Item 5.02.
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On June 1, 2016, Penn National Gaming, Inc. (the
Company
) entered into executive agreements (collectively, the
Executive Agreements
) with Timothy J. Wilmott, the Companys President and Chief Executive Officer, Jay A. Snowden, the Companys Executive Vice President and Chief Operating Officer, and Carl Sottosanti, the Companys Executive Vice President, General Counsel and Secretary. The Executive Agreements are effective as of June 13, 2016, the date the prior executive agreements with such named executive officers expire by their terms.
Mr. Wilmotts Executive Agreement has a term of two years, unless earlier terminated. Mr. Snowdens Executive Agreement has a term of three years, unless earlier terminated. Mr. Sottosantis Executive Agreement has a term of 30 months, unless earlier terminated.
In the event an executives employment is terminated without cause (as defined in the Executive Agreements) or by non-renewal of the Executive Agreement at the end of the term, the executive will be entitled to severance payments equal to (i) 24 months (18 months in the case of Mr. Sottosanti) of his annual base salary as of such date, paid in accordance with the Companys regular payroll procedures, and (ii) 1.5 times the average of the last two full years bonuses paid to such executive based on the actual performance of the Company, paid at the time such next bonuses are paid to similarly situated executives after the termination date.
If, within 12 months (24 months in the case of Mr. Wilmott) after a change in control (as defined in the Executive Agreements), an executive is terminated without cause or resigns for good reason (as defined in the Executive Agreements), he will be entitled to receive a cash payment equal to two times the sum of (i) his annual base salary and (ii) the amount of his targeted bonus compensation, each at the rate in effect at the time of the change of control or the termination date, whichever is greater. To the extent that an executive receives a change in control payment, such executive will not be eligible to receive any additional cash severance in the event of a termination of employment during the employment term. Prior to receipt of any severance payments, the executive must execute a general release in favor of the Company and its affiliates.
The Executive Agreements also contain customary confidentiality, non-competition and non-solicitation provisions. Each executive has agreed not to disclose or use the Companys confidential information for a period of two years following termination. Each executive has agreed not to compete with the Company within 150 miles of any facility in which the Company or its affiliates owns or operates or is actively seeking to own or operate a facility for a period of (i) 12 months (6 months in the case of Mr. Sottosanti) if the executive is terminated in a manner in which no severance is paid or (ii) 24 months (18 months in the case of Mr. Sottosanti) if the executive receives severance upon termination. Each executive has agreed not to solicit or hire an executive or management level employee of the Company for a period of 18 months following termination.
The summary of the material terms of the Executive Agreements described above is qualified in its entirety by reference to each of the Executive Agreements, copies of which are attached hereto as Exhibits 10.1, 10.2 and 10.3 and are incorporated herein by reference.
Item 5.07. Submission of Matters to a Vote of Security Holders.
The Company held its Annual Meeting of Shareholders (the
Annual Meeting
) on June 2, 2016, at 10:00 a.m., local time, at the offices of Ballard Spahr LLP, 1735 Market Street, 51st Floor, Philadelphia, Pennsylvania 19103. Of the 81,218,649 shares of the Companys common stock outstanding as of the close of business on April 1, 2016, the record date for the Annual Meeting, 78,241,591 shares, or approximately 96% of the total shares eligible to vote at the Annual Meeting, were represented in person or by proxy. Three proposals were submitted to the shareholders at the Annual Meeting and are described in detail in the Companys Proxy Statement for the Annual Meeting. The following is a brief description of each matter voted upon at the Annual Meeting and the number of votes cast for, against or withheld, as well as the number of abstentions and broker non-votes, with respect to each matter, as applicable.
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