INSTRUCTION LETTER
October 19, 2021
TO:

Former holders of Class A Subordinate Voting Shares and Special Voting Shares(“Company Shares”) of Score Media and Gaming Inc. (“Score”) who were Eligible
Holders

RE:Instruction Letter for Eligible Holders who wish to file a Section 85 Election in
respect of the acquisition of their shares by 1317774 B.C. Ltd. (“Purchaser”)

Unless otherwise noted, all defined terms in this Instruction Letter have the meaning as set out in
the NOTICE OF SPECIAL MEETING OF SHAREHOLDERS AND MANAGEMENTINFORMATION CIRCULAR for the Special Meeting of the shareholders of Score to be held
October 12, 2021, dated September 13, 2021 (the “Circular”).
The purpose of this Instruction Letter is to describe the process for an Eligible Holder to make ajoint election with Purchaser under subsection 85(1) of the Income Tax Act (Canada) (the “TaxAct”) or, in the case of an Eligible Holder that is a partnership, under subsection 85(2) of the TaxAct (in either case, a “Section 85 Election”), in respect of the disposition of such Eligible Holder’sCompany Shares to Purchaser in exchange for Consideration consisting of a combination of cashand Exchangeable Shares pursuant to the Plan of Arrangement as described in the Circular.
A Section 85 Election in respect of a disposition of Company Shares to Purchaser for theConsideration may only be made by a former Score Shareholder who was an “Eligible Holder”.
An Eligible Holder is a beneficial owner of Company Shares immediately prior to the Effective
Time who is:•resident in Canada for the purposes of the Tax Act and not exempt from tax under Part
I of the Tax Act, or•

A partnership any member of which is resident in Canada for purposes of the Tax Actand not exempt from tax under Part I of the Tax Act.

A Section 85 Election is not available if your Company Shares were held in a trust governed by
an RRSP, RRIF, RESP, TFSA, RDSP or DPSP, as such plans are not Eligible Holders. If yourCompany Shares were held in such a plan please consult your tax advisor.
If you are an Eligible Holder that would otherwise realize a gain on the disposition of Company
Shares to Purchaser, it may be to your advantage to make the Section 85 Election. You shouldseek professional advice from your tax advisor to determine whether making the Section
85 Election is appropriate, considering your particular facts and circumstances.
Please review this Instruction Letter very carefully and consult your tax advisor as to theproper completion and delivery of the Section 85 Election Form (as defined below) toPurchaser (or its agents) and the applicable deadlines. The information provided herein
and in the Circular with respect to such Section 85 Elections is provided for generalassistance only, may not be exhaustive and is not intended to be, nor should it beconstrued as, legal or tax advice to any particular Eligible Holder. The law in this area iscomplex and contains numerous technical requirements not addressed in this Instruction
Letter.

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Furthermore, apart from providing this Instruction Letter and enclosure(s) to an Eligible
Holder for their convenience, none of Purchaser, Penn National Gaming, Inc. (“Parent”),
Score, the Depository, or any of the appointed agents or representatives assisting with theSection 85 Election process, nor any affiliate or successor of any such entity will provide anEligible Holder with any advice on making a Section 85 Election. Accordingly, EligibleHolders wishing to make a Section 85 Election are urged to consult with their own tax
advisors without delay for specific advice in respect of the process involved in making theSection 85 Election and how to comply with the requirements for making such Section 85
Election having regard to their own particular circumstances.
Such Eligible Holders should also review Information Circular 76-19R3 and Interpretation Bulletin
IT-291R3 (archived) issued by the Canada Revenue Agency (“CRA”) for information in respect ofthe Section 85 Election under the Tax Act.
1.

