CHURCHILL DOWNS INCORPORATED
RESTRICTED STOCK AGREEMENT
_________ SHARES
THIS RESTRICTED STOCK AGREEMENT (the “Agreement”) is made as of the __ day of
February, 2015 by and between ___________ (the “Executive”), and Churchill Downs
Incorporated (the “Company”), a Kentucky corporation with its principal place of
business at 600 N. Hurstbourne Parkway, Louisville, Kentucky 40222.
WITNESSETH:
WHEREAS, the Company maintains the Churchill Downs Incorporated 2007 Omnibus
Stock Incentive Plan (the “Plan”) which was approved by shareholders of the
Company at the 2007 Annual Meeting of Shareholders on June 28, 2007;
WHEREAS, the Plan provides for the granting of restricted shares of the
Company’s common stock, no par value per share (the “Common Stock”) in
accordance with the terms and provisions thereof and the Executive is a person
eligible for participation under the Plan;
WHEREAS, the Compensation Committee (the “Committee”) of the Board of Directors
of the Company at its meeting on ______________ authorized and directed the
Company to make an award of stock to the Executive under the terms and
conditions set forth in this Agreement; and
WHEREAS, the parties desire to enter into this Agreement to set forth the terms
and conditions of such award.
NOW, THEREFORE, in consideration of the foregoing and the mutual undertakings
herein contained, and for other good and valuable consideration, the mutuality,
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1.Grant of Stock. Subject to the further terms, conditions and restrictions
contained in this Agreement, the Company hereby grants to the Executive         
shares (the “Shares”) of the Company’s Common Stock in consideration for
services to be performed by the Executive as an employee of the Company and its
subsidiaries. As long as the Shares are subject to the Restrictions set forth in
Section 4 of this Agreement, such shares shall be deemed to be, and are referred
to in this Agreement as, the “Restricted Shares”.
2.Certificates for Shares/Book Entry. Certificates (or alternatively, where
applicable and permitted by applicable law and the rules of an applicable stock
exchange, book entries) evidencing Restricted Shares shall be deposited (or
recorded) with the Company to be held in escrow until such Shares are released
to the Executive or forfeited in accordance with this Agreement. The Executive
shall, simultaneously with the execution and delivery of this Agreement, execute
and deliver to the Company a stock power in blank with respect to the Restricted
Shares. If any Restricted Shares are forfeited, the Company shall direct the
transfer agent of the Common Stock to make the appropriate entries in its
records showing the cancellation of the certificate or certificates (or, as
applicable, the book entries) for such Restricted Shares.
3.Adjustments in Restricted Shares.
(a)
In the event of any change in the outstanding Common Stock by reason of a stock
dividend or distribution (or distribution on Common Stock of any security
convertible into securities of the Company), recapitalization, merger,
consolidation, split-up, combination, subdivision,

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reclassification, exchange of shares or the like, the Committee shall make
equitable adjustments in the Restricted Shares so that the shares represent the
same percentage of the Company’s equity as was the case immediately prior to
such change. Any new, additional or different securities to which the Executive
shall be entitled in respect of Restricted Shares by reason of such adjustment
shall be deemed to be Restricted Shares and shall be subject to the same terms,
conditions and restrictions as the Restricted Shares so adjusted.
(b)
In the event Company merges, consolidates or effects a share exchange with
another entity, or all or a substantial portion of Company’s assets or
outstanding capital stock are acquired (whether by merger, purchase or
otherwise) by another entity (any such entity being hereafter referred to as the
“Successor”) each of the Restricted Shares shall automatically be converted into
and replaced by shares of common stock, or such other class of securities having
rights and preferences no less favorable than the Restricted Shares, of the
Successor, and the number of Restricted Shares shall be correspondingly
adjusted, so that Executive shall have the right to that number of shares of
common stock of the Successor that have a value equal, as of the date of the
merger, conversion or acquisition, to the value, as of the date of the merger,
conversion or acquisition, of the Restricted Shares.

