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Penn National Gaming Inc – ‘DEFS14A’ for 7/26/01

On: Monday, 7/2/01, at 7:41pm ET · As of: 7/3/01 · For: 7/26/01 · Accession #: 912057-1-522392 · File #: 0-24206

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 7/03/01  Penn National Gaming Inc          DEFS14A     7/26/01    1:22K                                    Merrill Corp/FA

Definitive Proxy Solicitation Material — Special Meeting — Schedule 14A
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: DEFS14A     Proxy Statement                                        9     39K 

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SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.    ) 

                                                                [Download Table]
                                                                       
Filed by the Registrant /X/                                            

Filed by a Party other than the Registrant / /                         

Check the appropriate box:                                             
/ /        Preliminary Proxy Statement                                 
/ /        CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED  
           BY RULE 14A-6(e)(2))                                        
/X/        Definitive Proxy Statement                                  
/ /        Definitive Additional Materials                             
/ /        Soliciting Material Pursuant to Rule 14a-12                 

                              PENN NATIONAL GAMING, INC.               
-----------------------------------------------------------------------
           (Name of Registrant as Specified In Its Charter)            

                                               N/A                     
-----------------------------------------------------------------------
     (Name of Person(s) Filing Proxy Statement, if other than the      
                              Registrant)                              

Payment of Filing Fee (Check the appropriate box):                              

                                                                [Download Table]
                                                                          
/X/        No fee required.                                               
/ /        Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 
           and 0-11.                                                      
           (1)  Title of each class of securities to which transaction    
                applies:                                                  
                ----------------------------------------------------------
           (2)  Aggregate number of securities to which transaction       
                applies:                                                  
                ----------------------------------------------------------
           (3)  Per unit price or other underlying value of transaction   
                computed pursuant to Exchange Act Rule 0-11 (set forth the
                amount on which the filing fee is calculated and state how
                it was determined):                                       
                ----------------------------------------------------------
           (4)  Proposed maximum aggregate value of transaction:          
                ----------------------------------------------------------
           (5)  Total fee paid:                                           
                ----------------------------------------------------------

/ /        Fee paid previously with preliminary materials.                

/ /        Check box if any part of the fee is offset as provided by      
           Exchange Act Rule 0-11(a)(2) and identify the filing for which 
           the offsetting fee was paid previously. Identify the previous  
           filing by registration statement number, or the form or        
           schedule and the date of its filing.                           

           (1)  Amount Previously Paid:                                   
                ----------------------------------------------------------
           (2)  Form, Schedule or Registration Statement No.:             
                ----------------------------------------------------------
           (3)  Filing Party:                                             
                ----------------------------------------------------------
           (4)  Date Filed:                                               
                ----------------------------------------------------------

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[LOGO]
PENN NATIONAL GAMING, INC.

825 BERKSHIRE BOULEVARD, SUITE 200
WYOMISSING, PENNSYLVANIA 19610

------------------------

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS 
TO BE HELD ON JULY 23, 2001 

NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders of Penn   
National Gaming, Inc. (the "Company"), a Pennsylvania corporation, will be held 
on July 23, 2001, at 10:00 a.m., local time, at the offices of Schnader Harrison
Segal & Lewis, LLP, 38th Floor, 1735 Market Street, Philadelphia, Pennsylvania  
19103 for the following purposes:                                               

  1.  To approve an amendment to the Company's Amended and Restated Articles
      of Incorporation, as amended, to increase the number of shares of Common
      Stock, par value $.01 per share, that the Company is authorized to issue
from 20,000,000 shares to 200,000,000 shares.                     

    2.  To consider and transact such other business as may properly come before
the Special Meeting or any postponement or adjournment thereof.   

The foregoing items of business are more fully described in the Proxy   
Statement accompanying this Notice of Special Meeting.                          

 Only shareholders of record at the close of business on June 25, 2001 are
entitled to notice of and to vote at the Special Meeting and any postponement or
adjournment thereof. All shareholders are cordially invited to attend the       
Special Meeting in person. Any shareholder attending the Special Meeting may    
vote in person even if such shareholder previously signed and returned a proxy. 

