DEF 14A of PENN Entertainment, Inc.
Filed Apr 23, 2024 · FY20230001140361-24-021379
Our Board of Directors
Our Board of Directors Our Board is composed of highly experienced directors who have led, advised, and established leading organizations and institutions. Our directors have the experience and skill sets that collectively add significant value to the strategic decisions made by the Company, and which enable them to provide oversight of management to ensure accountability to our shareholders. We believe our Board possesses the right balance between long-term understanding of our business and fresh external perspectives. With the addition of three new directors in the last four years, we have ensured diversity of backgrounds and perspectives within the boardroom. In addition to demographic diversity, our directors have extensive backgrounds as entrepreneurs, operational, financial and technology experts, investors, advisors, and public company and nonprofit board members.
DIRECTORS
DIRECTORS
Introduction
Introduction Our Board of Directors currently consists of ten members. John Jacquemin is not standing for re-election at our 2024 Annual Meeting, and as a result, our Board of Directors will be reduced to nine directors effective as of our 2024 Annual Meeting. The directors are organized into three classes, with each class elected to serve a three-year term. At the Annual Meeting, shareholders will be asked to elect each of the three Class I directors to serve until the annual meeting of shareholders of the Company to be held in 2027 and until their respective successors are duly elected and qualified. Our Board of Directors, upon the recommendation of our Nominating and Corporate Governance Committee, has nominated David Handler, Vimla Black-Gupta and Anuj Dhanda to serve as Class I directors. Each of the nominated persons currently serves as a member of the Board of Directors and has consented to being named in this Proxy Statement and to serve as a Class I director, if elected. We believe that each of our Class I director nominees has the specific experience, qualifications, attributes, and skills necessary to serve as an effective director on our Board of Directors. A description of our process for identifying and evaluating director nominees, as well as our criteria for membership on our Board of Directors, is set forth under the heading “Director Candidate Qualification and Selection Process.” Under our bylaws, the three nominees for Class I director receiving the highest number of votes cast will be elected. For purposes of the election of directors, withheld and broker non-votes will not be counted as votes cast and will have no effect on the result of the vote, although they will be considered present for the purpose of determining the presence of a quorum.
Introduction
| Board Recommendation | | OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH CLASS I DIRECTOR NOMINEE: (I) David Handler; (II) Vimla Black-Gupta; and (III) Anuj Dhanda |
Introduction
| | KEY SKILLS AND EXPERTISE: • Financial (Capital Markets, Accounting & Tax): Acquired over his nearly 30-year career in investment banking with several leading global investment firms, where he successfully launched and expanded multiple technology sector groups. He most recently co-founded Tidal Partners, a strategic M&A advisory firm. • Strategic Planning / M&A: Gained through decades of advising major technology companies on large- scale, high-profile and industry-defining transactions. Mr. Handler's long-term exposure to the gaming and technology industries, including opportunities created by emerging technologies, is an especially valuable asset to PENN, particularly as it relates to evaluating potential acquisitions in support of the Company's growth strategy. • Technology / Digital: As a co-founder of an M&A advisory firm focused on the technology sector, Mr. Handler contributes to the Board deep strategic insights into the evolving and dynamic industry landscape, expertise in effective risk oversight and the ability to identify strategic opportunities for PENN's omnichannel growth strategy. EXPERIENCE: Tidal Partners – Co-Founder and Partner (2022-Present) • Strategic M&A advisory firm focused on the technology industry Centerview Partners – Partner, founding Head of the Technology Group (2008-2022) • Investment banking and advisory firm UBS – Managing Director, Co-Head of Americas Technology Investment Banking (2006-2009) • Global investment bank Bear Stearns & Company – Managing Director, Co-Head of Communications Technology Investment Banking (2000-2006) • Specialized financial services company and investment bank Jefferies – Managing Director, Head of New York Investment Banking (1995-2000) • Investment banking and capital markets firm | | David Handler | | | Class I Director (Independent) Age: 59 Director Since: 1994 Board Chair Since: 2019 Education: • NYU Stern School of Business: BA, Marketing • NYU Stern School of Business: MBA, Finance | |
Introduction
| | KEY SKILLS AND EXPERTISE: • Industry Experience (Gaming, Hospitality, Media): Acquired over Ms. Black-Gupta's more than 25- year executive career in global marketing roles, including as Global Chief Marketing Officer at Equinox. In this role, she led the enterprise-wide marketing strategy for over 300 equinox sport clubs and a pipeline of 10 lifestyle Equinox hotels with a focus on customer experience and digital engagement that successfully elevated the lifestyle brand, enhanced client loyalty and expanded omnichannel growth opportunities. • Sales & Marketing: Developed through her multiple roles focused on the development and execution of marketing strategies and digital media engagement tactics for global consumer brands. This included overseeing a digital marketing strategy for the $1B Bobbi Brown Cosmetics brand in over 150 countries, strategically positioning marketing for Procter and Gamble’s Gillette Venus and Oral B brands, and pioneering the beauty industry's first digital channel launch in support of Estée Lauder's Bobbi Brown brand, as well as her current role as Co-Founder of Ourself, where she is driving proprietary innovation in Bio-Technology for the fast growing direct-to-consumer and professional brand. • Strategic Planning / M&A: Obtained throughout numerous executive leadership roles, where Ms. Black-Gupta was responsible for strategy development and M&A initiatives, including at Estée Lauder, where she worked closely with the corporate development team to support the company's M&A strategy to fuel brand innovation and growth, and in her current role as Co-Founder and previously CEO of Ourself, where she oversaw go-to-market product and commercial strategy. EXPERIENCE: Ourself – Chief Executive Officer and Co-Founder (Co-Founder beginning 2021, CEO 2022-2024) • An innovative skincare biotech skincare brand Equinox Fitness Club and Hotel – Global Chief Marketing Officer (2017-2019) • Luxury fitness company Bobbi Brown Cosmetics – Senior Vice President of Global Marketing (2013-2017) • Global premium beauty brand Estée Lauder – Vice President Global Marketing Idea Bank (2008-2013) • A multinational cosmetics company Procter & Gamble – Global Marketing Director (2005-2007) • Global consumer goods corporation Various executive global marketing leadership roles for Gillette and Procter & Gamble – (1997-2005) | | Vimla Black-Gupta | | | Class I Director (Independent) Age: 54 Director Since: 2021 Committees: • Compensation • Nominating and Corporate Governance Education: • Duke University: BA • Northwestern University's Kellogg School of Management: MBA | |
Introduction
| | KEY SKILLS AND EXPERTISE: • Technology / Digital: Obtained through numerous executive leadership roles with consumer- oriented and digitally-enabled businesses with responsibilities for technological transformation efforts, including customer digital engagement and intelligence, application, and supply chain modernization. At Albertsons Companies (NYSE: ACI), he led the shift to exclusively cloud-based operations and is currently focused on accelerating business growth through the use of AI. In recognition of his contributions to advancing the use of technology in business, Mr. Dhanda was inducted into the CIO Hall of Fame. • Cybersecurity: Acquired through more than 15 years of service as Chief Information Officer with leading national retail and financial services companies, overseeing the security of IT architecture, application platforms and data, including in Mr. Dhanda’s current role with Albertsons Companies where he oversees the security and reliability of the payments platform that processes approximately $78 billion in sales. • Strategic Planning / M&A: Gained by serving in strategic planning roles at JP Morgan (NYSE: JPM) and executive roles with PNC Financial Services Group (NYSE: PNC), which focused on leading business development in high potential markets and enterprise-wide transformation strategies. He played critical roles in leading business and technology functions across multiple mergers and acquisitions by PNC. At Albertsons Companies, Mr. Dhanda oversaw the post-acquisition integration of the company and Safeway to a common platform and is currently leading the Integration planning for Albertsons for their planned merger with Kroger. EXPERIENCE: Albertsons Companies, Inc. (NYSE: ACI) – EVP and Chief Technology and Transformation Officer (Since 2023), EVP and Chief Information Officer (2015-2022) • Leading Fortune 100 grocery store chain Giant Eagle, Inc. – SVP, Digital Commerce and Chief Information Officer (2013-2015) • American supermarket chain The PNC Financial Services Group, Inc. (NYSE: PNC) – EVP and CIO (2008-2013), SVP and CIO, PNC Bank (2005-2008), SVP and Manager, Eastern Markets (1997-1999), Small Business Lending (1995-1997) • Diversified U.S.-based financial services institution JP Morgan Chase & Co. (NYSE: JPM) (Formerly JP Morgan & Co.) – SVP, Marketing and Business Planning Manager, Consumer Bank (1992-1995), Strategic Planning Officer, Regional Banking Operations Division (1989-1992), Management Consultant, Retail Operations and Technology (1988-1989) • Leading global financial services firm Citigroup, Inc. (NYSE: C) – Management Consultant (1986-1987) • Diversified financial services holding company | | Anuj Dhanda | | | Class I Director (Independent) Age: 61 Director Since: 2024 Committees: • Compliance Education: • University of Delhi: BA, Commerce • Rutgers University: MBA • Rutgers University: PhD, Finance Public Board Directorships: • BlueLinx Holdings (NYSE: BXC) (2023-Present) | |
Introduction
| Board Recommendation | | OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH CLASS I DIRECTOR NOMINEE: (I) David Handler; (II) Vimla Black-Gupta; and (III) Anuj Dhanda |
Introduction
| | KEY SKILLS AND EXPERTISE: • Industry Experience (Gaming, Hospitality, Media) and Government Affairs: Gained over Ms. Kaplowitz's more than 35-year career in the media industry, including her current role as Chief Executive Officer of 4A's, a trade association for advertising agencies that serves corporate members representing more than 85% of total U.S. advertising spend. In her current role, Ms. Kaplowitz works closely with members of the U.S. Congress to address critical issues pertaining to the media and digital media industry and the industry's evolving regulatory landscape. • Sales & Marketing: Acquired through her extensive career in marketing and communications, including executive leadership roles focused on identifying strategic growth areas to build consumer loyalty and strengthen brand equity. During Ms. Kaplowitz's nearly 25 years at media communication agencies, she led marketing campaigns for global high-profile brands across personal care, restaurant and financial services sectors. Ms. Kaplowitz has successfully guided clients through impacts of evolving technologies on consumer behavior, including risks and opportunities associated with digital consumer experiences, omnichannel growth strategies and data privacy risks. • Sustainability: Obtained through her leadership roles in advertising, marketing and media that required understanding of the evolving impact of climate risks on various industries and evolving consumer preferences. Ms. Kaplowitz's work has included advising global companies on the FTC's updated Green Guides on the use of environmental marketing claims, as well as the shifting regulatory and legislative landscape across state jurisdictions. EXPERIENCE: American Association of Advertising Agencies (4A's) – President and CEO (2017-Present) • Trade association serving more than 600 member agencies throughout the U.S. MEC Global (now Wavemaker Global) – CEO of North America (2011-2017) • Global media agency. Mediavest (now Spark Foundry) – EVP, Managing Director (2006-2011), SVP, Group Media Director (1999-2002) • A full-service media agency that provides marketing, content and technology solutions. Ammirati Puris Lintas – SVP, Group Media Director (1996-1999) • Advertising Agency | | Marla Kaplowitz | | | Class III Director (Independent) Age: 58 Director Since: 2020 Committees: • Nominating and Corporate Governance, Chair • Compensation Education: • UC Santa Barbara: BA, Sociology | |
Introduction
| | KEY SKILLS AND EXPERTISE: • Risk Management: Acquired during Ms. Scaccetti’s almost 45-year career as a practicing CPA, including at Drucker & Scaccetti, which she co-founded, and at Laventhol & Horwath, where she was the first woman to be named tax partner. In these roles, she provided counsel to U.S. and international companies on a wide range of complex tax planning, corporate transactions and business strategy matters. • Cybersecurity: Developed through her leadership role at Drucker & Scaccetti, where she oversaw the creation and continued evolution of information security systems and controls to safeguard the firm’s information infrastructure. Ms. Scaccetti’s expertise was further enhanced through her role as the chair of the audit committee at multiple public companies for over three decades and her service on the board of a $3B+ in revenue non-profit institution where cybersecurity is paramount to protecting personal health records and information; annual CPA continuing education requirements; and cybersecurity oversight and cybersecurity training from the National Association of Corporate Directors. • HR / Talent Management / DE&I: Gained through her experience working with corporate clients on succession planning, compensation and organizational development of key staff, as well as her extensive experience managing people and developing talent as a partner, principal and CEO for accounting and business advisory firms. EXPERIENCE: Armanino LLP – Of Counsel (2022-Present) • The successor company of Drucker & Scaccetti, P.C. Drucker & Scaccetti, P.C. – Chief Executive Officer (2013-2021), Partner (1990-2021) • A public accounting and business advisory firm Laventhol & Horwath – Partner (1987-1990), Staff/Manager (1977-1987) • An international accounting firm | | Jane Scaccetti | | | Class III Director (Independent) Age: 70 Director Since: 2015 Committees: • Audit, Chair • Compliance Education: • Temple University's Fox School of Business: BBA • Villanova Law School: MA, Taxation Public Board Directorships: • Myers Industries, Inc (2016-2021) • The Pep Boys (2002-2016) | |
