EXHIBIT 10 (xx)

CHURCHILL DOWNS INCORPORATED

EXECUTIVE SEVERANCE POLICY

(Amended Effective as of November 12, 2008)

 

1. Purpose. The Churchill Downs Incorporated Executive Severance Policy (the
“Policy”) is established effective November 13, 2003, to provide Executives and
Other Key Employees (both as defined below) of Churchill Downs Incorporated or
its wholly-owned subsidiaries (collectively, the “Company”) who are in a
position to contribute materially to the success of the Company and its
affiliates with severance income while they seek alternative employment if they
are involuntarily separated from employment due to elimination of their
positions or duties. “Elimination of their positions or duties” means
elimination for lack of work, cost containment, a general reduction in force, or
other reasons unrelated to job performance under circumstances that constitute
or result in a “separation from service” under Section 409A (“Job Elimination”).
“Elimination of their positions or duties” specifically excludes, without
limitation, termination of employment for cause or otherwise due to job
performance or other job-related matters. As a condition for such severance
income and other benefits under this Policy, the Executive or Other Key Employee
shall release the Company from any and all actions, suits, proceedings, claims
and demands related to employment by the Company and to the termination by
signing a waiver and release document in a form provided by the Company. Such
document shall include a statement that benefits under this Policy are
conditioned upon the Company’s receipt of a signed release.

 

2. Administration. The Vice President Human Resources of the Company, as agent
of the Company, has complete discretion and authority with respect to the
administration and application of the Policy, except as expressly limited by the
terms of the Policy; provided however, that approval must be obtained from the
Compensation Committee of the Board of Directors of the Company (the
“Committee”) in order to authorize severance outside of the terms of this Policy
to the employees covered by this Policy in the context of the elimination of a
position or duties.

 

3.

Participation. The Committee shall select the Executives and Other Key Employees
who are eligible for severance under this Policy (the “Participants”).
Participants who are eligible for severance under this Policy are listed by job
title on Exhibit A, which is attached hereto and incorporated by reference.
Notwithstanding the foregoing sentence, an Executive or Other Key Employee who
is entitled to severance benefits pursuant to a separate written agreement with
the Company shall not be eligible for severance under this Policy whether or not
his or her specific position is listed on Exhibit A. A Participant shall not be
eligible for Severance Pay if a Successor Employer (as defined below) offers
him/her a job that (a) has a base salary that is no more than 10% less than the
Participant’s then current base salary, (b) is located within fifty miles of the
Participant’s then current place of employment from a Successor Employer and
(c) commences within thirty days following his or her termination of employment
by the Company, whether or not the participant accepts the employment offer.
“Successor Employer” means any business

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organization that acquires (through merger, consolidation, reorganization,
transfer of stock or assets, or otherwise) either (i) all or substantially all
of the business or assets of the Company, or a division or subsidiary of the
Company; or a business unit of the Company, including Hoosier Park, L.P., or
(ii) the facility where the Participant usually works.

 

4. Definitions.

 

  a. “Base salary” means the fixed compensation (excluding bonuses and other
benefits) paid to an employee regularly each pay period for performing assigned
job responsibilities. The base salary, or base salary rate, of a Participant
shall be determined as of the date of termination of employment.

 

  b. “Code” shall mean the Internal Revenue Code of 1986, as amended, including
any regulations or guidance promulgated thereunder.

 

  c. “Executive” means an employee of the Company with the title of vice
president or higher.

 

  d. “Other Key Employee” means an employee who is not an Executive but is
determined by the Committee to be in a position to contribute materially to the
success of the Company.

 

  e. “Release” means a general release and waiver of claims against the Company,
in a form to be provided by the Company.”

 

  f. “Section 409A” shall mean Section 409A of the Code.

 

  g. “Severance Benefits” means the benefits set forth in Sections 5 and 6 of
this Policy.

 

  h. “Severance Pay” means the amount payable pursuant to Section 5 of this
Policy.

 

  i. “Years of Service” means the total of all full years of service and any
partial years of service in which the Participant worked at least 6 months
beginning with the Participant’s first day of employment with the Company.

 

5. Severance Pay Any Participant whose employment with the Company is terminated
by the Company due to Job Elimination shall be eligible for Severance Pay
hereunder provided the Participant has been employed by the Company for a
minimum of 12 months; and provided further that the Participant has returned a
signed Release to the Committee within the minimum time period required under
applicable state and federal laws, or if no such period, within five business
days, and has not revoked the Release within the minimum time permitted under
applicable state and federal laws.

 

  a.

