Penn National Gaming Announces Tender Offer and Consent Solicitation for Any and All of Its 8.75% Senior Subordinated Notes Due

  Penn National Gaming Announces Tender Offer and Consent Solicitation for Any
  and All of Its 8.75% Senior Subordinated Notes Due 2019

Business Wire

WYOMISSING, Pa. -- October 15, 2013

Penn National Gaming, Inc. (PENN: Nasdaq) (“Penn”) announced today that it is
commencing a cash tender offer for any and all of the $325 million aggregate
outstanding principal amount of its 8.75% senior subordinated notes due 2019
(CUSIP No. 707569AN9) and a related consent solicitation to effect certain
amendments to the indenture governing the notes.

As part of the tender offer, Penn is soliciting consents for amendments that
would eliminate or modify certain covenants, events of default and other
provisions contained in the indenture governing the notes. Holders who tender
their notes will be deemed to consent to all of the proposed amendments, and
holders may not deliver consents without tendering their notes. The tender
offer and consent solicitation is being made pursuant to the Offer to Purchase
and Consent Solicitation Statement, dated October 15, 2013, and a related
Consent and Letter of Transmittal, which more fully set forth the terms and
conditions of the tender offer and consent solicitation.

The tender offer will expire at 5:00 p.m., New York City time, on November 13,
2013, unless the tender offer is extended or earlier terminated (the
“Expiration Date”). Under the terms of the tender offer and consent
solicitation, holders of the notes who validly tender their notes and deliver
their consents at or prior to 5:00 p.m., New York City time, on October 28,
2013 (as such time and date may be extended, the “Consent Payment Deadline”)
and do not withdraw their notes or revoke their consents at or prior to 5:00
p.m., New York City time, on October 28, 2013 (such date and time, as it may
be extended, the “Withdrawal Deadline”), and whose notes are accepted for
purchase, will receive the “Total Consideration” of $1,107.24 per $1,000
principal amount of tendered notes, which is equal to the “Tender Offer
Consideration” of $1,087.24 per $1,000 principal amount of tendered notes plus
a consent payment of $20.00 per $1,000 principal amount of tendered notes.
Holders of notes who validly tender their notes after the Consent Payment
Deadline but at or prior to the Expiration Date, and whose notes are accepted
for purchase, will receive only the Tender Offer Consideration. In addition to
the Total Consideration or the Tender Offer Consideration, as the case may be,
holders whose notes are accepted in the tender offer will receive accrued and
unpaid interest from and including the most recent interest payment date, and
up to, but excluding, the applicable settlement date.

Penn reserves the right but is under no obligation, on any day following the
Consent Payment Deadline and prior to the Expiration Date (the “Early
Settlement Date”), to accept for purchase any notes validly tendered prior to
the Early Settlement Date (and not withdrawn at or prior to the Withdrawal
Deadline), subject to satisfaction or waiver of the conditions to the tender
offer.

Penn intends to call for redemption any and all notes not tendered in the
tender offer. Penn may call the notes for redemption, and effect the
satisfaction and discharge of the indenture governing the notes, as early as
the Early Settlement Date.

The tender offer and consent solicitation is subject to certain conditions,
including the condition that Penn has completed one or more financing
transactions resulting in net proceeds to Penn that are sufficient to pay the
Total Consideration, plus accrued and unpaid interest from and including the
most recent interest payment date and up to, but not including, the applicable
settlement date, in respect of all of the notes, as well as related fees and
expenses of the tender offer and consent solicitation. If any of the
conditions are not satisfied, Penn is not obligated to accept for payment,
purchase or pay for, and may delay the acceptance for payment of, any tendered
notes or delivered consents and may terminate the tender offer and consent
solicitation.

This press release does not constitute a notice of redemption under the
optional redemption provisions of the indenture governing the notes, nor does
it constitute an offer to sell, or a solicitation of an offer to buy, any
security. No offer, solicitation, or sale will be made in any jurisdiction in
which such an offer, solicitation, or sale would be unlawful.

Requests for documents relating to the tender offer and consent solicitation
may be directed to i-Deal, LLC, the Information Agent, toll-free at (888)
593-9546 or (212) 849-3880 (banks and brokers). J.P. Morgan and BofA Merrill
Lynch will act as Dealer Managers for the tender offer and solicitation agents
for the consent solicitation. Questions regarding the tender offer and consent
solicitation may be directed to J.P. Morgan, toll-free at (800) 245-8812, or
BofA Merrill Lynch, toll-free at (888) 292-0070.

