Penn National Gaming Obtains Lenders’ Waivers and Discloses Approximate Debt Balance with Respect to Its Previously Announced Change in Classification of Master Lease Accounting

WYOMISSING, Pa.--()--Penn National Gaming, Inc. (PENN: Nasdaq) (“Penn National Gaming” or the “Company”) today announced that it received waivers from its lenders under the Company’s senior secured credit facility in connection with the change in the classification of the Company’s Master Lease (the “Master Lease”) with Gaming and Leisure Properties, Inc. (“GLPI”) from an operating lease to a financing obligation, as announced on October 22, 2015, which extends the period for the Company to file its financial statements for the quarter ended September 30, 2015 from November 14, 2015 to January 15, 2016. In addition, the Company anticipates that, as a result of this change in lease classification, it will report additional liabilities of approximately $3.5 billion as of September 30, 2015 which represents the present value of the future minimum lease payments to GLPI under the Master Lease.

As announced on October 22, 2015, the Company’s cash flows for all prior and future periods will not be affected by this change in accounting, nor will its current tax treatment with respect to the transaction. In addition, the adjustments in the restatement will have no impact on the following indicators of the Company’s performance:

  • the Company’s cash position;
  • the Company’s leverage ratios under its senior credit facility and other debt instruments (as the terms of those obligations require the Master Lease to be treated as an operating lease regardless of the treatment required under GAAP);
  • the Company’s revenues; or
  • the Company’s rental payments or other obligations under the Master Lease.

About Penn National Gaming

Penn National Gaming owns, operates or has ownership interests in gaming and racing facilities and video gaming terminal operations with a focus on slot machine entertainment. At September 30, 2015, the Company operated twenty-seven facilities in seventeen jurisdictions, including Florida, Illinois, Indiana, Kansas, Maine, Massachusetts, Maryland, Mississippi, Missouri, Nevada, New Jersey, New Mexico, Ohio, Pennsylvania, Texas, West Virginia, and Ontario. At September 30, 2015, in aggregate, Penn National Gaming operated approximately 34,000 gaming machines, 800 table games and 4,600 hotel rooms.

Forward-looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the use of forward looking terminology such as “expects,” “believes,” “estimates,” “projects,” “intends,” “plans,” “seeks,” “may,” “will,” “should” or “anticipates” or the negative or other variations of these or similar words. Although the Company believes that our expectations are based on reasonable assumptions within the bounds of our knowledge of our business, there can be no assurance that actual results, including the impact of the restatement, will not differ materially from our expectations. Meaningful factors that could cause actual results to differ from expectations include, but are not limited to, risks relating to the final impact of the restatement on the Company’s financial statements; the impact of the restatement on the Company’s evaluation of the effectiveness of its internal control over financial reporting; delays in the preparation of the financial statements; the risk that additional information will come to light during the course of the preparation of restated financial statements that alters the scope or magnitude of the restatement; potential reviews, litigation or other proceedings by governmental authorities, stockholders or other parties; the risk that the Company will be unable to obtain any required waivers under the Company’s note indenture with respect to a significant delay in filing periodic reports with the Securities and Exchange Commission; risks relating to our liquidity and ability to raise capital; risks related to the impact on the restatement on the Company’s reputation, development projects, joint ventures and other commercial contracts; and other factors as discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, each as filed with the United States Securities and Exchange Commission. The Company does not intend to update publicly any forward-looking statements 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.

Contacts

Penn National Gaming, Inc.
Saul V. Reibstein, 610-401-2049
Chief Financial Officer
or
JCIR
Joseph N. Jaffoni / Richard Land, 212-835-8500
penn@jcir.com

Contacts

Penn National Gaming, Inc.
Saul V. Reibstein, 610-401-2049
Chief Financial Officer
or
JCIR
Joseph N. Jaffoni / Richard Land, 212-835-8500
penn@jcir.com