days from the date of this Agreement

 OPTION TO PURCHASE REAL PROPERTY

       1. In consideration of Seven Thousand and no/100 Dollars ($7,000.00) paid
to Joyce M. Peck, c/o 1558 Texas Street, Memphis,  Tennessee, 38106, hereinafter
referred to as "Seller", receipt of which is hereby acknowledged,  Seller hereby
gives and grants to Penn National  Gaming,  Inc.,  with business  offices at 825
Berkshire  Boulevard,   Wyomissing,   PA  19610,   hereinafter  referred  to  as
"Purchaser",  and its assigns, the exclusive option to purchase the 65 acre real
property of Seller situated in the City of Memphis,  County of Shelby,  State of
Tennessee,  and particularly described on Exhibit A which is attached hereto and
made a part hereof by reference.

       2.      Exercise of the option to purchase is at the sole
discretion of Purchaser.

       3.      The period of duration of the option is thirty (30)
days from the date hereof.

       4. However,  Purchaser is also granted  additional options of up to three
hundred thirty (330)  additional days. Said options will be granted upon receipt
of the sum of $7,000.00 per thirty (30) day period.  The first $7,000.00 must be
tendered to Seller  before the  expiration  of the first thirty (30) day option,
and each  additional  $7,000.00 must be tendered to Seller before the expiration
of each  succeeding  thirty (30) day period.  Said sums shall be paid out of the
Escrow Account, below mentioned.

       5.  The sum of  seventy-seven  thousand  dollars  ($77,000.00)  shall  be
deposited with an Escrow Agent in Memphis,  Tennessee on or before fourteen (14)
days  from the date of this  Agreement.  Said  Escrow  Agent  shall be chosen by
mutual agreement of the parties, in writing. Seller's consent to the designation
of an Escrow Agent may not be unreasonably withheld. Said seventy-seven thousand
dollars ($77,000.00) (hereinafter the Deposit Funds) may, at Purchaser's option,
be placed by Escrow Agent in an interest bearing account.

       5. Upon  failure of  Purchaser  to exercise  this option to purchase  the
property, the aforementioned  $7,000.00 and any additional option monies paid to
Seller  shall be the sole  property  of  Seller,  and there  shall be no further
liability of the parties

                                     (46)

under this agreement, one to the other.

       6.      In the event Purchaser exercises its option to
purchase the property, all option payments made to Seller shall be
applied to the purchase price.

       7.  Purchase  price of the  subject  property  is  $30,000.00  per  acre;
purchase shall be of the property, in its entirety,  described on Exhibit A. All
sums due to Seller shall be paid in certified  funds at closing.  Property shall
be surveyed at expense of Seller;  survey shall be furnished to Purchaser within
30 days of the date of this Agreement.

       8. Purchaser's exercise of its option to purchase shall be written notice
to Seller by  hand-delivery,  U.S.Mail or Federal Express,  which notice,  to be
effective,  must be  actually  received  by Seller  before  midnight  on the day
Purchaser's option or any extensions expires.

       9. The final closing of the Purchase  shall be within thirty (30) days of
Purchaser's  exercise of its option,  subject to any  extensions the parties may
mutually agree upon, in writing.

       10.  At  closing,  Seller  will  deliver  to  Purchaser  a good and valid
Warranty Deed on forms  customarily used in Memphis,  Shelby County,  Tennessee,
wherein the Seller will warrant that there are no liens or  encumbrances on said
property,  except any  subdivision  or other  restrictions  of  record,  and any
property  taxes  levied by the City of Memphis or County of Shelby.  Seller will
not grant any easements or other  encumbrances on the property after the date of
this Agreement.

       11. Any property  taxes for years prior to the tax year of closing  shall
be paid by Seller;  the property taxes for the year of closing shall be prorated
between the Seller and the Purchaser,  as of the date of closing.  Any Greenbelt
taxes  shall  be paid by  Seller.  Any  billboard  leases  will be  assigned  to
Purchaser.  All tax liens, and liens of Deeds of Trust, will be removed,  at the
sole expense of the Seller. Any labor and materialman liens will be removed,  at
the sole expense of the Seller.