4.Restrictions. During applicable periods of restriction determined in
accordance with Section 6 of this Agreement, Restricted Shares, and all rights
with respect to such Shares, may not be sold, assigned, transferred, exchanged,
pledged, hypothecated or otherwise encumbered or disposed of and shall be
subject to the risk of forfeiture contained in Section 5 of this Agreement (such
limitations on transferability and risk of forfeiture being herein referred to
as the “Restrictions”), but the Executive shall have all other rights of a
stockholder; provided, however, that, until such time as the Restrictions lapse,
the Executive shall not have the right to vote the Restricted Shares; receive
dividends thereon (dividends shall accrue and vest and be paid at the same time
as the Restrictions lapse); or purchase any securities pursuant to that certain
Rights Agreement dated as of March 19, 1998, between the Company and The Fifth
Third Bank (as successor Rights Agent to Bank of Louisville), as amended, and as
the same may be amended, modified or supplemented from time to time.
5.Forfeiture of Restricted Shares. Subject to Section 6 below, in the event that
the Executive’s employment with the Company and its subsidiaries terminates for
any reason, such event shall constitute an “Event of Forfeiture” and all Shares
which at that time are Restricted Shares shall thereupon be forfeited by the
Executive to the Company without payment of any consideration by the Company,
and neither the Executive nor any heir, personal representative, successor or
assign of the Executive shall have any right, title or interest in or to such
Restricted Shares or any certificates (or book entries) evidencing the same.
6.Lapse of Restrictions.
(a)
The Restrictions on the respective Restricted Shares shall lapse per the
schedule immediately below, provided, however, that such corresponding date
occurs prior to a Termination of Employment (as defined in Appendix A), but
subject to Sections 6(c) and 6(e) below:    

Date
# of Shares for which Restrictions lapse and which become non-forfeitable
 
 
 
 

(b)
Upon the lapse of the Restrictions in accordance with this Section, the Company
shall, as soon as practicable thereafter, deliver to the Executive a certificate
(or record as a book entry and deliver evidence of same to the Executive)
(without any restrictive endorsement referring to such Restrictions) for the
Shares that are no longer subject to such Restrictions.

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(c)
In the event the Executive’s employment is terminated by the Company other than
for Cause (as defined in Appendix A), Disability (as defined in Appendix A) or
death, or if the Executive voluntarily resigns for Good Reason (as defined in
Appendix A) for purposes of determining any lapse of the Restrictions in (a)
above and the forfeiture of Shares, if any, under Section 5 and Section 6, the
Executive’s employment shall be considered to have continued through the last
day of the calendar quarter in which his Termination of Employment occurs.

(d)
If, during the 2-year period following a Change in Control (as defined in
Appendix A): (i) the Executive is terminated by the Company other than for
Cause, Disability or death, or (ii) the Executive voluntarily resigns for Good
Reason, the Restrictions on all then-Restricted Shares shall fully lapse, as of
the Termination of Employment.

(e)
In the event the Executive’s employment is terminated due to his death or
Disability (as defined in Appendix A), for purposes of determining any lapse of
the Restrictions in (a) above and the forfeiture of Shares, if any, under
Section 5 and Section 6, the Executive’s employment shall be considered to have
continued through 18 months following his Termination of Employment (as defined
in Appendix A).

7.Withholding Requirements. Whenever Restrictions lapse with respect to
Restricted Shares, the Company shall have the right to (i) withhold from sums
due to the Executive; (ii) require the Executive to remit to the Company; or
(iii) retain Shares otherwise deliverable to the Executive; in an amount
sufficient to satisfy any Federal, state or local withholding tax requirements
prior to making such payments or delivering any such Shares to the Executive.
8.Effect Upon Employment. Nothing contained in this Agreement shall confer upon
the Executive the right to continue in the employment of the Company or its
subsidiaries or affect any right that the Company or its subsidiaries may have
to terminate the employment of the Executive.
9.Amendment. This Agreement may not be amended, modified or supplemented except
with the consent of the Committee and by a written instrument duly executed by
the Executive and the Company.
10.Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their heirs, personal representatives,
successors and assigns. Executive accepts the award of Shares hereunder subject
to all of the terms and conditions of this Agreement. Executive hereby agrees to
accept as binding, conclusive and final all reasonable decisions and
interpretations of the Committee upon any questions arising under this
Agreement, including without limitation, the interpretation of the Restrictions
imposed upon the Shares.
11.Notices. Notices shall be deemed delivered if delivered personally or if sent
by registered or certified mail to the Company at its principal place of
business, as set forth above, and to Executive at the address as shall most
currently appear on the records of the Company, or at such other address as
either party may hereafter designate in writing to the other.
12.Investment Representation. If the Shares awarded to the Executive under this
Agreement are not registered under the Securities Act of 1933, as amended,
pursuant to an effective registration statements, the Executive, if the
Committee shall reasonably deem it advisable, may be required to represent and
agree in writing (i) that any Shares acquired by the Executive under this
Agreement will not be sold except pursuant to an effective registration
statement under the Securities Act of 1933, as amended, or pursuant to an
exemption from registration under such Act, and (ii) that the Executive has
acquired such Shares for his own account and not with a view to the distribution
thereof.
13.Compliance with Section 16(b). This Agreement and the grant of Shares
hereunder is intended to comply with all applicable conditions of Rule 16(b)-3
of the General Rules and Regulations under the Securities Exchange Act of 1934,
as amended. All transactions involving the Company’s executive officers are
subject to such conditions, regardless of whether the conditions are expressly
set forth in this Agreement. Any provision of this Agreement that is contrary to
a condition of Rule 16b-3 shall not apply.
14.Compliance With Other Laws And Regulations. The rights of the Executive and
the obligations of Company under this Agreement shall be subject to all
applicable federal and state laws, rules

