In a spirited exchange of documents leading up to their June 17 annual meeting, Penn Entertainment has firmly rebutted several key accusations put forth by HG Vora in a recent detailed filing. The ongoing proxy skirmish, which is primarily centered around the election of directors, has seen HG Vora openly criticizing Penn’s strategy in online sports betting and its partnership with ESPN Bet since January.
Penn’s latest response, released on Tuesday, addresses and challenges assertions related to CEO Jay Snowden’s remuneration, the use of the company’s private jet for personal purposes, and allegations of manipulating regulatory bodies. Moreover, Penn emphasizes that it supports the election of two directors nominated by HG Vora itself.
The Board of Directors at Penn stated, “While headlines about management enriching themselves through excessive compensation or misuse of corporate assets may capture attention, the accusations laid out by HG Vora do not align with the reality depicted in our public disclosures.”
On Tuesday, Penn’s stock saw a 2% rise to close at $15.38, showcasing a positive market reaction amidst this back-and-forth.
Addressing claims made by HG Vora that Snowden is among the highest-paid CEOs within their peer group—with purported earnings of $25 million—Penn clarifies that Snowden’s actual take-home pay only accounts for 45% of this figure. This adjustment places him in the lower 25% bracket among his peers according to Penn’s documentation.
Contrary to HG Vora’s depiction of insider share sales suggesting Snowden sold over $40 million worth of stock since becoming CEO in January 2020 (right before initiating the Barstool partnership), Penn clarifies these sales were solely to cover option strike prices and taxes. Furthermore, insider purchases exceeding $5.7 million since 2020—with Snowden himself investing $2.8 million—highlight an enduring confidence in the company’s trajectory.
The critique regarding Snowden and CFO Felicia Hendrix treating corporate aircraft “like their personal Uber service” was also countered. Though HG Vora presented data showing significant flights to destinations associated with both executives over five years, Penn clarified such figures included hours when aircraft were leased out to third parties. In reality, only 1.5% of flight hours since 2020 were attributed to personal travel by executives.
Regarding governance concerns raised by HG Vora about leveraging regulatory oversight for evading accountability on board seat allocations, Penn clarified that it operates within strict regulatory guidelines which are independently exercised by gaming authorities—not influenced by suggestions from any entity including PENN itself.
Moreover, despite suggestions from HG Vora about establishing a board committee for evaluating capital allocation—which faced regulatory restrictions—Penn underlined its compliance with all regulatory mandates while striving for transparent governance practices.
In addition to addressing these points directly, Penn also provided insights into its board members’ expertise and skills deemed crucial for steering the company forward amidst evolving industry dynamics.
This robust defense paints a picture not just of a company ardently defending its operational integrity and leadership decisions but also highlights the intricate dance between corporate governance practices and shareholder activism within today’s competitive casino entertainment landscape.
