FCPT 10-K & 10-Q changes, risk factors and insider trading

As the owner of properties serving the restaurant industry, we are impacted by the risks associated with the restaurant industry. 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 factors over which we and any of our tenants in the restaurant industry have no control. As we are subject to risks inherent in substantial investments in a single industry, a decrease in the restaurant business would likely have a greater adverse effect on our revenues than if we owned a more diversified real estate portfolio.

We derive substantially all of our revenue from tenants who lease space from us at our properties. 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.uncertainty or as a result of new or threatened policies of governmental and regulatory agencies. As a result, our tenants may delay lease commencements, decline to extend or renew leases upon expiration, fail to make rental payments when due, close a number of restaurants or declare bankruptcy. Any of these actions could result in the loss of rental income attributable to the terminated leases and write-downs of certain of our assets. In that event, we may be unable to re-lease the vacated space at attractive rents or at all. The occurrence of any of the situations described above would have a material adverse effect on our results of operations and our financial condition.

Security breaches, cyber-attacks, or disruption, of our physical or information technology infrastructure, networks and related management systems could result in, among other things, a breach of our networks and information technology infrastructure, the misappropriation of our or our tenants’ proprietary or confidential information, interruptions or malfunctions in our or our tenants’ operations, delays or interruptions to our ability to meet tenant needs, breach of our legal, regulatory or contractual obligations, inability to access or rely upon critical business records, unauthorized access to our facilities or other disruptions in our operations. 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. 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. 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. 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. Techniques used to breach security change frequently, and are generally not recognized until launched against a target, so we may not be able to promptly detect that a security breach or unauthorized access has occurred. 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. We also may not be able to implement security measures in a timely manner or, if and when implemented, we may not be able to determine the extent to which these measures could be circumvented. As we provide assurances to our tenants that we provide a high level of security, if an actual or perceived security breach occurs, the market’s perception of our security measures could be harmed and we could lose current and potential tenants, and such a breach could be harmful to our brand and reputation. Any breaches that may occur could expose us to increased risk of lawsuits, material monetary damages, potential violations of applicable privacy and other laws, penalties and fines, harm to our reputation and increases in our security and insurance costs, which could have a material adverse effect on our business, financial condition and results of operations. In the event of a breach resulting in loss of data, such as personally identifiable information or other such data protected by data privacy or other laws, we may be liable for damages, fines and penalties for such losses under applicable regulatory frameworks despite not handling the data. We cannot guarantee that any backup systems, regular data backups, security protocols, network protection mechanisms and other procedures currently in place, or that may be in place in the future, will be adequate to prevent network and service interruption, system failure, damage to one or more of our systems or data loss in the event of a security breach or attack. Further, while we carry cyber liability insurance, such insurance may not be adequate to cover all losses related to such events.

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). 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. 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, we have issued $625 million of senior unsecured fixed rate notes (the “Notes”). The Notes consist of $50 million of notes due in December 2026 priced at a fixed interest rate of 4.63%, $75 million of notes due in June 2027 priced at a fixed interest rate of 4.93%, $50 million of notes due in December 2028 priced at a fixed interest rate of 4.76%, $50 million of notes due in April 2029 priced at a fixed interest rate of 2.74%, $50 million of notes due in June 2029 priced at a fixed interest rate of 3.15%, $75 million of notes due in April 2030 priced at a fixed interest rate of 3.20%, $50 million of notes due in March 2031 priced at a fixed interest rate of 3.09%, $50 million of notes due in April 2031 priced at a fixed interest rate of 2.99%, $75 million of notes due in March 2032 priced at a fixed interest rate of 3.11%, and $100 million of notes due in July 2033 priced at a fixed interest rate of 6.44%. We may incur additional indebtedness in the future to refinance our existing indebtedness, to finance newly-acquired assets or for other purposes. Our governing documents do not contain any limitations on the amount of debt we may incur and we do not have a formal policy limiting the amount of debt we may incur in the future. Subject to the restrictions, if any, set forth in our debt agreements, our Board of Directors may establish and change our leverage policy at any time without stockholder approval. Any significant additional indebtedness could require a substantial portion of our cash flow to make interest and principal payments due on our indebtedness. Greater demands on our cash resources may reduce funds available to us to pay dividends, make capital expenditures and acquisitions, or carry out other aspects of our business strategy. Increased indebtedness can also limit our ability to adjust rapidly to changing market conditions, make us more vulnerable to general adverse economic and industry conditions and create competitive disadvantages for us compared to other companies with relatively lower debt levels. Increased future debt service obligations may limit our operational flexibility, including our ability to acquire assets, finance or refinance our assets, contribute assets to joint ventures or sell assets as needed.

