and sold (1) by the Company to, or through, a consortium of banks acting as its sales agents or (2) by a consortium of banks acting as forward sellers on behalf of any forward purchasers contemplated thereunder, in each case by means of ordinary brokers’ transactions on the NYSE or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices, by privately negotiated transactions (including block sales) or by any other methods permitted by applicable law.
During the year ended December 31, 2023, we recorded property expenses of $11.6 million, of which $9.4 million was reimbursed by tenants. Interest Expense We incur interest expense on our $515 million of term loans, any outstanding borrowings on our revolving credit facility, interest rate swaps, and our $625 million of senior unsecured fixed rate notes.
During the year ended December 31, 2024, we recorded property expenses of $11.6 million, of which $9.5 million was reimbursed by tenants. Interest Expense We incur interest expense on our $590 million of term loans, any outstanding borrowings on our revolving credit facility, interest rate swaps, and our $625 million of senior unsecured fixed rate notes.
During the year ended December 31, 2024, we recognized costs paid by the lessor and reimbursed by the lessees within rental revenue of $9.5 million, compared to $9.4 million during the year ended December 31, 2023. These amounts are also recognized in property expenses.
During the year ended December 31, 2025, we recognized costs paid by the lessor and reimbursed by the lessees within rental revenue of $11.0 million, compared to $9.5 million during the year ended December 31, 2024. These amounts are also recognized in property expenses.
At December 31, 2024 there were outstanding borrowings of $5 million under the revolving credit facility and no outstanding letters of credit. At December 31, 2023, there were outstanding borrowings of $16 million under the revolving credit facility and no outstanding letters of credit.
At December 31, 2025 there were no outstanding borrowings under the revolving credit facility and no outstanding letters of credit. At December 31, 2024, there were outstanding borrowings of $5 million under the revolving credit facility and no outstanding letters of credit.
See Term Loan and Revolving Credit Facility below for additional information. Debt Instruments At December 31, 2024, our debt consisted of $515 million of non-amortizing term loans, $5 million in outstanding borrowings under the revolving credit facility, and $625 million aggregate principal amount of senior unsecured fixed rate notes issued by FCPT OP.
See Term Loan and Revolving Credit Facility below for additional information. Debt Instruments At December 31, 2025, our debt consisted of $590 million of non-amortizing term loans, no outstanding borrowings under the revolving credit facility, and $625 million aggregate principal amount of senior unsecured fixed rate notes issued by FCPT OP.
Fair value is generally determined by appraisals or sales prices of comparable assets. 30 The judgments we make related to the expected useful lives of long-lived assets and our ability to realize undiscounted cash flows in excess of the carrying amounts of these assets are affected by factors such as the ongoing maintenance and improvements of the assets, changes in economic conditions, changes in usage or operating performance, desirability of the restaurant sites and other factors, such as our ability to sell our assets held for sale.
The judgments we make related to the expected useful lives of long-lived assets and our ability to realize undiscounted cash flows in excess of the carrying amounts of these assets are affected by factors such as the ongoing maintenance and improvements of the 30 assets, changes in economic conditions, changes in usage or operating performance, desirability of the restaurant sites and other factors, such as our ability to sell our assets held for sale.
As of December 31, 2024, there was $413.9 million available for issuance under the ATM program. On a long-term basis, our principal demands for funds include payment of dividends, financing of property acquisitions, and scheduled debt maturities.
As of December 31, 2025, there was $500.0 million available for issuance under the ATM program. On a long-term basis, our principal demands for funds include payment of dividends, financing of property acquisitions, and scheduled debt maturities.
General and administrative expense increased $1.1 million in the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to a $0.8 million increase in cash compensation-related expenses and non-cash stock compensation expenses stemming from a higher head count and benefits costs, as well as increased professional fees.
General and administrative expense increased $3.1 million in the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily due to a $2.7 million increase in cash compensation-related expenses and non-cash stock compensation expenses stemming from a higher head count and benefits costs, as well as increased professional fees.
Interest expense, excluding deferred financing costs, on the $515 million of term loans and the interest rate swaps we entered into to hedge the variability associated with the term loans was $19.1 million and $15.7 million for the years ended December 31, 2024 and 2023, respectively. This interest expense includes the reclassification of other comprehensive income into interest expense.
