Exhibit 10.1

 

EXECUTIVE AGREEMENT

 

This EXECUTIVE AGREEMENT (this “Agreement”) is entered into on this 24th day of
September, 2019 and shall be effective as of September 24, 2019 (the “Effective
Date”), by Penn National Gaming, Inc., a Pennsylvania corporation (the
“Company”), and the senior executive who has executed this Agreement below
(“Executive”).

 

WHEREAS, Executive’s current employment agreement, entered into on October 19,
2016, effective as of January 1, 2017, expires on January 1, 2020 (the “Current
Agreement”).

 

WHEREAS, the Company and Executive have agreed to extend the Current Agreement
and facilitate a transition as described below.

 

WHEREAS, each of the parties wishes to enter into this Agreement, the terms of
which are intended to be in compliance with the requirements of Section 409A of
the Internal Revenue Code of 1986, as amended (“Section 409A”, see Section 22
below).

 

WHEREAS, the Compensation Committee of the Board of Directors of the Company,
the Board of Directors and the Chief Executive Officer have determined that it
is in the best interests of the Company and its shareholders to enter into this
Agreement and Executive is willing to serve as an employee of the Company
subject to the terms and conditions of this Agreement.

 

WHEREAS, this Agreement is intended to amend, restate and supersede the Current
Agreement.

 

NOW, THEREFORE, the parties, in exchange for the mutual promises described
herein and other good and valuable consideration and intending to be legally
bound, agree as follows:

 

1.        Employment. The Company hereby agrees to continue to employ Executive
and Executive hereby accepts such employment, in accordance with the terms,
conditions and provisions hereinafter set forth in this Agreement.

 

1.1.     Duties and Responsibilities. Executive shall continue to serve as
Executive Vice President and Chief Financial Officer of the Company. Executive
shall perform all duties and accept all responsibilities incident to such
position as may be reasonably assigned to him by the Chief Executive Officer of
the Company or the Board of Directors of the Company. Executive’s principal
place of employment shall be in Wyomissing, Pennsylvania.

 

1.2.     Term. The term of this Agreement shall begin on the Effective Date and
shall terminate on March 31, 2020 (the “Term”) or the termination of Executive’s
employment with the Company; provided, however, notwithstanding anything in this
Agreement to the contrary, Sections 6 through 24 shall survive the termination
of Executive’s employment with the Company. At the end of the Term, Executive
shall be deemed to have resigned from all officer, director, manager member or
other such positions with the Company or its affiliates or subsidiaries.

 

1.3.     Extent of Service. Executive agrees to use Executive’s best efforts to
carry out Executive’s duties and responsibilities and, consistent with the other
provisions of this Agreement, to devote substantially all of Executive’s
business time, attention and energy thereto. The foregoing shall not be
construed as preventing Executive from serving on the board of philanthropic
organizations, commercial entities (but only if and to the extent that Executive
is so serving as of the date hereof) or providing oversight with respect to his
personal investments, so long as such service does not materially interfere with
Executive’s duties hereunder.

 

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2.       Compensation. For all services rendered by Executive to the Company
during the Term, the Company shall compensate Executive as set forth below.

 

2.1.     Base Salary. During the Term, the Company shall pay to Executive his
current base salary, payable in accordance with the Company’s payroll practices
as in effect from time to time.

 

2.2.     Bonus. Executive shall participate in the Company’s annual incentive
compensation plan applicable to other similarly situated senior executives
(“Peer Executives”) for his service in 2019. Executive shall not be entitled to
participate in the Company’s annual incentive compensation plan for his service
in 2020.

 

2.3.     Equity Compensation. Executive agrees that he will not be eligible to
receive any additional equity-based compensation and that all equity-based
compensation that has not vested on or before March 31, 2020 shall be cancelled
and forfeited.

 

2.4.     Payments and Benefits at the End of Term. At the end of the Term,
subject to compliance with the terms of this Agreement (including Sections 7
through 9) and the execution of a release substantially in the form attached
hereto as Exhibit A (“Release”), Executive will be entitled to:

 

(a)      the items described in Section 5 (below);

 

(b)      exercise any vested stock appreciation rights and vested stock options
until the earlier of (i) one additional year beyond the one year period from
March 31, 2020 described in the applicable equity plans or (ii) the expiration
of the original terms of the vested stock appreciation rights and vested stock
options.

 

(c)      accelerated vesting on March 31, 2020 of the third tranche of
Executive’s 2018 performance share awards at target under the Company’s 2018
Performance Share Program as provided in the attached Exhibit B;

 

(d)      accelerated vesting on March 31, 2020 of the second and third tranches
of Executive’s 2019 and 2020 performance share awards and phantom stock unit
awards at target under the Company’s 2019 Performance Share Program as provided
in the attached Exhibit B; and

 

(e)      Payment of any deferred compensation at such time and amounts as
determined in accordance with the terms of the Penn National Gaming, Inc.
Deferred Compensation Plan and Executive’s election(s) thereunder.