EXECUTION AND DELIVERY OF A SECTION 85 ELECTION

A Section 85 Election may be made by an Eligible Holder by providing two signed copies of theapplicable joint election forms (the “Section 85 Election Form”) to Parent, at the address provided
below. The deadline for providing the Section 85 Election Form to Purchaser is now 75 days
after the Effective Date (the “Election Deadline”).
The required federal forms to make a Section 85 Election can be found here for an Eligible Holderthat is a partnership, and here for any other Eligible Holder.
If the Section 85 Election Form for an Eligible Holder is not received by Parent by the Election
Deadline and in accordance with the procedures set out in this Instruction Letter, Purchaser
will have no obligation to make a Section 85 Election with such Eligible Holder. An Eligible
Holder wishing to make a Section 85 Election should give their immediate attention to thismatter. In its sole discretion, Purchaser may choose to sign and deliver a Section 85 Election
based on a Section 85 Election Form received after the Election Deadline, but will have noobligation to do so and no assurances can be given that Purchaser will sign and deliver sucha Section 85 Election.
Each Eligible Holder who wishes to make a Section 85 Election must send its Section 85 Election
Forms to Parent by the Election Deadline via electronic mail to Section85@pngaming.com.
Purchaser will not verify the accuracy of the information provided on the Section 85 Election Formprovided by or on behalf of any electing Eligible Holder.
2.

PROVINCIAL OR TERRITORIAL ELECTIONS

In certain provinces or territories, it may be necessary to file a separate copy of the Section 85
Election or a separate provincial or territorial tax election analogous to the Section 85 Election withthe taxing authority of such province or territory.
Purchaser will also make such a provincial or territorial tax election with an Eligible Holder. Eligible
Holders are entirely responsible for determining whether any such separate provincial or
territorial election is applicable and appropriate in their circumstances and (if so) completingand forwarding the related forms to Parent for execution by Purchaser by the Election
Deadline.

2Please consult your advisor on the completion of any applicable provincial or territorial tax forms,
the filing deadline for such forms with the applicable provincial or territorial taxing authorities andhow to deliver such forms to such provincial or territorial taxing authorities.
3.

FILING A SECTION 85 ELECTION WITH THE CRA

After submission of your Section 85 Election Form to Parent, Purchaser shall, within 60 days after
receiving the completed joint election forms from an electing Eligible Holder, and subject to suchjoint election forms being correct and complete and in compliance with requirements imposed under
the Tax Act (or any analogous provision of provincial income tax legislation), sign and return suchforms to such Eligible Holder.
Each Eligible Holder is solely responsible for ensuring the Section 85 Election Form iscompleted correctly and filed with the CRA (and any applicable provincial tax authority) by
the required deadline. Neither Score, Purchaser, Parent, nor any successor corporation shallbe responsible for the proper completion and filing of any joint election form, except for theobligation to sign and return the duly completed joint election forms which are received by
the Election Deadline. The Eligible Holder will be solely responsible for the payment of anytaxes, interest or penalties arising as a result of the failure of an Eligible Holder to properlyor timely complete and file such joint election forms in the form and manner prescribed bythe Tax Act (or any applicable provincial tax legislation).
The following is a brief summary of how to execute and deliver the forms to the CRA:Filing Deadline
Generally, for a Section 85 Election under subsection 85(1) of the Tax Act to be accepted by theCRA without an electing Eligible Holder being liable for a late filing penalty, such completed Section
85 Election must be filed with the CRA on or before the date that is the earlier of:(a)the day by which Purchaser is required to file an income tax return for the taxation year that
includes the Effective Date; and(b)the day by which the electing Eligible Holder is required to file an income tax return for thetaxation year that includes the Effective Date.

Special rules apply for partnerships when determining the filing deadline for a Section 85 Election
under subsection 85(2) of the Tax Act and with respect to the persons that are required to executesuch election. If you are an Eligible Holder that is a partnership, please consult your advisor on such
filing deadlines and signing requirements.
Purchaser’s taxation year that includes the Effective Date is expected to end on December 31, 2021,
and its income tax return is required to be filed within six months from the end of the taxation year
(June 30, 2021).
Where to file the Section 85 Election
A Section 85 Election should be filed with your CRA Tax Centre. The Tax Services Offices and theassociated Tax Centre are listed on the CRA website: https://www.canada.ca/en/revenueagency/corporate/contact-information/tax-services-offices-tax-centres.html.
•For trusts, the applicable Tax Centre is based on the location of the Trustee.

3•For a corporation or an individual, the CRA has designated specific Tax Centres for allcorporations and individuals depending on where they are located. The Tax Centres andthe areas they serve can be found on the CRA website referred to above.