Amount of Severance Pay. The amount of Severance Pay for which a Participant is
eligible hereunder shall be determined in accordance with his or her status as
an

 

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Executive or Other Key employee and his or her Years of Service with the
Company, as follows:

 

  i. Chief Executive Officer: The Chief Executive Officer of the Company is
entitled to severance benefits pursuant to a separate written agreement between
the Company and the Chief Executive Officer and shall not be eligible for
severance under this Policy.

 

  ii. Executive Vice President: An executive vice president shall be eligible
for Severance Pay equal to four (4) weeks of base salary for each Year of
Service with the Company. The minimum Severance Pay for an executive vice
president shall be sixteen (16) weeks of base salary and the maximum Severance
Pay for an executive vice president shall be fifty-two (52) weeks of base
salary.

 

  iii. Corporate Senior Vice Presidents or Track President: A corporate senior
vice president or track president shall be eligible for Severance Pay equal to
three (3) weeks of base salary for each Year of Service with the Company. The
minimum Severance Pay for a corporate senior vice president or track president
shall be twelve (12) weeks of base salary and the maximum Severance Pay for a
corporate senior vice president shall be twenty-six (26) weeks of base salary.

 

  iv. Corporate or Unit Vice President or Other Key Employee: A corporate or
unit vice president or Other Key Employee shall be eligible for Severance Pay
equal to two (2) weeks of base salary for each Year of Service with the Company.
The minimum Severance Pay for corporate or unit vice presidents or Other Key
Employees shall be two (2) weeks of base salary and the maximum Severance Pay
for a corporate or unit vice president shall be twenty-six (26) weeks of base
salary.

 

  b.

Method and Timing of Payment. Severance Pay shall be paid to an eligible
Participant in a single cash sum as soon as practicable, but in no event later
than 60 days, following the later of (i) the expiration of the applicable
revocation period following the signing of the Release by the Participant or
(ii) the Participant’s termination date with the Company; provided, however,
that in no event shall such Severance Pay be paid later than the March 15th of
the year following the year in which such termination occurs, but conditioned on
the Company receiving a signed Release that has not been revoked within the time
provided herein or in the Release. Notwithstanding the foregoing and any
provision in this Policy to the contrary, to the extent Severance Pay is
“deferred compensation” for purposes of Section 409A for an eligible
Participant, such Severance Pay shall be paid to such Participant in a single
cash sum as soon as practicable, but in no event later than 60 days, following
the Participant’s date of “separation from service” (within the meaning of
Section 409A) with the Company, but conditioned on the Company receiving a
signed Release that has

 

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not been revoked within the time provided herein or in the Release and in any
case where the first and last days of the applicable release and
non-revocability periods are in two separate tax years, to the extent required
to avoid accelerated taxation and/or tax penalties under Section 409A, Severance
Pay shall be made in the later tax year.

 

  c. Death of Participant. If a Participant dies after signing the release and
prior to receiving Severance Pay to which he or she is entitled pursuant to the
Policy, payment shall be made to the beneficiary designated by the Participant
to the Company or, in the event of no designation of beneficiary, then to the
estate of the deceased Participant.

 

  d. Section 409A. Notwithstanding any provision to the contrary, to the extent
required to avoid accelerated taxation and/or tax penalties under Section 409A,
if a Participant is a “specified employee” (as defined under Section 409A) as of
the date of his “separation from service” (as defined under Section 409) from
the Company, then the Separation Pay shall not be paid until the earlier of
(a) the expiration of the six (6) month period measured from the date of the
Participant’s “separation from service” and (b) the date of the Participant’s
death. All payments and benefits that are delayed pursuant to the immediately
preceding sentence shall be paid to the Participant in a lump sum as soon as
practicable following the expiration of such period (or if earlier, upon the
Participant’s death) but in no event later than thirty (30) days following such
period. To the extent required to avoid accelerated taxation and/or tax
penalties under Section 409A, no amount or benefit that is payable or to be
provided upon a termination of employment from the Company pursuant to this
Policy shall be payable or provided unless such termination also meets the
requirements of a “separation from service” under Section 409A. The Participant
shall cooperate fully with the Company to ensure compliance with Section 409A
including, without limitation, adopting amendments to arrangements subject to
Section 409A and operating such arrangements in compliance with Section 409A.

 

6. Outplacement Services. The Company shall provide standard outplacement
services at the expense of the Company, but not to exceed in total an amount
equal to $8,000, from an established outplacement firm selected by the Company.
In order to receive outplacement services, the Participant must begin utilizing
the services within thirty (30) days of the Participant’s date of termination of
employment with the Company and such services shall not extend beyond the
earlier of (i) the last day of the second taxable year following the taxable
year in which such termination date occurred or (ii) the date in which the
Participant is hired by another employer.

