As required by general accounting principles, Penn National will report the payment in the fourth quarter of 2001. Earnings for the quarter and for the year as reported Feb. 4 will be adjusted by $650,000 after taxes, or 4 cents per share.
Penn National Gaming will pay a $1 million settlement to a Las Vegas casino company that was suing over the casino rights to Charles Town Races.Showboat Development agreed to drop all pending litigation in return for the one-time payment. The casino company, a subsidiary of Harrah's Entertainment, had filed a lawsuit in Pennsylvania claiming that the video lottery and slot machine operation at Charles Town constituted a casino, which triggered an option Showboat has to manage a casino at the West Virginia racetrack. The suit also claimed Penn National's acquisition of an 11% minority interest in Charles Town from the BDC Group, a former partner, violated a first right of refusal agreement that Showboat has with BDC Group regarding the sale of any interest in a casino at the track.