 

2.5.     Other Benefits. Executive shall be entitled to participate in all other
employee benefit plans and programs, including, without limitation, health,
vacation, retirement, deferred compensation or SERP, made available generally to
other Peer Executives, as such plans and programs may be in effect from time to
time and subject to the eligibility requirements and other terms of each plan.
Nothing in this Agreement shall prevent the Company from amending or terminating
any retirement, welfare or other employee benefit plans or programs from time to
time, as the Company deems appropriate.

 

2.6.     Reimbursement of Expenses. During the Term, the Company shall reimburse
Executive for all reasonable expenses incurred by him in the performance of his
duties in accordance with the Company’s policies applicable to Peer Executives.

 

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3.       Termination by the Company.

 

(a)      Termination. The Company may terminate Executive’s employment at any
time without Cause (as such term is defined in subsection (c) below), with
Cause, or at the end of the Term by non-renewal of this Agreement.

 

(b)      Without Cause. The Company may terminate Executive’s employment at any
time without Cause (as such term is defined in subsection (c) below) by delivery
of written notice to Executive, which notice shall set forth the effective date
of such termination.

 

(c)      With Cause. The Company may terminate Executive’s employment at any
time for Cause effective immediately upon delivery of written notice to
Executive. As used herein, the term “Cause” shall mean:

 

(i)       Executive shall have been convicted of, or pled guilty or nolo
contendere to, a criminal offense involving allegations of fraud, dishonesty or
physical harm during the term of this Agreement;

 

(ii)      Executive is found (or is reasonably likely to be found) disqualified
or not suitable to hold a casino or other gaming license by a governmental
gaming authority in any jurisdiction where Executive is required to be found
qualified, suitable or licensed;

 

(iii)     Executive breaches any significant Company policy (such as the
Business Code of Conduct or the Harassment Policy) or term of this Agreement,
including, without limitation, Sections 6 through 9 of this Agreement and, in
each case, fails to cure such breach within 15 days after receipt of written
notice thereof (to the extent curable);

 

(iv)     Executive misappropriates corporate funds or resources as determined in
good faith by the Audit Committee of the Board;

 

(v)      the Company determines in its reasonable discretion that Executive has
failed to perform Executive’s duties with the Company (other than any such
failure resulting from incapacity due to physical disability or mental illness)
or in the case of repeated insubordination;

 

(vi)     the Company determines in its reasonable discretion that Executive has
engaged in illegal conduct or gross misconduct which is or is reasonably
expected to be materially injurious to the Company or one of its affiliates;

 

(vii)    Executive's death (this Agreement and Executive’s employment will
terminate automatically upon Executive’s death); or

 

(viii)   Executive's inability to perform the essential functions of Executive's
job (with or without reasonable accommodation) by reason of disability, where
such inability continues for a period of ninety (90) days continuously.

 

4.        Termination by Executive. Executive may voluntarily terminate
employment for any reason effective upon 60 days’ prior written notice to the
Company, in which case the payment and benefits described in Section 2.1 above
following termination date of employment and in Section 2.4 above and Section 5
below shall not be payable (other than any amounts payable to Executive under
the Penn National Gaming, Inc. Deferred Compensation Plan and Executive’s
election(s) thereunder).

 

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5.        Severance Pay and Benefits. Subject to the terms and conditions set
forth in this Agreement, if Executive’s employment is terminated due to the
expiration of the Term or non-renewal by the Company or under Section 3(b) at or
before the end of the Term, then the Company will provide Executive with the
following severance pay and benefits (except in the event of a breach of the
Release, as defined below); provided, for purposes of Section 409A, each payment
of severance pay under this Section 5 shall be considered a separate payment:

 

(a)      Amount of Post-Employment Base Salary. Subject to Sections 5(d) and 22,
the Company shall pay to Executive an amount equal to 24 months (the “Severance
Period”) of base salary at the rate in effect on the date of Executive’s
separation from service (the “Termination Date”). Such amount shall be paid over
the Severance Period in accordance with the Company’s regular payroll procedures
for similarly situated executives following the Termination Date.

 

(b)      Amount of Post-Employment Bonus. In addition to the Post-Employment
Base Salary provided under Section 5(a) above, and subject to Section 5(d), the
Company shall pay to Executive an amount equal to the product of 1.5 times the
amount of the average of the last two full years bonuses paid to Executive based
on the actual performance of the Company. Such amount paid to Executive under
this Section 5(b) shall be paid on the date annual bonuses are paid to
similarly-situated executives after the Termination Date. 

