Executive Severance Policy


CHURCHILL DOWNS
INCORPORATED 
EXECUTIVE SEVERANCE
POLICY 



     	1.	
          Purpose. The Churchill Downs Incorporated 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 or Hoosier Park, L.P. (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
          (“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. This Policy is administered by the Chief Executive
          Officer of the Company. The Chief Executive Officer 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. The Chief Executive
          Officer must receive approval from the Compensation Committee of the Board of
          Directors (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”). 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. Participants who are eligible for
          severance under this Policy are listed by job title on Exhibit A, which is
          attached here and incorporated by reference. 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 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. 



	 
	 
	
                1
	

	 
	 






     	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. 


               



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


               



          	 	c. 	
               “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. 


               



          	 	d. 	
               “Severance Benefits” means the benefits set forth in Section 6 of this
               Policy. 


               



          	 	e. 	
               “Severance Period” means the period commencing on the date of the
               Participant’s last day of employment with the Company and continuing for a
               period equal to the number of weeks of Severance Pay the Participant will
               receive pursuant to the Policy. 


               



          	 	f. 	
               “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 the Participant has returned a signed Release
          to the Committee within the time period requested by the Committee and has not
          revoked the Release within the 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 executive or key employee and his or her length of service with
               the Company. Severance Pay under this Policy means base pay and any pro-rata
               earned incentive bonus under the Company’s Incentive Compensation Plan. 



	 
	 
	
                2
	

	 
	 






	 	
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. 






	 	
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 for an executive vice president shall be fifty-two (52)
weeks of base salary. 






	 	
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 pay and the maximum
severance for a corporate senior vice president shall be twenty-six (26) weeks of base
salary. 






	 	
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 for a corporate or unit vice president shall be
twenty-six (26) weeks of base salary. 






          	 	b. 	
               Method of Payment. Severance Pay shall be paid to an eligible Participant
               pro rata by checks issued in accordance with the Company’s regular payroll
               schedule, commencing with the pay period following the expiration of the 7-day
               revocation period following the signing of the release or the business day
               following the Participant’s last day of employment, whichever is later. 


               



          	 	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. 


               



     	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 30 days of his or her date of termination. 



	 
	 
	
                3
	

	 
	 






     	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 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 Pay or 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 Pay or 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 Pay and 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 Pay at the time of
          such amendment or termination. Severance Pay is not intended to be a vested
          right. The Chief Executive Officer 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 Chief Executive Officer 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. 



	 
	 
	
                4
	

	 
	 





     	12.	
          Non-Assignability. Severance Pay and 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 Pay or 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 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 Pay,
          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
          Severance Pay and 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. 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 Chief Executive Officer. 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 Chief Executive Officer,
          unless the Chief Executive Officer determines that special circumstances require
          an extension of time for processing your claim. If the Chief Executive Officer
          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 of 90 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. 



	 
	 
	
               5
	

	 
	 






	 	
The
Chief Executive Officer’s 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)
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. 



	 
	 
	
                6
	

	 
	 





	 	
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 Plan Administrator’s office and at other
          specified locations (such as 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 Plan Administrator. The
          Plan Administrator 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 or 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. 



	 
	 
	
                7
	

	 
	 






	 	
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 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 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 to be executed in its name by its duly authorized officer as of the
13th day of November, 2003. 



	
	  	Churchill Downs
        Incorporated


		By:
/s/Thomas H. Meeker
		            Thomas H. Meeker


		Title: President & Chief Executive Officer




	 
	 
	
                8
	

	 
	 





EXHIBIT A 


CHURCHILL DOWNS INCORPORATED 




Corporate Executive Vice President and Chief Financial Officer 

Corporate Executive Vice President and Chief Operating Officer

Senior Vice President, General Counsel and Secretary 

Senior Vice President, Sales and Marketing 

Senior Vice President, Public Affairs

Vice President, Finance and Treasurer 

Vice President, New Media

Vice President, Development 

Vice President, Community Relations

Vice President, Sales 

Vice President, Marketing 

Assistant Secretary 

President, Churchill Downs Simulcast Network 

Vice President, Churchill Downs Simulcast Network 

Senior Vice President, Racing (CDMC)

 Vice President, Finance and Administration, and Treasurer (CDMC)

 



CHURCHILL DOWNS 




President

Vice President, Administration

Vice President, Racing Communications

Vice President, Track Superintendent

Vice President, Marketing and Group Sales

Vice President, Guest Services

Vice President, Operations

Controller 




	 
	 
	
                9
	

	 
	 





ARLINGTON PARK

 



President

Executive Vice President, Racing and Racing Secretary

Vice President, Administration 

Vice President, Finance

VicePresident, Marketing

Vice President, Legislative Affairs

 



HOLLYWOOD PARK 





President 

General Manager 

Vice President, Finance

Vice President, Marketing 





CALDER RACE COURSE 





President

General Manager

Vice President, Finance 

Vice President, Marketing 



HOOSIER PARK  





President 

Vice President, Finance 

Vice President, Marketing 

Vice President, Communications 



ELLIS PARK 





General Manager 



	 
	 
	
                10