Introduction
| | KEY SKILLS AND EXPERTISE: • Industry Experience (Gaming, Hospitality, Media): Gained from Mr. Snowden’s more than 25- year successful career in the highly regulated and rapidly evolving gaming and sports betting industry, and hospitality and entertainment sectors. Prior to being appointed as CEO in 2020, he served as PENN’s President and Chief Operating Officer and as SVP of Regional Operations. Mr. Snowden previously spent 12 years with Caesars Entertainment, where he acquired significant gaming industry management experience across several regional and destination markets, including as Senior Vice President and General Manager of both Caesar’s and Harrah’s Resorts in Atlantic City. • HR / Talent Management / DE&I: Acquired through his executive leadership career overseeing talent strategies at large corporations, including talent integration initiatives following strategic transactions. At PENN, Mr. Snowden oversaw the launch of the expansive DE&I strategy and evolution of talent initiatives to support the growth of the Interactive segment. • Technology / Digital: Since being named CEO, Mr. Snowden has led PENN’s expansion into sports media, entertainment and technology, including the Company’s acquisition of theScore and transformative strategic alliance with ESPN. His deep industry knowledge and digital transformation expertise provide unique perspectives on the Company’s strategic navigation of its broader omnichannel expansion. EXPERIENCE: PENN Entertainment • CEO and President (2020-Present) • President and Chief Operating Officer (2017-2019) • Chief Operating Officer (2014-2017) • Senior Vice President of Regional Operations (2011-2014) Caesars and Harrah's Resorts Atlantic City – Senior Vice President and General Manager (2010-2011) • Casino resort and hotel Caesars Entertainment Corporation – Various leadership positions in St. Louis, San Diego and Las Vegas (1998-2010) • Leading global gaming and hospitality resort chain | | Jay Snowden | | | Class III Director (Executive Director) Age: 48 Education: • Harvard University: BA • Washington University in St. Louis: MBA | |
Introduction
| | KEY SKILLS AND EXPERTISE: • Financial (Capital Markets, Accounting & Tax): Acquired over Ms. Shattuck Kohn’s 35-year career in investment banking, capital markets and project finance, where she advised companies on M&A and capital allocation strategies. Additionally, as president of an investment banking firm she co-founded, Shattuck Hammond Partners, Ms. Shattuck Kohn was responsible for overseeing the company’s financial reporting and compliance processes. Ms. Shattuck Kohn contributes this extensive financial expertise to the Board to evaluate potential acquisitions and financing opportunities. • Regulatory / Public Policy: During her extensive investment banking career, Ms. Shattuck Kohn specialized in navigating the highly regulated healthcare industry at both the state and federal government levels, obtaining regulatory approvals for multiple transactions across various jurisdictions. • Corporate Governance: Ms. Shattuck Kohn brings over 20 years of public company director experience, and currently serves as a director on the boards of Fluent (NASDAQ: FLNT), an advertising and marketing services company, and Emblem Health, one of the nation’s largest nonprofit health plans. She previously served as a director of Computer Task Group (NYSE: CTG), a division of Sunlife Financial Corporation. EXPERIENCE: Hammond Hanlon Camp LLC – Principal (2012-2018) • Strategic advisory and investment banking firm Shattuck Hammond Partners – Principal, Founder and President (1993-2012, when acquired by Morgan Keegan – Raymond James) • An investment banking firm Cain Brothers, Shattuck & Company – Principal and Co-Founder (1983-1993) • A healthcare financial advisory firm Goldman Sachs & Co. – Vice President and Manager of Healthcare Investment Banking Group (1976-1983) • Multinational investment bank and financial services company | | Barbara Shattuck Kohn | | | Class II Director (Independent) Age: 73 Director Since: 2004 Committees: • Compensation, Chair • Audit Education: • Connecticut College: BA, Environmental Studies Public Board Directorships: • Fluent, Inc. (2019-Present) | |
Introduction
| | KEY SKILLS AND EXPERTISE: • Cybersecurity: Developed through his over 40 years of service in executive leadership and independent director roles at public companies, which included both oversight and execution of information security and customer data privacy programs. • Government Affairs: Acquired through holding a number of government leadership positions, including Chair of the Pennsylvania Stimulus Oversight Commission, Chief Accountability Officer for the Commonwealth of Pennsylvania, Chair of the Federal Reserve Bank of Philadelphia and various roles in the White House. Additionally, as CEO of a public specialty chemical company, Mr. Naples led regulatory compliance efforts and was responsible for maintaining strong relationships with government agencies. • Sustainability: Obtained extensive expertise while serving in the White House as Special Assistant to the Head of the Federal Energy Administration and while serving as Executive Director of a Presidential Task Force on energy problems. As a CEO of several public companies and during his most recent service on the board of Glatfelter Corp., a sustainably engineered products company, Mr. Naples developed expertise in establishment, execution and oversight of sustainability practices and processes to strengthen customer access and market position, and preparedness for evolving sustainability requirements. EXPERIENCE: Commonwealth of Pennsylvania – Chief Accountability Officer (2009-2011) Quaker Chemical Corporation (NYSE: KWR) – Chief Executive Officer and Chairman (1995-2008) • Public specialty chemical company serving the metalworking and manufacturing industries worldwide Federal Reserve Bank of Philadelphia – Board Chair (2001-2005) Hunt Manufacturing Company – Chief Executive Officer and Board Chair (1981-1995) • Consumer and commercial product business with retail distribution Presidential Task Force on Energy – Executive Director (1975-1976) White House – White House Fellow (1974-1975), serving as: • Assistant to the Counselor to the President for Economic Affairs • Special Assistant to the Head of the Federal Energy Administration U.S. Army – Captain (1967-1971) | | Ronald Naples | | | Class II Director (Independent) Age: 78 Director Since: 2013 Committees: • Compliance • Nominating and Corporate Governance Education: • U.S. Military Academy at West Point: BS • Fletcher School at Tufts University: MA • Harvard Business School: MBA Public Board Directorships: • Glatfelter Corp. (2000-2021) • Quaker Chemical Corp. (1997-2009) • Hunt Manufacturing Company (1981-1995) | |
Introduction
| | KEY SKILLS AND EXPERTISE: • Financial (Capital Markets, Accounting and Tax): Acquired through more than 40 years of service in the public accounting industry as a licensed CPA advising public and private companies, including in the gaming industry. Mr. Reibstein developed significant familiarity with PENN’s growth drivers and capital allocation strategies from serving as the Company’s Chief Financial Officer between 2013 and 2016. In that role, he oversaw PENN’s capital restructuring, obtained financing for new property development and gained insights into every aspect of the Company’s operations. • Regulatory / Public Policy: Gained through his first-hand experience working with state gaming regulators while serving as CFO of PENN. This included working with regulators throughout the licensing application process and overseeing the Company’s compliance program across multiple jurisdictions. • Corporate Governance: Developed through Mr. Reibstein’s service as Independent Board Chair at Vishay Precision Group (NYSE: VPG). His previous roles on Vishay’s Board included Chair of the Audit Committee and a member of both its Compensation and Nominating and Corporate Governance Committees, which provided him with extensive experience across all key governance aspects of a public company. EXPERIENCE: PENN Entertainment – Executive Advisor (2017), Senior Vice President, Chief Financial Officer (2013-2016), Treasurer (2014-2016) CBIZ, Inc. (NYSE: CBZ) – Member of the senior management team holding a number of positions, including, most recently: Executive Managing Director and Head of New York Office (2004-2013) • Professional services company specializing in accounting, tax, insurance and human resources advisory BDO Seidman – Regional Managing Partner (1998-2003), Partner (1993-2003) • National accounting services firm | | Saul Reibstein | | | Class II Director (Independent) Age: 76 Director Since: 2018 (and previously a director from 2011-2014) Committees: • Audit • Compensation Education: • Fox School of Business at Temple University: BBA, Accounting and Finance Public Board Directorships: • Vishay Precision Group, Inc. (2010-Present) | |
Compensation Committee
| • | Recommending director compensation to the Board; and |
Change of Independent Registered Public Accounting Firm
| DIRECTOR COMPENSATION |
Non-Employee Director Compensation
Non-Employee Director Compensation The Company pays fees to each director who is not an employee of the Company. During the year ended December 31, 2023, the annual compensation for each non-employee director consisted of an annual retainer of $50,000, plus an additional $10,000 for service on each of the Audit Committee, the Compensation Committee and the Compliance Committee, as applicable, and $5,000 for service on the Nominating and Corporate Governance Committee. The Chair of the Audit Committee receives an additional $15,000 annual retainer, and the Chairs of the Compensation Committee and the Nominating and Corporate Governance Committee each receive a supplemental $10,000 annual retainer. For 2023, each non-employee director had the opportunity to elect to receive his or her annual retainer in the form of either cash or shares of restricted stock, with forfeiture restrictions for restricted stock lapsing on the first anniversary of the date of grant. In 2023, each non-employee director other than the Board Chair received a grant of cash settled restricted stock units or restricted stock at his or her election with a grant value of $250,000, and the Board Chair received a cash settled grant of restricted stock units or restricted stock at his election with a grant value of $375,000. Each award of cash settled restricted stock units or shares of restricted stock vests on the first anniversary of the date of grant. Director Stock Ownership Guidelines. We believe that equity ownership supports the alignment of director interests with those of the Company’s shareholders. To this end, the Compensation Committee has established stock ownership guidelines which provide that each non-employee director should own shares with a value equal to at least five times the current annual cash retainer amount, within five years from the date they joined the Board. All of our non-employee directors either currently meet our director stock ownership guidelines or we expect that they will meet the guidelines within five years of becoming a director. The Company’s Legal Department monitors compliance with these guidelines on an annual basis and apprises the Compensation Committee no less than annually regarding the same.
2023 Director Compensation Table
2023 Director Compensation Table The following table sets forth information with respect to all compensation awarded to the Company’s non-employee directors for 2023.
2023 Director Compensation Table
| NAME | FEES EARNED OR PAID IN CASH ($) (3) | STOCK AWARDS ($) (1) (2) | TOTAL ($) | | Vimla Black-Gupta | 70,000 | 249,995 | 319,995 | | David Handler | 50,000 | 375,007 | 425,007 | | John Jacquemin(5) | 55,000 | 249,995 | 304,995 | | Marla Kaplowitz | 75,000 | 249,995 | 324,995 | | Barbara Shattuck Kohn | 80,000 | 249,995 | 329,995 | | Ronald Naples | 65,000 | 249,995 | 314,995 | | Saul Reibstein | 70,000 | 249,995 | 319,995 | | Jane Scaccetti | 85,000 | 249,995 | 334,995 | | Anuj Dhanda(4) | — | — | — |
2023 Director Compensation Table
| (1) Reflects aggregate grant date fair value of stock awards granted in 2023, which does not include any cash fees that directors voluntarily elected to receive in shares of restricted stock as detailed in footnote (3) below. The amounts listed are calculated based on the closing price on the day prior to grant date computed in accordance with FASB ASC Topic 718. |
2023 Director Compensation Table
| (2) As of December 31, 2023, the following stock awards were outstanding: (i) for Ms. Black-Gupta 10,933 shares of restricted stock; (ii) for Mr. Handler, 14,520 shares of restricted stock; (iii) for Mr. Jacquemin, 10,420 shares of restricted stock; (iv) for Ms. Kaplowitz, 8,541 shares of restricted stock; (v) for Ms. Shattuck Kohn, 8,541 shares of restricted stock; (vi) for Mr. Naples, 8,541 cash settled restricted stock units and 2,221 shares of restricted stock; (vii) for Mr. Reibstein, 8,541 cash settled restricted stock units and 2,392 shares of restricted stock; and (viii) for Ms. Scaccetti 11,445 shares of restricted stock. |
2023 Director Compensation Table
| (3) As described above, in 2023 each non-employee director could elect to receive his or her retainer fees in cash or shares of restricted stock, which vest on the first anniversary of the date of grant. This column reflects director compensation eligible to be paid in cash, which consists of the annual Board retainer and any applicable fees for committee members and committee chairs. Each of the following directors elected to receive restricted stock in lieu of such amounts eligible to be paid in cash, in the following amounts: Mr. Handler — $50,000; Ms. Scaccetti — $85,000; Mr. Jacquemin — $55,000; Mr. Naples — $65,000; Mr. Reibstein — $70,000; and Ms. Black-Gupta — $70,000. |
2023 Director Compensation Table
| (4) Mr. Dhanda was appointed to the Board in 2024, and therefore was not paid any compensation in 2023. |
2023 Director Compensation Table
| (5) Mr. Jacquemin is not standing for re-election at the 2024 Annual Meeting. |
2023 Director Compensation Table
| EXECUTIVE OFFICERS |
2023 Director Compensation Table
Set forth below is certain information regarding each of our current executive officers, other than Mr. Snowden, whose biographical information is presented under “Proposal 1: Election of Class I Directors—Continuing Directors.”