Interest expense, excluding deferred financing costs, on the $590 million of term loans and the interest rate swaps we entered into to hedge the variability associated with the term loans was $22.4 million and $19.1 million for the years ended December 31, 2025 and 2024, respectively. This interest expense includes the reclassification of other comprehensive income into interest expense.
Liquidity and Financial Condition At December 31, 2024, we had $4.1 million of cash and cash equivalents and $245.0 million of borrowing capacity under our revolving credit facility. The revolving credit facility provides for a letter of credit sub-limit of $25 million. As of February 13, 2025, we had $350 million of borrowing capacity under the revolving credit facility.
Liquidity and Financial Condition At December 31, 2025, we had $12.1 million of cash and cash equivalents and $350 million of borrowing capacity under our revolving credit facility. The revolving credit facility provides for a letter of credit sub-limit of $25 million. As of February 12, 2026, we had $350 million of borrowing capacity under the revolving credit facility.
At December 31, 2023, our debt consisted of $430 million of non-amortizing term loans, $16 million in outstanding borrowings under the revolving credit facility, and $675 million aggregate principal amount of senior unsecured fixed rate notes issued by FCPT OP.
At December 31, 2024, our debt consisted of $515 million of non-amortizing term loans, $5 million in outstanding borrowings under the revolving credit facility, and $625 million aggregate principal amount of senior unsecured fixed rate notes issued by FCPT OP.
If these assets are determined to be impaired, the amount of impairment recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value.
If these assets are determined to be impaired, the amount of impairment recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. Fair value is generally determined by appraisals or sales prices of comparable assets.
The ATM program replaces the Company's previous $450.0 million ATM program (the "prior ATM program" and, together with the ATM program, the "ATM programs"), which was established in November 2022, under which the Company had sold shares of its common stock having an aggregate gross sales price of $404.8 million through September 17, 2024.
The ATM program replaces the Company's previous $500.0 million ATM program (the "prior ATM program" and, together with the ATM program, the "ATM programs"), which was established in September 2024, under which the Company had sold shares of its common stock having an aggregate gross sales price of $291.8 million through October 30, 2025.
Product Notional Amount ($ in thousands) Effective Date Maturity Date Fixed Rate to Pay Swap 50,000 10/25/2022 11/9/2025 0.44% Swap 25,000 11/9/2022 11/9/2025 2.70% Swap 25,000 3/9/2023 11/9/2026 4.12% Swap 50,000 11/9/2023 11/9/2025 0.82% Swap 25,000 11/9/2023 11/9/2026 3.65% Swap 25,000 11/9/2023 11/9/2028 4.25% Swap 25,000 11/13/2023 11/9/2028 4.42% Swap (1) 25,000 4/9/2024 4/9/2029 4.04% Swap (1) 30,000 4/9/2024 4/9/2029 3.91% Swap (1) 30,000 4/9/2024 4/9/2029 3.88% Swap (1) 25,000 11/9/2024 11/9/2029 3.97% Swap (1) 25,000 1/31/2025 1/31/2030 3.81% Swap (1) 25,000 1/31/2025 1/31/2030 3.80% Swap (1) 25,000 1/31/2025 1/31/2030 3.09% Swap 50,000 11/10/2025 11/9/2027 1.48% Swap 50,000 11/10/2025 11/9/2027 1.54% Swap 25,000 11/10/2025 11/9/2028 2.25% Swap 50,000 11/10/2025 11/9/2028 1.49% Swap 50,000 11/10/2025 11/9/2028 2.02% (1) During 2024, we entered into these interest rate swaps to hedge the interest rate variability associated with the term loan portion of our credit facility The Company enters into forward-starting interest rate swap agreements to hedge against changes in future cash flows resulting from changes in interest rates from the trade date through the forecasted issuance date of long-term debt.
