Employment Agreement as Amended and Restated


    

      EMPLOYMENT
        AGREEMENT

      AS
        AMENDED AND RESTATED

      AS
        OF
        DECEMBER 31, 2005

      


      THIS
        EMPLOYMENT AGREEMENT is
        entered
        into as of March 13, 2003
        and
        as amended and restated as of December 31, 2005
        between
        CHURCHILL DOWNS INCORPORATED, a Kentucky corporation ("Company"), and THOMAS
        H.
        MEEKER (the "Executive”). 

      


      WHEREAS,
        the Board of Directors of Churchill Downs Incorporated (the “Board"),
determined
        that it is in the best interest of the Company and its shareholders, to retain
        the Executive as its President and Chief Executive Officer; and

      


      WHEREAS,
        the Executive is currently willing and competent to serve the Company as
        its
        President and Chief Executive Officer under the terms and conditions of this
        Employment Agreement (the “Agreement”);
        and

      


      WHEREAS,
        the Executive is currently a member of the Board and has agreed to resign
        as a
        member of the Board if requested to do so with the expectation that, upon
        such
        resignation, the Executive would then be designated a Director Emeritus;
        and

      


      WHEREAS,
        the Company and the Executive agree that it is in the best interest of the
        Company and its shareholders to amend the Agreement to provide for the effective
        and efficient transition of the Company's management.

      


      NOW,
        THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

      


      1. 
        Employment.
        The
        Company hereby employs the Executive, and the Executive hereby accepts
        employment, in the capacity of President and Chief Executive Officer of the
        Company. Subject to the general direction, approval and control of the Board,
        the Executive shall exert his best efforts and devote his full time and
        attention to the business and affairs of the Company. The Executive shall
        be in
        complete charge of the operation of the Company, shall have all powers and
        responsibilities as provided in the Company's current bylaws attendant to
        the
        position of President and Chief Executive Officer, and shall have full authority
        and responsibility for formulating and executing the business policies and
        managing and supervising the business of the Company in all respects. At
        all
        times
        during
        the Term (as
        hereinafter
        defined)
        the
        Executive’s position (including status, offices, titles and reporting
        requirements), authority, duties and responsibilities shall be at least
        commensurate in all material respects with those held, exercised and assigned
        on
        the date this Agreement was first executed. The Executive’s office shall be
        located at the Company’s headquarters in Louisville, Kentucky. Further, at no
        time during the term or any renewal term shall the Executive’s office be located
        more than 35 miles from 700 Central Avenue, Louisville, Kentucky.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      2. Term.
        This
        Employment
        Agreement shall commence on March 13, 2003, and shall expire on March 13,
        2007,
        unless terminated earlier as herein provided (the "Term").

      


      3. Compensation
        and Perquisites.
        During
        the Term:

      


      A. Base
        Salary.
        As
        compensation for the services rendered by
        the
        Executive hereunder, the Company shall pay to the Executive a base salary
        of
        $500,580 a year (effective for 2005 and 2006), payable in arrears in
        semi-monthly installments (the “Base Salary”). Base Salary adjustments, if any,
        shall be made, in the discretion of the Board of Directors, at any time,
        but in
        no event may the Executive's Base Salary be reduced below that paid in the
        preceding year. All payments or other compensation to the Executive shall
        be
        subject to appropriate withholding.

       

      B. Incentive
        Compensation.
        In
        addition to any other compensation provided under this Agreement, the Executive
        shall be entitled to participate in any Company sponsored annual or long-term,
        cash or equity based, incentive plan or other such arrangement, now in existence
        or hereafter created, made available to its executives and key management
        employees, subject to and on a basis consistent with the terms, conditions
        and
        overall administration of such plans and arrangements. The plans currently
        in
        existence include: The Incentive Compensation Plan, Restricted
        Stock
        Option Plan and the Deferred Compensation Plan. The Company may, from time
        to
        time, amend the provisions of these plans prospectively.

      


      C.
         Travel
        and Entertainment Expenses.
        The
        Company shall reimburse the Executive for all reasonable and necessary travel
        and other out-of-pocket expenses incurred by him in the performance of his
        duties. The Company shall pay the Executive's reasonable travel and
        entertainment expenses and other reasonable expenses incurred on behalf of
        the
        Company's business. The Company also shall pay for such expenses for the
        Executive's wife when she travels with him on the Company's business. The
        Executive shall present to the Company on a timely basis an itemized account
        of
        such expenses in such form as may be required by the Company and the
        reimbursement of such expenses shall be subject to the customary policies
        of the
        Company.

      


      D. Supplemental
        Benefit Plan.
        The
        Company shall provide the Executive various retirement benefits under the
        provisions of the Company’s Supplemental Benefit Plan as described in Exhibit A
        attached hereto. The Company may, from time to time, amend the Supplemental
        Benefit Plan prospectively.

       

      E.
         Automobile.
        The
        Company shall provide the Executive with an automobile and shall pay for
        maintenance, repairs, insurance and all operating costs incident
        thereto.

       

      
        
          
          

        

        
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      F.
         Life
        Insurance.
        The
        Company shall provide the Executive a $250,000 life insurance policy with
        a
        reputable and responsible insurance company acceptable to the Company and
        the
        Executive, with all premiums being paid by the Company.

      


      G.
         Dues.
        The
        Company shall pay for the Executive's dues for one country club and for all
        appropriate professional or business associations to which he may
        belong.