About Penn National Gaming

Penn National Gaming owns, operates or has ownership interests in gaming and
racing facilities with a focus on slot machine entertainment. The Company
presently operates twenty-eight facilities in eighteen jurisdictions,
including Florida, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine,
Maryland, Mississippi, Missouri, Nevada, New Jersey, New Mexico, Ohio,
Pennsylvania, Texas, West Virginia, and Ontario. In aggregate, Penn National’s
operated facilities currently feature approximately 33,000 gaming machines,
800 table games, 2,900 hotel rooms and approximately 9.0 million total
property square feet.

Forward-looking Statements

This press release and the information incorporated by reference herein
include “forward looking statements,” including statements about tender offer
and consent solicitation and other transactions. These statements can be
identified by the use of forward looking terminology such as “expects,”
“believes,” “estimates,” “expects,” “intends,” “may,” “will,” “should” or
“anticipates” or the negative or other variation of these or similar words, or
by discussions of future events, strategies or risks and uncertainties. Such
forward looking statements are inherently subject to risks, uncertainties and
assumptions about Penn and its subsidiaries, and accordingly, any forward
looking statements are qualified in their entirety by reference to the factors
described in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2012, subsequent Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K as filed with the Securities and Exchange Commission (the
“SEC”). Important factors that could cause actual results to differ materially
from the forward looking statements include, without limitation, risks related
to the following: the proposed transactions, including the proposed spin-off
from Penn of Gaming and Leisure Properties, Inc. (“GLPI”), our ability to
raise the capital necessary to finance the spin-off and related transactions,
our ability to consummate the proposed transactions on the timeline and at the
costs expected and to achieve the expected benefits thereof, Penn’s ability to
successfully conduct and expand Penn’s business and GLPI’s ability to
successfully conduct its business following the consummation of the proposed
transactions and the diversion of management’s attention from Penn’s business;
Penn’s ability to obtain timely regulatory approvals required to operate and
manage Penn’s facilities, or other delays or impediments to implementing
Penn’s business plan, including favorable resolution of any related
litigation, including the appeal by the Ohio Roundtable addressing the
legality of video lottery terminals in Ohio; Penn’s ability to secure state
and local permits and approvals necessary for construction; construction
factors, including delays, unexpected remediation costs, local opposition and
increased cost of labor and materials; Penn’s ability to reach agreements with
the thoroughbred and harness horseman in Ohio in connection with the proposed
relocations and to otherwise maintain agreements with Penn’s horseman,
pari-mutuel clerks and other organized labor groups; the passage of state,
federal or local legislation (including referenda) that would expand,
restrict, further tax, prevent or negatively impact operations in or adjacent
to the jurisdictions in which Penn do or seek to do business (such as a
smoking ban at any of Penn’s facilities); the effects of local and national
economic, credit, capital market, housing, and energy conditions on the
economy in general and on the gaming and lodging industries in particular; the
activities of Penn’s competitors and the rapid emergence of new competitors
(traditional, internet and sweepstakes based); increases in the effective rate
of taxation at any of Penn’s properties or at the corporate level; Penn’s
ability to identify attractive acquisition and development opportunities and
to agree to terms with partners for such transactions; financial, operational,
regulatory or other potential challenges of the subsidiary of GLPI from whom
Penn will lease substantially all of the properties on which Penn conducted
gaming operations after the spin-off; the fact that significant portions of
Penn’s cash flows will be required to be paid as rent after the spin-off; any
unscheduled disruptions in Penn’s technology services or interruption in the
supply of electrical power; the costs and risks involved in the pursuit of
such opportunities and Penn’s ability to complete the acquisition or
development of, and achieve the expected returns from, such opportunities;
Penn’s expectations for the continued availability and cost of capital; the
outcome of pending legal proceedings; changes in accounting standards; Penn’s
dependence on key personnel; the impact of terrorism and other international
hostilities; the impact of weather; and other factors discussed in Penn’s
filings with the SEC. All subsequent written and oral forward looking
statements attributable to Penn or persons acting on Penn’s behalf are
expressly qualified in their entirety by the cautionary statements included in
this press release. Penn undertakes no obligation to publicly update or revise
any forward looking statements contained or incorporated by reference herein,
whether as a result of new information, future events or otherwise, except as
required by law. In light of these risks, uncertainties and assumptions, the
forward looking events discussed in this press release may not occur.

Contact:

Penn National Gaming, Inc.
William J. Clifford, 610-373-2400
Chief Financial Officer
or
JCIR
Joseph N. Jaffoni, Richard Land
212-835-8500
penn@jcir.com
 
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