2023 Director Compensation Table
| NAME | AGE (1) | POSITION | | Jay Snowden | 48 | Chief Executive Officer, President and Director | | Felicia Hendrix | 55 | Executive Vice President, Chief Financial Officer | | Todd George | 54 | Executive Vice President, Operations | | Chris Rogers | 48 | Executive Vice President, Chief Strategy Officer and Secretary |
2023 Director Compensation Table
| (1) Ages as of our 2024 Annual Meeting. |
2023 Director Compensation Table
Felicia Hendrix has served as our Chief Financial Officer and Executive Vice President since March 2021, and Principal Accounting Officer since February 25, 2024. Ms. Hendrix oversees Accounting, Finance, Internal Audit, and Procurement. Prior to joining PENN, Ms. Hendrix spent 25 years on Wall Street and was most recently a Managing Director and Equity Research Analyst at Barclays, covering the gaming, lodging and leisure industries. Before joining Barclays, Ms. Hendrix was a Managing Director at Lehman Brothers. Ms. Hendrix holds a bachelor's degree from the University of Virginia and an MBA from the Darden School of Business at the University of Virginia. Todd George has served as our Executive Vice President, Operations since January 2020. Mr. George oversees PENN's Regional Operations, Interactive, Marketing and Information Technology, as well as Design and Construction. Mr. George plays a critical role in execution of our omnichannel strategy, including our efforts to use our expanded digital database to drive increased visitation to our casinos. Prior to his current role, Mr. George served as Vice President and General Manager of Hollywood Casino in Lawrenceburg, Indiana, and Hollywood Casino St. Louis. In 2017, Mr. George was promoted to Senior Vice President, Regional Operations, overseeing nine properties in PENN's Midwest Region. Prior to PENN, Mr. George spent 12 years in various management positions at Pinnacle Entertainment, including leading the development and launch of Pinnacle's two St. Louis properties, River City Casino and Lumiere Place. Mr. George holds a bachelor's degree from LeMoyne College and an MBA from Villanova University. Chris Rogers has served as our Executive Vice President, Chief Strategy Officer since January 2020. In 2023, Mr. Rogers was appointed as Secretary and also assumed responsibility for overseeing the Company’s legal and compliance functions. In his capacity as Chief Strategy Officer, Mr. Rogers leads the team in developing and pursuing PENN's strategic growth initiatives. Over his past ten years with PENN, Mr. Rogers has served as Senior Vice President, Corporate Development, and Vice President, Deputy General Counsel. Prior to joining PENN, Mr. Rogers was a corporate attorney at the Dallas-based law firm Vinson & Elkins and the Boston-based law firm Ropes & Gray, as well as a CPA for PricewaterhouseCoopers and Arthur Andersen. Mr. Rogers holds a Bachelor of Business Administration from the University of Oklahoma's Price College of Business and a J.D. from Harvard Law School.
2023 Director Compensation Table
| SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT |
2023 Director Compensation Table
The following table sets forth certain information regarding the beneficial ownership of the Company’s common stock, as of April 5, 2024. This table lists: (i) each person known to us to beneficially own more than 5% of any class of the outstanding voting securities of the Company, (ii) each of our directors, (iii) each of our named executive officers listed in the table entitled “2023 Summary Compensation Table” below, and (iv) all of our current directors and executive officers as a group. Beneficial ownership of shares is determined under rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power. Except as noted by footnote, and subject to community property laws where applicable, we believe based on the information provided to us that the persons and entities named in the table below have sole voting and investment power with respect to all shares of our common stock shown as beneficially owned by them. Unless otherwise noted below, the address of the persons listed in the table is c/o PENN Entertainment, Inc., 825 Berkshire Blvd., Wyomissing, PA 19610. The percentages shown in this table are calculated based on 151,867,302 shares of our common stock outstanding as of April 5, 2024.
2023 Director Compensation Table
| 5% SHAREHOLDERS, OFFICERS AND DIRECTORS | NUMBER OF SHARES BENEFICIALLY OWNED | PERCENTAGE OF COMMON STOCK | | Beneficial owners of 5% or more of our common stock: | | | | FMR LLC (1) | 15,824,941 | 10.42% | | The Vanguard Group, Inc. (4) | 14,729,920 | 9.70% | | HG Vora Capital Management (2) | 14,500,000 | 9.55% | | BlackRock, Inc. (3) | 13,009,868 | 8.57% | | Executive Officers and Directors: | | | | Vimla Black-Gupta | 32,987 | 0.02% | | Anuj Dhanda | 0 | 0.00% | | David Handler | 223,450 | 0.15% | | John Jacquemin (8) | 120,842 | 0.08% | | Marla Kaplowitz | 26,203 | 0.02% | | Ronald Naples | 20,587 | 0.01% | | Saul Reibstein (6) | 37,055 | 0.02% | | Jane Scaccetti | 79,324 | 0.05% | | Barbara Shattuck Kohn (7) | 28,541 | 0.02% | | Jay Snowden (5) | 2,314,598 | 1.52% | | Felicia Hendrix (5) | 95,231 | 0.06% | | Todd George (5) | 218,640 | 0.14% | | Chris Rogers (5) | 132,463 | 0.09% | | All current executive officers and directors as a group (13 persons) (6) | 3,329,921 | 2.19% |
2023 Director Compensation Table
*Less than 1%.
2023 Director Compensation Table
| (1) Based on its Schedule 13G/A filed with the SEC on February 9, 2024, the number of shares in the table includes shares beneficially owned as of December 31, 2023, by FMR LLC and Abigail P. Johnson. FMR LLC has sole voting power over 15,103,485 shares, shared voting power over 0 shares, sole dispositive power over 15,824,941 shares and shared dispositive power over 0 shares. Abigail P. Johnson has sole voting power over 0 shares, shared voting power over 0 shares, sole dispositive power over 15,824,941 shares and shared dispositive power over 0 shares. The address of the entity and individual listed above is 245 Summer Street, Boston, Massachusetts 02210. |
2023 Director Compensation Table
| (2) Based on its Schedule 13D/A filed with the SEC on January 16, 2024, the number of shares in the table includes share beneficially owned as of January 12, 2024, by HG Vora Capital Management LLC. HG Vora Capital Management LLC has sole voting power over 0 shares, shared voting power over 14,500,000 shares, sole dispositive power over 0 shares and shared dispositive power over 14,500,000 shares. The address of HG Vora Capital Management LLC is 330 Madison Avenue, 21st Floor, New York, NY 10017. |
2023 Director Compensation Table
| (3) Based on its Schedule 13G/A filed with the SEC on January 25, 2024, the number of shares in the table includes shares beneficially owned as of December 31, 2023, by BlackRock, Inc. and its listed affiliates. BlackRock, Inc. has sole voting power over 12,365,398 shares, shared voting power over 0 shares, sole dispositive power over 13,009,868 shares and shared dispositive power over 0 shares. The address of BlackRock, Inc. is 50 Hudson Yards, New York, New York 10001. |
2023 Director Compensation Table
| (4) Based on its Schedule 13G/A filed with the SEC on February 13, 2024, the number of shares in the table includes shares beneficially owned as of December 29, 2023, by The Vanguard Group, Inc. and its listed affiliates. The Vanguard Group, Inc. has sole voting power over 0 shares, shared voting power over 53,742 shares, sole dispositive power over 14,531,892 shares and shared dispositive power over 198,028 shares. The address of Vanguard Group, Inc. is 100 Vanguard Blvd., Malvern, Pennsylvania 19355. |
2023 Director Compensation Table
| (5) The number of shares in the table includes shares that may be acquired upon the exercise of outstanding options or options that may be exercised within 60 days from the Record Date, as follows: Mr. Snowden, 1,515,753, Ms. Hendrix, 42,792; Mr. George, 152,315, Mr. Rogers, 87,812, and all current executive officers and directors as a group, 1,798,672 shares. |
2023 Director Compensation Table
| (6) The number of shares in the table excludes 150 shares owned by Mr. Reibstein’s spouse, as to which shares Mr. Reibstein disclaims beneficial ownership. |
2023 Director Compensation Table
| (7) The number of shares in the table excludes 1,750 shares owned by the estate of Ms. Shattuck Kohn’s late spouse, as to which shares Ms. Shattuck Kohn disclaims beneficial ownership. |
2023 Director Compensation Table
| (8) Mr. Jacquemin is not standing for re-election at the 2024 Annual Meeting. |
2023 Director Compensation Table
| COMPENSATION COMMITTEE REPORT |
Alignment of Pay with Performance
Note: the above pie charts reflect the target values of new incentives awarded in 2023. These values vary from the grant values reflected in the Summary Compensation Table and the Grants of Plan-Based Awards Table, below, because the values included in those tables reflect portions of performance-based equity awards issued in 2021, 2022, and 2023 and associated with the 2023 performance period, in accordance with SEC disclosure rules. Because the performance targets for the 2021, 2022, and 2023 performance-based equity awards were set annually for 33% of each year’s overall targeted award, only the 33% portion of each year’s overall targeted performance-based equity award could be included in the proxy tables for the year in which the goals were established. In contrast, the above pie charts reflect 100% of the target value of the performance-based equity awarded in 2023, and none of the value associated with performance-based equity awards originally awarded in 2021 and 2022. Annual total target opportunities adjusted to be closer to the peer median to maintain the competitiveness of our compensation program. Consistent with our pay for performance approach, the increase in target opportunity for our CEO in 2023 was delivered exclusively in the form of long-term equity incentives to foster a stronger alignment with the interests of our stockholders. Following these adjustments, the rate of our regular total target opportunities for our CEO and other NEOs remained positioned below the peer group median. Incentive program payouts are aligned with performance. Our short- and long-term incentive payouts of 99.1% and 108.1% of the targeted levels respectively, were aligned with our robust 2023 financial and operational performance results, which were achieved despite ongoing macroeconomic headwinds and volatility in the retail and digital gaming spaces. Our leadership team remained focused on executing our omnichannel, tech-forward strategy that drove significant new user database growth, delivered on our property level margins goals and deepened our customer engagement across all product channels. These results reflect the momentum driven by our management team’s dedication to our highly differentiated growth strategy, one that positions the Company for successful long-term value creation in 2024 and beyond. CEO realizable compensation for 2023 was 64% of target compensation levels, reflecting the alignment of our executive pay opportunities with company performance. As of the record date of this filing, stock options that represented 50% of the long-term incentive opportunities for our executives in 2021, 2022 and 2023 remain underwater and have zero intrinsic value, and likewise the 2021 CEO Supplemental Award is also underwater with no realizable value, which underscores the long-term alignment of our compensation program outcomes with our shareholders.
2023 Target and Realizable Executive Pay Outcomes
2023 Target and Realizable Executive Pay Outcomes Target Compensation: 2023 base salary earned, 2023 target annual incentive compensation and 2023 target value of the annual equity awards. Realizable Compensation Value: 2023 base salary earned, 2023 annual incentive earned, the value of 2023 performance-based equity issued and earned based on fiscal 2023 performance and valued at target for 2024 and 2025 tranches, and zero intrinsic value of Stock Options issued in 2023, in each case valued based on stock price of $26.02 as of December 29, 2023. 2024 Performance-Based Equity Awards to reflect a three-year performance period and predominantly financial metric structure. In response to feedback provided by shareholders in our engagement sessions since our 2023 Say-on-Pay voting, the Compensation Committee approved a three-year performance period for our 2024 performance-based equity program (which is settled in common stock) with vesting tied to financial metrics (70% weighting) and quantitative operational metrics (30% weighting). Our 2023 and 2022 performance-based equity award grants will serve as a bridge to the new program design, with vesting of two-thirds of the 2023 award and one-third of our 2022 award, for which targets were traditionally set at the start of each annual performance period, to be tied to a 2-year and 1-year performance period, respectively, with the same mix of financial metrics (70% weighting) and quantitative operational metrics (30% weighting) being used for the 2024 performance-based equity award grant.