The maximum U.S. federal income tax rate applicable to income from “qualified dividends” payable by non-REIT “C” corporations to certain non-corporate U.S. stockholders is currently 23.8% (taking into account the 3.8% Medicare tax applicable to net investment income). Dividends payable by REITs, however, generally are not qualified dividends. EffectiveUnder forthe taxableTax yearsCuts beginningand afterJobs DecemberAct 31,of 2017 and(the before January 1, 2026,“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. These extensions include the permanent allowance of the 20% deduction for “qualified REIT dividends” for non-corporate U.S. stockholders. For non-corporate U.S. stockholders in the top marginal tax bracket of 37%, the deduction for REIT dividends yields an effective U.S. federal income tax rate of 29.6% on REIT dividends, which is higher than the 20% tax rate on qualified dividend income paid by “C” corporations. This does not adversely affect the taxation of REITs; however, the more favorable rates applicable to regular corporate qualified dividends could cause certain non-corporate investors to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT “C” corporations that pay dividends, which could adversely affect the value of the shares of REITs, including our common stock.

To qualify as a REIT for U.S. federal income tax purposes, we must ensure that, at the end of each calendar quarter, at least 75% of the value of our assets consists of cash, cash items, government securities and “real estate assets” (as defined in the Code). The remainder of our investments (other than government securities, qualified real estate assets and securities issued by a TRS) generally cannot include more than 10% of the outstanding voting securities of any one issuer or more than 10% of the total value of the outstanding securities of any one issuer. In addition, in general, no more than 5% of the value of our total assets (other than government securities, qualified real estate assets and securities issued by a TRS) can consist of the securities of any one issuer, no more than 20%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 a result, we may be required to liquidate or forego otherwise attractive investments. These actions could have the effect of reducing our income and amounts available for distribution to our stockholders.

In 2024,2025, FCPT engaged in various real estate transactions for a total investment of $273.0$325.5 million, including capitalized transaction costs. Pursuant to these transactions, we acquired 87105 properties and ground leaseholds, aggregating 546.6713.9 thousand square feet, and representing 3135 brands, including AFCChuy's, UrgentCrash Care,Champions, BaptistHawaiian Medical,Bros, ChristianLittle Brothers,Caesar's, MercyOne,Mission Pet Health, and P.F.United Chang's.Rentals.

An average annual rent escalation of 1.4%1.5% 1 through December 31, 20292030 (weighted by annualized base rent); and 99.8% of the contractual base rent collected for the year ended December 31, 2024.2025.

Rental revenue increased $17.3$25.5 million during the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024. This increasechange is due to recognizing a full year of revenue in 20242025 from the 9287 properties acquired in 2023,2024, and the acquisition of 87105 properties and ground leaseholds in 2024.2025. During the year ended December 31, 2024,2025, we recognized costs paid by the lessor and reimbursed by the lessees within rental revenue of $9.5$11.0 million, compared to $9.4$9.5 million during the year ended December 31, 2023.2024. These amounts are also recognized in property expenses.

Depreciation and amortization expense represents the depreciation on real estate investments and equipment that have estimated lives ranging from 2 to 55 years. Depreciation and amortization expense increased by approximately $3.8$5.9 million for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, primarily due to the acquisition of 87105 properties in 2024,2025, and the depreciation on 9287 properties acquired in 20232024 that incurred a full year of depreciation. In addition, we recorded an impairment of $827 thousand in 2025 to depreciation and amortization expense for the write-down of a single property.

Interest expense increased by approximately $4.6$2.6 million for the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024. This was primarily due to the issuancenet increase in term loans of $75 million in January 2025, which was partially offset by lower utilization of the additionalrevolving $85credit 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.facility.

Total restaurant expenses increased approximately $0.3$0.4 million in the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, primarily due to improved staffing and a reduction in overtime hours.turnover.

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. On an ongoing basis, management evaluates its estimates and assumptions; however, actual results may differ from these estimates and assumptions, which in turn could have a material impact on our financial statements. Estimates and assumptions include, among other things, subjective judgments regarding the fair values and useful lives of our properties for depreciation and lease classification purposes, and asset impairment analysis.