Product Notional Amount ($ in thousands) Effective Date Maturity Date Fixed Rate to Pay Variable Rate to Receive Swap 25,000 3/9/2023 11/9/2026 4.12% Daily Simple SOFR + 10 bps Swap 25,000 11/9/2023 11/9/2026 3.65% Daily Simple SOFR + 10 bps Swap 25,000 11/9/2023 11/9/2028 4.25% Daily Simple SOFR + 10 bps Swap 25,000 11/13/2023 11/9/2028 4.42% Daily Simple SOFR + 10 bps Swap 25,000 4/9/2024 4/9/2029 4.04% Daily Simple SOFR + 10 bps Swap 30,000 4/9/2024 4/9/2029 3.91% Daily Simple SOFR + 10 bps Swap 30,000 4/9/2024 4/9/2029 3.88% Daily Simple SOFR + 10 bps Swap 25,000 11/9/2024 11/9/2029 3.97% Daily Simple SOFR + 10 bps Swap 25,000 1/31/2025 1/31/2030 3.81% Daily Simple SOFR + 10 bps Swap 25,000 1/31/2025 1/31/2030 3.80% Daily Simple SOFR + 10 bps Swap 25,000 1/31/2025 1/31/2030 3.09% Daily Simple SOFR + 10 bps Swap (1) 25,000 3/19/2025 3/9/2030 3.79% Daily Simple SOFR + 10 bps Swap (1) 25,000 7/9/2025 11/9/2027 3.55% Daily Simple SOFR + 10 bps Swap 50,000 11/10/2025 11/9/2027 1.48% Daily Simple SOFR + 10 bps Swap 50,000 11/10/2025 11/9/2027 1.54% Daily Simple SOFR + 10 bps Swap 25,000 11/10/2025 11/9/2028 2.25% 1 month Term SOFR Swap 50,000 11/10/2025 11/9/2028 1.49% Daily Simple SOFR + 10 bps Swap 50,000 11/10/2025 11/9/2028 2.02% Daily Simple SOFR + 10 bps Swap (1) 25,000 11/9/2026 11/9/2030 3.75% Daily Simple SOFR + 10 bps Swap (1) 25,000 11/9/2026 11/9/2031 3.87% Daily Simple SOFR + 10 bps Swap (1) 25,000 11/9/2027 11/9/2029 3.51% Daily Simple SOFR + 10 bps Swap (1) 25,000 11/9/2027 11/9/2029 3.39% Daily Simple SOFR + 10 bps (1) During 2025, we entered into these interest rate swaps to hedge the interest rate variability associated with the term loan portion of our credit facility The Company also enters into forward-starting interest rate swap agreements to hedge against changes in future cash flows resulting 32 from changes in interest rates from the trade date through the forecasted issuance date of debt.
Real Estate Operations Rental Revenue Rental revenue increased $17.3 million during the year ended December 31, 2024 compared to the year ended December 31, 2023. This increase is due to recognizing a full year of revenue in 2024 from the 92 properties acquired in 2023, and the acquisition of 87 properties and ground leaseholds in 2024.
Real Estate Operations Rental Revenue Rental revenue increased $25.5 million during the year ended December 31, 2025 compared to the year ended December 31, 2024. This change is due to recognizing a full year of revenue in 2025 from the 87 properties acquired in 2024, and the acquisition of 105 properties and ground leaseholds in 2025.
AFFO is used by us as a basis to address our ability to fund our dividend payments. We calculate AFFO by adding to or subtracting from FFO: 1. Transaction costs incurred in connection with business combinations 2. Straight-line rent revenue adjustment 3. Stock-based compensation expense 4. Non-cash amortization of deferred financing costs 5. Other non-cash interest expense (income) 6.
AFFO is used by us as a basis to address our ability to fund our dividend payments. We calculate AFFO by adding to or subtracting from FFO: 1. Straight-line rent revenue adjustment 2. Non-cash expense (income) adjustments related to deferred tax benefits 3. Stock-based compensation expense 4. Non-cash amortization of deferred financing costs 5. Non-real estate investment depreciation 6.
Non-cash expense (income) adjustments related to deferred tax benefits AFFO is not intended to represent cash flow from operations for the period, and is only intended to provide an additional measure of performance by adjusting the effect of certain items noted above included in FFO.
Debt extinguishment gains and losses AFFO is not intended to represent cash flow from operations for the period, and is only intended to provide an additional measure of performance by adjusting the effect of certain items noted above included in FFO.
We also record initial direct costs (lease negotiation and other previously capitalizable transaction expenses) as property expenses. Other property expenses consist of expenses incurred on vacant properties, abandoned deal costs, lease transaction costs, property-level expenses and franchise taxes. During the year ended December 31, 2024, we recorded property expenses of $11.6 million, of which $9.5 million was reimbursed by tenants.