 

(c)      Continued Medical Benefits Coverage. During the Severance Period,
Executive and Executive’s dependents will have the opportunity under the
provisions of the Consolidated Omnibus Budget Reconciliation Act of 1986, as
amended (“COBRA”) to elect COBRA continuation coverage. If Employee so elects
and pays for COBRA coverage in a timely manner, the Company shall reimburse
Executive for the cost of purchasing COBRA coverage through the end of the
Severance Period (or until such earlier date as Executive and Executive’s
dependents cease to receive COBRA coverage).

 

(d)      Release Agreement. Executive’s entitlement to any severance pay and
benefit entitlements under this Section 5 is conditioned upon Executive’s first
entering into the Release and the Release becoming effective no later than the
sixtieth day following the employment termination date, the Release shall be
delivered to Executive within 14 days after the Termination Date.
Notwithstanding any other provision hereof, all severance payments to Executive
shall be delayed until after the expiration of any applicable revocation period
with respect to the Release, but in the event the applicable revocation period
spans two calendar years, the payments shall commence in the second calendar
year. Executive also acknowledges that any severance pay under this Section 5 is
subject to the Company’s then current recoupment policy.

 

6.       No Conflicts of Interest. Executive agrees that throughout the period
of Executive’s employment hereunder, Executive will not perform any activities
or services, or accept other employment, that would materially interfere with or
present a conflict of interest concerning Executive’s employment with the
Company. Executive agrees and acknowledges that Executive’s employment is
conditioned upon Executive adhering to and complying with the business practices
and requirements of ethical conduct set forth in writing from time to time by
the Company in its employee manual, code of conduct or similar publication.
Executive represents and warrants that no other contract, agreement or
understanding to which Executive is a party or may be subject to will be
violated by the execution of this Agreement by Executive. Executive further
agrees to not accept any position on the board of a for-profit company without
the written consent of the Penn National Gaming, Inc. Chief Executive Officer or
General Counsel.

 

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7.        Confidentiality.

 

(a)      Definition. “Confidential Information” means data and information
relating to the business of the Company or its affiliates, (i) which the Company
or its affiliates have disclosed to Executive, or of which Executive became
aware as a consequence of or in the course of Executive’s employment with the
Company, (ii) which have value to the Company or its affiliates, and (iii) which
are not generally known to its competitors. Confidential Information will not
include any data or information that the Company or its affiliates have
voluntarily disclosed to the public (except where Executive made or caused that
public disclosure without authorization), that others have independently
developed and disclosed to the public, or that otherwise enters the public
domain through lawful means.

 

(b)      Restrictions. Executive agrees to treat as confidential and will not,
without the prior written approval of the Company in each instance, directly or
indirectly use (other than in the performance of Executive’s duties of
employment with the Company or its affiliates), publish, disclose, copyright or
authorize anyone else to use, publish, disclose or copyright, any Confidential
Information obtained during Employee’s employment with the Company or its
affiliates, whether or not the Confidential Information is in written or other
tangible form. This restriction will continue to apply for a period of two (2)
years after the Termination Date. Executive acknowledges and agrees that the
prohibitions against disclosure and use of Confidential Information recited in
this section are in addition to, and not in lieu of, any rights or remedies that
the Company or its affiliates may have available under applicable laws.

 

(c)      Nothing in this Agreement or in the Release shall prohibit Executive
from reporting possible violations of federal law or regulation to any
governmental agency or entity, or making other disclosures that are protected
under the whistleblower provisions of applicable federal or state law or
regulation.

 

8.        Non-Competition.

 

(a)      As used in this Section 8, the term “Restriction Period” shall mean a
period equal to: (i) the 12-month period immediately following the termination
of this Agreement for any reason (including, but not limited to, termination by
Executive or the expiration of the Term of this Agreement), if Executive’s
employment terminates under circumstances where Executive is not entitled to
payments under Section 5 or 10 or (ii) the Severance Period if Executive’s
employment terminates under circumstances where Executive is entitled to
payments under Section 5 or 10.

 

(b)      During the term of this Agreement and for the duration of the
Restriction Period thereafter, Executive shall not, except with the prior
written consent of the Company, directly or indirectly, own, manage, operate,
join, control, finance or participate in the ownership, management, operation,
control or financing of, or be connected as an officer, director, employee,
partner, principal, agent, representative, consultant or otherwise with, or use
or permit Executive’s name to be used in connection with, any Competing
Business. A “Competing Business” includes any business enterprise which owns or
operates, or is publicly seeking to own or operate, a gaming facility located
within 150 miles of any facility in which Company or its affiliates owns or
operates or is actively seeking to own or operate a facility at such time (the
“Restricted Area”). Executive acknowledges that any business which offers
gaming, racing, sports wagering or internet real money / social gaming, and
which markets to any customers in the Restricted Area, is a Competing Business.

