Gaming Property Investment Overview
Definitions of Non-GAAP Financial Measures
FFO, FFO per diluted common share, AFFO, AFFO per diluted common share, Adjusted EBITDA and Cash NOI, which are detailed in the
reconciliation tables that accompany this release, are used by the Company as performance measures for benchmarking against the Company's
peers and as internal measures of business operating performance, which is used for a bonus metric. The Company believes FFO, FFO per diluted
common share, AFFO, AFFO per diluted common share, Adjusted EBITDA and Cash NOI provide a meaningful perspective of the underlying
operating performance of the Company's current business. This is especially true since these measures exclude real estate depreciation, and we
believe that real estate values fluctuate based on market conditions rather than depreciating in value ratably on a straight-line basis over time.
Cash NOI is rental and other property income, inclusive of rent credits recognized in connection with the Tropicana Las Vegas transaction, less
cash property level expenses. Cash NOI excludes depreciation, the amortization of land rights, real estate general and administrative expenses,
other non-routine costs and the impact of certain generally accepted accounting principles ("GAAP") adjustments to rental revenue, such as
straight-line rent adjustments and non-cash ground lease income and expense. It is management's view that Cash NOI is a performance measure
used to evaluate the operating performance of the Company's real estate operations and provides investors relevant and useful information
because it reflects only income and operating expense items that are incurred at the property level and presents them on an unleveraged basis.
FFO, FFO per diluted common share, AFFO, AFFO per diluted common share, Adjusted EBITDA and Cash NOI are non-GAAP financial measures
that are considered supplemental measures for the real estate industry and a supplement to GAAP measures. NAREIT defines FFO as net income
(computed in accordance with GAAP), excluding (gains) or losses from sales of property and real estate depreciation. We have defined AFFO as
FFO excluding stock-based compensation expense, the amortization of debt issuance costs, bond premiums and original issuance discounts,
other depreciation, the amortization of land rights, straight-line rent adjustments and losses on debt extinguishment reduced by capital
maintenance expenditures. We have defined Adjusted EBITDA as net income excluding interest, taxes on income, depreciation, (gains) or losses
from sales of property, stock-based compensation expense, straight-line rent adjustments, the amortization of land rights, and losses on debt
extinguishment. For financial reporting and debt covenant purposes, the Company includes the amounts of non-cash rents earned in FFO, AFFO,
and Adjusted EBITDA. Finally, we have defined Cash NOI as Adjusted EBITDA for the REIT excluding real estate general and administrative
expenses and including stock-based compensation expense and (gains) or losses from sales of property.
FFO, FFO per diluted common share, AFFO, AFFO per diluted common share, Adjusted EBITDA and Cash NOI are not recognized terms under
GAAP. These non-GAAP financial measures: (i) do not represent cash flow from operations as defined by GAAP; (ii) should not be considered as
an alternative to net income as a measure of operating performance or to cash flows from operating, investing and financing activities; and (iii)
are not alternatives to cash flow as a measure of liquidity. In addition, these measures should not be viewed as an indication of our ability to
fund all of our cash needs, including to make cash distributions to our shareholders, to fund capital improvements, or to make interest payments
on our indebtedness. Investors are also cautioned that FFO, FFO per share, AFFO, AFFO per share, Adjusted EBITDA and Cash NOI, as presented,
may not be comparable to similarly titled measures reported by other real estate companies, including REITs, due to the fact that not all real
estate companies use the same definitions. Our presentation of these measures does not replace the presentation of our financial results in
accordance with GAAP.View entire presentation