Compensation Framework
| | COMPONENT | CEO | OTHER NEOS | KEY CHARACTERISTICS | 2023 PERFORMANCE METRICS | | FIXED PAY | Base Salary | | | • Fixed cash compensation designed to compensate executives for their day- to-day responsibilities based on the job responsibilities, individual performance, experience, expertise and qualifications | N/A | | VARIABLE PAY | SHORT-TERM INCENTIVE PROGRAM (“STIP”) | | | | | | | Short-Term Incentive Plan (“STIP”) | | | • Cash compensation tied to the achievement of pre-determined quantitative performance goals • Aligns a significant portion of target cash compensation to the achievement of near-term EBITDAR goals that support our long-term growth strategy | Adjusted EBITDAR | | | LONG-TERM INCENTIVE PROGRAM (“LTIP”)* | | | | | | | Performance- Based Equity (50% Weighting of Total LTIP) | | | • Equity incentive designed to motivate achievement of pre-set performance goals throughout a three-year performance period to drive long-term shareholder value • Performance metrics reflect key drivers of our long-term growth, including incentives to advance our omnichannel growth strategy, as well as to encourage progress on key sustainability initiatives • Settling in shares of our restricted stock to align interests of our executives with those of our shareholders, promote an ownership mentality, and motivate long-term shareholder value creation | Omnichannel • Loyalty Database Activations • Loyalty App Registrations • Retail to Online Registrations • Online to Retail Activations Interactive • iCasino Handle • Online Sportsbook Handle ESG/Sustainability • Key metrics that promote inclusive culture across our organization, encourage inclusive leadership and incentivize progress on making our operations more energy efficient | | | Stock Options (50% Weighting of Total LTIP) | | | • Equity incentives motivate executives to build long-term shareholder value • Award vests ratably over a four-year period to encourage long-term retention | Stock options only deliver value to executives to the degree our stock price appreciates after the grant date, strongly aligning executive interests with shareholder value creation and motivating sustained, long-term outperformance |
Compensation Framework
| * The performance-based equity weighting in the table above reflects the target values of new incentives awarded in 2023. These values vary somewhat from the grant values reflected in the Summary Compensation Table and the Grants of Plan-Based Awards Table, below, since the values in these tables include portions of performance-based equity grants that were part of performance-based equity awards originally made in 2021, 2022, and 2023. |
Impact of ESPN Strategic Alliance on 2023 Compensation Outcomes
| In determining the final payouts, the Compensation Committee approved adjustments to both short-and long-term incentive programs that it believed more reasonably represented full-year 2023 performance results achieved by our executive team, as follows: • STIP Adjustments: Interactive segment results for the period following our decision to launch ESPN BET were excluded from the calculation of Adjusted EBITDAR. The Compensation Committee determined that it was appropriate to calculate Adjusted EBITDAR by only accounting for Interactive segment results for the period from January through the end of June, prior to the Company’s decision to launch ESPN BET, and that doing so accurately reflected management’s strong performance in 2023, distinct from the unanticipated change in Interactive strategy. These adjustments resulted in an increase of executive STIP achievement from 78.1% to 99.1% of target, as set out in more detail in “2023 STIP Awards” below. Please see Appendix “A” for details on reconciliation of GAAP to non-GAAP financial measures. • LTIP Adjustments: The Compensation Committee exercised its discretion to reduce the achievement level for the 2023 performance-based equity awards for our executive team by excluding Interactive segment goals from the LTIP calculation entirely and including omnichannel results only for January to October 2023, the period prior to the launch of ESPN BET. By doing so, the Compensation Committee sought to limit any artificial inflation of the LTIP achievement resulting from the success of the ESPN BET launch. Through these discretionary reductions, the Compensation Committee lowered LTIP achievement from 141.4% to 108.1% of target, reducing performance-based equity awards to our executives by 33%, which the Compensation Committee believed to reflect management’s performance for the year more accurately than the unadjusted LTIP goals. |
Risk Assessment (cont.)
Risk Assessment (cont.) compensation is long-term incentives through a mix (which may vary from year to year and by level) of stock options and performance-based equity awards that we believe are important to help further align executives’ interests with those of our shareholders. Such grants are subject to long-term vesting schedules and the annual bonus and performance-based equity awards are subject to maximum payout limits. We believe that the focus on annual short-term incentive pay is balanced by our long-term incentive awards, which are granted annually, continually ensuring that executives’ incentive pay is aligned with our share price performance over multiple years. These cash and equity incentive awards, especially when combined with the compensation clawback policy described on page 67 of this Proxy Statement, appropriately balance payment for performance and alignment of executive compensation with shareholders without encouraging imprudent conduct or excessive risk-taking. Additionally, we have share ownership guidelines that require our executive officers to own a given multiple of their base salary in the form of our common stock, restricted stock or stock settled restricted stock units (ranging from six times for the CEO to three times for other named executive officers) to help ensure that the majority of executives compensation always has significant value tied to long-term stock price performance. Based on the foregoing, we believe that our compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company. We also believe that our incentive compensation arrangements provide incentives that do not encourage risk-taking beyond the Company’s ability to effectively identify and manage significant risks, are compatible with effective internal controls and are supported by the oversight of the Compensation Committee.
Executive Compensation Peer Group
Executive Compensation Peer Group The Compensation Committee reviews the total compensation package for each of the executive officers against data from a pre-selected peer group of companies, which are chosen based on data compiled by an independent compensation consultant. Consistent with the objectives of the Company’s executive compensation program, the Compensation Committee compares executive officer compensation against the median compensation opportunities of these peer companies to ensure that the Company is able to attract and retain highly qualified executive officers by providing a total compensation package that is competitive with Company peers. The Compensation Committee, with the assistance of its independent compensation consultant, reviews the Company’s peer group annually to determine whether any changes from the prior year’s group are warranted. For setting 2023 target compensation levels, the executive compensation peer group consisted of the companies identified below, as recommended by the Compensation Committee’s independent compensation consultant and approved by the Compensation Committee. The peer group remained the same as the peer group the Company used for setting 2022 target compensation levels, as follows:
Executive Compensation Peer Group
| COMPENSATION COMMITTEE PEER GROUP | | | Boyd Gaming Corporation | MGM Resorts International | | Caesars Entertainment, Inc. | Red Rock Resorts, Inc. | | DraftKings Inc. | Roku, Inc. | | Electronic Arts Inc. | Sirius XM Holdings, Inc. | | Las Vegas Sands Corp. | Wynn Resorts, Ltd. | | Lions Gate Entertainment Corporation | Zynga inc. |
Executive Compensation Peer Group
This executive compensation peer group is comprised of core gaming companies and online and digital entertainment companies, which reflects PENN’s evolving operational complexity and a greater emphasis on online and digital entertainment. These peer companies were selected because they met certain criteria based on similarity of their business, market capitalization and annual revenues, and the fact that they serve as competitors for PENN’s executive talent. The Compensation Committee reviewed the peer group in October 2022, and at that time the Company ranked at the 65th percentile of this group in annual revenue, at the 71st percentile in the number of employees, and at the 16th percentile in market capitalization.
Base Salary
Base Salary Base salary is the fixed element of an executive officer’s annual cash compensation and is intended to attract and retain highly qualified executives and to compensate them for expected day-to-day performance. The Compensation Committee reviews the base salary for each of our executive officers on an annual basis and considers the following factors in making its determinations: the executive officer’s position, responsibilities associated with that position, experience, expertise, knowledge and qualifications, individual contributions, market factors, the industry in which we operate and compete, recruitment and retention factors, the executive officer’s individual compensation history, salary levels of the other members of our executive team, the median salaries of similarly situated/comparable executives in our peer group, and our overall compensation philosophy. When establishing our named executive officers’ annual base salaries, the Compensation Committee references the peer group median salaries. Set forth in the table below are the 2022 and 2023 base salaries for each of our named executive officers, along with year-over- year percentage market-based pay increases that were designed to bring base salaries of our executives closer to the peer group median for the comparable executive roles and scope of responsibilities.
Annual Short-Term Incentive Plan (“STIP”)
Annual Short-Term Incentive Plan (“STIP”) Our executive officers are eligible to participate in the short-term cash incentive plan (STIP), which is intended to motivate the executive officers to achieve short-term company performance goals that are key to long-term Company success and strong share price performance. The STIP provides payout opportunities based on the achievement of pre-determined corporate performance objective(s), with actual STIP bonuses earned based on the achievement of such performance objective(s) each fiscal year. The Compensation Committee sets the range of STIP opportunity payable to each executive as a percentage of annual base salary, consistent with the incentive programs and practices used by the Company’s peer group. When establishing our named executive officers’ target STIP opportunities, the Compensation Committee references the peer group median target bonus levels. The 2023 target STIP opportunities for our named executive officers, as well as payout levels for threshold and maximum performance, remained unchanged from the prior year at 250% of base salary for our CEO and 100% of base salary for the other NEOs. No compensation is awarded to executives for below-threshold performance, except in instances where the Compensation Committee determines that an adjustment to the performance metric(s) is warranted. If corporate performance is between performance levels (i.e., between threshold and target, or between target and maximum), the actual amount of the award that is earned will be determined by linear interpolation using the two identified levels of performance. Annual STIP incentive opportunities are capped at the maximum bonus levels, equivalent to 150% of target for each executive, regardless of the extent to which performance exceeds the maximum performance level.
2023 STIP Awards
2023 STIP Awards The Compensation Committee approved Adjusted EBITDAR as the performance metric for the 2023 STIP because Adjusted EBITDAR is an objective and quantifiable measurement for the Company’s financial performance that balances an aggressive approach to executing on our highly differentiated strategy with a disciplined approach to spending to support our long-term growth priorities. It is also a common performance metric in the industry used by our investors to evaluate the Company’s performance relative to other industry peers. In order to determine the appropriate rigor of Adjusted EBITDAR as the metric for the 2023 STIP, the Compensation Committee reviewed the Company’s 2023 operating plan. Based on this analysis, in early 2023, the Compensation Committee approved “threshold,” “target” and “maximum” performance levels for the Adjusted EBITDAR goal. The target performance level for Adjusted EBITDAR represented an increase over last year’s target and was deemed by the Compensation Committee to be rigorous and reflect the Company’s internal business plan and overall macroeconomic outlook at the start of 2023. At that time, the Company’s transformative strategic alliance with ESPN was not anticipated and therefore was not reflected in the Company’s business forecast for the year. As described above, in August 2023, PENN entered into an exclusive U.S. online sports betting agreement with ESPN, forming a transformative strategic alliance. The success of our subsequent ESPN BET launch resulted in significant user growth, dramatically expanding our digital database and strengthening our foundation for future growth across our omnichannel ecosystem. The ESPN BET launch was more successful than anticipated and resulted in more new users than we forecasted. As a result, we incurred higher losses than expected, primarily related to promotional expenses associated with new user growth. When deliberating how to reflect the financial impact of this new strategic alliance with ESPN and the results of the ESPN BET launch on our 2023 performance, the Compensation Committee took a prudent and balanced approach to (i) eliminate the punitive short-term financial impact of the losses incurred to support the launch of ESPN BET from the STIP achievement, and (ii) remove the unanticipated positive impact of the Company’s change in Interactive strategy from the LTIP achievement, as described in more detail below. The Compensation Committee retains the discretion to adjust quantitative results to account for factors that were unforeseen at the time compensation targets were established, and therefore made adjustments that it believed were reasonable and balanced, to reflect the impact of the strategic alliance with ESPN. These adjustments ultimately resulted in STIP achievement that was more closely aligned with our operating performance for the year.
2023 STIP Awards
| For the reasons described above, and as detailed in “Impact of ESPN Strategic Alliance on 2023 Compensation Outcomes” on page 54, the Compensation Committee approved adjustments to target and achieved performance levels for Adjusted EBITDAR, which resulted in an increase in payout levels under our STIP to 99.1% of target, from the unadjusted achievement of 78.1% of target, as follows: • First, the performance target and actual results for Corporate Adjusted EBITDAR were adjusted from $1.923 billion to $1.915 billion, and from $1.513 billion to $1.897 billion, respectively, to remove Interactive results from both the performance target and actual results, resulting in an adjusted payout percentage of 99.6% of target; and • The Compensation Committee then used its discretion to reduce the overall STIP achievement by 50-basis points, from 99.6% to 99.1%, to reflect the Interactive segment’s performance from January to June, the period prior to the Company’s decision to enter into the strategic long-term alliance with ESPN. |
2023 STIP Awards (cont.)
2023 STIP Awards (cont.) Full detail on the adjusted target, threshold, maximum and actual performance levels for the 2023 STIP metric are set forth below:
2023 STIP Awards (cont.)
| 2023 STIP Performance Metric | Threshold (85% of Target) | Target (100% of Target) | Maximum (115% of Target) | Achievement ($) | Payout (% of Target) | | Corporate Adjusted EBITDAR | $1.647B | $1.938B | $2.229B | $1.513B | 78.1% | | Final Adjustment to Corporate Adjusted EBITDAR | $1.628B | $1.915B | $2.202B | $1.897B | 99.1% |