 

(c)      The foregoing restrictions shall not be construed to prohibit
Executive’s ownership of less than 5% of any class of securities of any
corporation which is engaged in any of the foregoing businesses and has a class
of securities registered pursuant to the Securities Exchange Act of 1934,
provided that such ownership represents a passive investment and that neither
Executive nor any group of persons including Executive in any way, either
directly or indirectly, manages or exercises control of any such corporation,
guarantees any of its financial obligations, otherwise takes any part in its
business, other than exercising Executive’s rights as a shareholder, or seeks to
do any of the foregoing.

 

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(d)      Executive acknowledges that the covenants contained in Sections 7
through 9 hereof are reasonable and necessary to protect the legitimate
interests of the Company and its affiliates and, in particular, that the
duration and geographic scope of such covenants are reasonable given the nature
of this Agreement and the position that Executive will hold within the Company.
Executive further agrees to disclose the existence and terms of such covenants
to any employer that Executive works for during the Restriction Period.

 

9.        Non-Solicitation. Executive will not, except with the prior written
consent of the Company, during the term of this Agreement and for a period of 18
months after the termination of this Agreement for any reason (including, but
not limited to, termination by Executive or the expiration of the Term of this
Agreement), directly or indirectly, solicit or hire, or encourage the
solicitation or hiring of, any person who is, or was within a six month period
prior to such solicitation or hiring, an executive or management (or higher)
level employee of the Company or any of its affiliates, for any position as an
employee, independent contractor, consultant or otherwise for the benefit of any
entity not affiliated with the Company.

 

10.      Change of Control.

 

(a)      Definition. The term Change of Control (“COC”) shall have the meaning
given to such term in the Company’s then current Long Term Incentive
Compensation Plan.

 

(b)      Payments. In the event of a Change of Control, and either (A)
Executive’s employment is terminated without Cause within 12 months after the
effective date of the Change of Control or (B) Executive resigns from employment
for Post-COC Good Reason (as such term is defined in subsection (f) below)
within 12 months after the effective date of the Change of Control (the
effective date of such termination or resignation, the “Activation Date”),
subject to Section 10(d), Executive shall be entitled to receive, on the
sixtieth day following the employment termination date, a cash payment in an
amount equal to the product of two times the sum of the Executive’s: (i) base
salary and (ii) targeted amount of annual cash bonus, at the rate in effect
coincident with the Change of Control or the Activation Date, whichever is
greater; provided, however, that if the Change of Control is not a “change in
control event” for purposes of Code Section 409A, then only those amounts that
do not constitute non-qualified deferred compensation under Section 409A shall
be paid in a lump sum and the remaining payments shall be paid over the
Severance Period in accordance with the Company’s regular payroll procedures for
similarly-situated executives. Such payment shall be in lieu of any payment to
which Executive would be entitled under Section 5(a)-(b), provided that
Executive shall also be entitled to receive the benefits set forth in Section
5(c).

 

(c)      Restrictive Provisions. As consideration for the payments under
Sections 10(b) or 5, Executive agrees not to challenge the enforceability of any
of the restrictions contained in Sections 7, 8 or 9 of this Agreement upon or
after the occurrence of a Change of Control.

 

(d)      Release Agreement and Payment Terms. Executive’s entitlement to any
severance pay and benefit entitlements under this Section 10 is conditioned upon
Executive’s first entering into a Release as provided by the Company to
Executive within 14 days after the Activation Date and the Release becoming
effective no later than the sixtieth day following the Activation Date.
Notwithstanding any other provision hereof, all payments to Executive shall be
delayed until after the expiration of any applicable revocation period with
respect to the Release, but in the event the applicable revocation period spans
two calendar years, the payments shall commence in the second calendar year.

 

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(e)      Post-COC Good Reason. As used herein, the term “Post-COC Good Reason”
shall mean the occurrence of any of the following events that the Company fails
to cure within 10 days after receiving written notice thereof from Executive
(which notice must be delivered within 30 days of Executive becoming aware of
the applicable event or circumstance): (i) assignment to Executive of any duties
inconsistent in any material respect with Executive’s position (including
status, titles and reporting requirements), authority, duties or
responsibilities or inconsistent with Executive’s legal or fiduciary
obligations; (ii) any reduction in Executive’s compensation or substantial
reduction in Executive’s benefits taken as a whole; (iii) any travel
requirements materially greater than Executive’s travel requirements prior to
the Change of Control; (iv) an office relocation of greater than 50 miles from
Executive’s then current office or (v) any breach of any material term of this
Agreement by the Company.

 

11.      Property Surrender. After the termination of this Agreement for any
reason (including, but not limited to, termination by Executive or the
expiration of the Term of this Agreement), Executive shall immediately surrender
and deliver to the Company all property that belongs to the Company, including,
but not limited to, any keys, equipment, computers, phones, credit cards, disk
drives and any documents, correspondence and other information, including all
Confidential Information, of any type whatsoever, from the Company or any of its
agents, servants, employees, suppliers, and existing or potential customers,
that came into Executive’s possession by any means during the course of
employment.