                                       BY ORDER OF THE BOARD OF DIRECTORS,
                      Robert S. Ippolito
             SECRETARY

Wyomissing, Pennsylvania                                                        
July 3, 2001                                                                    

WHETHER OR NOT YOU EXPECT TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE  
AND SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE       
PROVIDED FOR THAT PURPOSE TO ASSURE REPRESENTATION OF YOUR SHARES. NO POSTAGE   
NEED BE AFFIXED IF MAILED IN THE UNITED STATES.                                 

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[LOGO]
PENN NATIONAL GAMING, INC.

825 BERKSHIRE BOULEVARD, SUITE 200
WYOMISSING, PENNSYLVANIA 19610

------------------------

PROXY STATEMENT 
SPECIAL MEETING OF SHAREHOLDERS 
JULY 23, 2001 

    This Proxy Statement and the enclosed Proxy are first being sent or given to
shareholders of Penn National Gaming, Inc. (the "Company") on or about July 5,  
2001, in connection with the solicitation of proxies for use at a Special       
Meeting of Shareholders of the Company to be held on July 23, 2001 (the "Special
Meeting"), or at any adjournment or postponement thereof, for the purposes set  
forth herein and in the accompanying Notice of Special Meeting. The Special     
Meeting will be held at the offices of Schnader Harrison Segal & Lewis, LLP,    
38th Floor, 1735 Market Street, Philadelphia, Pennsylvania 19103. This          
solicitation is being made on behalf of the Board of Directors of the Company.  

INFORMATION CONCERNING SOLICITATION AND VOTING

RECORD DATE AND SHARES OUTSTANDING                                              

   The Board of Directors has fixed the close of business on June 25, 2001, as
the record date ("Record Date") for the determination of shareholders of the    
Company entitled to notice of, and to vote at, the Special Meeting. On the      
Record Date, 15,471,850 shares (excluding shares held in treasury) of the       
Company's Common Stock were issued and outstanding and entitled to vote at the  
Special Meeting.                                                                

REVOCABILITY OF PROXIES                                                         

  Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to the Secretary of the      
Company written notice of revocation or a duly executed proxy bearing a later   
date or by attending the Special Meeting and voting in person.                  

VOTING AND SOLICITATION                                                         

The presence, in person or by proxy, of shareholders entitled to cast at
least a majority of the votes which all shareholders are entitled to cast is    
necessary for a quorum to be present at the Special Meeting. Each share of the  
Company's Common Stock outstanding is entitled to one vote on each matter which 
may be brought before the Special Meeting.                                      

    Proxies given in the form enclosed, unless previously revoked, will be voted
at the Special Meeting in accordance with the instructions contained therein,   
AND IF NO CHOICE IS SPECIFIED, WILL BE VOTED IN FAVOR OF THE PROPOSAL SET FORTH 
IN THE NOTICE OF MEETING. Assuming a quorum is present, the affirmative vote of 
a majority of the votes cast at the Special Meeting is required for (i) the     
approval of the amendment; and (ii) the approval of any other matters which may 
properly come before the Special Meeting or any postponement or adjournment     
thereof. For purposes of determining the number of votes cast, only those cast  
"for" or "against" are counted. Abstentions and broker non-votes are not        
considered "cast" but are counted for purposes of determining whether a quorum  
is present at the Special Meeting. Under Pennsylvania law, a quorum is required 
to conduct business at the Special Meeting.                                     

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   It is expected that the solicitation of proxies will be conducted primarily
by mail. Proxies also may be solicited personally or by telephone, telegraph,   
telecopy or via the internet. The cost of this solicitation will be borne by the
Company. In addition, the Company may reimburse brokerage firms and other       
persons representing beneficial owners of shares for their expenses in          
forwarding solicitation material to such beneficial owners. Proxies also may be 
solicited by certain directors, officers and employees of the Company, without  
additional compensation, personally or by telephone, telegram, telecopy or via  
the internet.                                                                   

PROPOSAL 1: AMENDMENT OF THE ARTICLES OF INCORPORATION TO INCREASE THE NUMBER OF
AUTHORIZED SHARES OF COMMON STOCK 

   On June 19, 2001, the Board of Directors declared advisable and unanimously
approved an amendment to the Amended and Restated Articles of Incorporation, as 
amended (the "Articles of Incorporation"), of the Company to increase the       
aggregate number of shares of Common Stock that the Company is authorized to    
issue from 20,000,000 shares to 200,000,000 shares (the "Amendment").           

