Penn National Gaming Closes $2.725 Billion Senior Secured Credit Facility to Fund Acquisition of Argosy Gaming Company and to Provide Additional Working Capital

The $2.725 billion financing package consists of three creditfacilities comprised of a $750.0 million revolving credit facility (ofwhich $236 million is drawn), a $325.0 million Term Loan A Facilityand a $1.65 billion Term Loan B Facility.

Deutsche Bank Trust Company Americas, Goldman Sachs CreditPartners L.P., and Lehman Brothers Inc. served as Joint LeadArrangers/Agents.

The credit facility allows Penn National Gaming to raise anadditional $300 million in senior secured credit for projectdevelopment and property expansion as well as to satisfy, ifnecessary, the post-closing termination rights related to theCompany's sale earlier this year of The Downs Racing and itssubsidiaries to the Mohegan Tribal Gaming Authority (which arise onlyin the event of certain materially adverse legislative or regulatoryevents).

Commenting on the financing, Peter M. Carlino, Chief ExecutiveOfficer of Penn National said, "Managing our capital structure andbalance sheet have been important elements of Penn National'slong-term growth and expansion. Our finance team has done an excellentjob structuring this financing package as it provides us with accessto capital at attractive rates allowing us to complete our acquisitionof Argosy Gaming Company and to fund additional expansion, capitalexpenditures and acquisitions. The confidence in Penn Nationalexpressed by the respected financial institutions who arranged andparticipated in this financing is extremely gratifying and theseentities are very supportive of our strategic plans for continuedgrowth."

About Penn National Gaming

Reflecting the addition of three Argosy properties (and theanticipated divestitures of three Argosy properties), Penn NationalGaming owns and operates casino and horse racing facilities with afocus on slot machine entertainment. The Company presently operatesfifteen facilities in thirteen jurisdictions including Colorado,Illinois, Indiana, Iowa, Louisiana, Maine, Mississippi, Missouri, NewJersey, Ohio, Pennsylvania, West Virginia, and Ontario. In aggregate,Penn National's facilities feature over 17,500 slot machines, over 400table games, over 2,000 hotel rooms and approximately 575,000 squarefeet of gaming floor space. Although the Company's Casino Magic - BaySt. Louis, in Bay St. Louis, Mississippi and the Boomtown Biloxicasino in Biloxi, Mississippi remain closed following extensive damageincurred as a result of Hurricane Katrina all property statistics inthis announcement are inclusive of these properties.

This press release contains forward-looking statements within themeaning of the Private Securities Litigation Reform Act of 1995.Actual results may vary materially from expectations. Penn describescertain of these risks and uncertainties in its filings with theSecurities and Exchange Commission, including its Annual Report onForm 10-K for the year ended December 31, 2004. Meaningful factorswhich could cause actual results to differ from expectations describedin this press release include, but are not limited to, the opportunityto assess more fully the hurricane damage recently incurred at twoproperties and the ability of the Company to recover losses under itsinsurance policies for that damage; the passage of state, federal orlocal legislation that would expand, restrict, further tax or preventgaming operations in the jurisdictions in which we do business; ourability to successfully integrate the operations of Argosy GamingCompany; the activities of our competitors; increases in our effectiverate of taxation at any of our properties or at the corporate level;successful completion of capital projects at our gaming andpari-mutuel facilities; the existence of attractive acquisitioncandidates and the costs and risks involved in the pursuit of thoseacquisitions; our ability to maintain regulatory approvals for ourexisting businesses and to receive regulatory approvals for our newbusinesses (including without limitation an operators' license inPennsylvania); delays in the process of finalizing gaming regulationsand the establishment of related governmental infrastructure inPennsylvania and Maine; the maintenance of agreements with ourhorsemen and pari-mutuel clerks; our dependence on key personnel; theimpact of terrorism and other international hostilities and theavailability and cost of financing and other factors as discussed inthe Company's filings with the United States Securities and ExchangeCommission. Furthermore, the Company does not intend to updatepublicly any forward-looking statements except as required by law. Thecautionary advice in this paragraph is permitted by the PrivateSecurities Litigation Reform Act of 1995.