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Argosy Faces Questioning on Guidance

9 November 2004

NEW YORK – As reported by the Wall Street Journal: "An investment manager with a small stake in Argosy Gaming Co. sent a letter to its directors questioning comments Argosy's management made about its slowing growth prospects just days before the company's recent agreement to be acquired by Penn National Gaming Inc. for $1.4 billion.

"Jason Ader, chief executive of Hayground Cove Asset Management in New York, asked Argosy board members to reconsider their plans to sell the company for $47 per share. In a letter faxed to each board member yesterday and provided to The Wall Street Journal, Mr. Ader said he thinks the price undervalues Argosy's riverboat casinos and other gambling assets.

"The letter questioned comments that Argosy officials made during an investor conference call several days before the sale was announced. The comments led some brokerage firms to downgrade Argosy's stock.

" 'It would certainly not be right to talk down the stock price by raising concerns about growth that sweeten the deal for Penn,'Mr. Ader wrote.

"…He said he believes the stock is worth closer to $60 a share given the high values of casinos these days, he also said he will contact shareholders to raise pressure on the company about the issue…"

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