2023 STIP Awards (cont.)
During the first quarter of 2024, based on our Adjusted EBITDAR for 2023, the Compensation Committee approved the following STIP awards for the named executive officers (the Board approved the Chief Executive Officer’s STIP award following the Compensation Committee’s recommendation):
2023 STIP Awards (cont.)
| NAMED EXECUTIVE OFFICER | 2023 ANNUAL INCENTIVE OPPORTUNITY (% of Base Salary) | TARGET STIP OPPORTUNITY | ADJUSTED STIP PAYOUT LEVEL | ACTUAL 2023 STIP PAYOUT | | Jay Snowden | 250% | $4,500,000 | 99.1% | $4,365,000 | | Felicia Hendrix | 100% | $850,000 | 99.1% | $824,500 | | Todd George | 100% | $950,000 | 99.1% | $929,417 | | Chris Rogers | 100% | $725,000 | 99.1% | $703,250 |
Long-Term Incentive Program (“LTIP”)
Long-Term Incentive Program (“LTIP”) We maintain a long-term incentive program (LTIP) for our executive officers to encourage an ownership mindset and incentivize long-term value creation. The long-term incentives are delivered through a combination of time- and performance-based awards. Performance-based equity awards motivate progress toward our strategic and operational priorities that are critical for our ability to create long-term shareholder value. Both time- and performance-based awards are tied to our stock price value and vest over three- and four-year periods, respectively, to incentivize executives to drive sustained value creation by successfully executing a range of strategic initiatives that advance our long-term growth priorities. Each fiscal year, the Compensation Committee determines an aggregate target value for the time-based and performance-based portions of the annual LTIP award for each executive officer, which in 2023 were below (but generally within a competitive range of) the median target opportunities, and which were generally consistent with incentive program design prevalence among the Company’s peer group, as well as broader industry and market standards and best governance practices. Due to the transformational nature of our omnichannel growth strategy, at the beginning of 2023 the Compensation Committee determined that it was not feasible to forecast reliable three-year performance targets for the full 2023-2025 performance cycle. To maintain the rigor of the compensation program and effectively incentivize progress toward our strategic priorities, the Compensation Committee maintained the historical practice of setting annual performance targets for each year of the three- year performance cycle under the 2023 performance-based equity grant under the LTIP program. To foster alignment with our shareholders, any earned shares were subject to service-based vesting requirements through the end of the three-year performance cycle. For 2024, in response to the input of our shareholders in the shareholder engagement sessions following our 2023 Say-on-Pay voting and given our recent transformational alliance with ESPN, the Compensation Committee determined to update the design of our long-term performance program by introducing a three-year cumulative performance period and to allocate a 70% weighting to financial metrics, with the remaining 30% weighting allocated to strategic operational metrics. In light of the new design applicable to the 2024 performance-based equity awards, the Compensation Committee approved a cumulative two-year performance period for the 2024 – 2025 outstanding portion of the 2023 performance-based equity awards, instead of two one-year performance periods, and determined that this two-year performance period should utilize a performance metric structure that reflects a 70% allocation to financial performance measures and 30% allocation to strategic operational metrics. The third and final tranche of the 2022 performance-based equity awards will similarly be based on 2024 performance using this same 70% financial and 30% operational metric weighting, but with the remaining one-year performance period.
2023 LTIP Awards
2023 LTIP Awards Below is an overview of the long-term incentives as approved by the Compensation Committee for 2023 grant cycle:
2023 LTIP Awards
| EQUITY VEHICLE | PURPOSE | WEIGHTING FOR CEO AND OTHER NEOS | 2023 PERFORMANCE METRICS | | Performance- Based Equity Awards | Incentivize performance on key financial, strategic and operational metrics that drive success of the transformation strategy and our ability to create long-term value | | • 2023 Performance-Based Equity Award is split into two tranches: • Tranche 1: 1/3 of the target award value, with payout contingent upon strategic and operational metrics tied to omnichannel, interactive segment and ESG priorities, based on a one-year performance period for 2023. Any earned shares are subject to service-based vesting requirements through the end of the three-year performance period • Tranche 2: 2/3 of the target award value, with payout for the two-year performance period, covering 2024 and 2025, based on the new performance metrics structure of 70% allocation to financial performance measures and the remaining 30% weighting allocated to strategic operational metrics • Payouts range between 0-150% of target | | Stock Options | Incentivize creation of long-term shareholder value through successful execution of the growth priorities | | • Deliver value only if the Company’s stock price appreciates from the grant date • Vest and become exercisable at a rate of one-fourth per year over 4 years to support retention |
2023 LTIP Awards
The above pie charts reflect the target grant values of new incentives awarded in 2023. These values vary from the grant values reflected in the Summary Compensation Table and the Grants of Plan-Based Awards Table, below, because the values included in those tables include portions of performance-based equity awards that were part of performance-based equity awards originally made in 2021, 2022, and 2023, in accordance with SEC disclosure rules that do not allow for inclusion of target award values in the tables until all of the performance targets have been fully established. Because the performance targets for the 2021, 2022, and 2023 performance-based equity were set annually for 33% of each year’s overall targeted award, only the 33% portion of each year’s overall targeted performance-based equity award could be included in the proxy tables for the year in which the goals were established. As such, the performance-based equity award values reflected in this year’s tables include 33% of each of the 2021, 2022, and 2023 performance-based equity target values. In contrast, the above pie charts reflect 100% of the target value of the performance-based equity awarded in 2023, and none of the value associated with performance-based equity originally awarded in 2021 and 2022. The Compensation Committee approved the following 2023 LTIP award targets for the NEOs (the independent members of our Board approved our CEO’s LTIP award targets) that reflected market-based adjustments designed to maintain competitiveness of our executive compensation program and bring the total target opportunities for our NEOs closer to the median pay levels of our peer group.
2023 LTIP Awards
| NAMED EXECUTIVE OFFICER | 2023 TARGET LTIP AWARD VALUE | PERFORMANCE-BASED EQUITY (50% of Target LTIP Value) | STOCK OPTIONS (50% of Target LTIP Value) | | Jay Snowden | $11,130,000 | $5,565,000 | $5,565,000 | | Felicia Hendrix | $2,975,000 | $1,487,500 | $1,487,500 | | Todd George | $3,325,000 | $1,662,500 | $1,662,500 | | Chris Rogers | $1,740,000 | $870,000 | $870,000 |
2023 Performance-Based Equity Awards
2023 Performance-Based Equity Awards For fiscal 2023 performance-based equity awards, the Compensation Committee approved performance metrics that it believed were the best measures of our ability to create long-term shareholder value by incentivizing (i) closer integration between our brands to provide a seamless omnichannel experience for our customers, (ii) expansion of our market share, and (iii) progress toward our ESG priorities in support of long-term shareholder value creation.
2023 Performance-Based Equity Awards
| • | Omnichannel metrics (60%) focused on incentivizing growth of PENN Play database and retail and online cross-sell opportunities to generate a greater brand loyalty and spend-per-customer, which are critical elements of our omnichannel growth strategy to support revenue growth and drive profitability. The Compensation Committee set targets to align with our operating plan and projections for new customer growth and expectations around marketing and promotional spend for the year. The Committee considered the performance targets to be rigorous and requiring a significant level of effort to be achieved. |
2023 Performance-Based Equity Awards
| • | 2H Interactive metrics (30%) designed to incentivize growth of online sports betting and iCasino market share, which are key indicators of our future growth in the digital space. In light of the planned migration of the Barstool Sportsbook onto our proprietary technology stack in the second half of the year, the Compensation Committee set Interactive metrics based on performance for the second half of the year. This was done to both account for the unique operating environment during the pre-migration portion of the year, and to incentivize a seamless integration effort and minimize potential disruptions associated with a significant technological migration. |
2023 Performance-Based Equity Awards
| • | ESG metrics (10%) promote inclusive culture across our organization, encourage inclusive leadership and incentivize progress on making our operations more energy efficient. |
2023 Performance-Based Equity Awards
Note: As noted above and further detailed below, the Compensation Committee adjusted the weightings of these metrics following the Company’s strategic alliance with ESPN, announced in August 2023, as this strategic alliance was not anticipated at the start of the year when the Compensation Committee approved the design of 2023 Performance Awards.
Status of Outstanding Performance-Based Equity Awards
Status of Outstanding Performance-Based Equity Awards The Compensation Committee believes that the long-term incentive compensation awards granted to the named executive officers pursuant to the LTIP appropriately align our named executive officers’ focus with the achievement of the Company’s strategic objectives and with the long-term value return expectations of our shareholders. The following table shows the status of the Performance Awards granted since 2021, in each case measured as of December 31, 2023. Based on the performance results achieved in 2021, 2022 and 2023, performance-based equity awards issued in 2021 for the 2021- 2023 performance period were earned at 119.2% of target.
Performance-Based Equity Award Results
Performance-Based Equity Award Results Each Subsequent Year Represents 33.3% of the Target Grant Opportunity
Performance-Based Equity Award Results
| AWARD YEAR | METRICS | WEIGHTING(1) | ACTUAL PAYOUT % of Target | TOTAL EARNED SHARES FOR 2021 % of Target | TOTAL EARNED SHARES FOR 2022 % of Target | TOTAL EARNED SHARES FOR 2023 % of Target | TOTAL PAYOUT % of Target | | 2023 AWARD | Omnichannel | 86% | 103.5% | | | | | | | Interactive | n/a | n/a | | | 108.1% | N/A | | | ESG | 14% | 135.6% | | | | | | 2022 AWARD | Omnichannel | 50% | 141.6% | | 99.6% | 108.1% | N/A | | | iCasino Market Share | 30% | 0% | | | | | | | Ontario Launch | 10% | 141.8% | | | | | | | ESG | 10% | 146.5% | | | | | | 2021 AWARD | Adj. EBITDAR Margin | 50% | 150% | 150% | 99.6% | 108.1% | 119.2% | | | Online Platform Launch | 50% | 150% | | | | |
Performance-Based Equity Award Results
| (1) Weightings for 2023 Award reflect the impact of Compensation Committee discretionary adjustments to exclude Interactive results for the entire year and only include Omnichannel achievements from January 1 to October 31, 2023, the period prior to the launch of ESPN BET. |
Performance-Based Equity Award Results
Based on the 2023 performance results, the following shares of restricted stock or restricted stock units were earned and credited to our named executive officers under our 2021, 2022 and 2023 Performance Awards. Prior to 2022, the performance awards were granted in the form of restricted stock. In 2022, to better align with industry compensation trends, the Compensation Committee determined that performance awards would be settled in restricted stock units. Any earned portion of the 2021, 2022 and 2023 Performance Awards remains subject to forfeiture through the end of the full three-year service period. Such forfeiture restrictions lapse earlier in the event of termination of service due to death or disability, or a termination of service following a change in control of the Company. In addition, with respect to the 2021 and 2022 Performance Awards, such forfeiture restrictions will also lapse upon an involuntary termination of service or retirement.
Performance-Based Equity Award Results
| NAMED EXECUTIVE OFFICER | 2023 AWARD (First Tranche) | 2022 AWARD (Second Tranche) | 2021 AWARD (Third Tranche) | | Jay Snowden | 67,191 | 41,538 | 14,009 | | Felicia Hendrix | 17,799 | 6,464 | 2,698 | | Todd George | 19,893 | 7,236 | 3,009 | | Chris Rogers | 10,410 | 6,103 | 2,387 |
Stock Options
Stock Options Stock options represented 50% of the target annual long-term incentive opportunity awarded in 2023 and vest 25% per year over four years. Unvested options are forfeited unless the option holder remains in continuous employment with the Company through the applicable vesting dates (except as otherwise provided in the participant’s employment agreement in specific instances, such as terminations “without cause” or for “good reason” including following a “change in control”). As of the Record Date, in alignment with the experience of our shareholders over the last three-year period, all stock options issued to our named executive officers in 2021, 2022 and 2023 were under water.