•Where the Section 85 Election is made by a partnership or an Eligible Holder that owned
Company Shares together with a co-owner or co-owners, the applicable Tax Centre is thatof Purchaser, being:
Prince Edward Island tax centre
275 Pope Road
Summerside, PE C1N 6A2Each Eligible Holder is urged to consult its own tax advisor as soon as possible respecting theSection 85 Election and the filing deadlines (at the federal and provincial and territorial level) that
apply to it. However, regardless of the applicable filing deadline, a complete and accurate Section
85 Election Form must be received by Purchaser on or before the Election Deadline and inaccordance with the procedures set out in this Instruction Letter.
With the exception of execution and delivery of the election form by Purchaser following
receipt of the Section 85 Election Form (provided such information is received by Purchaserby the Election Deadline), compliance with the requirements for a valid Section 85 Election
will be the sole responsibility of the Eligible Holder making the election. None of Purchaser,Score, Parent, or any of the appointed agents or representatives assisting with the Section
85 Election process will be responsible or liable for taxes, interest, penalties, damages orexpenses resulting from the failure by anyone to provide information necessary for theelection in accordance with the procedures set out in this Instruction Letter, to properly
complete any election form or to properly file it within the time prescribed and in the form
prescribed under the Tax Act (or the corresponding provisions of any provincial or territorial
tax legislation).
4.

PROCEDURE FOR COMPLETING PRESCRIBED FORM T2057

The following section illustrates the information required to be provided by an Eligible Holder
completing Form T2057, relevant for Eligible Holders other than a Partnership. Please consult
your advisor on the completion of any additional prescribed forms (such as Form T2058,
relevant for an Eligible Holder that is a partnership, and any applicable provincial orterritorial tax forms).
Note: Do not write the required information on this letter of instructions. The information should
be typed or legibly printed on the prescribed forms.
Page 1 of Form T2057
Complete the information in this first box for the Eligible Holder making the election:
Name of taxpayer (transferor) (print)

Social insurance number or Business NumberAddress

Postal code

Tax year of taxpayer
for the period fromYear

MonthDaytoYear

MonthDayTax services office

The taxation year for individuals and trusts (other than a “graduated rate estate” as defined in theTax Act) is January 1, 2021 to December 31, 2021. A corporation or a graduated rate estate must
provide the taxation year that includes the Effective Date.
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Complete the information in this box if the Company Shares were held in joint ownership,
otherwise leave the box blank or enter "N/A":
Name of co-owner(s), if any (if more than one, attach schedule giving similar details) (print)

Social insurance number

Address

Tax services office

Postal code

The next section may be completed as follows:
Name of corporation (transferee) (print)

Business Number

1317774 B.C. Ltd.

785224007BC0001

Address

Postal code

595 Burrard Street, Suite 2600
Vancouver, BCV7X 1L3

Tax year of taxpayer
for the period fromYear Month Day

2021 JUL 30

toYear Month Day

Tax services office2021 DEC 31

Vancouver, BC

Complete the last line of this section by filling in your name and telephone number or, if
appropriate, the name and telephone number of your tax advisor:
Name of person to contact for additional information

Area code

Telephone number

The final section on page 1 of Form T2057 relates to late-filed elections and is only applicable
to Eligible Holders whose elections will be filed late.
Page 2 of Form T2057
The answers to the first five questions may be completed as follows:5

Eligible Holders should answer question 6 and 6(b) based on their particular circumstances.
The determination of whether the Company Shares were capital property or inventory to theEligible Holder is a question of fact depending on the Eligible Holder’s particular
circumstances. An Eligible Holder’s Company Shares generally would have been consideredcapital property to the Eligible Holder unless the Eligible Holder held or used them in thecourse of carrying on a business, or acquired such shares the course of an adventure orconcern in the nature of trade.
If Yes, questions 6(a) and 6(c) may be completed as follows:

Eligible Holders who held their Company Shares as capital property and acquired theirCompany Shares in an arm's length transaction should check "No" in answer to question
6(b) above.
Questions 7 and 8 may be completed as follows:

The final part of this section may be left blank or completed as follows:
Corporation’s name

N/A
Business number

Paid-up capital of shares transferred (under the Income Tax Act)The section titled “Description of shares received” at the bottom of page 2 may becompleted to indicate that the Consideration Shares are Exchangeable Shares(exchangeable for one share of Parent). Eligible Holders must fill in the number of shares
received and the “paid-up capital” of such shares, which generally will be equal to thedifference between the Eligible Holder’s Agreed Amount (as described below) and theaggregate amount of the cash received by the Eligible Holder. The Exchangeable Sharesare non-voting and are redeemable for a value equal to the value of the correspondingshare of Parent.
Eligible Holders received US$17.00 and 0.2398 of an Exchangeable Share of Purchaser
for each Company Share held. Note that Eligible Holders are generally required to report
all amounts in Canadian dollars; the cash portion of the Consideration should be converted
into Canadian dollars using the Bank of Canada CAD/USD exchange rate posted for theEffective Date.