Other property expenses consist of expenses incurred on vacant properties, abandoned deal costs, lease transaction costs, property-level expenses and franchise taxes. During the year ended December 31, 2025, we recorded property expenses of $13.6 million, of which $11.0 million was reimbursed by tenants.
Year Ended December 31, (In thousands, except share and per share data) 2024 2023 2022 Net income $ 100,595 $ 95,462 $ 97,908 Depreciation and amortization 54,372 50,592 41,342 Realized gain on sales of real estate — (2,341 ) (8,139 ) Funds from Operations (FFO) (as defined by NAREIT) $ 154,967 $ 143,713 $ 131,111 Straight-line rent adjustment (3,810 ) (5,523 ) (6,372 ) Deferred income tax benefit (1) (200 ) (259 ) (125 ) Stock-based compensation expense 6,987 6,271 4,978 Non-cash amortization of deferred financing costs 2,597 2,311 2,104 Non-real estate investment depreciation 142 139 129 Amortization of above and below market leases, net 2,072 2,061 2,151 Adjusted Funds from Operations (AFFO) $ 162,755 $ 148,713 $ 133,976 Fully diluted shares outstanding (2) 94,179,057 88,861,587 81,921,624 FFO per diluted share $ 1.65 $ 1.62 $ 1.60 AFFO per diluted share $ 1.73 $ 1.67 $ 1.64 (1) Amount represents non-cash deferred income tax benefit recognized at Kerrow Restaurant Operating Business.
Year Ended December 31, (In thousands, except share and per share data) 2025 2024 2023 Net income $ 112,488 $ 100,595 $ 95,462 Depreciation and amortization 59,382 54,372 50,592 Realized gain on sales of real estate — — (2,341 ) Provision for impairment 827 — — Funds from Operations (FFO) (as defined by NAREIT) $ 172,697 $ 154,967 $ 143,713 Straight-line rent adjustment (3,203 ) (3,810 ) (5,523 ) Deferred income tax benefit (1) (231 ) (200 ) (259 ) Stock-based compensation expense 8,854 6,987 6,271 Non-cash amortization of deferred financing costs 3,158 2,597 2,311 Non-real estate investment depreciation 215 142 139 Amortization of above and below market leases, net 1,923 2,072 2,061 Adjusted Funds from Operations (AFFO) $ 183,413 $ 162,755 $ 148,713 Fully diluted shares outstanding (2) 103,063,176 94,179,057 88,861,587 FFO per diluted share and OP unit $ 1.68 $ 1.65 $ 1.62 AFFO per diluted share and OP unit $ 1.78 $ 1.73 $ 1.67 (1) Amount represents non-cash deferred income tax benefit recognized at Kerrow Restaurant Operating Business.
Amortization of the senior unsecured notes deferred financing costs was $0.7 million and $0.7 million for the years ended December 31, 2024 and 2023, respectively. For additional information on the Company’s debt instruments, see “Liquidity and Financial Condition” below. Realized Gain on Sale, Net During the year ended December 31, 2024, the Company did not sell any properties.
Amortization of the senior unsecured notes deferred financing costs was $0.7 million and $0.7 million for the years ended December 31, 2025 and 2024, respectively. For additional information on the Company’s debt instruments, see “Liquidity and Financial Condition” below.
Year Ended December 31, (In thousands) 2024 2023 2022 Revenues: Rental $ 237,134 $ 219,881 $ 193,611 Restaurant 30,939 30,725 29,583 Total revenues 268,073 250,606 223,194 Operating expenses: General and administrative 23,789 22,680 20,043 Depreciation and amortization 54,514 50,731 41,471 Property 11,575 11,550 7,989 Restaurant 29,024 28,707 27,822 Total operating expenses 118,902 113,668 97,325 Interest expense (49,231 ) (44,606 ) (36,405 ) Other income, net 963 919 542 Realized gain on sale, net — 2,341 8,139 Income tax benefit (expense) (308 ) (130 ) (237 ) Net income 100,595 95,462 97,908 Net income attributable to noncontrolling interest (122 ) (122 ) (136 ) Net Income Available to Common Shareholders $ 100,473 $ 95,340 $ 97,772 Analysis of Results of Operations We operate in two segments, real estate operations and restaurant operations.
