PENN Entertainment Inc

The primary components of our executive compensation program are base salary, short-term incentive compensation (cash bonus plan) and long-term equity incentive compensation. These components of our 2024 compensation program are described in more detail below.

EXECUTIVE COMPENSATION

Compensation Process

The Compensation Committee is solely responsible for making the final decisions on compensation for our executive officers, other than for our CEO, whose pay is approved by the independent members of our Board. The Compensation Committee has the authority to delegate any of its responsibilities to subcommittees as it may deem appropriate, in its sole discretion, and is also supported by an independent compensation consultant, as described below.

The Compensation Committee, in its discretion, has sole authority to select, approve, retain, terminate and oversee its relationship with the independent compensation consultant. In 2024, Exequity, Inc. (“Exequity”), the independent compensation consultant, did not provide any consulting services other than those related to executive compensation matters. In selecting its compensation consultant, the Compensation Committee considered the independence of such consultant in accordance with the standards of the Nasdaq Rules, any applicable rules and regulations of the SEC and other applicable laws relating to independence of advisors and consultants. The Compensation Committee concluded that no conflict of interest existed that would prevent Exequity from independently advising the Compensation Committee.

Risk Assessment

The Compensation Committee’s responsibilities include, among others, oversight of risks related to our compensation practices and plans to ensure they appropriately balance risks and rewards in relation to our overall business strategy and do not encourage excessive or unnecessary risk-taking behavior. In this regard, the Compensation Committee annually reviews the Company’s compensation and benefits programs in the context of potential risks. The executive compensation program is structured as a balanced mix between fixed and variable, annual and long-term, and cash and equity compensation.

Base salaries are reviewed and set annually. Annual short-term incentive pay in 2024 was focused on achievement of a specific, readily quantifiable and meaningful financial goal (Adjusted EBITDAR) and was determined using absolute and objective

EXECUTIVE COMPENSATION

Risk Assessment (cont.)

performance criteria in reference to the Company’s annual budget. The other major component of our executive officers’ compensation is long-term incentives through a mix (which may vary from year to year and by level) of PSUs and stock options that we believe are important to help further align executives’ interests with those of our shareholders. The PSUs under the long-term performance plan were tied to objective financial and operational goals aligned with our long-term growth priorities. Equity incentive awards 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 incentivize long-term performance results and align interest of our executives with the Company’s ability to create sustained value. These cash and equity incentive awards, especially when combined with the compensation clawback policy described on page 62 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 executive 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 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

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.

In October 2023, the Compensation Committee reviewed and approved the executive compensation peer group for setting 2024 target compensation levels, which consisted of the companies identified below, as recommended by the Compensation Committee’s independent compensation consultant. The Committee did not make any changes to the peer group from the prior year’s composition, except to remove Zynga Inc. from the peer group as a result of its acquisition by Take-Two Interactive in May 2022.

EXECUTIVE COMPENSATION

Executive Compensation Peer Group (cont.)

This executive compensation peer group is comprised of core gaming companies and online and digital entertainment companies, which reflects PENN’s operational complexity. 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 2023, and at that time the Company ranked at the 61 st percentile of this group in annual revenue.

Elements of Executive Compensation

Our executive compensation program consists of the following primary components:

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 industries 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 2024 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. The Compensation Committee approved modest increases to base salary for Ms. Hendrix and Mr. George to align their compensation with market benchmarks. Base salary for Mr. Rogers was increased to reflect the expanded scope of responsibilities after he assumed the role of Chief Legal Officer and Secretary in 2024, in addition to his previous duties as Chief Strategy Officer. The Board maintained the CEO’s base salary, which has remained unchanged since 2021.

EXECUTIVE COMPENSATION

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 achievement of short-term performance objectives that are key to the Company’s long-term success and ability to create sustained shareholder value. 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. For 2024, the Committee approved an increase to our non-CEO NEOs’ target bonus levels from 100% of base salary to 125% of base salary to bring their target cash opportunities closer to the median opportunities for comparable executives within our peer group. The Board maintained the CEO’s 2024 target STIP opportunity, which has remained unchanged since 2021.