 

7.

Perquisites. The Participant’s right to use a Company automobile and any
automobile allowance that the Participant was receiving in accordance with the
arrangement in effect at the time of termination of the Participant’s employment
will cease at the time of termination of the Participant’s employment. Any
reimbursement for fringe benefits such

 

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as dues and expenses related to club memberships and expenses for professional
services will cease at the time of termination of the Participant’s employment.

 

8. Funding. The Policy shall at all times be entirely unfunded and no provision
shall at any time be made with respect to segregating assets of the Company for
payment of any Severance Benefits hereunder. No Participant or other person
shall have any interest in any particular assets of the Company by reason of the
right to receive Severance Benefits under the Policy and any such Participant or
any other person shall have only the rights of a general unsecured creditor of
the Company with respect to any rights under the Policy.

 

9. Taxation. All Severance Benefits shall be subject to federal, state and local
tax deductions and withholding for the same.

 

10. Non-Exclusivity of Rights. The terms of the Policy shall not prevent or
limit the right of a Participant to receive any base annual salary, pension or
welfare benefit, perquisite, bonus or other payment provided by the Company to
the Participant, except for such rights as the Participant may have specifically
waived in writing. Amounts that are vested benefits or which the Participant is
otherwise entitled to receive under any benefit policy or program provided by
the Company shall be payable in accordance with the terms of such policy or
program.

 

11. Amendment and Termination. This Policy may be amended or terminated by the
Committee acting in its sole discretion at any time. In addition, Participants
may be added and deleted by the Committee acting in its sole discretion at any
time. No such termination or amendment shall affect the rights of any individual
who is then entitled to receive Severance Benefits at the time of such amendment
or termination. Severance Benefits are not intended to be a vested right. The
Vice President Human Resources reserves the right in his sole discretion to
interpret the Policy, prescribe, amend and rescind rules and regulations
relating to it, determine the terms and provisions of the severance payments and
make all other determinations he deems necessary or advisable for the
administration of the Policy, subject to the appeals procedure in paragraph 16.
The determination of the Vice President Human Resources on all matters regarding
the Policy shall be conclusive. Copies of this Policy and any amendments shall
be provided to each constituent entity of the Company and, in the absence of any
written notice to the contrary, shall be deemed adopted by each such
constituent.

 

12. Non-Assignability. Severance Benefits pursuant to the Policy shall not be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge prior to actual receipt thereof by a Participant;
and any attempt to so anticipate, alienate, sell, transfer, assign, pledge,
encumber or charge prior to such receipt shall be void; and the Company shall
not be liable in any manner for, or subject to, the debts, contracts,
liabilities, engagements or torts of any person entitled to any Severance
Benefits under this Policy.

 

13.

Termination of Employment. Nothing in the Policy shall be deemed to entitle a
Participant to continued employment with the Company, and the rights of the
Company to

 

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terminate the employment of a Participant shall continue as though the Policy
were not in effect. Nothing in the Policy shall be deemed to vest any rights in
the Participant until the occurrence of a Job Elimination.

 

14. Confidential Information. As a condition of receiving Severance Benefits,
Participants shall agree to hold, in a fiduciary capacity for the benefit of the
Company, all confidential information regarding the Company acquired by the
Participant while employed by the Company. This confidential information may
include, but is not limited to, information regarding the Company’s business
practices, trade secrets, policies, customer lists, contracts, financial and
market data, marketing reports, pricing, business opportunities and other
information of a confidential nature. In consideration of the Benefits received
by a Participant pursuant to this Policy, Participant shall agree and covenant
that he or she (i) shall not use to the Company’s detriment and (ii) shall not
divulge, publicly or privately, any specified or other such confidential
information regarding any aspect of the Company’s business acquired during or as
a result of his or her employment with the Company. Furthermore, to the extent
that disclosure of any such information is controlled by statute, regulation or
other law, Participant shall agree that he or she is bound by such laws and that
this Policy does not operate as a waiver of any such non-disclosure requirement.
In the event of any breach of confidentiality, the Company shall be entitled to
injunctive relief, in addition to all other rights it may have at law or in
equity.

 

15. Governing Law. Except to the extent preempted by ERISA, the terms of the
Policy shall be governed by and construed and enforced in accordance with the
laws of the Commonwealth of Kentucky including all matters of construction,
validity and performance.