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and regulations and to such approvals by any government or regulatory agency as
may be required. Company shall not be required to issue or deliver certificates
for shares of Common Stock before [i] the listing of such shares on any stock
exchange or over-the-counter market, such as NASDAQ, on which the Common Stock
may then be listed or traded, and [ii] the completion of any registration or
qualification of any governmental body which Company shall, in its sole
discretion, determines to be necessary or advisable. The Company agrees to use
its best efforts to procure any such listing, registration or qualification.
15.Severability. The invalidity or unenforceability of any provision of the
Agreement shall not affect the validity or enforceability of the remaining
provisions of the Agreement, and such invalid or unenforceable provision shall
be stricken to the extent necessary to preserve the validity and enforceability
of the Agreement with the parties agreeing in such event to make all reasonable
efforts to replace such invalid or unenforceable provision with a valid
provision that will place the parties in approximately the same economic
position as contemplated hereunder.
16.Governing Law; Jurisdiction. This Agreement shall be governed by the laws of
the Commonwealth of Kentucky. The Executive consents to the exclusive
jurisdiction of the courts of the Commonwealth of Kentucky and of any federal
court located in Jefferson County, Kentucky in connection with any action or
proceeding arising out of or relating to this Agreement, any document or
instrument delivered pursuant to or in connection with this Agreement, or any
breach of this Agreement or any such document or instrument.
17.Entire Agreement. This Agreement contains the entire agreement between the
parties hereto with respect to the subject matter hereof.
18.Counterparts and Signatures. This Agreement may be signed in counterparts,
each of which shall be an original, with the effect as if the signatures thereto
and hereto were upon the same instrument. Signatures conveyed by facsimile or
PDF file shall constitute original signatures.

(Signature page follows.)

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IN WITNESS WHEREOF, the Company and the Executive have executed and delivered
this Agreement as of the date first above written.

 
[PARTICIPANT]
 

 
 
 
CHURCHILL DOWNS INCORPORATED

By: _______________________________
Charles G. Kenyon
Senior Vice President, Human Resources
       (Authorized Representative)
 
 

        

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APPENDIX A
Definitions
(a)“Agreement” - see the recitals to this Agreement.
(b)“Base Salary” - means the Executive’s base salary as of the date the
Agreement is executed.
(c)“Board” means the Board of Directors of the Company.
(d)“Cause” for termination by the Company of Executive’s employment with the
Company means any of the following:
(i)the willful and continued failure of Executive to perform substantially his
duties to the Company (other than any such failure resulting from incapacity due
to disability), after a written demand to cure such failure (the “Demand to
Cure”) is delivered to Executive by the ______________ which specifically
identifies the manner in which the ______________ believes that Executive has
not substantially performed his duties;
(ii)Executive’s conviction of, or plea of guilty or no contest to (A) a felony
or (B) a misdemeanor involving dishonesty or moral turpitude; or
(iii)the willful engaging by Executive in illegal conduct or gross misconduct
which is materially and demonstrably injurious to the business or reputation of
the Company.
For purposes of this definition, no act or failure to act, on the part of
Executive, shall be considered “willful” unless it is done, or omitted to be
done, by Executive in bad faith or without reasonable belief that Executive’s
action or omission was in the best interests of the Company. Any act, or failure
to act, based upon specific authority given pursuant to a resolution duly
adopted by the Board or upon instructions of the __________________ or based
upon the advice of counsel of the Company which Executive honestly believes is
within such counsel’s competence shall be conclusively presumed to be done, or
omitted to be done, by Executive in good faith and in the best interests of the
Company. The Company shall give written notice to Executive of the termination
for Cause. Such notice shall state in detail the particular act or acts or the
failure or failures to act that constitute the grounds on which the Cause
termination is based and such notice shall be given within six (6) months of the
occurrence of, or, if later, the Company’s actual knowledge of, the act or acts
or the failure or failures to act which constitute the grounds for Cause.
Executive shall have sixty (60) days upon receipt of the Demand to Cure in which
to cure such conduct, to the extent such cure is possible.
(e)“Change in Control” means the first to occur of the following events:
(i)the acquisition, directly or indirectly, by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a
"Person") of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of more than 50% of either the then outstanding voting
securities of the Company (the "Outstanding Company Common Stock") or the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however that for purposes of this
subsection (i), the following acquisitions shall not constitute a Change in
Control: (w) any acquisition directly from the Company, (x) any acquisition by
the Company or any of its subsidiaries, (y) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, or (z) any acquisition by any corporation
pursuant to a transaction which complies with clauses (A), (B) and (C) of
subsection (iii) of this definition;
(ii)individuals who, as of the Effective Date, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the Effective Date whose election, or nomination for election