For 2024, based on data provided by the Compensation Committee’s independent compensation consultant, the Committee approved an increase in the maximum payout level under the annual STIP from 150% to 200% of target to more closely align with our peer group and broader market practice. The threshold payout remained unchanged at 50% of target, with no compensation awarded to executives for below-threshold performance. If 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 is determined by linear interpolation between threshold and target or target and maximum level of achievement, as applicable.

2024 STIP Awards

The Compensation Committee approved Adjusted EBITDAR as the performance metric for the 2024 STIP because it is an objective and quantifiable measurement for the Company’s financial performance that balances a forward-looking approach to executing on our highly differentiated strategy with a disciplined approach to supporting our long-term growth priorities. It is also a common performance metric used by our investors to evaluate the Company’s performance relative to other gaming industry peers. Adjusted EBITDAR is defined as the consolidated results for the Company’s retail, interactive and corporate overhead and other segments.

To ensure the rigor of the Adjusted EBITDAR target for the 2024 STIP, the Compensation Committee reviewed a range of internal and external considerations, including the Company’s 2024 operating plan, projected market conditions, our long-term growth strategy, and analyst and shareholder expectations. Based on this analysis, in April 2024, the Compensation Committee approved threshold, target and maximum performance levels for Adjusted EBITDAR which reflected the Company’s approved operating plan for the year. The target performance level for Adjusted EBITDAR was consistent with our financial guidance, presented a similar degree of difficulty for achievement in comparison to the goals chosen in prior years and was deemed by the Compensation Committee to maintain the same level of rigor as in the prior year. Threshold and maximum performance hurdles were based on a range of sensitivities relative to the Company’s operating plan, with the maximum performance hurdle requiring a significant level of outperformance for the executive team to achieve.

Full detail on the threshold, target, maximum and actual performance levels for the 2024 STIP metric are set forth below:

EXECUTIVE COMPENSATION

2024 STIP Awards (cont.)

During the first quarter of 2025, the Compensation Committee certified the following Adjusted EBITDAR achievement level and associated STIP payouts for 2024 (the Board approved the CEO’s STIP award following the Compensation Committee’s recommendation):

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 shareholder value creation. The long-term incentives are delivered through a combination of time- and performance-based equity awards, designed to drive progress toward our strategic and operational priorities, which are critical for our ability to create long-term shareholder value. Both performance- and time-based awards are tied to our stock price value and vest over three- and four-year periods, respectively, to incentivize executives to generate sustained value creation by successfully executing a range of strategic initiatives that advance our long-term growth priorities.

For 2024, the Compensation Committee chose to deliver long-term incentive awards to NEOs (other than our CEO) in an equal mix in value of PSUs and stock options. To further strengthen accountability for the Company’s long-term financial performance and reflect the CEO’s greater impact on our overall performance results, the Compensation Committee increased the ratio of the CEO’s equity incentives allocated to PSUs from 50% to 75%, while reducing the ratio of stock options from 50% to 25%.

In alignment with our shareholder preferences, the Compensation Committee also approved a three-year performance period starting with the 2024 PSUs, shifting from the three one-year performance periods used in the previous program design. Additionally, the Compensation Committee allocated 70% weighting to financial performance metrics, limiting operational metrics to 30% of target, compared to 100% weighting for operational metrics under the prior performance plans.

EXECUTIVE COMPENSATION

2024 LTIP Awards

The Compensation Committee approved the following 2024 LTIP award targets for the NEOs (while the independent members of our Board approved our CEO’s LTIP award targets), which reflect market-based adjustments designed to better align our NEOs’ total target pay with the designed market positioning for each, and with the intent of maintaining the competitiveness of our executive compensation program and incentivizing long-term performance. The CEO’s 2024 target LTIP compensation opportunity was increased exclusively in the form of performance-based awards, as noted above, to recognize his critical role in establishing the strategic ESPN partnership, align his interests with those of our shareholders and incentivize the execution of the initiatives designed to unlock the full potential and value of our ESPN partnership and the launch of our stand-alone iCasino offering.