Year Ended December 31, (In thousands) 2025 2024 2023 Revenues: Rental $ 262,648 $ 237,134 $ 219,881 Restaurant 31,484 30,939 30,725 Total revenues 294,132 268,073 250,606 Operating expenses: General and administrative 26,843 23,789 22,680 Depreciation and amortization 60,424 54,514 50,731 Property 13,559 11,575 11,550 Restaurant 29,442 29,024 28,707 Total operating expenses 130,268 118,902 113,668 Interest expense (51,873 ) (49,231 ) (44,606 ) Other income, net 800 963 919 Realized gain on sale, net — — 2,341 Income tax expense (303 ) (308 ) (130 ) Net income 112,488 100,595 95,462 Net income attributable to noncontrolling interest (124 ) (122 ) (122 ) Net Income Available to Common Shareholders $ 112,364 $ 100,473 $ 95,340 Analysis of Results of Operations We operate in two segments, real estate operations and restaurant operations.
Non-real estate investment depreciation 7. Merger, restructuring and other related costs 8. Impairment charges 9. Other non-cash revenue adjustments, including amortization of above and below market leases and lease incentives 10. Amortization of capitalized leasing costs 11. Debt extinguishment gains and losses 12.
Other non-cash revenue adjustments, including amortization of above and below market leases and lease incentives 7. Transaction costs incurred in connection with business combinations 8. Merger, restructuring and other related costs 9. Other non-cash interest expense (income) 10. Non-real estate impairment charges 11. Amortization of capitalized leasing costs 12.
Depreciation and amortization expense increased by approximately $3.8 million for the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to the acquisition of 87 properties in 2024, and the depreciation on 92 properties acquired in 2023 that incurred a full year of depreciation. 28 Property Expense We record all tenant expenses, both reimbursed and non-reimbursed, to property expense.
Depreciation and amortization expense increased by approximately $5.9 million for the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily due to the acquisition of 105 properties in 2025, and the 28 depreciation on 87 properties acquired in 2024 that incurred a full year of depreciation.
Total restaurant expenses increased approximately $0.3 million in the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to improved staffing and a reduction in overtime hours.
Total restaurant expenses increased approximately $0.4 million in the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily due to staffing turnover.
The Amended Loan Agreement provides for a revolving credit facility in an aggregate principal amount of $350 million and a term loan facility in an aggregate principal amount of $590 million, comprised of (i) a $225 million term credit facility with a maturity date of February 1, 2029, (ii) a $100 million term credit facility with a maturity date of November 9, 2026, (iii) a $90 million term credit facility with a maturity date of February 1, 2027, (iv) a $90 million term credit facility with a maturity date of February 1, 2028 and (v) a $85 million term credit facility with a maturity date of March 14, 2027.
Prior to entering into the Credit Agreement, certain amounts outstanding under the term loan facility pursuant to the Prior Credit Agreement were scheduled to mature as follows: $150 million principal amount outstanding was scheduled to mature on November 9, 2025, $100 million principal amount outstanding was scheduled to mature on November 9, 2026, $90 million principal amount outstanding was scheduled to mature on January 9, 2027, $85 million principal amount outstanding was scheduled to mature on March 14, 2027, and $90 million principal amount outstanding was scheduled to mature on January 9, 2028. 31 The Credit Agreement provides for borrowings up to $940 million, consisting of (1) a revolving credit facility in an aggregate principal amount of $350 million and term loans in an aggregate principal amount of $590 million comprised of (i) a $100 million term loan with a maturity date of November 9, 2026 (the "Term Loan A-2 Facility"), (ii) a $90 million term loan with a maturity date of February 1, 2027 (the "Term Loan A-3 Facility"), (iii) an $85 million term loan with a maturity date of March 14, 2027 (the "Term Loan A-5 Facility"), (iv) a $90 million term loan with a maturity date of February 1, 2028 (the "Term Loan A-4 Facility"), and (v) a $225 million term loan with a maturity date of February 1, 2029 (the "Term Loan A-1 Facility").