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In the last box on page 2 of Form T2057, the Eligible Holder or its authorized officer orauthorized person must sign above the “Signature of Transferor or Authorized Officer orAuthorized Person” line and date the form above the “Date” line.
Page 3 of Form T2057
On the top line of this section, the Eligible Holder should enter the date on which it disposedof its Company Shares and received the Consideration, being the Effective Date of October
19, 2021.
If the Company Shares were capital property of the Eligible Holder, complete theinformation in each column of this section (within the area designated by the title “Capital
Property Excluding Depreciable Property”), according to the instructions referenced below.
If the Company Shares were not capital property, please consult your own tax advisor
regarding your particular circumstances.

A

AgreedAmount(cannot bezero)
B

Amount to bereported
B-A(If greaterthan 0 see
Note 4)

(3)

$ (4)

$ (5)

Property Disposed of
Description

Elected Amount Limits
Fair Market
Value

(1)
_Class A Subordinate
Voting shares of
Score Media andGaming Inc.

Consideration Received
Non-share

Share

Description

Number and Class

Fair Market
Value of Total
Consideration

(7)
$ (2)

$(6)

__
Exchangeable
Shares of1317774 B.C.
Ltd.

$(1) Enter the number of Company Shares sold to Purchaser.
(2) Enter the total fair market value of the Company Shares sold at the time of sale.
The total fair market value of the Company Shares sold will be equal to the total of
the amount of cash forming part of the Consideration and the aggregate fair market
value of the Exchangeable Shares received by the Eligible Holder.
(3) Enter the adjusted cost base (“ACB”) of the Company Shares sold to Purchaser.
Each Eligible Holder should consult its own tax advisor to obtain assistancein determining the correct ACB or cost amount of the Company Sharesdisposed of pursuant to the Arrangement.
(4) Enter the Agreed Amount (see below), which will be your deemed proceeds ofdisposition of the Company Shares, subject to the rules described below withrespect to calculation of the Agreed Amount.
(5) Enter the result of B minus A, if it is greater than $0.
(6) Enter the dollar amount of the cash received by the Eligible Holder upon thedisposition of the Company Shares. Each Eligible Holder will receive US$17.00 foreach Company Share held; the Canadian dollar equivalent of such amount as of
the Effective Date should be entered. While the position is not binding on the CRA,
Score considers that the Ancillary Rights have a nominal value.

7(8)(7) Enter the number of Exchangeable Shares received as part of the Consideration.
Eligible Holders will receive 0.2398 of an Exchangeable Share for each Company
Share held, rounded down to the nearest number of Exchangeable Shares if
applicable.
(8) Enter the total fair market value at the Effective Date of the Consideration. The
amount entered here should equal the amount entered in (2), above.
As described in the Circular, the Agreed Amount that is chosen by the Eligible Holder, withincertain parameters defined in the Tax Act, will affect the tax results of the disposition of theCompany Shares. The Agreed Amount will be the proceeds of disposition for purposes ofcomputing any gain or loss on the Eligible Holder’s disposition of Company Shares.
The Eligible Holder’s Agreed Amount for Company Shares disposed of pursuant to theArrangement must comply with the following rules:(a)

The Agreed Amount may not be less than the amount of the cash received bythe Eligible Holder.

(b)

The Agreed Amount may not be less than the lesser of (i) the ACB to theEligible Holder of the Company Shares sold, determined immediately before
the time of the sale, and (ii) the fair market value of the Company Shares atthat time.

(c)

The Agreed Amount may not exceed the fair market value of the Company
Shares at the time of the sale.

An Agreed Amount that does not otherwise comply with the foregoing limitations will beautomatically adjusted under the Tax Act, so that it is in compliance with such limitations.
Eligible Holders should consult their tax advisors regarding the selection of theappropriate Agreed Amount in respect of their Company Shares.

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