MTR Gaming Group Updates Status of Its Planned Racetrack for Eri

CHESTER, W.Va.--(BUSINESS WIRE)--June 27, 2003--MTR Gaming Group, Inc. (Nasdaq National Market:MNTG) today provided an update concerning the status of its planned racetrack in Erie, Pennsylvania, for which the Pennsylvania State Horse Racing Commission unanimously granted a license on November 19, 2002 to MTR's wholly owned subsidiary, Presque Isle Downs, Inc. As has been previously announced, affiliates of Penn National Gaming and Magna Entertainment challenged the Racing Commission's decision in the Commonwealth Court of Pennsylvania.
As part of a settlement agreement between MTR and Magna, on June 19, 2003, Magna filed a motion to withdraw its appeal with prejudice and informed the Court that the Racing Commission supported the motion. On June 25, 2003, MTR and Penn National reached an agreement in principle pursuant to which Penn National agreed to withdraw its appeal in consideration for MTR's agreement to purchase Penn National's off track wagering facility in Erie upon MTR's commencement of parimutuel wagering in Erie and to offer comparable employment to Penn National's employees at the Erie facility.
On June 26, 2003, the Court issued its Opinion and Order in which it denied Penn National's petition for review, finding that the Racing Commission had not committed an error of law in granting the license. However, notwithstanding Magna's motion to withdraw its appeal, the Court granted Magna's petition, holding that Magna had timely requested and should have received a formal hearing to be conducted in accordance with Pennsylvania's Administrative Agency Law. The Court therefore vacated the Racing Commission's November 19, 2002 Order, with regard to Magna, and remanded the case to the Racing Commission for a formal hearing. The Company believes that on remand, there being no further dispute among the parties to the proceeding, the Racing Commission will reaffirm Presque Isle Downs' license. There can be no assurances of this result, however, or that the Company's plans to build the racetrack will be executed.