Update on 2021 CEO Supplemental Award
| • | PHASE II - “Relative TSR Hurdle Award”: an equity-based award that, contingent upon achievement of at least one milestone under the Stock Price Hurdle Award (Phase I), provides an opportunity to earn additional shares if the Company’s five-year TSR measured at the end of 2026 and 2027 equals or exceeds the 75th percentile of the S&P 500 index. |
Other Compensation Program Elements and Policies
Other Compensation Program Elements and Policies Deferred Compensation. The Company does not maintain any defined benefit pension programs for its executives. The Company maintains an elective nonqualified deferred compensation plan (the “Deferred Compensation Plan”) for tax planning and retirement purposes for our executives. In 2023, the minimum annual deferrable amount was $3,000 and the maximum was 90% of the executive’s base annual salary and/or bonus. Deferral elections must be made before the beginning of the year in which compensation will be earned. The Company’s contributions under the plan in 2023 were equal to 50% of the participant’s deferral for the first 10% of the salary and/or bonus deferred, subject to a maximum annual Company contribution equal to 5% of the participant’s salary and/or bonus. All amounts credited to an executive’s account are invested, as directed by the executive, in commonly available mutual funds, and the Company does not guarantee any minimum returns. The plan is unfunded, and benefits are paid from the Company’s general assets; however, the Company currently contributes funds into a grantor trust on a monthly basis in respect of these deferred compensation obligations. The Company generally sets aside separately the amounts deferred by the executives and the matching contributions thereon and, to protect against excess liabilities, invests such amounts in the mutual funds notionally selected by each executive. This program is described in more detail beginning on page 72. The Compensation Committee believes that the Deferred Compensation Plan is necessary to attract and retain our executives and is consistent with competitive and industry practices. Benefits and Perquisites. We offer a set of benefits to all of our employees, including medical, dental and vision insurance, group life insurance, short- and long-term disability and a 401(k) with certain contributions matched by us in 2023. We believe that executives should be offered benefits and perquisites that are reasonable relative to the benefits provided to all employees and that are consistent with competitive and industry practices among the Company’s peer group. Consistent with these objectives, the Company also provides certain executive officers with selected supplemental benefits and perquisites, including matching contributions under the Company’s Deferred Compensation Plan and financial and tax planning services. In addition, Mr. Snowden is entitled to life insurance in the amount of three times his base salary. He is also entitled to use of Company aircraft, which is important in ensuring efficient travel to our gaming facilities that are located across a wide geographic area without regular commercial flight alternatives and which is generally consistent with other companies in our gaming peer group that permit their chief executive officers to use the company’s aircrafts for personal use and commuting. In determining the supplemental benefits and perquisites that our executive officers are entitled to receive, the Compensation Committee evaluates the benefits and perquisites given by companies in the Company’s core gaming peer group. The description and value of such supplemental benefits and perquisites in 2023 can be found in the “All Other Compensation” column of the Summary Compensation Table in this Proxy Statement. Hedging and Pledging Policy. We maintain policies prohibiting each of the Company’s directors and employees (including executive officers) from engaging in hedging transactions (such as short sales, puts and calls and other derivatives), and pledging Company shares as collateral for a loan or holding shares in a margin account. Compensation Clawback Policy. As a highly regulated, multi-jurisdictional gaming and racing company, the Company has maintained a long- standing commitment to ensure that its executive officers adhere to the highest professional and ethical standards. As part of this commitment, the Company adopted its Executive Incentive Compensation Recoupment Policy (“Clawback Policy”) in compliance with Section 10D of the Exchange Act and Nasdaq Rules, effective September 19, 2023. The Clawback Policy is administered by the Compensation Committee and enables the Company to recover from specified current and former executive officers certain incentive-based compensation in the event of an accounting restatement resulting from material noncompliance with any financial reporting requirements under the federal securities laws for the three most recent completed fiscal years. Such recovery will be made without regard to any individual knowledge or responsibility related to the accounting.
Other Compensation Program Elements and Policies (cont.)
The Chief Executive Officer is authorized to set ownership requirements for other members of the senior management team as appropriate. As with the director stock ownership guidelines, the value of a named executive officer’s stock ownership at any time will be based on the aggregate value of common stock, restricted stock and stock settled restricted stock units held by such named executive officer. Each named executive officer is required to achieve compliance with these guidelines within five years of assuming his or her current position. Once in compliance with the stock ownership guidelines associated with their position, each named executive officer will remain in compliance with these guidelines regardless of decreases in the trading price of our shares or changes to their base salary until attainment of a position requiring a higher threshold, in which case the five-year compliance period starts again. We anticipate that all of the named executive officers will comply with the applicable guidelines within the required time. Timing of Equity-Based Awards. The Company adopted an Equity Based Award Policy, under which, for regular annual stock option awards to executive officers, the grant date will be the second trading day of the calendar year. Performance-based awards are typically made during the first quarter of each year when the Compensation Committee approves the performance goals for the year. From time to time, annual grants may be made on a later date in the year as a result of the timing of the determination of the awards and terms or other factors, such as performance metrics for a given year. In 2023, the annual Performance Awards were approved by the Compensation Committee on February 28, 2023, for the NEOs (other than the Chief Executive Officer) and on March 8, 2023 at the regular meeting of the Board for the Chief Executive Officer. New hire equity-based awards granted outside of the regular annual pay program are made on the first trading day of the quarter following the award approval, and ad hoc equity-based awards are generally granted on the fifth business day following the date upon which the CEO approves such awards. All equity-based grants, whether granted on the second trading day of the calendar year or later in the year, are priced in accordance with the terms of the applicable equity compensation plans or performance-based equity programs, which require, among other things, that the exercise price of all stock options be established by reference to the closing price on the trading day immediately prior to the date of grant.
2023 Summary Compensation Table
2023 Summary Compensation Table This Summary Compensation Table summarizes the total compensation paid or earned by each of our named executive officers for the years ended December 31, 2023, 2022 and, 2021, respectively.
2023 Summary Compensation Table
| EXECUTIVE NAME AND PRINCIPAL POSITION | YEAR | SALARY ($) | BONUS ($) | STOCK AWARDS ($) (a) | OPTION AWARDS ($) (a) | NON-EQUITY INCENTIVE PLAN COMPENSATION ($) (b) | ALL OTHER COMPENSATION ($) (c) | TOTAL ($) | | Jay Snowden Chief Executive Officer and President | 2023 | 1,800,000 | — | 3,388,480 | 5,564,999 | 4,365,000 | 423,826 | 15,542,305 | | | 2022 | 1,800,000 | — | 2,146,326 | 4,814,999 | 4,696,343 | 617,946 | 14,075,614 | | | 2021 | 1,786,154 | — | 53,054,562 | 4,050,022 | 6,750,000 | 246,476 | 65,887,214 | | Felicia Hendrix Executive Vice President, Chief Financial Officer | 2023 | 844,808 | — | 751,055 | 1,487,504 | 824,500 | 100,150 | 4,008,017 | | | 2022 | 712,500 | — | 405,381 | 857,987 | 746,197 | 91,433 | 2,813,498 | | | 2021 | 537,500 | 375,000 | 518,491 | 779,989 | 975,000 | 25,000 | 3,210,980 | | Todd George Executive Vice President, Operations | 2023 | 948,077 | — | 839,580 | 1,662,504 | 929,417 | 100,196 | 4,479,774 | | | 2022 | 854,962 | — | 914,511 | 960,475 | 923,853 | 108,325 | 3,762,126 | | | 2021 | 722,404 | — | 1,589,576 | 870,014 | 1,087,500 | 55,920 | 4,325,414 | | Chris Rogers (d) Executive Vice President, Chief Strategy Officer and Secretary | 2023 | 723,079 | — | 526,479 | 869,992 | 703,250 | 91,979 | 2,914,779 | | | 2022 | 671,202 | — | 464,331 | 810,051 | 704,504 | 89,843 | 2,739,931 | | | 2021 | — | — | — | — | — | — | — |
2023 Summary Compensation Table
| (a) Amounts set forth in the Stock Awards and Option Awards columns represent the aggregate grant date fair value of awards granted in each year as computed in accordance with ASC 718, disregarding estimates of forfeitures related to service- based vesting conditions. Performance Award values are based upon their probable outcome of the performance condition as of the grant date. For compensation purposes, Performance Awards are not considered granted until such time that the performance goals are established. For additional information about the assumptions used in these calculations, see (i) footnote (a) in the Grants of Plan Based Awards Table below, and (ii) Notes 2 and 16 to our audited consolidated financial statements included in our 2023 Annual Report. The amounts presented in the Stock Awards column for each named executive officer during 2023 include the grant date fair value of their awards as follows: |
2023 Summary Compensation Table
Mr. Snowden : (i) last one-third of the 2021 performance-based restricted stock award ($386,746); (ii) second one-third of the 2022 performance-based restricted stock unit award ($1,146,755); and (iii) first one-third of the 2023 performance-based restricted stock unit award ($1,854,979). As required under proxy disclosure rules, the full grant-date value of the 2021 CEO Supplemental Award, as detailed on pages 65-66 hereof, is reflected in Mr. Snowden’s 2021 total compensation. As noted on pages 65-66, unless the Company’s stock price appreciates 660% from the stock price of $17.36 per share on the Record Date in the remaining 1 year and 8 months of the performance period, the incentive opportunity under both Phase I and Phase II of the 2021 CEO Supplemental Award will be forfeited. Ms. Hendrix : (i) last one-third of the 2021 performance-based restricted stock award ($75,160); (ii) second one-third of the 2022 performance-based restricted stock unit award ($180,058); and (iii) first one-third of the 2023 performance-based restricted stock unit award ($495,837). Mr. George : (i) last one-third of the 2021 performance-based restricted stock award ($83,829); (ii) second one-third of the 2022 performance-based restricted stock unit award ($201,580); and (iii) first one-third of 2023 performance-based restricted stock unit award ($554,171). Mr. Rogers : (i) last one-third of the 2021 performance-based restricted stock award ($66,491); (ii) second one-third of the 2022 performance-based restricted stock unit award ($170,005); and (iii) first one-third of 2023 performance-based restricted stock unit award ($289,983).
2023 Summary Compensation Table
| (b) The amounts reflect cash payments for 2023 pursuant to the Company’s annual short-term incentive plan, which provided for the payment of incentive compensation upon the Company’s achievement of pre-established performance goals. A discussion of our annual short-term incentive plan may be found in our CD&A under “Annual Short-Term Incentive Plan.” |
2023 Summary Compensation Table
| (c) For Mr. Snowden, All Other Compensation in 2023 consisted of: (i) $324,817 in Company matching contributions under the Company’s Deferred Compensation Plan (“DCP”); (ii) $8,551 in Company paid insurance premiums; (iii) $20,300 in tax and financial planning; (iv) $6,600 in matching 401(k) contributions; and (v) $63,558 representing aggregate incremental cost for use of the Company’s aircraft which is based on variable costs of operating the aircraft including fuel costs, landing costs and repairs and maintenance. |
2023 Summary Compensation Table
For Ms. Hendrix, All Other Compensation in 2023 consisted of: (i) $79,550 in Company matching contributions under the DCP; (ii) $14,000 in tax and financial planning; and (iii) $6,600 in matching 401 (k) contributions. For Mr. George, All Other Compensation in 2023 consisted of: (i) $93,596 in Company matching contributions under the DCP; and (ii) $6,600 in matching 401(k) contributions. For Mr. Rogers, All Other Compensation in 2023 consisted of: (i) $71,379 in Company matching contributions under the DCP; (ii) $14,000 in tax and financial planning; and (iii) $6,600 in matching 401(k) contributions.
2023 Summary Compensation Table
| (d) Mr. Rogers became a named executive officer of the Company in 2022 and, therefore, in accordance with SEC regulations, only compensation information for the fiscal year in which each became a named executive officer is included in the Summary Compensation Table. |
2023 Summary Compensation Table (cont.)
2023 Summary Compensation Table (cont.)
2023 Summary Compensation Table (cont.)
| PERFORMANCE AWARD COMPENSATION DISCLOSED FOR 2023 | | | | | | | | YEAR | DISCLOSED VS. DESIGN | 2021 | 2022 | 2023 | 2024 | 2025 | | 2023 Performance Award | Plan Design Value | — | — | 100% | — | — | | | Value Disclosed in Summary Compensation Table | — | — | 33% | 33% | 33% | | 2022 Performance Award | Plan Design Value | — | 100% | — | — | — | | | Value Disclosed in Summary Compensation Table | — | 33% | 33% | 33% | — | | 2021 Performance Award | Plan Design Value | 100% | — | — | — | — | | | Value Disclosed in Summary Compensation Table | 33% | 33% | 33% | — | — |
2023 Summary Compensation Table (cont.)
The grant date fair value assuming the maximum level of performance achieved under performance awards for the 2023 performance period are as follows: (i) $5,082,720 for Mr. Snowden; (ii) $1,126,583 for Ms. Hendrix; (iii) $1,259,370 for Mr. George; and (iv) $789,719 for Mr. Rogers.