 

12.      Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws (and not the law of conflicts) of the
Commonwealth of Pennsylvania.

 

13.      Jurisdiction. The parties hereby irrevocably consent to the
jurisdiction of the courts of the Commonwealth of Pennsylvania for all purposes
in connection with any action or proceeding which arises out of or relates to
this Agreement and agree that any action instituted under this Agreement shall
be commenced, prosecuted and continued only in the state or federal courts
having jurisdiction for matters arising in Wyomissing, Pennsylvania, which shall
be the exclusive and only proper forum for adjudicating such a claim.

 

14.      Notices. All notices and other communications required or permitted
under this Agreement or necessary or convenient in connection herewith shall be
in writing and shall be deemed to have been given when hand delivered, delivered
by guaranteed next-day delivery or shall be deemed given on the third business
day when mailed by registered or certified mail, as follows (provided that
notice of change of address shall be deemed given only when received):

 

If to the Company, to:

 

Penn National Gaming, Inc.

825 Berkshire Boulevard, Suite 200

Wyomissing, Pennsylvania 19610

Attention: Chief Executive Officer (with a copy to the General Counsel)

 

If to Executive, to:

 

Executive’s then current home address as provided by Executive to the Company.

 

or to such other names or addresses as the Company or Executive, as the case may
be, shall designate by notice to each other person entitled to receive notices
in the manner specified in this Section 14.

 

15.      Contents of Agreement; Amendment and Assignment. This Agreement sets
forth the entire understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior or contemporaneous agreements or
understandings with respect to thereto. This Agreement cannot be changed,
modified, extended, waived or terminated except upon a written instrument signed
by the party against which it is to be enforced. Executive may not assign any of
Executive’s rights or obligations under this Agreement. The Company may assign
its rights and obligations under this Agreement to any successor to all or
substantially all of its assets or business by means of liquidation,
dissolution, merger, consolidation, transfer of assets, stock transfer or
otherwise.

 

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16.      Severability. If any provision of this Agreement or application thereof
to anyone under any circumstances is adjudicated to be invalid or unenforceable
in any jurisdiction, such invalidity or unenforceability shall not affect any
other provision or application of this Agreement which can be given effect
without the invalid or unenforceable provision or application and shall not
invalidate or render unenforceable such provision or application in any other
jurisdiction. If any provision is held void, invalid or unenforceable with
respect to particular circumstances, it shall nevertheless remain in full force
and effect in all other circumstances. In addition, if any court determines that
any part of Sections 7, 8 or 9 hereof is unenforceable because of its duration,
geographical scope or otherwise, such court will have the power to modify such
provision and, in its modified form, such provision will then be enforceable.

 

17.      Remedies. No remedy conferred upon a party by this Agreement is
intended to be exclusive of any other remedy, and each and every such remedy
shall be cumulative and shall be in addition to any other remedy given under
this Agreement or now or hereafter existing at law or in equity. No delay or
omission by a party in exercising any right, remedy or power under this
Agreement or existing at law or in equity shall be construed as a waiver
thereof, and any such right, remedy or power may be exercised by such party from
time to time and as often as may be deemed expedient or necessary by such party
in its sole discretion. Executive acknowledges that money damages would not be a
sufficient remedy for any breach of this Agreement by Executive and that the
Company shall be entitled to specific performance and injunctive relief as
remedies for any such breach, in addition to all other remedies available at law
or equity to the Company.

 

18.      Construction. This Agreement is the result of thoughtful negotiations
and reflects an arms’ length bargain between two sophisticated parties, each
with an opportunity to be represented by counsel. The parties agree that, if
this Agreement requires interpretation, neither party should be considered “the
drafter” nor be entitled to any presumption that any ambiguities are to be
resolved in such party’s favor.

 

19.      Beneficiaries/References. Executive shall be entitled, to the extent
permitted under any applicable law, to select and change a beneficiary or
beneficiaries to receive any compensation or benefit payable under this
Agreement following Executive’s death or incapacity by giving the Company
written notice thereof. In the event of Executive’s death or a judicial
determination of Executive’s incompetence, reference in this Agreement to
Executive shall be deemed, where appropriate, to refer to Executive’s
beneficiary, estate or other legal representative. Except as provided in this
provision or Company affiliates, no third party beneficiaries are intended.

 

20.      Withholding. All payments under this Agreement shall be made subject to
applicable tax withholding, and the Company shall withhold from any payments
under this Agreement all federal, state and local taxes, as the Company is
required to withhold pursuant to any law or governmental rule or regulation.
Executive shall bear all expense of, and be solely responsible for, all federal,
state and local taxes due with respect to any payment received under this
Agreement.

 

21.      Regulatory Compliance. The terms and provisions hereof shall be
conditioned on and subject to compliance with all laws, rules, and regulations
of all jurisdictions, or agencies, boards or commissions thereof, having
regulatory jurisdiction over the employment or activities of Executive
hereunder.