       12.  Seller,  at  Seller's  expense,  will fill the  entire 65 acres to a
height one foot above the 100 year flood plain as established on FEMA maps as of
December,  1994.  Said fill shall be an engineered  fill and compacted to 90% of
Maximum Standard Proctor Density. If the property is not filled by the date of

                                     (47)

closing,  then the sum of $15,000.00  (of the purchase  price) per unfilled acre
will be held in escrow,  with sums  released to Seller as the fill is completed.
All fill must be completed within six (6) months after closing.

       13.  In the  event  either  party  must  enforce  its  rights  under  the
Agreement,  or otherwise  seek  redress  from the other for damages  suffered in
connection  with this  Agreement,  the losing party shall pay to the  prevailing
party all reasonable costs, attorney fees and suit expenses.

       14.  Tennessee law shall apply in any action brought  arising out of this
Agreement,  and all suits shall be  prosecuted  in the Chancery  Court of Shelby
County, Tennessee.

       Executed in duplicate originals as of the 20th day of June, 1997.

SELLER:

By: /s/  Joyce M. Peck
JOYCE M. PECK

PURCHASER:

By: /s/ William J. Bork
PENN NATIONAL GAMING, INC.

                                     (48)

                                                      Individual Acknowledgement

STATE OF TENNESSEE

COUNTY OF SHELBY

       On this  the 18th  day of  June,  1997,  before  me,  Ramona  Allen,  the
undersigned  officer,  personally  appeared Joyce M. Peck, known to me to be the
person whose name is subscribed to the within  instrument and acknowledged  that
he executed the same for the purpose therein contained.

       IN WITNESS WHEREOF, I have hereunto set my hand and official seal.

                                             By: /s/ Ramona Allen

                                             Notary Public

My commission expires:

July 12, 1999

                                                       Corporate Acknowledgement

STATE OF PENNSYLVANIA

COUNTY OF BERKS

       I hereby  certify that on this day before me, an officer duly  authorized
in the state  aforesaid  and in the county  aforesaid to take  acknowledgements,
personally  appeared William J. Bork , to me known to be the person described in
and who executed the foregoing  instrument as President of Penn National Gaming,
Inc., a corporation named therein,  and acknowledged  before me that he executed
the  same as such  officer,  in the  name of and for and on  behalf  of the said
corporation.

       IN WITNESS  WHEREOF,  I have hereunto set my hand and affixed my official
seal this 23rd day of June, 1997.

                                       By: /s/ Susan M. Montgomery

                                     (49)

                                                   Notary Public

My Commission Expires:

June 7, 1999
                                     (50) 

Basic Info X:

Name: days from the date of this Agreement
Type: the date of this Agreement
Date: Aug. 13, 1997
Company: PENN NATIONAL GAMING INC
State: Pennsylvania

Other info:

Date:

  • December , 1994
  • 20th day of June , 1997
  • 18th day of June , 1997
  • July 12 , 1999
  • 23rd day of June , 1997
  • June 7 , 1999

Organization:

  • County of Shelby , State of Tennessee
  • City of Memphis or County of Shelby
  • Maximum Standard Proctor Density
  • Penn National Gaming , Inc.
  • Notary Public My Commission Expires

Location:

  • Wyomissing
  • City of Memphis
  • Greenbelt
  • Chancery Court of Shelby County
  • TENNESSEE
  • PENNSYLVANIA

Money:

  • seventy-seven thousand dollars
  • $ 77,000.00
  • $ 7,000.00
  • $ 30,000.00
  • $ 15,000.00

Person:

  • Joyce M. Peck JOYCE M. PECK
  • Ramona Allen
  • William J. Bork
  • Susan M. Montgomery

Time:

  • midnight

Percent:

  • 90 %