What does "penalty" mean?

Penalty: The suffering, or the sum to be forfeited, to which a person subjects himself by covenant or agreement, in case of nonfulfillment of stipulations; forfeiture; fine. The penalty and forfeit of my bond. Shak.

Additional senses

  1. 2.A handicap. [Sporting Cant] Note: The term penalty is in law mostly applied to a pecuniary punishment. Bill of pains and penalties. See under Bill. -- On, or Under, penalty of, on pain of; with exposure to the penalty of, in case of transgression.

Sources