 

16. Claims Procedure. Generally, benefits will be paid under the Policy (also,
referred to as the “Plan”) without the necessity of filing a claim. If you
believe you are being denied benefits under the Plan, you may file a written
claim with the Vice President Human Resources. If a claim for a Plan benefits is
denied in whole or in part, you will receive a written notice of the denial.
This notice must be provided to you within a reasonable period of time, but not
later than 90 days after receipt of the claim by the Vice President Human
Resources, unless the Vice President Human Resources determines that special
circumstances require an extension of time for processing your claim. If the
Vice President Human Resources determines that an extension is necessary, notice
of the extension will be furnished to you prior to the termination of the
initial 90-day period. In no event will such extension exceed a period of90 days
from the end of the initial 90-day period. The extension notice will indicate
the special circumstances requiring an extension of time and when you can expect
the benefit determination.

The Vice President Human Resources’ notice of denial of your claim will contain
the following information: (a) The specific reason or reasons for the adverse
determination; (b) references to specific Plan provisions on which the
determination is based; (c) a description of any additional material or
information necessary for you to perfect the claim and an explanation of why
such material or information is necessary; and (d)

 

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appropriate information as to the steps to be taken if you want to submit your
claim for review, including a statement of your right to bring a civil action
under ERISA following an adverse benefit determination on review.

If a claim is denied, you may appeal the adverse determination by filing a
written request for a review of the claim with the Compensation Committee of the
Board of Directors. The request for review must be made within 60 days of the
date you receive the denial (or, if no written denial is received, within 60
days of the date when the denial was due). Send your written request for review
to the Committee.

You may submit written comments, documents, records, and other information
relating to your claim for benefits. You will be provided, upon request and free
of charge, reasonable access to, and copies of, all documents, records, and
other information relevant to your claim for benefits. The review will take into
account all comments, documents, records, and other information submitted by you
relating to your claim, without regard to whether such information was submitted
or considered in the initial benefit determination.

The Committee will provide you with a written notice of its decision on review
within 60 days after the Committee’s receipt of your written claim for review,
unless the Committee determines that special circumstances require an extension
of time for processing your claim. If the Committee determines that an extension
of time is required, written notice of the extension will be furnished to you
prior to the end of the initial 60-day period. The extension notice will
indicate the special circumstances requiring an extension of the time and the
date by which the Committee expects to render its determination on review. The
extension will not exceed a period of 60 days from the end of the initial 60-day
period.

In the case of an adverse benefit determination on review, the notice will set
forth: (a) The specific reason or reasons for the adverse determination;
(b) references to the specific Plan provisions on which the determination is
based; and (c) a statement that you are entitled to receive, upon request and
free of charge, reasonable access to, and copies of, all documents, records, and
other information relevant to your claim for benefits.

By participating in the Plan, you agree that (a) the Plan will not pay any
benefit for a claim filed more than one year from the date you terminate
employment, and (b) no legal or equitable action may be filed against the Plan
or any Plan fiduciary more than 90 days after exhaustion of the your rights
under the above claims procedure. You must exhaust all levels of the appeal
procedure before you can bring an action at law or equity. The power and
authority of the Chief Executive Officer and the Committee shall be
discretionary with respect to all matters arising before each of them under this
claims procedure.

 

17.

Your Rights Under ERISA. As a Participant in the Plan, you are entitled to
certain rights and protections under the Employee Retirement Income Security Act
of 1974 (ERISA). ERISA provides that all plan participants are entitled to:
examine, without charge, at the office of the Vice President Human Resources and
at other specified locations (such as

 

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worksites), all documents governing the Plan, including insurance contracts, if
any; and obtain copies of documents governing the operation of the Plan,
including insurance contracts, if any, and updated summary plan description upon
written request to the Vice President Human Resources. The Vice President Human
Resources may make a reasonable charge for the copies; and

In addition to creating rights for plan participants, ERISA imposes duties upon
the people who are responsible for the operation of the Plan. The people who
operate the Plan, called “fiduciaries” of the Plan, have a duty to do so
prudently and in the interest of you and other plan participants and
beneficiaries. No one, including your employer or any other person, may fire you
or otherwise discriminate against you in any way to prevent you from obtaining a
benefit .of exercising your rights under ERISA.

If your claim for a pension or welfare benefit is denied in whole or in part,
you have a right to know why this was done, to obtain copies of documents
relating to the decision without charge and to appeal the denial, all under
certain time schedules. Under ERISA, there are steps you can take to enforce
these rights. For instance, if you request materials from the plan and do not
receive them within 30 days, you may file suit in a federal court. In such a
case, the court may require the plan administrator to provide the materials and
pay you up to $110 a day until you receive them, unless the materials were not
sent because of reasons beyond the control of the plan administrator. If you
have a claim for benefits which is denied or ignored, in whole or in part, you
may file suit in a state or federal court. In addition, if you disagree with the
Plan’s decision, or lack thereof, concerning the qualified status of a domestic
relations order, you may file suit in federal court. If it should happen that
plan fiduciaries misuse the plan’s money, or if you are discriminated against
for asserting your rights, you may seek assistance from the U.S. Department of
Labor, or you may file suit in a federal court. The court will decide who should
pay court costs and legal fees. If you are successful, the court may order the
person you have sued to pay these costs and fees. However, if you lose, the
court may order you to pay the costs and fees; for example, if it finds your
claim is frivolous.