 If approved by the shareholders, the Amendment will become effective upon
the filing of Articles of Amendment to the Articles of Incorporation with the   
Secretary of the Commonwealth of Pennsylvania. The Amendment would change       
Article 4, subparagraph (a) of the Articles of Incorporation to read in its     
entirety as follows:                                                            

"4. The aggregate number of shares which this Corporation shall have the
authority to issue is:                                                  

     (a) Two hundred million (200,000,000) shares of Common Stock with a par
value of $.01 per share; and"                                     

PURPOSE AND EFFECT OF THE AMENDMENT                                             

 As of the Record Date, of the Company's 20.0 million authorized shares of
Common Stock, approximately 15.5 million shares were issued and outstanding, and
approximately 2.6 million shares were reserved for future issuance under the    
Company's equity compensation plans, of which, currently, approximately         
1.9 million are covered by outstanding options and approximately 700,000 are    
available for grant or award. Based upon the foregoing number of outstanding and
reserved shares of Common Stock, the Company currently has approximately        
1.9 million shares of Common Stock remaining available for issuance for other   
purposes.                                                                       

  The Board of Directors believes that it is in the Company's best interests
to increase the number of authorized but unissued shares of Common Stock to have
additional shares available to meet the Company's future business needs as they 
arise. The Company has filed a shelf registration statement with the Securities 
and Exchange Commission seeking to register $300.0 million of securities of the 
Company, including its Common Stock. However, the Company has no present        
arrangements, agreements, understandings or plans for the use of the additional 
shares proposed to be authorized, including those shares that could be sold     
under the shelf registration statement, if such registration statement is       
declared effective. The Board of Directors believes that the availability of    
such additional shares will provide the Company with the flexibility to issue   
Common Stock for a variety of other purposes the Board may deem advisable       
without further action by the Company's shareholders, unless required by law,   
regulation or Nasdaq Marketplace rule. These purposes could include, among other
things, the sale of stock to obtain additional capital funds or to acquire other
companies, business or assets; to provide equity-based compensation and other   
employee benefit plans for employees, consultants and others; to declare future 
stock splits or distributions; and for other bona fide purposes.                

  There will be no change in the voting rights, dividend rights, liquidation
rights, preemptive rights or any other shareholder rights as a result of the    
proposed Amendment. The additional shares might be issued at such times and     
under such circumstances as to have a dilutive effect on earnings per share and 
on the equity ownership of the present holders of Common Stock.                 

2 

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POTENTIAL ANTI-TAKEOVER EFFECT                                                  

The proposed Amendment could, under certain circumstances, have an      
anti-takeover effect, although this is not the intention of the Amendment. The  
increased number of authorized shares of Common Stock could discourage, or be   
used to impede, an attempt to acquire or otherwise change control of the        
Company. The private placement of shares of Common Stock into "friendly" hands, 
for example, could dilute the voting strength of a party seeking control of the 
Company.                                                                        

 Furthermore, many companies, including the Company, have issued rights to
acquire shares of Preferred Stock to the holders of its Common Stock to         
discourage or defeat unsolicited share accumulation programs and acquisition    
proposals, which programs or proposals may be viewed by the Board of Directors  
as not in the best interest of the Company and the shareholders. Under the terms
set forth in a Rights Agreement dated as of March 2, 1999 between the Company   
and Continental Stock Transfer and Trust Company (the "Rights Agreement"), each 
outstanding share of Common Stock includes one right. Each right entitles the   
registered holder, subject to the terms of the Rights Agreement, to purchase    
from the Company one unit, equal to one one-hundredth of a share of the         
Company's Series A Preferred Shares, par value $.01 per share, at an exercise   
price of $40.00 per unit, subject to adjustment. The rights are attached to all 
certificates representing outstanding shares of the Company's Common Stock, and 
no separate rights certificates have been distributed.                          