 

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22.      Section 409A. Any amounts that constitute nonqualified deferred
compensation as defined in Section 409A that become payable upon a termination
of employment shall be payable only if such termination of employment
constitutes a separation from service (as defined in Section 409A). The payments
due under this Agreement are intended to be exempt from Code Section 409A, but
to the extent that such payments are not exempt, this Agreement is intended to
comply with the requirements of Section 409A and shall be construed accordingly.
Any payments or distributions to be made to Executive under this Agreement upon
a separation from service (as defined in Section 409A) of amounts classified as
“nonqualified deferred compensation” for purposes of Code Section 409A and do
not satisfy an exemption from the time and form of payment requirements of
Section 409A, shall in no event be made or commence until six months after such
separation from service if Executive is a specified employee (as defined in
Section 409A). Each payment of nonqualified deferred compensation under this
Agreement shall be treated as a separate payment for purposes of Code Section
409A. Any reimbursements made pursuant to this Agreement shall be paid as soon
as practicable but no later than 90 days after Executive submits evidence of
such expenses to the Company (which payment date shall in no event be later than
the last day of the calendar year following the calendar year in which the
expense was incurred). The amount of such reimbursements during any calendar
year shall not affect the benefits provided in any other calendar year, and the
right to any such benefits shall not be subject to liquidation or exchange for
another benefit. Notwithstanding anything herein to the contrary, the Company
shall not have any liability to the Executive or to any other person if the
payments and benefits provided in this Agreement that are intended to be exempt
from or compliant with Code Section 409A are not so exempt or compliant.

 

23.      Defend Trade Secrets Act.  Pursuant to the Defend Trade Secrets Act of
2016, Executive acknowledges that Executive will not have criminal or civil
liability under any Federal or State trade secret law for the disclosure of a
trade secret that  (A) is made (i) in confidence to a Federal, State, or local
government official, either directly or indirectly, or to an attorney; and (ii)
solely for the purpose of reporting or investigating a suspected violation of
law; or (B) is made in a complaint or other document filed in a lawsuit or other
proceeding, if such filing is made under seal.  In addition, if Executive files
a lawsuit for retaliation by the Company for reporting a suspected violation of
law, Executive may disclose the trade secret to Executive’s attorney, and may
use the trade secret information in the court proceeding, if Executive (X) files
any document containing the trade secret under seal, and (Y) does not disclose
the trade secret, except pursuant to court order.

 

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24.      Clawback Policy. Executive acknowledges that Executive has received the
Company’s Clawback Policy and agrees to be bound by it.

 

IN WITNESS WHEREOF, the undersigned, intending to be legally bound, have
executed this Agreement as of the date first above written.

  

 PENN NATIONAL GAMING, INC.          By: /s/ Timothy J. Wilmott  Name: Timothy
J. Wilmott  Title: Chief Executive Officer       EXECUTIVE       /s/ William J.
Fair   William J. Fair 

 

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Exhibit A

 

SEPARATION AGREEMENT AND GENERAL RELEASE

 

This is a Separation Agreement and General Release (hereinafter referred to as
the "Agreement") between _______________ (hereinafter referred to as the
"Employee") and _____________ and its affiliates (hereinafter referred to as the
"Employer"). In consideration of the mutual promises and commitments made in
this Agreement, and intending to be legally bound, Employee, on the one hand,
and the Employer on the other hand, agree to the terms set forth in this
Agreement.

 

1.       Employee is party to an Executive Agreement dated [DATE] (the
"Executive Agreement"). Employer and Employee hereby acknowledge that Employee’s
employment was terminated on [DATE].

 

2.      (a)       Following the execution of this Agreement, Employee will be
entitled to the post-employment benefits and subject to the post-employment
responsibilities set forth in Employee’s Executive Agreement.

 

(b)       If Employee accepts any employment with the Employer, or an affiliate
or related entity of the Employer, and becomes reemployed during the Severance
Period (as defined in the Executive Agreement), Employee acknowledges and agrees
that Employee will forfeit all future severance payments from the date on which
reemployment commences.

 

3.      (a)       When used in this Agreement, the word "Releasees" means the
Employer and all or any of its past and present parent, subsidiary and
affiliated corporations, members, companies, partnerships, joint ventures and
other entities and their groups, divisions, departments and units, and their
past and present directors, trustees, officers, managers, partners, supervisors,
employees, attorneys, agents and consultants, and their predecessors, successors
and assigns.

 

(b)       When used in this Agreement, the word "Claims" means each and every
claim, complaint, cause of action, and grievance, whether known or unknown and
whether fixed or contingent, and each and every promise, assurance, contract,
representation, guarantee, warranty, right and commitment of any kind, whether
known or unknown and whether fixed or contingent.