The above table reflects the target grant values of the annual incentives approved and awarded in 2024. These values differ from the grant values reflected in the Summary Compensation Table and the Grants of Plan-Based Awards Table. With the transition to a three-year performance period, at the beginning of 2024 the Compensation Committee approved two-year and one-year targets, respectively, for the outstanding 67% and 33% of the 2023 and 2022 PSU awards. As such, the PSU values reflected in this year’s tables below include 100% of the target value associated with 2024 PSUs, approximately 67% of the target value associated with 2023 PSUs value, and 33% of the target value associated with 2022 PSUs. In contrast, the above table reflects 100% of the target value of the PSUs awarded in 2024, and none of the value associated with the PSUs originally awarded in 2022 and 2023.

2024 Performance Stock Units (“PSUs”)

As noted above, in response to the input provided by our shareholders, the Compensation Committee approved the adoption of a three-year cumulative performance period and the introduction of financial performance metrics to our 2024 PSUs, weighted 70%, with the remaining 30% allocated to strategic operational metrics. These operational metrics, outlined below, were selected to incentivize key top- and bottom-line measures of our omnichannel growth strategy and long-term profitability, including (i) database growth, (ii) growth in both total and omnichannel players, and (iii) ESPN BET market share growth.

The performance results will be measured at the end of the full three-year performance period. This design replaced our prior approach to the PSUs plan, which included three annual performance targets set for each year of a three-year performance cycle. In addition to the implementation of a single three-year performance period with updated weightings allocation for financial and operational metrics, the Compensation Committee changed the maximum potential payout under the 2024 PSU program from 150% to 200% of target for the non-CEO NEOs (and the independent members of our Board approved the same maximum payout change for our CEO) to align the incentive program design with market and peer group practices.

The actual number of shares that will be delivered at the end of the three-year performance period ending on December 31, 2026, may range between 0% and 200% of the target number of shares awarded, depending on the Company’s performance over such time period against the goals set forth below, subject to each executive’s continued employment. If the performance falls between threshold or target or target and maximum, the number of shares earned will be determined using a linear interpolation.

EXECUTIVE COMPENSATION

2024 PSUs (cont.)

EXECUTIVE COMPENSATION

Stock Options

Stock options represented 25% and 50% of the annual long-term incentive opportunity awarded in 2024 for our CEO and other NEOs, respectively. Stock options vest 25% per year over four years, subject to continued employment (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”). Stock options are issued with an exercise price equal to the closing price of PENN common stock on the trading day immediately preceding the grant date, and have a maximum term of 10 years.

Status of Outstanding PSU Awards

In conjunction with the transition to a full three-year long-term performance cycle starting with 2024 PSUs, the Compensation Committee approved a cumulative two-year performance period for the 2024-2025 cycle associated with the unvested 2023 PSUs, and a one-year performance period for the 2024 cycle associated with the final unvested portion of 2022 PSUs. Performance goals for these awards were historically set annually at the start of each performance year. Consistent with our shareholder preferences, the Committee determined to apply the same 70% allocation to financial performance measures and 30% to strategic operational metrics to the unvested 2022 and 2023 PSUs, rather than relying exclusively on operational metrics.

Since the ESPN BET market share metric was intended to be a full three-year performance metric, the Compensation Committee determined to allocate 15% weighting to each of the Database Growth and Omnichannel Players metrics within the operational performance component when setting performance targets for the unvested portions of the 2022 and 2023 PSUs. This weightings allocation applies to the 2024 performance period of the 2022 PSUs and 2024-2025 performance period under 2023 PSUs awards.

The following table shows the status of the outstanding performance awards, in each case measured as of December 31, 2024.