   In addition to the Series A Preferred Stock issuable pursuant to the Rights
Agreement, the Board of Directors is authorized to issue shares of Preferred    
Stock in one or more other series without further action by the Company's       
shareholders, unless required by law, regulation or Nasdaq Marketplace rule. The
Board of Directors is authorized to establish the rights, preferences,          
privileges and restrictions, including, but not limited to, voting rights,      
dividend rights, conversion rights, redemption privileges and liquidation       
preferences, of such series of Preferred Stock. The authority of the Board of   
Directors to issue other series of Preferred Stock and to set the terms of such 
Preferred Stock also could discourage or defeat unsolicited share accumulation  
programs and acquisition proposals.                                             

Although the Company presently has no intent to use the additional      
authorized shares of Common Stock for the purposes described above, if the      
Amendment is adopted, more capital stock of the Company would be available for  
such purposes than is currently available.                                      

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE PROPOSAL TO
AMEND THE COMPANY'S AMENDED AND RESTATED ARTICLES OF INCORPORATION, AS AMENDED, 
TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK.                    

3 

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SECURITY OWNERSHIP OF CERTAIN 
BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information with respect to      
beneficial ownership of the Company's Common Stock as of May 31, 2001 (except as
noted), by each person known to the Company to own beneficially more than five  
percent of the Company's outstanding Common Stock, each director, the chief     
executive officer and each of the four other most highly compensated executive  
officers of the Company and all of the executive officers and directors of the  
Company as a group.                                                             

                                                        [Enlarge/Download Table]

                                                              NUMBER OF SHARES   PERCENTAGE OF
NAME AND ADDRESS(1)                                          BENEFICIALLY OWNED    CLASS(2)   
-------------------                                          ------------------  -------------
                                                                                              
Peter M. Carlino(3)(4)......................................       5,484,534         34.2%    
Harold Cramer(4)(5).........................................       4,521,404         29.2%    
Peter D. Carlino(6).........................................       4,504,040         29.2%    
Richard J. Carlino(7).......................................       4,324,244         28.0%    
Carlino Family Trust(8).....................................       4,300,326         27.8%    
William J. Bork(4)..........................................         150,668          1.0%    
David A. Handler(4).........................................          86,395         *        
John M. Jacquemin(4)........................................          25,950         *        
Robert S. Ippolito(4).......................................          23,600         *        
Robert P. Levy(4)...........................................          22,500         *        
Robert Abraham(4)...........................................          20,750         *        
George A. Connolly(4).......................................           7,700         *        
Joseph A. Lashinger Jr......................................              --         *        
Akre Capital Management, LLC                                                                  
  Potomac Tower, 6th Floor                                                                    
  1001 19th Street North                                                                      
  Arlington, Virginia 22209(9)..............................       1,099,998          7.1%    
All executive officers and directors as a group (10                                           
  persons)(4)...............................................       6,043,175         39.1%    

------------------------                                                        

*   Less than 1%.                                                               

(1) The persons named in the above table have sole voting and investment power  
 with respect to all shares of Common Stock shown as beneficially owned by
   them except as otherwise shown in the succeeding footnotes, and the address
of each such person, other than Akre Capital Management, LLC is c/o the 
    Company, 825 Berkshire Boulevard, Suite 200, Wyomissing, Pennsylvania 19610.

(2) The percentage for each beneficial owner is calculated based on (i) the     
  aggregate number of shares reported to be beneficially owned by such group
or individual and (ii) the aggregate number of shares of Common Stock   
 outstanding (less shares held in Treasury) as of May 31, 2001 (15,448,350
shares).                                                                

(3) The number of shares in the table includes 4,300,326 shares owned by the    
    Family Trust (as defined in Note (5) below) as to which Peter M. Carlino has
  sole voting power for the election of directors and certain other matters,
  shared voting power with respect to certain matters, and shared investment
    power; and 581,958 shares owned jointly by Mr. Carlino and his wife, Marshia
Carlino.                                                                

(4) Includes shares that may be acquired upon the exercise of outstanding       
    options and warrants that are exercisable within 60 days of May 31, 2001, as
follows: Peter M. Carlino, 602,250 shares; Harold Cramer, 15,000 shares;
 William J. Bork, 140,668 shares; David A. Handler, 22,500 shares; John M.
    Jacquemin, 22,500 shares; Robert S. Ippolito, 21,750 shares; Robert P. Levy,
22,500 shares; Robert Abraham, 19,750 shares; George A. Connolly, 7,500 
shares; and all executive officers and directors as a group,            
874,418 shares.                                                         

4 

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(5) The number of shares in the table includes 300,326 shares owned by the      
 Family Trust, and an aggregate of 182,578 shares owned by a marital trust
    for the benefit of Peter D. Carlino and by a residuary trust for the benefit
   of Peter D. Carlino's children as to both of which Harold Cramer has shared
investment power and shared voting power.                               

