NEWS

WIRES

OTHER

Penn National Gaming and Sam Houston Race Park Close on Investment in Joint Venture to Own and Operate Three Texas Pari-Mutuel Facilities

Under the terms of the joint venture, Penn National has secured a 50% interest in the joint venture, which will have sole ownership of the above entities including interests in 323 acres at Sam Houston Race Park, 80 acres at Valley Race Park and an option to purchase 135 acres for the planned racetrack in Laredo, Texas. Penn National and SHRP will work collaboratively to strengthen and enhance the existing pari-mutuel operations and pursue other opportunities, including the potential to bring slot machines to existing pari-mutuel facilities in Texas, to maximize the overall value of the business.

Peter M. Carlino, Chief Executive Officer of Penn National commented, "Penn National is the nation's largest owner, operator and investor in pari-mutuel racing operations. We expect to leverage this extensive expertise as we work collaboratively with Sam Houston Race Park and our joint venture partner to strengthen and enhance existing operations and pursue other opportunities, including the potential for adding slot machines at existing Texas pari-mutuel facilities in order to maximize the overall value of the business. Recent polls have indicated that an overwhelming majority of Texans want the right to decide on slot machines at racetracks through a state-wide referendum and we look forward to working with local community and state leaders to ensure that this broad consensus is heard. Given the state of the economy, we believe this should be a priority as implementing slot machines at existing pari-mutuel facilities has proven in many jurisdictions to benefit local horsemen, local communities and all state residents through the creation of new jobs and new revenues for the State."

Shawn Hurwitz, Chief Executive Officer of Sam Houston Race Park, said, "We are pleased to begin this important partnership with Penn National Gaming, an industry leader with racing and gaming expertise. Our goal is to reinvigorate Texas horseracing, an exciting sport that continues to contribute to our state's economy. We are hopeful that providing slot machines at existing racetracks will be authorized so that we can bring back horse owners and horsemen who have left the state for other jurisdictions where slot machines at pari-mutuel facilities have helped produce larger purses and, perhaps most critically, we will then be able to create tens of thousands of jobs and generate much-needed revenue that can be made available to the state very quickly."

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-five facilities in seventeen jurisdictions, including Colorado, Florida, Illinois, Indiana, Iowa, Louisiana, Maine, Maryland, Mississippi, Missouri, New Jersey, New Mexico, Ohio, Pennsylvania, Texas, West Virginia, and Ontario. In aggregate, Penn National's operated facilities feature over 27,000 gaming machines, over 500 table games, over 2,000 hotel rooms and over 1 million square feet of gaming floor space.

Through a joint venture, Penn National is developing a full casino at Kansas Speedway in Kansas City, which is anticipated to open in the first half of 2012, and is also developing casinos in Toledo and Columbus, Ohio, with openings targeted for 2012. In October 2010, Penn National purchased all of the outstanding debt of The M Resort LLC. The M Resort Spa Casino is situated on over 90 acres on the southeast corner of Las Vegas Boulevard. Penn National recently entered into an asset purchase agreement with M Resort's equity owners that will allow the Company to convert its debt ownership into full equity, subject to, among other things, regulatory approvals.

About Sam Houston Race Park

Sam Houston Race Park opened in April 1994 as Houston's first and only live horse racing facility. The Class I horse track, located in the nation's fourth largest city, hosts thoroughbred and quarter horse racing and offers daily simulcast operations. Home to internationally-acclaimed racing surfaces and a 226,000 square foot Grandstand and Pavilion Centre, Sam Houston Race Park is located in Northwest Houston along Beltway 8 near the intersection of Highway 249. The facility also hosts various special events, private parties and meetings, as well as concerts and national touring festivals throughout the year.

About Valley Race Park

Valley Race Park, which was opened in 1990 and acquired by Sam Houston Race Park in 2000, is a 91,000 square foot dog racing and simulcasting facility located in Harlingen, Texas.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may vary materially from expectations. Penn describes certain of these risks and uncertainties in its filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2010. Meaningful factors which could cause actual results to differ from expectations described in this press release include, but are not limited to: the passage of state, federal or local legislation (including referenda) that would expand, restrict, further tax, prevent or negatively impact operations in the jurisdictions in which we do business (such as a smoking ban at any of our facilities) or in jurisdictions in which we intend to do business; our ability to receive, or delays in obtaining, the regulatory approvals required to own, develop and/or operate our facilities, or other delays or impediments to completing our planned acquisitions or projects, including favorable resolution of any related litigation; our ability to secure state and local permits and approvals necessary for construction; the activities of our competitors and the emergence of new competitors; construction factors, including delays, unexpected remediation costs, local opposition and increased cost of labor and materials; the costs and risks involved in the pursuit of development opportunities; the availability and cost of financing; the effects of local and national economic, credit, capital market, housing, energy conditions on the economy in general and on the gaming and lodging industries in particular; our relations and agreements with horsemen, pari-mutuel clerks and other organized labor groups and other factors as discussed in the Company's filings with the United States Securities and Exchange Commission. Furthermore, the Company does not intend to update publicly any forward-looking statements except as required by law. The cautionary advice in this paragraph is permitted by the Private Securities Litigation Reform Act of 1995.

Penn National Gaming
William J. Clifford, 610-373-2400
Chief Financial Officer
or
Sam Houston Race Park
Lyda Creus Molanphy, 512-751-1636
lmolanphy@shrp.com
or
Jaffoni & Collins Incorporated
Joseph N. Jaffoni / Richard Land, 212-835-8500
penn@jcir.com