2023 Grants of Plan Based Awards
2023 Grants of Plan Based Awards
2023 Grants of Plan Based Awards
| NAME | GRANT DATE (a) | AWARD DATE (a) | ESTIMATED FUTURE PAYOUTS UNDER NON-EQUITY INCENTIVE PLAN AWARDS ($) | | | ESTIMATED FUTURE PAYOUTS UNDER EQUITY INCENTIVE PLAN AWARDS (#) | | | ALL OTHER STOCK AWARDS: (#) | ALL OTHER OPTION AWARDS (#) (b) | EXERCISE PRICE OF OPTION AWARDS ($/SHARE) | GRANT DATE FAIR VALUE OF STOCK AND OPTION AWARDS ($)(c) | | | | | THRESHOLD ($) | TARGET ($) | MAXIMUM ($) | THRESHOLD (#) | TARGET (#) | MAXIMUM (#) | | | | | | Jay Snowden | — | — | 2,250,000 | 4,500,000 | 6,750,000 | — | — | — | — | — | — | — | | | 1/4/2023 | — | — | — | — | — | — | — | — | 296,566 | 29.27 | 5,564,999 | | | 3/8/2023(d) | 4/12/2021 | — | — | — | 6,483 | 12,965 | 19,448 | — | — | — | 386,746 | | | 3/8/2023(e) | 3/9/2022 | — | — | — | 19,222 | 38,443 | 57,665 | — | — | — | 1,146,755 | | | 3/8/2023(f) | 3/8/2023 | — | — | — | 31,093 | 62,185 | 93,278 | — | — | — | 1,854,979 | | Felicia Hendrix | — | — | 425,000 | 850,000 | 1,275,000 | — | — | — | — | — | — | — | | | 1/4/2023 | — | — | — | — | — | — | — | — | 79,271 | 29.27 | 1,487,504 | | | 2/28/2023(d) | 4/12/2021 | — | — | — | 1,249 | 2,497 | 3,746 | — | — | — | 75,160 | | | 2/28/2023(e) | 2/15/2022 | — | — | — | 2,991 | 5,982 | 8,973 | — | — | — | 180,058 | | | 2/28/2023(f) | 2/28/2023 | — | — | — | 8,237 | 16,473 | 24,710 | — | — | — | 495,837 | | Todd George | — | — | 475,000 | 950,000 | 1,425,000 | — | — | — | — | — | — | — | | | 1/4/2023 | — | — | — | — | — | — | — | — | 88,597 | 29.27 | 1,662,504 | | | 2/28/2023(d) | 4/12/2021 | — | — | — | 1,393 | 2,785 | 4,178 | — | — | — | 83,829 | | | 2/28/2023(e) | 2/15/2022 | — | — | — | 3,349 | 6,697 | 10,046 | — | — | — | 201,580 | | | 2/28/2023(f) | 2/28/2023 | — | — | — | 9,206 | 18,411 | 27,617 | — | — | — | 554,171 | | Chris Rogers | — | — | 362,500 | 725,000 | 1,087,500 | — | — | — | — | — | — | — | | | 1/4/2023 | — | — | — | — | — | — | — | — | 46,363 | 29.27 | 869,992 | | | 2/28/2023(d) | 4/12/2021 | — | — | — | 1,105 | 2,209 | 3,314 | — | — | — | 66,491 | | | 2/28/2023(e) | 2/15/2022 | — | — | — | 2,824 | 5,648 | 8,472 | — | — | — | 170,005 | | | 2/28/2023(f) | 2/28/2023 | — | — | — | 4,817 | 9,634 | 14,451 | — | — | — | 289,983 |
2023 Grants of Plan Based Awards
| (a) The grant date shown in the table was determined pursuant to ASC 718, which is the date our Compensation Committee (or our Board for the CEO) established the performance criteria for the first one-third of the 2023 Performance Awards, the second one-third of the 2022 Performance Awards and the final one-third of the 2021 Performance Awards. The award date shown above represents the date on which our Compensation Committee (or our Board for the CEO) awarded the target number of Performance Awards to the named executive officers when the date differs from the grant date. |
2023 Grants of Plan Based Awards
| (b) Option awards represent stock options granted to the executives as part of their annual equity incentive compensation. The option awards vest over four years, 25% on the first anniversary of the date of grant and 25% on each succeeding anniversary. |
2023 Grants of Plan Based Awards
| (c) Represents the full grant date fair value of awards under ASC 718. Generally, the full grant date fair value is the amount the Company expenses in its financial statements over the award’s vesting period. Assumptions used in the calculation of the amounts for stock option awards and performance awards are included in Notes 2 and 16 to the Company’s audited financial statements in our 2023 Annual Report. |
2023 Grants of Plan Based Awards
| (d) Equity incentive awards represent performance-based restricted stock awards approved on April 12, 2021 in connection with the Company’s 2021 Performance Awards. The aggregate target number of restricted stock having a three-year award period consisting of three one-year performance periods and a three-year service period were: (i) 38,897 for Mr. Snowden; (ii) 7,491 for Ms. Hendrix; (iii) 8,356 for Mr. George; and (iv) 6,627 for Mr. Rogers. |
2023 Grants of Plan Based Awards
| (e) Equity incentive awards represent performance-based restricted stock units approved on March 9, 2022 for Mr. Snowden and February 15, 2022 for the other named executive officers in connection with the Company’s 2022 performance-based equity program. The aggregate target number of restricted stock units having a three-year award period consisting of three one-year performance periods and a three-year service period were: (i) 115,329 for Mr. Snowden; (ii) 17,946 for Ms. Hendrix; (iii) 20,090 for Mr. George; and (iv) 16,943 for Mr. Rogers. |
2023 Grants of Plan Based Awards
| (f) Equity incentive awards represent performance-based restricted stock units approved on March 8, 2023 for Mr. Snowden and February 28, 2023 for the other named executive officers in connection with the Company’s 2023 performance-based equity program. The aggregate target number of restricted stock units having a three-year award period consisting of three one-year performance periods and a three-year service period were: (i) 186,557 for Mr. Snowden; (ii) 49,419 for Ms. Hendrix; (iii) 55,233 for Mr. George; and (iv) 28,904 for Mr. Rogers. |
Outstanding Equity Awards at Fiscal Year End
Outstanding Equity Awards at Fiscal Year End This Summary Compensation Table summarizes the total compensation paid or earned by each of our named executive officers for the years ended December 31, 2023, 2022 and, 2021, respectively.
Outstanding Equity Awards at Fiscal Year End
| NAME | OPTION AWARDS | | | | STOCK AWARDS | | | | | | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS: | | OPTION EXERCISE PRICE ($) | OPTION EXPIRATION DATE | NUMBER OF SHARES OR UNITS HELD THAT HAVE NOT VESTED (#) | MARKET VALUE OF SHARES OR UNITS HELD THAT HAVE NOT VESTED ($) (k) | EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED (#) | EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED ($) | | | EXERCISABLE (#) | UNEXERCISABLE (#) | | | | | | | | Jay Snowden | 105,769 | — | 30.74 | 1/3/2025 | 51,863(h) | 1,349,475 | — | — | | | 156,203 | — | 19.45 | 1/3/2029 | 96,108(i) | 2,500,730 | 38,443(l) | 1,000,287 | | | 1,032,706 | — | 18.81 | 8/6/2029 | 93,278 (j) | 2,427,094 | 124,372(l) | 3,236,159 | | | 44,820 | 44,819(b) | 80.89 | 1/5/2031 | — | — | 300,000(m) | 7,806,000 | | | 39,852 | 119,556(d) | 50.64 | 1/4/2032 | — | — | 600,000(n) | 15,612,000 | | | — | 296,566(e) | 29.27 | 1/4/2033 | — | — | — | — | | Felicia Hendrix | 5,849 | 5,848(c) | 117.82 | 2/23/2031 | 9,989(h) | 259,914 | — | — | | | 7,101 | 21,304(d) | 50.64 | 1/4/2032 | 14,955(i) | 389,129 | 5,982(l) | 155,652 | | | — | 79,271(e) | 29.27 | 1/4/2033 | 24,710(j) | 642,954 | 32,946(l) | 857,255 | | Todd George | 5,375 | —(f) | 14.10 | 1/4/2024 | 11,142(h) | 289,915 | — | — | | | 13,360 | — | 30.74 | 1/3/2025 | 16,743(i) | 435,653 | 6,696(l) | 174,230 | | | 25,404 | — | 19.45 | 1/3/2029 | 27,617(j) | 718,594 | 36,822(l) | 958,108 | | | 45,796 | 15,265(a) | 26.14 | 1/3/2030 | — | — | — | — | | | 9,628 | 9,628(b) | 80.89 | 1/5/2031 | — | — | — | — | | | 7,949 | 23,849(d) | 50.64 | 1/4/2032 | — | — | — | — | | | — | 88,597(e) | 29.27 | 1/4/2033 | — | — | — | — | | Chris Rogers | 7,074 | — | 14.10 | 1/4/2024 | 8,837(h) | 229,939 | — | — | | | 3,584 | — | 30.74 | 1/3/2025 | 14,120(i) | 367,402 | 5,647(l) | 146,935 | | | 24,290 | — | 19.45 | 1/3/2029 | 14,451(j) | 376,015 | 19,270(l) | 501,405 | | | 17,614 | 5,871(a) | 26.14 | 1/3/2030 | — | — | — | — | | | 7,636 | 7,636(b) | 80.89 | 1/5/2031 | — | — | — | — | | | 6,704 | 20,114(d) | 50.64 | 1/4/2032 | — | — | — | — | | | — | 46,363(e) | 29.27 | 1/4/2033 | — | — | — | — |
Outstanding Equity Awards at Fiscal Year End
| (a) The vesting date is January 3, 2024. |
Outstanding Equity Awards at Fiscal Year End
| (b) The vesting dates are January 5, 2024 and January 5, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (c) The vesting dates are February 23, 2024 and February 23, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (d) The vesting dates are January 4, 2024, January 5, 2025, and January 4, 2026. |
Outstanding Equity Awards at Fiscal Year End
| (e) The vesting dates are January 4, 2024, January 4, 2025, January 4, 2026 and January 4, 2027. |
Outstanding Equity Awards at Fiscal Year End
| (f) The option award consists of a Cash Settled Stock Appreciation Award. |
Outstanding Equity Awards at Fiscal Year End
| (g) The stock awards consist of performance awards, which were made under the performance-based equity program adopted under the 2018 and 2022 Long Term Incentive Compensation Plans. |
Outstanding Equity Awards at Fiscal Year End
| (h) The vesting date shall be in the first quarter of 2024 following the certification of performance by the Compensation Committee or the Board of Directors, as applicable. Per instructions to Item 402(f)(2), since performance goals exceed the threshold, the disclosure reports the next higher performance measure. |
Outstanding Equity Awards at Fiscal Year End
| (i) The vesting date shall be in the first quarter of 2025 following the certification of performance by the Compensation Committee or the Board of Directors, as applicable. Per instructions to Item 402(f)(2), since performance goals exceed the threshold, the disclosure reports the next higher performance measure. |
Outstanding Equity Awards at Fiscal Year End
| (j) The vesting date shall be in the first quarter of 2026 following the certification of performance by the Compensation Committee or the Board of Directors, as applicable. Per instructions to Item 402(f)(2), since performance goals exceed the threshold, the disclosure reports the next higher performance measure. |
Outstanding Equity Awards at Fiscal Year End
| (k) Calculated based on the closing price of $26.02 for the Company’s common stock on December 29, 2023, which was the last trading day of the Company’s 2023 fiscal year. |
Outstanding Equity Awards at Fiscal Year End
| (l) These amounts represent the target number of performance-based restricted stock and restricted stock units for the performance periods ending December 31, 2024, December 31, 2025 and December 31, 2026. The final number of shares or units earned, if any, will be based on the performance achieved for such periods. |
Outstanding Equity Awards at Fiscal Year End
| (m) These awards make up the Stock Price Hurdle Award. A discussion of the Stock Price Hurdle Award may be found in our CD&A under “CEO Performance Based Supplemental Equity Awards.” |
Outstanding Equity Awards at Fiscal Year End
| (n) These awards make up the Relative TSR Hurdle Award. A discussion of the Relative TSR Hurdle Award may be found in our CD&A under “CEO Performance Based Supplemental Equity Awards.” |
2023 Option Exercises and Stock Vested
2023 Option Exercises and Stock Vested
2023 Option Exercises and Stock Vested
| | OPTION AWARDS | | STOCK AWARDS | | | NAME | NUMBER OF SHARES ACQUIRED ON EXERCISE (#) | VALUE REALIZED ON EXERCISE ($) | NUMBER OF SHARES ACQUIRED ON VESTING (#) (a) | 2023 VALUE REALIZED ON VESTING ($) (b) | | Jay Snowden | 219,222 | 2,445,285 | — | — | | Felica Hendrix | — | — | 1,061 | 33,655 | | Todd George | — | — | 49,965 | 1,422,329 | | Chris Rogers | — | — | 13,121 | 354,137 |
2023 Option Exercises and Stock Vested
| (a) The number of shares acquired on vesting includes 30,690 restricted stock units, which were settled in cash, for Mr. George; and 5,707 restricted stock units, which were settled in cash, for Mr. Rogers. |
2023 Option Exercises and Stock Vested
| (b) Value realized represents fair value, per share, as of the trading day immediately prior to the vesting date. |
2023 Nonqualified Deferred Compensation
2023 Nonqualified Deferred Compensation
2023 Nonqualified Deferred Compensation
| NAME | EXECUTIVE CONTRIBUTIONS IN LAST FISCAL YEAR ($) (a) | COMPANY CONTRIBUTIONS IN LAST FISCAL YEAR ($) (b) | AGGREGATE EARNINGS IN LAST FISCAL YEAR ($) (c) | AGGREGATE WITHDRAWALS/ DISTRIBUTIONS ($) | AGGREGATE BALANCE AT LAST FISCAL YEAR END ($) (d) | | Jay Snowden | 649,634 | 324,817 | 875,812 | 7,861 | 6,066,251 | | Felicia Hendrix | 159,100 | 79,550 | 113,895 | 1,596 | 643,712 | | Todd George | 561,579 | 93,596 | 671,328 | 2,256 | 4,307,780 | | Chris Rogers | 169,310 | 71,379 | 193,110 | 1,718 | 1,338,450 |
2023 Nonqualified Deferred Compensation
| (a) For each executive, the executive’s contribution is included in the executive’s Salary column for 2023, as reported in the Summary Compensation Table. |
2023 Nonqualified Deferred Compensation
| (b) For each executive, the Company’s contribution is included in the executive’s All Other Compensation column for 2023, as reported in the Summary Compensation Table. |
2023 Nonqualified Deferred Compensation
| (c) Amounts reflect the change in account value during fiscal year 2023. No amounts are reported in the Summary Compensation Table because the earnings were not above market or preferential. |
2023 Nonqualified Deferred Compensation
| (d) The amount of each executive’s aggregate balance at fiscal year-end that was reported as compensation in the Summary Compensation Table for previous years is as follows: |
2023 Nonqualified Deferred Compensation
(i) Jay Snowden: 1,532,676; (ii) Felicia Hendrix: 188,925; (iii) Todd George: 226,839; (iv) Chris Rogers: 148,064.
