The Bullwhackers assets consist of the Bullwhackers Casino, the adjoining Bullpen Sports Casino, the Silver Hawk Saloon and Casino, an administrative building and a 475-car parking area, all located in the Black Hawk, Colorado gaming jurisdiction. The purchase would mark Penn National's entry into the fast growing Colorado gaming marketplace and is subject to customary closing conditions and approval by the Colorado Gaming Commission as well as other regulatory bodies. The transaction, which is anticipated to close in the second quarter of 2002, is expected to be accretive to earnings.

The Bullwhackers properties comprise a total of 63,800 square feet of interior space, 20,700 square feet of which is devoted to gaming, consisting of 1,002 slot machines and 16 gaming tables. The properties are located on leased land as well as 3.25 acres of land included in the acquisition, much of which is utilized for parking. The 3.25 acre parcel is one of the largest tracts of level, undeveloped land in the area, providing Penn National with the potential for long term development opportunities.

Black Hawk is 35 miles west of downtown Denver and readily accessible from many of Colorado's leading ski resorts. Black Hawk has demonstrated tremendous growth since the legalization of gaming in 1991 and is now the largest of Colorado's three gaming markets, representing over 60% of total Colorado gaming activity.

Commenting on the acquisition, Peter M. Carlino, Chief Executive Officer of Penn National stated, "Penn National remains committed to opportunistically expanding its portfolio of gaming properties in markets that offer long term growth opportunities. This purchase provides us access to a new gaming jurisdiction and the particularly strong Black Hawk market. The Bullwhacker properties are attractively priced, provide excellent development potential, and do not require immediate significant capital expenditures."

Penn National Gaming owns and operates Charles Town Races in Charles Town, West Virginia, which presently features 2,000 gaming machines; two Mississippi casinos, the Casino Magic hotel, casino, golf resort and marina in Bay St. Louis and the Boomtown Biloxi casino in Biloxi; and the Casino Rouge, a riverboat gaming facility in Baton Rouge, Louisiana. Penn National also owns two racetracks and eleven off-track wagering facilities in Pennsylvania and one racetrack at Charles Town Races in West Virginia and operates the Casino Rama, a gaming facility located approximately 90 miles north of Toronto, Canada, pursuant to a management contract.

In addition to historical facts or statements of current condition, this press release may contain forward-looking statements that involve risks and uncertainties including, but not limited to, statements regarding the potential benefits and risks related to completing the planned acquisition of the Colorado Gaming and Entertainment Co. assets.