 

4.       In consideration of the promises of the Employer set forth in this
Agreement and the Executive Agreement, and intending to be legally bound,
Employee hereby irrevocably remises, releases and forever discharges all
Releasees of and from any and all Claims that Employee (on behalf of either
Employee or any other person or persons) ever had or now has against any and all
of the Releasees, or which Employee (or Employee’s heirs, executors,
administrators or assigns or any of them) hereafter can, shall or may have
against any and all of the Releasees, for or by reason of any cause, matter,
thing, occurrence or event whatsoever through the effective date of this
Agreement. Employee acknowledges and agrees that the Claims released in this
paragraph include, but are not limited to, (a) any and all Claims based on any
law, statute or constitution or based on contract or in tort on common law, and
(b) any and all Claims based on or arising under any civil rights laws, such as
any [STATE] employment laws, or Title VII of the Civil Rights Act of 1964 (42
U.S.C. § 2000e et seq.), or the Federal Age Discrimination in Employment Act (29
U.S.C. § 621 et seq.) (hereinafter referred to as the "ADEA"), and (c) any and
all Claims under any grievance or complaint procedure of any kind, and (d) any
and all Claims based on or arising out of or related to Employee’s recruitment
by, employment with, the termination of Employee’s employment with, Employee’s
performance of any services in any capacity for, or any other arrangement or
transaction with, each or any of the Releasees. Employee also understands, that
by signing this Agreement, Employee is waiving all Claims against any and all of
the Releasees released by this Agreement; provided, however, that as set forth
in section 7 (f) (1) (c) of the ADEA, as added by the Older Workers Benefit
Protection Act of 1990, nothing in this Agreement constitutes or shall (i) be
construed to constitute a waiver by Employee of any rights or claims that may
arise after this Agreement is executed by Employee, or (ii) impair Employee’s
right to file a charge with the U.S. Securities and Exchange Commission (“SEC”),
the U.S. Equal Employment Opportunity Commission (“EEOC”), the National Labor
Relations Board (“NLRB”) or any state agency or to participate in an
investigation or proceeding conducted by the SEC, EEOC, NLRB or any state agency
or as otherwise required by law. Notwithstanding the foregoing, Employee agrees
to waive Employee’s right to recover individual relief in any charge, complaint,
or lawsuit filed by Employee or anyone on Employee’s behalf, except that this
does not waive the Employee’s ability to obtain monetary awards from the SEC’s
whistleblower program.

 

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5.        Employee further certifies that Employee is not aware of any actual or
attempted regulatory, SEC, EEOC or other legal violations by Employer and that
Employee’s separation is not a result of retaliation based on any legal rights
or opposition to an illegal practice.

 

6.       Employee covenants and agrees not to sue the Releasees and each or any
of them for any Claims released by this Agreement and to waive any recovery
related to any Claims covered by this Agreement.

 

7.       Pursuant to the Defend Trade Secrets Act of 2016, Employee acknowledges
that Employee will not have criminal or civil liability under any Federal or
State trade secret law for the disclosure of a trade secret that (A) is made (i)
in confidence to a Federal, State, or local government official, either directly
or indirectly, or to an attorney; and (ii) solely for the purpose of reporting
or investigating a suspected violation of law; or (B) is made in a complaint or
other document filed in a lawsuit or other proceeding, if such filing is made
under seal. In addition, if Employee files a lawsuit for retaliation by the
Company for reporting a suspected violation of law, Employee may disclose the
trade secret to Employee’s attorney, and may use the trade secret information in
the court proceeding, if Employee (X) files any document containing the trade
secret under seal, and (Y) does not disclose the trade secret, except pursuant
to court order.

 

8.       Employee agrees to provide reasonable transition assistance to Employer
(including without limitation assistance on regulatory matters, operational
matters and in connection with litigation) for a period of one year from the
execution of this Agreement at no additional cost; provided, such assistance
shall not unreasonably interfere with Employee’s pursuit of gainful employment
or result in Employee not having a separation from service (as defined in
Section 409A of the Internal Revenue Code of 1986). Any assistance beyond this
period will be provided at a mutually agreed cost.

 

9.       Employee agrees that, except as specifically provided in this
Agreement, there is no compensation, benefits, or other payments due or owed to
Employee by each or any of the Releasees, including, without limitation, the
Employer, and there are no payments due or owed to Employee in connection with
Employee’s employment by or the termination of Employee’s employment with each
or any of the Releasees, including without limitation, any interest in unvested
options, SARs, restricted stock or other equity issued to, expected by or
contemplated by any of the Releasees (which interest is specifically released
herein) or any other benefits (including, without limitation, any other
severance benefits). For clarity, Employee acknowledges that upon Employee’s
separation date, Employee has no further rights under any bonus arrangement or
option plan of Employer. Employee further acknowledges that Employee has not
experienced or reported any work-related injury or illness.