Any earned portion of the 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 2022 and 2023 Performance Awards, such forfeiture restrictions will also lapse upon an involuntary termination of service or retirement.

EXECUTIVE COMPENSATION

2024 Performance Results – Final Tranche of 2022 PSUs

In early 2024, the Compensation Committee considered various performance metrics and approved the goals in the chart below for the 2024 fiscal performance period, which represents the third and final performance period of the 2022 Performance Awards.

The performance hurdles were intended to be rigorous and required a stretch effort to achieve target performance levels. The Retail Adjusted EBITDAR and Interactive Adjusted EBITDA targets were consistent with our publicly disclosed financial guidance for the year. The Interactive Adjusted EBITDA performance hurdles accounted for our investments in the Interactive business, which is expected to generate positive returns as the business scales. Achieving the target performance under the Interactive Adjusted EBITDA target required rigorous cost management and aggressive revenue growth.

Based on the performance results achieved in 2024, the last tranche of the 2022 performance period was earned at 83% of target. The following table shows the PSUs achievement for the third and final performance period of the 2022 Performance Awards.

EXECUTIVE COMPENSATION

Fiscal 2025 PSU Plan Updates

Starting in 2025, the weighting of the financial performance metrics for PSUs will be increased to 80% (from 70%), with the remaining 20% tied to key operational metrics. The Compensation Committee approved the increase in financial performance metrics based on shareholder feedback and to place a greater emphasis on long-term financial performance outcomes.

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 2024, 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 2024 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. Separately, the Company generally sets aside 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 67.

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 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 2024. 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, our CEO 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 safe and efficient travel to our gaming facilities located across a wide geographic area without regular commercial flight alternatives, and which is generally consistent with evolving personal security landscape and our gaming peer group practices 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 2024 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 operator, the Company has maintained a long- standing commitment to ensure that its executive officers adhere to the highest professional and ethical standards. The Company adopted its first Executive Incentive Compensation Recoupment Policy (“Clawback Policy”) on April 25, 2014, which was then subsequently amended on November 9 2022, and further amended on September 19, 2023, with the latter amendment designed to meet compliance requirements of Section 10D of the Exchange Act and Nasdaq Rules. To further align the policy with the market leading practices, on March 12, 2025, the Board further amended the Clawback Policy by expanding the policy to cover time-based incentives, in addition to the performance-based incentives. The Clawback Policy is administered by the Compensation Committee and requires the Company to recover from specified current and former executive officers, certain

EXECUTIVE COMPENSATION

Other Compensation Program Elements and Policies (cont.)

incentive-based compensation received during the three years immediately preceding an accounting restatement. Such recovery will be made without regard to any individual knowledge or responsibility related to the accounting. Without limiting the foregoing, the Clawback Policy also permits, in the discretion of the Board, the recovery of time-based incentives in the event of an accounting restatement.

Stock Ownership Guidelines for Senior Management. We believe that equity ownership fosters an atmosphere where directors and officers “think like owners” and are motivated to increase the long-term value of the Company by aligning their interests with those of the Company’s shareholders. To this end, the Compensation Committee has established the following stock ownership guidelines for senior management, which are required to be achieved within five years of assuming the position subject to the guideline, and which are re-evaluated periodically.

The CEO 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. Due to compression and volatility in the Company’s stock during fiscal year 2024, the Compensation Committee temporarily waived the five-year compliance deadline under the Company’s Stock Ownership Policy for Mr. George. Mr. George otherwise remains subject to the Stock Ownership Policy, and we anticipate that all other named executive officers will meet the required compliance deadlines.

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 2024, the annual Performance Awards were approved by the Compensation Committee on April 15, 2024, for the NEOs (other than the CEO) and on April 19, 2024, by the Board for the CEO. 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. The Compensation Committee neither grants equity awards in anticipation of the release of material nonpublic information, nor is the timing of filings of material nonpublic information based on equity award grant dates.

COMPENSATION TABLES AND ARRANGEMENTS