Real estate investments, net are recorded at cost less accumulated depreciation. Building components are depreciated over estimated useful lives using the straight-line method. Leasehold improvements, which are reflected on our Consolidated Balance Sheets as a component of buildings, within land, buildings and equipment, net, are amortized over the lesser of the non-cancelable lease term or the estimated useful lives of the related assets using the straight-line method. Equipment is depreciated over estimated useful lives also using the straight-line method. 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”).

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. 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. 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, 20242025 and 2023,2024, the weighted average interest rate on the term loans, after consideration of the interest rate hedges, was 3.84%4.00% and 3.69%,3.84%, respectively. At December 31, 20242025 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. At December 31, 2023, there were outstanding borrowings of $16 million under the revolving credit facility and no outstanding letters of credit.

We have an effective shelf registration statement on file with the SEC under which we may issue equity financing through the instruments and on the terms most attractive to us at such time. On SeptemberOctober 17,30, 2024,2025, 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. The ATM program replaces the Company's previous $450.0$500.0 million ATM program (the "prior ATM program" and, together with the ATM program, the "ATM programs"), which was established in NovemberSeptember 2022,2024, under which the Company had sold shares of its common stock having an aggregate gross sales price of $404.8$291.8 million through SeptemberOctober 17,30, 2024.2025. In connection with the Company’s ATM program,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. The use of forward sale agreements allows the Company to lock in a share price on the sale of shares of common stock at the time the respective forward sale agreements are executed but defer settling the forward sale agreements and receiving the proceeds from the sale of shares until a later date.

ImpairmentNon-real estate impairment charges

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. AFFO is a widely reported measure by other REITs; however, other REITs may use different methodologies for calculating AFFO and, accordingly, our AFFO may not be comparable to other REITs.

Statements contained in this Quarterly Report on Form 10-Q, including the documents that are incorporated by reference, that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). Also, when Four Corners Property Trust, Inc. (the “Company”) uses any of the words “anticipate,” “assume,” “believe,” “estimate,” “expect,” “intend,” or similar expressions, Four Corners Property Trust, Inc. is making forward-looking statements. Although management believes that the expectations reflected in such forward-looking statements are based upon present expectations and reasonable assumptions, actual results could differ materially from those set forth in the forward-looking statements. Certain factors that could cause actual results or events to differ materially from those anticipated or projected are described in the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, as such factors may be updated from time to time in our periodic filings with the Securities and Exchange Commission.

During the threesix months ended MarchJune 31,30, 2026, FCPT acquired 1033 properties for a total investment value of $26.8$85.5 million, including transaction costs. These properties are 100% occupied under net leases with a weighted average remaining lease term of 10.010.2 years.

At MarchJune 31,30, 2026, our lease portfolio had the following characteristics:

99.7% of the contractual base rent collected for the three months ended MarchJune 31,30, 2026; and 52%51% investment-grade tenancy (weighted by annualized base rent).

The following discussion includes the results of our operations for the three and six months ended MarchJune 31,30, 2026 and 2025 as summarized in the table below:

Three Months Ended MarchJune 31,30, 2026 Compared to Three Months Ended MarchJune 31,30, 2025

During the three months ended MarchJune 31,30, 2026 and 2025, we operated in two segments: real estate operations and restaurant operations. Our real estate operations generate rental income from leases primarily with restaurant brands, which we recognize on a straight-line basis to include the effect of base rent escalators. Our restaurant operations generate restaurant revenue from operating seven LongHorn Steakhouse restaurants.

Rental revenue increased $6.3$5.2 million, or 10%,8%, during the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025. This change was due primarily to the acquisition of 9291 leased properties during the year-over-yeartwelve month period from AprilJuly 1, 2025 through MarchJune 31,30, 2026. During the three months ended MarchJune 31,30, 2026, we recognized variable lease revenue, including costs paid by the lessor and reimbursed by the lessees, within rental revenue of $2.8 million as compared to $2.7 million during the three months ended MarchJune 31,30, 2025. These amounts are also recognized in property expenses.