If you have any questions about the Plan, you should call or write the plan
administrator. If you have any questions about this statement or about your
rights under ERISA, or if you need assistance in obtaining documents from the
Plan Administrator, you should contact the nearest office of the Employee
Benefits Security Administration, U.S. Department of Labor listed in your
telephone directory or the Division of Technical Assistance and Inquiries,
Employee Benefits Security Administration, U.S. Department of Labor, 200
Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain certain
publications about your rights and responsibilities under ERISA by calling the
publications hotline of the Employee Benefits Security Administration.

 

18.

Plan Information. This is a welfare benefit plan and this document serves as the
Plan’s official plan document and as the summary plan description. The Company
is the plan administrator for ERISA reporting and disclosure purposes. The
Company’s address is 700 Central Avenue, Louisville, Kentucky 40208, and service
of process may be made on

 

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the Company at this address. The Company’s employer identification number is
35-1930820, and the telephone number is 502-636-4400.

IN WITNESS WHEREOF, the Company has caused this Policy, as amended effective
November 12, 2008, to be executed in its name by its duly authorized officer as
of the 14th day of November, 2008.

 

CHURCHILL DOWNS INCORPORATED By  

/s/ Charles G. Kenyon

Title:  

VP Human Resources

 

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Exhibit A

Churchill Downs Incorporated

CEO (Evans)

Corporate Executive Vice President & Chief Development Officer (Carstanjen)

Corporate Executive Vice President & Chief Financial Officer (Mudd)

Corporate Executive Vice President Racing Operations (Sexton)

Senior Vice President, Legal & Secretary (Reed)

Senior Vice President, Racing Operations (Richardson)

Vice President, “Branding” (Tompkins)

Vice President, Finance & Treasurer (Anderson)

Vice President, National Public Affairs (Flanery)

Vice President, Development (Aronson)

Vice President, Development (Gay)

Vice President, Analytics (Jenkins)

Vice President, Human Resources (Kenyon)

Vice President, IT (Murr)

Vice President, Operations (Nicholson)

Vice President, Marketing (Koenig-Loignon)

VP Procurement (Castek)

Controller (Milliner)

VP/ Corporate Counsel (Blackwell)

Asst. General Counsel (Bailey)

BRIS

Vice President, General Manager (Broadbent)

Internet Technology (Antoniadis)

Sr. Technology Manager (Corbett)

TwinSpires

Executive Vice President & Chief Technology Officer (Niven)

Vice President, Product Engineering (Thukral)

Vice President, Sr. Business Analyst (Cody)

Vice President, Marketing (Clemons)

Sr. Engineer (Kudva)

Director Operations (Shah)

TrackNet

Vice President, TrackNet Media (Troutman)

Controller (O’Daniel)

VP Compliance ( J.Jezoriski)

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Arlington Park Race Course

President (Arnold)

Vice President, Racing (Greely)

Vice President, Communications (Stabler)

Vice President, Marketing (Kiehn)

Vice President, Legislative Affairs (Stumpf)

Vice President, Administration (Thayer)

Vice President, Facilities& Operations (Petrillo)

Sr. Director OTB Operations (Carmichael)

Controller (Peters)

Sr. Director Track Surface (Barajas)

Calder Race Course

President (Dunn)

Vice President, General Manager & Finance (Abes)

Vice President, Marketing (Cronin)

Track Surfaces (Cross)

Racing Secretary (Anifantis)

Churchill Downs Race Track

President (N/A)

Vice President, General Manager (Gates)

Vice President, Marketing Sales & Asst. GM (Schneider)

Vice President, Operations (Sweazy)

Vice President, Track Superintendent (Lehr)

Vice President, Racing Communications (Asher)

Controller (Graff)

Sr. Director Marketing (Alexander)

Racing Secretary (Huffman)

Fair Grounds

President (Soth)

Vice President, General Manager Slots & OTB’s (Miller)

Vice President, Finance (Bienvenu)

Asst. General Manager (Fenasci))

Video Poker Operations (Hepting)

Sr. Director Marketing (Conner)

 

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