Exhibit 10.33


 


PENN
NATIONAL GAMING, INC.


 


NON-QUALIFIED STOCK OPTION CERTIFICATE


 


This certifies that an option to purchase
shares of Common Stock of Penn National Gaming, Inc. has been granted
pursuant to the Penn National Gaming, Inc. 2008 Long Term Incentive
Compensation Plan, as follows:


 


	
  Name and
  Address of Optionee:

  	
   

  
	
   

  	
   

  
	
  Date of
  Grant:

  	
              
      , 20  

  
	
   

  	
   

  
	
  Type of
  Option:

  	
  Non-Qualified
  Stock Option

  
	
   

  	
   

  
	
  Number of
  shares subject to Option:

  	
   

  
	
   

  	
   

  
	
  Option
  Price:

  	
  $

  
	
   

  	
   

  
	
  Vesting
  Date(s):

  	
              
  shares on
                      ,
  20   

              
  shares on
                      ,
  20   

              
  shares on
                      ,
  20   

              
  shares on
                      ,
  20  

  
	
   

  	
   

  
	
  Expiration
  Date:

  	
              
      , 20  

  



 


The option is subject to all the terms and
conditions of the Penn National Gaming, Inc. 2008 Long Term Incentive
Compensation Plan, a copy of which is available upon request.


 


 


	
  Date:

  	
   

  	
   

  	
  PENN NATIONAL GAMING, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Robert S. Ippolito

  
	
   

  	
  Title:

  	
  Vice President, Secretary and Treasurer

  



 

















 


PENN NATIONAL
GAMING, INC.


STOCK OPTION
TERMS


 


All Stock Options are subject to the
provisions of the 2008 Long Term Incentive Compensation Plan (the “Plan”) and
any rules and regulations established by the Compensation Committee of the
Board of Directors of Penn National Gaming, Inc. (“PNG”).  A copy of the Plan is available upon
request.  Words used herein with initial
capitalized letters are defined in the attached Non-Qualified Stock Option
Certificate or the Plan.


 


The terms provided
here are applicable to the Stock Option specified in the attached
certificate.  Different terms may apply
to any prior or future stock option grants.


 


I.                                         OPTION PERIOD


 


You may exercise your Stock Options during
the Option Period, which begins on the Vesting Dates and ends on the Expiration
Date.  The Stock Options vest in 25%
installments on each Vesting Date.  The
Vesting Dates are the first, second, third and fourth anniversaries of the Date
of Grant.  Thus, you may exercise up to
25% of your Stock Options on the first Vesting Date, up to another 25% of your
Stock Options on the second Vesting Date, and so on.  The Expiration Date is seven (7) years
from the Date of Grant.  However, the
Option Period may end sooner if your employment is terminated under certain
circumstances.


 


II.                                     TERMINATION OF EMPLOYMENT


 


If you cease to be an Employee or Director of
the Company and all Subsidiaries, as the case may be, for any reason (other
than as specified in clauses (i), (ii) or (iii) below), then your
Stock Options that are exercisable as of the termination or cessation date
shall be cancelled and forfeited at the end of the 120th day after such date and
all Stock Options that are not exercisable as of the termination or cessation
date shall be forfeited and cancelled as of such date; except that, in cases of
where such termination of employment or cessation of service is a result of (i) death
or Disability, in which case the Stock Options that are not then exercisable
shall thereupon become exercisable and all Stock Options shall remain
exercisable for the balance of their respective terms, (ii) resignation
(other than for Retirement), in which case the Stock Options that are
exercisable as of such termination or cessation date shall be cancelled and
forfeited at the end of the 30th day after such date, and (iii) termination
for Cause by the Company, a Subsidiary, or the Board, in which case all of the
Stock Options, whether or not then exercisable, shall be cancelled and
forfeited as of such termination date.


 


III.                                 TRANSFERABILITY


 


In general, Stock Options may be exercised
during your lifetime only by you and may not be assigned or otherwise
transferred to anyone else; provided, however, that Options are transferable to
family members, subject to certain restrictions and with certain tax
implications.  Options are transferable
upon your death by will or the laws of distribution and descent.


 


IV.                                PAYMENT


 


When you exercise your Stock Options, you may pay the Option Price in
cash, by check, with previously issued shares of PNG Common Stock (under
certain circumstances), in accordance with a “cashless exercise program” or
with a combination of the foregoing.


 

















 


Penn National
Gaming, Inc.

Understanding How Non-Qualified Stock Options Work


 


Congratulations on receiving a Penn National
Gaming, Inc. (“PNG”) Non-Qualified Stock Option.  These Stock Options are designed so that you
may share in the Company’s success.


 


How Do Stock Options Work?


 


A stock option is the right, subject to
certain conditions, to purchase shares of PNG Common Stock at a fixed
price.  The per share price at which
Shares of Common Stock may be purchased when the Stock Option is exercised is
referred to as the Option Price.  The
Option Price is fixed on the Date of Grant and does not change for the life of
the Stock Option.  However, the market
price of PNG stock changes and will ultimately determine the gain, if any, from
your Stock Option.  If the value of PNG
stock increases, you will be able to buy PNG stock below the market price at
the time of exercise.  For example, if
you have been granted Stock Options to purchase 100 shares, at an Option Price
of $25 and the price of PNG stock has grown to $40 on the date you choose to
exercise, you would be able to purchase shares that are worth $4,000 for only
$2,500, a pre-tax gain of $15 per share. 
You will be subject to Federal income tax with respect to the Stock
Option when you exercise your Stock Option. 
THE TAX RULES APPLICABLE TO
NON-QUALIFIED STOCK OPTIONS ARE COMPLEX. 
YOU SHOULD CONSULT WITH YOUR FINANCIAL ADVISOR FOR MORE INFORMATION.


 


Stock Option Basics


 


The Option Price is set at the closing sales
price of a share of Common Stock of PNG stock on the immediately preceding
business day of the date the Stock Option is awarded.


 


The vesting period is the waiting period from the
Date of Grant
to the Vesting Date during
which you cannot exercise your Stock Option.


 


The Option Period is the time from the Vesting Date until
the Expiration Date,
during which you can exercise your Stock Options, which means you can purchase
shares of PNG stock at the Option Price.


 


Your Stock Option can no longer be exercised
after the Expiration Date, which is seven (7) years after the Date of
Grant.  The Stock Option will expire
sooner if you leave PNG under certain circumstances.  For example, if you were granted a Stock
Option to purchase 100 shares of PNG Common Stock, and you remain employed by
PNG for ten years, the Stock Option is exercisable as follows:


 


	
  Number of Shares

  	
   

  	
  Vesting
  Period

  	
   

  	
  Option
  Period

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  25 shares

  	
   

  	
  Date of
  Grant - 

  First Anniversary 

  of Date of Grant

  	
   

  	
  First
  Anniversary of Date of Grant - 

  Seventh Anniversary of Date of Grant

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  25 shares

  	
   

  	
  Date of
  Grant - 

  Second Anniversary 

  of Date of Grant

  	
   

  	
  Second
  Anniversary of Date of Grant - 

  Seventh Anniversary of Date of Grant

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  25 shares

  	
   

  	
  Date of
  Grant - 

  Third Anniversary 

  of Date of Grant

  	
   

  	
  Third
  Anniversary of Date of Grant - 

  Seventh Anniversary of Date of Grant

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  25 shares

  	
   

  	
  Date of
  Grant - 

  Fourth Anniversary 

  of Date of Grant

  	
   

  	
  Fourth
  Anniversary of Date of Grant - 

  Seventh Anniversary of Date of Grant