December 31, 2024 Shares Gross Wtd Avg Sales Price Net Wtd Avg Sales Price Net Proceeds (1) ($ in thousands) Executed forward sale agreements 7,796,898 $ 27.88 n/a Physically settled forward sale agreements 4,266,323 $ 27.56 $ 27.14 $ 115,800 Total shares sold and issued under the ATM programs 8,068,155 $ 27.10 $ 26.63 $ 214,900 (1) net proceeds, after sales commissions and offering expenses At December 31, 2024, the Company had outstanding forward sale agreement to sell 3,530,575 shares of common stock at a weighted average sales price of $28.27 before sales commission and offering expenses.
Year Ended December 31, 2025 Shares Gross Wtd Avg Sales Price Net Wtd Avg Sales Price Net Proceeds (1) ($ in thousands) Executed forward sale agreements 6,108,008 $ 28.27 n/a n/a Physically settled forward sale agreements 8,199,285 $ 27.95 $ 27.47 $ 225,235 Total shares sold and issued under the ATM programs 8,199,285 $ 27.95 $ 27.47 $ 225,235 (1) net proceeds, after sales commissions and offering expenses At December 31, 2025, the Company had outstanding forward sale agreement to sell 1,439,298 shares of common stock at a weighted average sales price of $28.16 before sales commission and offering expenses.
Income tax expense on real estate operations consists of state and local income taxes incurred by FCPT on its lease portfolio. As FCPT acquires additional properties in states subject to state income taxes, income tax expense will continue to increase.
As FCPT acquires additional properties in states subject to state income taxes, income tax expense will continue to increase.
The swaps were terminated on December 10, 2024, with the corresponding asset of $243 thousand which will be amortized over the next 10 years as an increase to interest expense. The Company has issued the following $625 million of senior unsecured fixed rate notes (together, the “Notes”) in private placements pursuant to note purchase agreements with the various purchasers.
The Company has issued the following $625 million of senior unsecured fixed rate notes (together, the “Notes”) in private placements pursuant to note purchase agreements with the various purchasers.
The Loan Agreement had an accordion feature allowing the facility to be increased by an additional aggregate amount not to exceed $350 million subject to obtaining lender commitments and other customary conditions.
The Credit Agreement is a syndicated credit facility that contains an accordion feature allowing the facility to be increased by an additional aggregate amount not to exceed $450 million, subject to certain conditions.
As of December 31, 2024, our lease portfolio had the following characteristics: • 1,198 properties located in 47 states and representing an aggregate leasable area of 8.0 million square feet; • 99.6% occupancy (based on leasable square footage); • An average remaining lease term of 7.3 years (weighted by annualized base rent); • An average annual rent escalation of 1.4% through December 31, 2029 (weighted by annualized base rent); and • 99.8% of the contractual base rent collected for the year ended December 31, 2024. 27 The results of operations for the accompanying consolidated financial statements discussed below are derived from our consolidated statements of comprehensive income (“Comprehensive Income Statement”) found elsewhere in this Annual Report on Form 10-K.
As of December 31, 2025, our lease portfolio had the following characteristics: • 1,303 properties located in 48 states and representing an aggregate leasable area of 8.8 million square feet; • 99.6% occupancy (based on leasable square footage); • An average remaining lease term of 6.9 years (weighted by annualized base rent); • An average annual rent escalation of 1.5% 1 through December 31, 2030 (weighted by annualized base rent); and • 99.8% of the contractual base rent collected for the year ended December 31, 2025. 1 Previously, annual rent escalation was calculated assuming expiring leases remained flat.
In 2024, FCPT engaged in various real estate transactions for a total investment of $273.0 million, including capitalized transaction costs. Pursuant to these transactions, we acquired 87 properties and ground leaseholds, aggregating 546.6 thousand square feet, and representing 31 brands, including AFC Urgent Care, Baptist Medical, Christian Brothers, MercyOne, and P.F. Chang's.
In 2025, FCPT engaged in various real estate transactions for a total investment of $325.5 million, including capitalized transaction costs. Pursuant to these transactions, we acquired 105 properties and ground leaseholds, aggregating 713.9 thousand square feet, and representing 35 brands, including Chuy's, Crash Champions, Hawaiian Bros, Little Caesar's, Mission Pet Health, and United Rentals.