 

10.       Except where the Employer has disclosed or is required to disclose the
terms of this Agreement pursuant to applicable federal or state law, rule or
regulatory practice, Employer and Employee agree that the terms of this
Agreement are confidential. Employee will not disclose or publicize the terms of
this Agreement and the amounts paid or agreed to be paid pursuant to this
Agreement to any person or entity, except to Employee’s spouse, Employee’s
attorney, Employee’s accountant, and to a government agency for the purpose of
payment or collection of taxes or application for unemployment compensation
benefits. Employee agrees that Employee’s disclosure of the terms of this
Agreement to Employee’s spouse, Employee’s attorney and Employee’s accountant
shall be conditioned upon Employee obtaining agreement from them, for the
benefit of the Employer, not to disclose or publicize to any person or entity
the terms of this Agreement and the amounts paid or agreed to be paid under this
Agreement. Employee understands that, notwithstanding any provisions of this
Agreement, Employee is not prohibited or in any way restricted from reporting
possible violations of law to a government agency or entity, and Employee is not
required to inform Employer if Employee makes such reports.

 

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11.       Employee agrees not to make any false, misleading, defamatory or
disparaging statements, including in blogs, posts on Facebook, twitter, other
forms of social media or any such similar communications, about Employer
(including without limitation Employer’s products, services, partners, investors
or personnel) and to refrain from taking any action designed to harm the public
perception of the Employer or any of the Releasees. Employee further agrees that
Employee has disclosed to Employer all information, if any, in Employee’s
possession, custody or control related to any legal, compliance or regulatory
obligations of Employer and any failures to meet such obligations.

 

12.       The terms of this Agreement are not to be considered as an admission
on behalf of either party. Neither this Agreement nor its terms shall be
admissible as evidence of any liability or wrongdoing by each or any of the
Releasees in any judicial, administrative or other proceeding now pending or
hereafter instituted by any person or entity. The Employer is entering into this
Agreement solely for the purpose of effectuating a mutually satisfactory
separation of Employee's employment.

 

13.       Sections 12 and 13 (Governing Law, Jurisdiction) of the Executive
Agreement shall also apply to this Agreement.

 

14.       This Agreement and the Executive Agreement (including, but not limited
to Sections 7 through 9) constitute a complete and final agreement between the
parties and supersede and replace all prior or contemporaneous agreements, offer
letters, severance policies and plans, negotiations, or discussions relating to
the subject matter of this Agreement and no other agreement shall be binding
upon each or any of the Releasees, including, but not limited to, any agreement
made hereafter, unless in writing and signed by an officer of the Employer, and
only such agreement shall be binding against the Employer.

 

15.       Employee is advised, and acknowledges that Employee has been advised,
to consult with an attorney before signing this Agreement.

 

16.       Employee acknowledges that Employee is signing this Agreement
voluntarily, with full knowledge of the nature and consequences of its terms.

 

17.       All executed copies of this Agreement and photocopies thereof shall
have the same force and effect and shall be as legally binding and enforceable
as the original.

 

18.       Employee acknowledges that Employee has been given up to twenty-one
(21) days within which to consider this Agreement before signing it. Subject to
paragraph 19 below, this Agreement will become effective on the date of
Employee's signature hereof.

 

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19.       For a period of seven (7) calendar days following Employee’s signature
of this Agreement, Employee may revoke the Agreement, and the Agreement shall
not become effective or enforceable until the seven (7) day revocation period
has expired. Employee may revoke this Agreement at any time within that seven
(7) day period, by sending a written notice of revocation to the Human Resources
Department of Employer. Such written notice must be actually received by the
Employer within that seven (7) day period in order to be valid. If a valid
revocation is received within that seven (7) day period, this Agreement shall be
null and void for all purposes and no severance shall be paid. If Employee does
not revoke this agreement, payment of the severance pay amount set forth in the
Employee’s Executive Agreement will be paid in the manner and at the time(s)
described in the Executive Agreement.

 

IN WITNESS WHEREOF, the Parties have read, understand and do voluntarily execute
this Separation Agreement and General Release which consists of [NUMBER] pages.

 

EMPLOYEREMPLOYEE    By:                        Date:    Date:        

 

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Exhibit B

 

Performance Share Plan Tranche Type of
Award Performance
Period Vesting Date Number of
Performance
Shares Vesting
at target 2018 Performance Share Plan 3rd Performance Shares 1/1/2020 to
12/31/2020 3/31/2020 6,417 2019 Performance Share Plan 2nd Performance Shares
1/1/2020 to 12/31/2020 3/31/2020 7,984 2019 Performance Share Plan 3rd
Performance Shares 1/1/2021 to 12/31/2021 3/31/2020 7,984 2019 Performance Share
Plan 2nd Phantom Stock Units 1/1/2020 to 12/31/2020 3/31/2020 7,984 2019
Performance Share Plan 3rd Phantom Stock Units 1/1/2021 to 12/31/2021 3/31/2020
7,984

 

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