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.
EXCEPT AS SPECIFICALLY PROVIDED OTHERWISE IN THIS AGREEMENT, 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.
20.
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.
21.
SECTION 409A.
THIS AGREEMENT IS INTENDED TO COMPLY WITH THE
REQUIREMENTS OF SECTION 409A AND SHALL BE CONSTRUED ACCORDINGLY.
IF A CESSATION
OF EMPLOYMENT OR SERVICE GIVING RISE TO PAYMENTS DESCRIBED IN
SECTION 3.4(B)(I) IS NOT A "SEPARATION FROM SERVICE" WITHIN THE MEANING OF
TREAS. REG. §1.409A-1(H)(1) (OR ANY SUCCESSOR PROVISION) ("SEPARATION FROM
SERVICE"), THEN THE AMOUNTS OTHERWISE PAYABLE PURSUANT TO THAT SECTION WILL BE
DEFERRED UNTIL THE EXECUTIVE EXPERIENCES A SEPARATION FROM SERVICE.
IN
ADDITION, TO THE EXTENT COMPLIANCE WITH THE REQUIREMENTS OF TREAS. REG.
§1.409A-3(I)(2) (OR ANY SUCCESSOR PROVISION) IS NECESSARY TO AVOID THE
APPLICATION OF AN ADDITIONAL TAX UNDER SECTION 409A OF THE CODE TO PAYMENTS DUE
TO THE EXECUTIVE UPON OR FOLLOWING HIS SEPARATION FROM SERVICE, THEN
NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT (OR ANY OTHERWISE
APPLICABLE PLAN, POLICY, AGREEMENT OR ARRANGEMENT), ANY SUCH PAYMENTS THAT ARE
OTHERWISE DUE WITHIN SIX MONTHS FOLLOWING THE EXECUTIVE'S SEPARATION FROM
SERVICE (TAKING INTO ACCOUNT THE PRECEDING SENTENCE) WILL BE DEFERRED WITHOUT
INTEREST AND PAID TO THE EXECUTIVE IN A LUMP SUM IMMEDIATELY FOLLOWING THAT SIX
MONTH PERIOD.
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 EMPLOYEE SUBMITS EVIDENCE
OF SUCH EXPENSES TO CORPORATION (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
12
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.
IN WITNESS WHEREOF, the undersigned, intending to be legally bound, have
executed this Agreement on the date first above written.
PENN NATIONAL GAMING, INC.
By:
/s/ Robert S. Ippolito
Name:
Robert S. Ippolito
Title:
Vice President, Secretary and Treasurer
EXECUTIVE
/s/ Peter M. Carlino
Peter M. Carlino
13
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 Penn National Gaming, Inc. (hereinafter
referred to