On January 31, 2025, the Company and FCPT OP entered into the Amended Loan Agreement, which amended and restated the Loan Agreement in its entirety.
Term Loan and Revolving Credit Facility On January 31, 2025, the Company and its subsidiary, FCPT OP, entered into a Fourth Amended and Restated Revolving Credit and Term Loan Agreement with a group of existing lenders (the “Credit Agreement”), which amended and restated in its entirety an existing Third Amended and Restated Revolving Credit and Term Loan Agreement dated as of October 25, 2022 (the "Prior Credit Agreement").
Interest expense increased by approximately $4.6 million for the year ended December 31, 2024 compared to the year ended December 31, 2023.
Interest expense increased by approximately $2.6 million for the year ended December 31, 2025 compared to the year ended December 31, 2024. This was primarily due to the net increase in term loans of $75 million in January 2025, which was partially offset by lower utilization of the revolving credit facility.
During the year ended December 31, 2023, the Company sold seven properties with a combined net book value of $23.7 million for a realized gain on sale of $2.3 million. Income Taxes During the years ended December 31, 2024 and 2023, income tax expense on real estate operations was $308 thousand and $227 thousand, respectively.
Income Taxes During the years ended December 31, 2025 and 2024, income tax expense on real estate operations was $329 thousand and $308 thousand, respectively. Income tax expense on real estate operations consists of state and local income taxes incurred by FCPT on its lease portfolio.
The Term Loan had a maturity date in March 2027 with one twelve month extension exercisable at the Company’s option, subject to certain conditions. At December 31, 2024 and 2023, the weighted average interest rate on the term loans, after consideration of the interest rate hedges, was 3.84% and 3.69%, respectively.
A facility fee at a rate of 0.20% per annum applies to the total revolving commitments available under the Credit Agreement. At December 31, 2025 and 2024, the weighted average interest rate on the term loans, after consideration of the interest rate hedges, was 4.00% and 3.84%, respectively.
Removed
This was primarily due to the issuance of the additional $85 million term loan in March 2024, which was offset by a reduction of interest expense due to the repayment of the $50 million senior unsecured fixed rate note and higher interest rates.
Added
In light of 1) our historical experience of renewals often at contractual rent increases, and 2) an increased number of leases coming due in the next 5 year timeframe.
Removed
Term Loan and Revolving Credit Facility The Third Amended and Restated Revolving Credit and Term Loan Agreement, dated as of October 25, 2022, as amended (the “Loan Agreement”), by and among the Company, FCPT OP, the Agent, the Lenders and the other agents party thereto, provided for a revolving credit facility in an aggregate principal amount of $250 million and a term loan facility in an aggregate principal amount of $430 million.
Added
Leases owned for less than one year are included based on the annualized first month’s rent. 27 The results of operations for the accompanying consolidated financial statements discussed below are derived from our consolidated statements of comprehensive income (“Comprehensive Income Statement”) found elsewhere in this Annual Report on Form 10-K.
Removed
Additionally, the amendment to the Loan Agreement converted the revolving credit facility from LIBOR to SOFR-based borrowings, and the Company and counterparties converted the related interest rate swaps concurrently. 31 The Loan Agreement provided that $150 million would mature on November 9, 2025, $100 million would mature on November 9, 2026, $90 million would mature on January 9, 2027, $85 million would mature on March 14, 2027 and $90 million would mature on January 9, 2028.
Added
In addition, we recorded an impairment of $827 thousand in 2025 to depreciation and amortization expense for the write-down of a single property. Property Expense We record all tenant expenses, both reimbursed and non-reimbursed, to property expense. We also record initial direct costs (lease negotiation and other previously capitalizable transaction expenses) as property expenses.
Removed
The revolving credit facility portion had a maturity date of November 9, 2025 with one six-month extension option. On March 14, 2024, FCPT entered into an Incremental Amendment to the Third Amended and Restated Revolving Credit and Term Loan Agreement with a group of existing lenders (the “Credit Agreement”).
Added
No amortization payments are required on the term loan prior to the maturity date. FCPT OP has the option to extend the maturity date of the revolving credit facility for up to two six month periods, subject to the payment of an extension fee of 0.0625% on the aggregate amount of the then-outstanding revolving commitment.