General and administrative expense is comprised of costs associated with personnel, office rent, legal, accounting, information technology, and other professional and administrative services in association with our real estate operations, our REIT structure and public company reporting requirements. General and administrative expenses decreasedincreased $0.2$0.8 million, or 2%,12%, in the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, primarily due to aan decreaseincrease in cash compensation-related expenses and increased non-cash stock-based compensation expense. General and administrative expense, after excluding stock-based compensation, for the three months ended MarchJune 31,30, 2026 was $4.9$4.8 million, compared to $4.9$4.4 million of general and administrative expense, after excluding stock-based compensation, for the three months ended MarchJune 31,30, 2025.

Depreciation and amortization expense represents the depreciation on real estate investments and equipment that have estimated lives ranging from 2 to 55 years. Depreciation and amortization increased by approximately $1.8$1.9 million, or 12%,13%, for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, due to the acquisition of 9291 properties, during the year-over-yeartwelve month period from AprilJuly 1, 2025 through MarchJune 31,30, 2026.

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. Other property expenses consist of expenses incurred on vacant properties, abandoned deal costs, lease transaction costs, property-level expenses and franchise taxes. During the three months ended MarchJune 31,30, 2026, we recorded property expenses of $3.4$3.6 million, of which $2.8 million was reimbursed by tenants. During the three months ended MarchJune 31,30, 2025, we recorded property expenses of $3.3$3.4 million, of which $2.7 million was reimbursed by tenants. The increase in property expenses is primarily due to an increase in franchise tax, property tax, and vacancy-related expenses.

We incur interest expense on our $590$640 million of term loans, any outstanding borrowings on our revolving credit facility, interest rate swaps, and our $625 million of senior fixed rate notes. Interest expense increased by $0.4$0.7 million for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, primarily due to the net increase in term loans of $75$50 million in JanuaryApril 2025.2026.

During the three months ended MarchJune 31,30, 2026 and 2025, no properties were sold.

During the three months ended MarchJune 31,30, 2026 and 2025, our income tax expense was $0.1$55 million,thousand and $112 thousand, respectively. The 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 modestly increase.

Restaurant revenues increased by $0.4 million, or 4%, during the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025 primarily due to increased guest counts and higher average spend per guest.

Total restaurant expenses increased by $0.3$0.4 million during the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, primarily attributable to higher commodity costs.

During the three months ended MarchJune 31,30, 2026,2026 and March 31, 2025, the Company recorded income tax expense of less than $20$50 thousand for either period.

At MarchJune 31,30, 2026, we had $29.6$24.8 million of cash and cash equivalents and $350 million of borrowing capacity under our revolving credit facility, which expires on February 1, 2029, subject to our ability to extend the term for two additional six-month periods to February 1, 2030. The revolving credit facility provides for a letter of credit sub-limit of $25 million. See Note 6 - Debt, Net of Deferred Financing Costs included in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information. As of MarchJune 31,30, 2026, we had no outstanding borrowings under the revolving credit facility. At MarchJune 31,30, 2026, the weighted average interest rate on the term loans, after consideration of the interest rate hedges, was 3.97%.4.04%.

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 “2025 Credit Agreement”).

On August 19, 2025, the Company entered into Amendment No. 1 to the 2025 Credit Agreement which removed the credit spread adjustment applicable to the revolving credit and term loan agreement. TermPursuant to the amendment, as of June 30, 2026, term loans under the 2025 Credit Agreement now accrueaccrued interest at a per annum rate equal to a SOFR rate plus a margin of 0.95% to 1.00%, and the revolver accruesaccrued interest at a per annum rate equal to a margin of 0.85%. A facility fee at a rate of 0.20% per annum appliesapplied to the total revolving commitments available under the 2025 Credit Agreement.

The 2025 Credit Agreement contains customary events of default including, among other things, payment defaults, breach of covenants, cross default and cross acceleration to material recourse indebtedness, bankruptcy-related defaults, judgment defaults, and the occurrence of certain change of control events. The occurrence of an event of default will limit the ability of the Company and FCPT OP to make distributions and may result in the termination of the credit facility, acceleration of repayment obligations and the exercise of remedies by the Lenders with respect to the collateral.

During the first threesix months of 2026, 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 from changes in interest rates from the trade date through the forecasted issuance date of debt.

During the three and six months ended MarchJune 31,30, 2026, the Company had the following activity under its ATM program, the net proceeds of which were employed to fund acquisitions and for general corporate purposes.

At MarchJune 31,30, 2026, the Company had no outstanding forward sale agreements.

At MarchJune 31,30, 2026, there was $500.0 million available for issuance under the ATM programs.