Exhibit 10.2

 

PENN NATIONAL GAMING, INC.

 

PERFORMANCE SHARE PROGRAM

 

RESTRICTED STOCK AWARD CERTIFICATE

 

This RESTRICTED STOCK AWARD CERTIFICATE (the “Award Certificate”) represents the
Award of Restricted Stock made as of [       ] by Penn National Gaming, Inc., a
Pennsylvania corporation (the “Company”) to [       ] (“Participant”).

 

On [          ,     ] (the “Date of Grant”), the Compensation Committee (the
“Committee”) of the Board of Directors of the Company (the “Board”), made an
Award of [       ] shares of Restricted Stock, at target, with performance-based
requirements (the “Performance Shares”) of the Company’s common stock, par value
$0.01 per share (the “Common Stock”).  The Performance Shares are granted under,
and subject to the terms and conditions of the Penn National Gaming, Inc. 2008
Long Term Incentive Compensation Plan (the “LTIP”), and the Performance Share
Program (the “Program”) adopted by the Committee under the LTIP in
February 2016.  A copy of the Program and of the LTIP are attached to this Award
Certificate.  All capitalized terms used in this Award Certificate without
definition have the meanings set forth in the Program or the LTIP.

 

1.                                      Award Period; Performance Periods,
Restriction Period and Performance Goals.

 

The Award Period with respect to this Award began on [January 1, 20 ,] and
continues for [three] years until [December 31, 20  ].  The Award Period
consists of three separate Performance Periods, and the number of Performance
Shares are evenly divided among the three Performance Periods.  The Restriction
Period began on the Date of Grant and extends until the date the Committee
determines the number of Performance Shares credited to your account for the
third Performance Period.

 

The Performance Goal for the first Performance Period is set forth below.  For
each of the second and third Performance Periods, the Committee or its designee
will establish the Performance Goal for such Performance Period and it will be
communicated to you by the Company as an addendum to this Award Certificate.

 

First Performance Period

 

[January 1, 20   to December 31, 20  ]

 

 

 

Entry Level EBITDA

 

 

 

 

 

Target Level EBITDA

 

 

 

 

 

Maximum Level EBITDA

 

 

 

2.                                      Determination of Earned Performance
Shares.

 

Within 90 days after the end of each Performance Period, the Committee will
determine whether, and to what extent, the Performance Goal is achieved for such
Performance Period.  Performance Shares will be credited to your account for
such Performance Period as follows:

 

·                                          If the Performance Goal is less than
the Entry Level EBITDA, no Performance Shares are credited;

 

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·                                          If the Performance Goal is achieved
at the Entry Level EBITDA, the number of Performance Shares credited for such
Performance Period will be 50% of the target Performance Shares applicable to
such Performance Period;

 

·                                          If the Performance Goal is achieved
at the Target Level EBITDA, the number of Performance Shares credited for such
Performance Period will be 100% of the target Performance Shares applicable to
such Performance Period;

 

·                                          If the Performance Goal is achieved
at or above the Maximum Level EBITDA, the number of Performance Shares credited
for such Performance Period will be 150% of the target Performance Shares
applicable to such Performance Period;

 

·                                          If the Performance Goal is achieved
at an amount between 85% (the Entry Level EBIDTA) and 100% (the Target Level
EBITDA), the number of credited Performance Shares will be determined in
accordance with straight line interpolation and adjusted accordingly, and if the
Performance Goal is achieved at an amount between 100% (the Target Level EBITDA)
and 115% (the Maximum Level EBITDA), the number of  credited Performance Shares
will be determined in accordance with straight line interpolation and adjusted
accordingly.  An example of this Performance Shares determination is set forth
in the Program.

 

Any Performance Shares credited to your account for a Performance Period will
remain subject to the Restriction Period until the end of the Restriction
Period, unless the forfeiture restrictions lapse earlier as described below.

 

3.                                      Forfeiture Restrictions and Lapse of
Forfeiture.  Your Performance Shares will remain as Restricted Stock until the
end of the Restriction Period.  You must remain employed, or continue to provide
services to the Company or any of its subsidiaries until the end of the
Restriction Period, or the Performance Shares, whether or not credited, will be
forfeited.  Such forfeiture restrictions will lapse, and a designated portion of
your Performance Shares will vest and be issued to you if one of the following
events occurs:  involuntary Termination of Service without Cause; death or
Disability; Retirement from service; or a Change in Control.  The Program
describes the impact of these events on your Award.

 

4.                                      Share Certificates.  In accordance with
the LTIP, the Performance Shares will be issued and outstanding shares of Common
Stock as of the Date of Grant.  You will be entitled to vote and receive
dividends, if and when declared, on such Performance Shares once credited to
your account; however, the Company will retain the Performance Shares in escrow
until the Restriction Period is ended.

 

5.                                      Survival of Terms.  As consideration for
the receipt of the Award described herein, the Participant and the Company and
their respective permitted assignees and transferees, heirs, legatees,
executors, administrators and legal successors are bound by the terms of this
Certificate.

 

6.                                      Representations.  Participant has
reviewed with his or her own tax advisors the Federal, state, local and foreign
tax consequences of this Performance Shares Award.  Participant is relying
solely on such advisors and not on any statements or representations of the
Company or any of its agents.  Participant understands that he or she (and not
the Company) shall be responsible for any tax liability that may arise as a
result of this Performance Shares Award.

 

7.                                      Award Certificate Not a Contract of
Employment.  Neither this Award Certificate nor any other action taken pursuant
to this Award Certificate shall constitute or be evidence of any agreement or
understanding, express or implied, that the Participant has a right to continue
to provide services as an

 

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employee of or consultant to the Company or any parent, subsidiary or affiliate
of the Company for any period of time or at any specific rate of compensation.

 

8.                                      Authority of the Board.  The Committee
and the Board each have full authority to interpret and construe the terms of
this Award Certificate.  The determination of the Committee or the Board as to
any such matter of interpretation or construction shall be final, binding and
conclusive.

 

9.                                      Restrictions on Transferability.  No
purported sale, assignment, mortgage, hypothecation, transfer, pledge,
encumbrance, gift, transfer in trust (voting or other) or other disposition of,
or creation of a security interest in or lien on, any of the Performance Shares
by any holder thereof will be valid, and the Company will not transfer any of
said Performance Shares on its books unless and until the Restriction Period
ends, except to the estate of or guardian, executor or other duly authorized
personal representative of the Participant.

 

10.                               Amendment.  Any amendment, revision or
addendum to this Award Certificate that adversely affects the rights of the
Participant under this Award shall require the approval of the Participant.

 

11.                               Governing Law.  This Award Certificate shall
be governed by and construed in accordance with the laws of the Commonwealth of
Pennsylvania, without regard to such state’s choice of law provisions, except as
superseded by applicable federal law.

 

 

PENN NATIONAL GAMING, INC.

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

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