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control The following tables describe and quantify the compensation that would become payable in the event of a termination of a named executive officer’s employment under several different circumstances or a change in control. The amounts shown are estimates of amounts that would be paid to the named executive officers assuming that such termination or change in control was effective as of December 29, 2023, and include amounts earned through such time and are based (where applicable) on the closing price of the Company’s common stock on such date, which was $26.02 per share. Following the end of the prior fiscal year, we entered into a new employment agreement with Ms. Hendrix, which is further described in the section titled “ Employment, Retirement and Separation Agreements” below. Therefore, the tables below are merely illustrative examples of the impact of a hypothetical termination of employment or change in control. The actual amounts to be paid can only be determined at the time of such named executive officer’s separation from the Company and/or change in control. For a description of the severance and change in control provisions giving rise to the payments set forth below, see pages 76-78. In establishing the appropriate payment and benefit levels, the Company evaluates the practices and levels set by companies in its peer group.
CEO Pay Ratio
CEO Pay Ratio Pursuant to SEC rules, we are required to disclose in this Proxy Statement the ratio of the annual total compensation of Mr. Snowden, our Chief Executive Officer and President, to the median of the annual total compensation of all of our employees (excluding Mr. Snowden). We determined that Mr. Snowden’s 2023 annual total compensation was $15,542,305, the median of the 2023 annual total compensation of all of our employees (excluding Mr. Snowden) was $38,332, and the ratio of these amounts was 405 to 1. The Company believes that the foregoing ratio is a reasonable estimate determined in accordance with SEC rules. Under the SEC rules, companies may identify the median annual total compensation using a wide variety of methods including reasonable assumptions and estimations. It is therefore difficult to compare our ratio to the ratio of other companies. We identified our median employee using payroll compensation consistent with what is reported on each employee’s W-2, Box 1 or equivalent taxable wages as of October 31, 2023 for all individuals, excluding our Chief Executive Officer and President, who were employed by us on such date. We measured total annual compensation based on all pay periods between November 1, 2022 and October 31, 2023. We did not make any assumptions or estimates with respect to total annual compensation. As of October 31, 2023, we had a total of 23,718 employees, excluding our Chief Executive Officer. We did not exclude any of our non-U.S. employees from this determination. We selected the median employee from that group for purposes of preparing the ratio of Chief Executive Officer pay to median employee pay. We then calculated the compensation for our median employee based upon the same components of compensation used to determine Mr. Snowden’s pay for purposes of Summary Compensation Table disclosure.
Pay Versus Performance
Pay Versus Performance As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation actually paid and certain financial performance of the Company. For further information concerning the Company’s variable pay-for-performance philosophy and how the Company’s aligns executive compensation with the Company’s performance, refer to “Executive Compensation—Compensation Discussion and Analysis” on page 48.
Pay Versus Performance
| | | | | | VALUE OF INTIAL $100 INVESTMENT BASED ON: | | | | | FISCAL YEAR | SUMMARY COMPENSATION TABLE TOTAL FOR PEO (1) | COMPENSATION ACTUALLY PAID TO PEO(2) | AVERAGE SUMMARY COMPENSATION TABLE TOTAL FOR NON-PEO NEOS(3) | AVERAGE COMPENSATION ACTUALLY PAID TO NON-PEO NEOS(4) | TOTAL SHAREHOLDER RETURN(5) | PEER GROUP TOTAL SHAREHOLDER RETURN(6) | NET INCOME ($M)(7) | ADJUSTED EBITDAR ($M)(8) | | 2023 | $15,542,305 | $10,187,197 | $3,800,856 | $3,866,865 | $101.80 | $104.27 | ($491.4) | $1,512.6 | | 2022 | $14,075,614 | ($10,073,072) | $3,105,185 | $1,412,413 | $116.20 | $82.85 | $221.7 | $1,939.4 | | 2021 | $65,887,214 | $7,961,396 | $3,440,477 | $2,027,447 | $202.86 | $110.71 | $420.5 | $1,994.4 | | 2020 | $3,898,655 | $75,499,569 | $3,232,591 | $13,492,467 | $337.91 | $112.34 | ($669.1) | $1,094.8 |
Pay Versus Performance
| 1 | The dollar amounts reported are the amounts of total compensation reported for Mr. Snowden (our Principal Executive Officer) for each corresponding year in the “Total” column of the Summary Compensation Table. Refer to “Executive Compensation—Compensation Tables and Arrangements—2023 Summary Compensation Table.” |
Pay Versus Performance
| 2 | The dollar amounts reported represent the amount of “compensation actually paid” to Mr. Snowden, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Mr. Snowden during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following “Compensation Actually Paid Calculation” table displays the adjustments made to Mr. Snowden’s total compensation for each year to determine the compensation actually paid. |
Pay Versus Performance
| 3 | The dollar amounts reported represent the average of the amounts reported for the Company’s named executive officers (NEOs) as a group (excluding Mr. Snowden) in the “Total” column of the Summary Compensation Table in each applicable year. The names of each of the NEOs (excluding Mr. Snowden) included for purposes of calculating the average amounts in each applicable year are as follows: (i) for 2022 and 2023, Felicia Hendrix, Todd George and Chris Rogers; (ii) for 2021, Felicia Hendrix, Todd George and Harper Ko; and (iii) for 2020, David Williams, William J. Fair and Carl Sottosanti. |
Pay Versus Performance
| 4 | The dollar amounts reported represent the average amount of “compensation actually paid” to the NEOs as a group (excluding Mr. Snowden), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs as a group (excluding Mr. Snowden) during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following “Compensation Actually Paid Calculation” table displays the adjustments made to average total compensation for the NEOs as a group (excluding Mr. Snowden) for each year to determine the average compensation actually paid to the NEOs as a group (excluding Mr. Snowden). |
Pay Versus Performance
| 5 | Cumulative TSR is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between the Company’s share price at the end and the beginning of the measurement period by the Company’s share price at the beginning of the measurement period. |
Pay Versus Performance
| 6 | Represents the weighted peer group TSR, weighted according to the respective companies’ stock market capitalization at the beginning of each period for which a return is indicated. The peer group used for this purpose is the following published industry index: Russell 3000 Casino and Gambling Index. |
Pay Versus Performance
| 7 | The dollar amounts reported represent the amount of net income (loss) reflected in the Company’s audited financial statements for the applicable year. |
Pay Versus Performance
| 8 | The Company believes Adjusted EBITDAR is the financial performance measure most closely linked to the calculation of compensation actually paid. Adjusted EBITDAR is a non-GAAP financial measure. For a definition and reconciliation of this non-GAAP financial measure to the most directly comparable GAAP measure, see the section entitled “Non-GAAP Financial Measures” on pages 43 - 45 of our 2023 Annual Report. |
Compensation Actually Paid Calculation
Compensation Actually Paid Calculation
Compensation Actually Paid Calculation
| | PEO | | | | NEO AVERAGE | | | | | | 2023 | 2022 | 2021 | 2020 | 2023 | 2022 | 2021 | 2020 | | Summary Compensation Table Total | $15,542,305 | $14,075,614 | $65,887,214 | $3,898,655 | $3,800,856 | $3,105,185 | $3,440,477 | $3,232,591 | | Less: Reported Fair Value of Equity Awards(a) | $8,953,479 | $6,961,325 | $57,104,584 | $2,431,391 | $2,045,705 | $1,470,912 | $1,645,208 | $1,699,259 | | Add: Year End Fair Value of Equity Awards(b) | $9,604,572 | $5,919,253 | $22,335,085 | $3,668,075 | $2,302,218 | $1,016,402 | $1,231,271 | $5,549,713 | | Add: Change in Fair Value of Outstanding and Unvested Equity Awards(b) | ($4,077,352) | ($18,419,902) | ($20,839,582) | $64,271,366 | ($271,763) | ($1,066,153) | ($1,020,003) | $6,437,966 | | Add: Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year(b) | — | — | — | — | — | — | — | — | | Add: Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year(b) | ($1,928,849) | ($4,686,713) | ($2,316,737) | $6,092,864 | $81,259 | ($172,109) | $20,909 | ($28,544) | | Less: Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year(b) | — | — | — | — | — | — | — | — | | Add: Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation(b) | — | — | — | — | — | — | — | — | | Compensation Actually Paid(c) | $10,187,197 | ($10,073,072) | $7,961,396 | $75,499,569 | $3,866,865 | $1,412,413 | $2,027,447 | $13,492,467 |
Compensation Actually Paid Calculation
| (a) The grant date fair value of equity awards represents the total of the amounts reported in the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table for the applicable year. |
Compensation Actually Paid Calculation
| (b) The equity award adjustments for each applicable year include the addition (or subtraction, as applicable) of the following: (i) the year-end fair value of any equity awards granted in the applicable year that are outstanding and unvested as of the end of the year; (ii) the amount of change as of the end of the applicable year (from the end of the prior fiscal year) in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year; (iii) for awards that are granted and vest in the same applicable year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the applicable year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value; and (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the applicable year, a deduction for the amount equal to the fair value at the end of the prior fiscal year. The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. |
Compensation Actually Paid Calculation
| (c) The Company does not maintain any defined benefit pension programs for its executives. |
Analysis of the Information Presented in the Pay versus Performance Table
Analysis of the Information Presented in the Pay versus Performance Table While the Company utilizes several non-financial performance measures to align executive compensation with Company performance, all of those Company measures are not presented in the Pay versus Performance table. Moreover, the Company generally seeks to incentivize long- term performance, and therefore does not specifically align the Company’s performance measures with compensation that is actually paid (as computed in accordance with Item 402(v) of Regulation S-K) for a particular year. In accordance with Item 402(v) of Regulation S-K, the Company is providing the following descriptions of the relationships between information presented in the Pay versus Performance table.
Compensation Actually Paid and Cumulative TSR
Compensation Actually Paid and Cumulative TSR As demonstrated by the following graph, the amount of compensation actually paid to Mr. Snowden and the average amount of compensation actually paid to the Company’s NEOs as a group (excluding Mr. Snowden) is aligned with the Company’s cumulative TSR over the four years presented in the table. The alignment of compensation actually paid with the Company’s cumulative TSR over the period presented is because a significant portion of the compensation actually paid to Mr. Snowden and to the other NEOs is comprised of equity awards. As described in more detail in the section “Compensation Discussion and Analysis,” in 2023, 90% of our Chief Executive Officer’s total target compensation, and 80% (on average) of our other NEOs’ total target compensation was variable and at risk, subject to achievement of pre-set performance goals or tied to our long-term stock price performance.
Compensation Actually Paid and Net Income
Compensation Actually Paid and Net Income As demonstrated by the following table, the amount of compensation actually paid to Mr. Snowden and the average amount of compensation actually paid to the Company’s NEOs as a group (excluding Mr. Snowden) is generally aligned with the Company’s net income as presented in the table. While the Company does not use net income as a performance measure in the overall executive compensation program, the measure of net income is correlated with the measure Adjusted EBITDAR, which the company does use for when setting goals in the Company’s STIP and LTIP. As described in more detail in the section “Compensation Discussion and Analysis,” in 2023, 90% of our Chief Executive Officer’s total target compensation, and 80% (on average) of our other NEOs’ total target compensation was variable and at risk, subject to achievement of pre-set performance goals or tied to our long-term stock price performance.
Compensation Actually Paid and Adjusted EBITDAR
Compensation Actually Paid and Adjusted EBITDAR As demonstrated by the following graph, the amount of compensation actually paid to Mr. Snowden and the average amount of compensation actually paid to the Company’s NEOs as a group (excluding Mr. Snowden) is generally aligned with the Company’s Adjusted EBITDAR. While the Company uses numerous measures, both financial and non-financial, for the purpose of evaluating performance for the Company’s compensation programs, the Company has determined that Adjusted EBITDAR is the financial performance measure that, in the Company’s assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the table) used by the Company to link compensation actually paid to the company’s NEOs, for the most recently completed fiscal year, to Company performance. The Company utilizes Adjusted EBITDAR when setting goals for the Company’s annual incentives to the NEOs under the Company’s incentive plan.