(6) The number of shares in the table includes 4,300,326 shares owned by an     
   irrevocable trust (the "Family Trust") among Peter D. Carlino and his eight
 children, as settlors, and certain trustees, as to which Peter D. Carlino
   has shared investment and voting power with respect to certain matters; and
   182,578 shares owned by a marital trust for the benefit of Peter D. Carlino
  and by a residuary trust for the benefit of Peter D. Carlino's children as
to both of which Peter D. Carlino has shared investment power and shared
voting power.                                                           

(7) The number of shares in the table includes 300,326 shares of Common Stock   
owned by the Family Trust, as to which Richard J. Carlino has shared    
investment power and shared voting power as to certain matters.         

(8) See note (5).                                                               

(9) The information in the table is based on information contained provided to  
the Company by Akre Capital Management, LLC as of March 10, 2001.       

OTHER MATTERS 

 The Company has mailed a proxy card together with this proxy statement to
all shareholders of record at the close of business on June 25, 2001. The Board 
of Directors does not know of any other business that will be presented for     
consideration at the Special Meeting. Except as the Board of Directors may      
otherwise permit, only the business set forth and discussed in the Notice of    
Special Meeting and Proxy Statement may be acted on at the Special Meeting. If  
any other business does properly come before the Special Meeting or any         
postponement or adjournment thereof, the proxy holders will vote in regard      
thereto according to their discretion insofar as such proxies are not limited to
the contrary.                                                                   

                                       By Order of the Board of Directors,
                      ROBERT S. IPPOLITO
             SECRETARY

July 3, 2001                                                                    

5 

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                                                                           PROXY

    PENN NATIONAL GAMING, INC.
SPECIAL MEETING OF SHAREHOLDERS, JULY 23, 2001

    The undersigned hereby appoints Peter M. Carlino and Harold Cramer, and each
of them, the attorneys and proxies of the undersigned, with full power of       
substitution, to vote on behalf of the undersigned all of the shares of Common  
Stock of Penn National Gaming, Inc. (the "Company"), which the undersigned is   
entitled to vote at the Special Meeting of Shareholders thereof to be held on   
July 23, 2001 and at any and all postponements and adjournments thereof, upon   
the following matters:                                                          

1.  To approve an amendment to the Company's Amended and Restated Articles of   
 Incorporation, as amended, to increase the authorized number of shares of
 Common Stock, par value $.01 per share, that the Company is authorized to
issue from 20,000,000 shares to 200,000,000 shares.                     

/ /  For            / /  Against            / /  Abstain

2.  In their discretion, such other business as may properly come before the    
special meeting and any and all adjournments thereof.                   

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THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEM NO. 1. IF NO SPECIFICATION  
IS MADE, SUCH PROXY WILL BE VOTED "FOR" THIS ITEM AND IN THE DISCRETION OF THE  
PROXIES ON ALL OTHER MATTERS PROPERLY BROUGHT BEFORE THE ANNUAL MEETING.        

                                         Dated _________________________, 2001
                                        __________________________
                                      Signature of Shareholder
                                        __________________________
                                      Signature of Shareholder
                                    Please sign exactly as
                           name appears.
                                      For joint accounts, each
                                    joint owner must sign.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS 
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY.

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Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘DEFS14A’ Filing	Date	First	Last	Other Filings

For Period End:	7/26/01
	7/23/01	2	8	10-K/A, PRES14A, S-3/A
	7/5/01	3
Filed as of:	7/3/01	2	7
Filed on:	7/2/01
	6/25/01	2	7	S-3
	6/19/01	4
	5/31/01	6
	3/10/01	7
	3/2/99	5
				List all Filings

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Filing Submission 0000912057-01-522392 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Penn National Gaming Inc – ‘DEFS14A’ for 7/26/01

On: Monday, 7/2/01, at 7:41pm ET · As of: 7/3/01 · For: 7/26/01 · Accession #: 912057-1-522392 · File #: 0-24206

Definitive Proxy Solicitation Material — Special Meeting — Schedule 14AFiling Table of Contents

Dates Referenced Herein and Documents Incorporated by Reference

Definitive Proxy Solicitation Material — Special Meeting — Schedule 14A
Filing Table of Contents