Removed
The Company utilized the accordion feature of the Loan Agreement to enter into a new $85 million term loan (the “Term Loan”), the proceeds from which were used to repay the $50 million of senior unsecured notes payable due in June 2024.
Added
FCPT OP has the option to extend the maturity date of each of the Term Loan A-1 Facility and the Term Loan A-2 Facility by one year, subject to the payment of an extension fee of 0.125% on the then-outstanding principal amount of term loans under the Term Loan A-1 Facility and the Term Loan A-2 Facility, as applicable.
Removed
The Amended Loan Agreement has an accordion feature to increase the revolving commitments or add one or more tranches of term loans up to an additional aggregate amount not to exceed $450 million, subject to certain conditions, including one or more new or existing lenders agreeing to provide commitments for such increased amount.
Added
FCPT OP has the option to extend the maturity date of the Term Loan A-5 Facility by one year, subject to the payment of an extension fee of 0.15% on the then-outstanding principal amount of term loans under the Term Loan A-5 Facility.
Removed
During the year ended December 31, 2024, the Company terminated one cash flow hedge in connection with the $85 million Term Loan that was entered into on March 11, 2024 and funded on March 14, 2024.
Added
Amounts owed under the Credit Agreement may be prepaid at any time without premium or penalty, subject to customary breakage costs in the case of borrowings with respect to which SOFR rate election is in effect.
Removed
This cash flow hedge had a total notional value of $25 million and was entered into in August 2023 to hedge the interest rate on a future offering or term loan.
Added
On August 19, 2025, the Company entered into Amendment No. 1 to the Credit Agreement which reduced the credit spread adjustment applicable to the revolving credit and term loan agreement from 0.10% to 0.00%.
Removed
The swap was terminated on February 28, 2024, with the corresponding asset of $211 thousand which will be amortized over the next 10 years as an increase to interest expense. The Company also terminated two cash flow hedges in connection with the $225 million Amended Term Loan. See Note 15 - Subsequent Events - Capital Resources.
Added
Term loans under the Credit Agreement now accrue interest at a per annum rate equal to a SOFR rate plus a margin of 0.95% to 1.00%, and the revolver accrues interest at a per annum rate equal to a margin of 0.85%.
Removed
The cash flow hedges had a total notional value of $50 million and were entered into in June 2024 and August 2024 32 to hedge the interest rate on a future offering or term loan.
Added
The margin is based on the highest applicable credit rating on its senior, unsecured, long-term indebtedness per the credit agreement. In the event that all or a portion of the principal amount of any loan borrowed pursuant to the Credit Agreement is not paid when due, interest will accrue at the rate that would otherwise be applicable thereto plus 2.00%.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed7 unchanged
As of December 31, 2024, our assets were primarily long-term, fixed-rate leases (though most have scheduled rental increases during the terms of the leases). As of December 31, 2024, $625 million of our total indebtedness consisted of senior unsecured fixed rated notes.
As of December 31, 2025, our assets were primarily long-term, fixed-rate leases (though most have scheduled rental increases during the terms of the leases). As of December 31, 2025, $625 million of our total indebtedness consisted of senior unsecured fixed rated notes.
Risk Factors - Risks Related to Our Business - Hedging transactions could have a negative effect on our results of operations.” Due to the fixed rate nature of $1.06 billion of our indebtedness and the hedging transactions described above, a hypothetical one percentage point decline in interest rates would not have materially affected our consolidated financial position, results of operations or cash flows as of December 31, 2024.
Risk Factors - Risks Related to Our Business - Hedging transactions could have a negative effect on our results of operations.” Due to the fixed rate nature of $1.19 billion of our indebtedness and the hedging transactions described above, a hypothetical one percentage point decline in interest rates would not have materially affected our consolidated financial position, results of operations or cash flows as of December 31, 2025.
The remaining $520 million of our total indebtedness consisted of three to five-year variable-rate obligations for which we have entered into swaps that effectively fix $435 million through November 2025, and outstanding borrowings on the revolving credit facility.
The remaining $590 million of our total indebtedness consisted of three to five-year variable-rate obligations for which we have entered into swaps that effectively fix $560 million through November 2027, and outstanding borrowings on the revolving credit facility.

Other FCPT 10-K year-over-year comparisons