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by the Company's shareholders, was approved by a vote of at least a majority of
the directors then comprising the Incumbent Board shall be considered as though
such individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board;
(iii)consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company or the
acquisition of assets of another entity (a “Corporate Transaction”), in each
case, unless, immediately following such Corporate Transaction, (A) all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such Corporate Transaction
beneficially own, directly or indirectly, more than 50% of, respectively, the
then-outstanding shares of common stock and the combined voting power of the
then-outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such Corporate
Transaction (including, without limitation, an entity which as a result of such
transaction owns the Company or all or substantially all of the Company's assets
either directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Corporate Transaction,
of the Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be, (B) no Person (excluding any corporation
resulting from such Corporate Transaction or employee benefit plan (or related
trust) of the Company or such corporation resulting from such Corporate
Transaction) beneficially owns, directly or indirectly, 50% or more of,
respectively, the then-Outstanding Company Common Stock resulting from such
Corporate Transaction or the Outstanding Company Voting Securities resulting
from such Corporate Transaction, except to the extent that such ownership
existed prior to the Corporate Transaction, and (C) at least a majority of the
members of the Board resulting from the Corporate Transaction were members of
the Incumbent Board at the time of the execution of the initial plan or action
of the Board providing for such Corporate Transaction; or
(iv)approval by the shareholders of the Company of a complete liquidation or
dissolution of the Company.
(f)“Code” means the Internal Revenue Code of 1986, as amended from time-to-time.
(g)“Common Stock” means the common stock, no par value, of the Company.
(h)“Company” - see the recitals to this Agreement.
(i)“Disability” means that Executive becomes “disabled” within the meaning of
Section 409A(a)(2)(C) of the Code or any successor provision and the applicable
regulations thereunder.
(j)“Exchange Act” means the Securities Exchange Act of 1934.
(k)“Executive” - see recitals to this Agreement.
(l)“Good Reason” for termination by Executive of Executive’s employment means
the occurrence (without Executive’s express written consent) of any one of the
following acts by the Company or failures by the Company to act:
(i)the assignment to Executive of any duties inconsistent in any material
respect with the position held by the Executive at the time this Agreement is
executed (including status, office, title and reporting requirements), or the
authority, duties or responsibilities of the position, or any other diminution
in any material respect in such position, authority, duties or responsibilities
unless agreed to by Executive;
(ii)the Company’s requiring Executive to be based at, or perform his principal
functions at, any office or location other than a location within 35 miles of
the Main Office unless such other location is closer to Executive’s then-primary
residence than the Main Office;
(iii)a material reduction in Base Salary;
(iv)a material reduction in Executive’s welfare benefits plans, qualified
retirement plan, or paid time off benefit unless other senior executives suffer
a comparable reduction; and
(v)any purported termination of Executive’s employment under this Agreement by
the Company other than for Cause, death or Disability.

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Prior to Executive’s right to terminate employment for Good Reason, he shall
give written notice to the Company of his intention to terminate his employment
on account of a Good Reason. Such notice shall state in detail the particular
act or acts or the failure or failures to act that constitute the grounds on
which Executive’s Good Reason termination is based and such notice shall be
given within six (6) months of the occurrence of the act or acts or the failure
or failures to act which constitute the grounds for Good Reason. The Company
shall have sixty (60) days upon receipt of the notice in which to cure such
conduct, to the extent such cure is possible.
(m)“Main Office” means 600 N. Hurstbourne Parkway, Louisville, Kentucky.
(n) “Termination of Employment” means a termination by the Company or by
Executive of Executive’s employment with the Company.