      


      4. Other
        Employee Benefits.

      


      A.
         Welfare
        Benefit Plans.
        During
        the
        Term,
        the Executive and/or the Executive’s family, as the case may be, shall be
        eligible to participate in and shall receive all benefits under all welfare
        benefit plans, practices, policies and programs provided by the Company
        (including, without limitation, disability, group life, accidental death)
        to the
        extent applicable generally to other executives of the Company.

      


      B. Profit
        Sharing Plan.
        During
        the
        Term,
        the Executive shall be entitled to participate in the Company’s 401(k) Profit
        Sharing Plan or any other similar plan, program, policy or practice generally
        made available to other executives of the Company.

      


      C. Health
        Insurance.
        During
        the
        Term,
        the Company shall provide the Executive and his wife, as the case may be,
        major
        medical and health insurance coverage consistent with that provided to other
        employees of the Company. All premiums shall be paid by the
        Company.

      


      D. Vacation.
        The
        Executive shall be awarded paid time off (PTO) consistent with the Company’s
        then established policy. The Executive shall consult with the Chairman of
        the
        Board prior to scheduling PTO days.

      


      5. Termination
        of Employment.

      


      A. Termination
        for Cause.
        The
        Company may terminate the Executive’s employment during the
        Term for
        cause. For purposes of this Agreement, “Cause” shall mean: (i) the willful and
        continued failure of the Executive to perform substantially the duties of
        president and chief executive officer (other than any such failure resulting
        from incapacity due to disability), after a written demand for substantial
        performance improvement is delivered to the Executive by the Chairman of
        the
        Board which specifically identifies the manner in which the Board believes
        that
        the Executive has not substantially performed the duties of president and
        chief
        executive officer, or (ii) the willful engaging by the 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 paragraph,
        no
        act or failure to act, on the part of the Executive, shall be considered
        “willful” unless it is done, or omitted to be done, by the Executive in bad
        faith or without reasonable belief that the 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 Chairman of the Board or based upon the advice of
        counsel of the Company which the Executive honestly believes is within such
        counsel’s competence shall be conclusively presumed to be done, or omitted to be
        done, by the Executive in good faith and in the best interests of the Company.
        In the event the Company terminates the Executive for cause, he shall be
        entitled to receive:

      


      
        
          
          

        

        
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      (1)  Base
        Salary through the date of termination;

      


      (2) The
        balance of any annual or long term awards, if any, earned but not yet paid
        pursuant to any Long Term Incentive Compensation Plan maintained by the Company
        in which the Executive participated at the time of his termination subject
        to
        and payable in accordance with the Plan and the customary practices of the
        Company for other executives; and

      


      (3) Any
        other
        benefits or payments due to the Executive under and subject to applicable
        plans
        or programs maintained by the Company in which the Executive participated
        at the
        time of termination, including without limitation, any benefits due under
        the
        Supplemental Benefit Plan.

      


      B. Termination
        Without Cause,
        By
        Constructive Termination or Due to Death, Disability or
        Retirement.

      


      (1) Termination
        Without Cause.
        The
        Company may terminate the Executive’s employment with the Company, other than
due
        to
        death, disability (as provided under Paragraph 5.B.(2)) or Cause and such
        termination shall be deemed a termination “without cause.”

      


      (2) Termination
        Due to Disability.
        If the
        Executive shall become disabled (as defined in Section 409A of the Internal
        Revenue Code of 1986, as amended (the "Code") and the regulations thereunder)
        during the Term, he shall be entitled to the payment of his Base Salary and
        benefits being paid or provided at the time of the commencement of such
        disability and such shall continue for the duration of such disability but
        in no
        event for a period longer than six (6) consecutive months or an aggregate
        of six
        (6) months in any 12-month period. If such disability continues for a period
        of
        six (6) consecutive months, the Company, at its option, may thereafter, upon
        written notice to the Executive or his personal representative, terminate
        his
        employment.

      


      (3) Constructive
        Termination.
        The
        Executive may, in his sole discretion, terminate his employment with the
        Company
        by virtue of the Company’s Constructive Termination of his employment.
For
        purposes of the Agreement, “Constructive Termination” shall mean: (i) The
        assignment to the Executive of any duties inconsistent in any material respect
        with those of the president and chief executive officer (including status,
        office, title and reporting requirements), or the authority, duties or
        responsibilities as contemplated by Paragraph 1 of this Agreement, or any
        other
        diminution in any material respect in such position, authority, duties or
        responsibilities unless agreed to by the Executive; (ii) the Company’s requiring
        the Executive to be based at any office or location other than as provided
        in
        Paragraph 1 hereof; (iii) reduction of Base Salary or material reduction
        of
        other compensation or perquisites described in Paragraph 3; (iv) a reduction
        in
        the Executive’s Other Employee Benefits including incentive opportunities,
        benefits or perquisites described in Paragraph 4 unless other senior executives
        suffer a comparable reduction; and (v) any purported termination of the
        Executive’s employment under this Agreement by the Company other than due to
        death, disability (as provided under Paragraph 5.B.(2)) or Cause.
        Prior
        to the Executive’s right to terminate this Agreement, he shall give written
        notice to the Company of his intention to terminate his employment on account
        of
        a Constructive Termination. Such notice shall state in detail the particular
        act
        or acts of the failure or failures to act that constitute the grounds on
        which
        the Executive’s Constructive 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 the Constructive Termination.
        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.

      


      
        
          
          

        

        
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      (4) Accrued
        But Unpaid Benefits Due Upon Termination Without Cause, Constructive Termination
        or Termination Due to Death, Disability or Retirement.
        In the
        event the Executive's employment is terminated by the Company without Cause,
        by
        the Executive by reason of Constructive Termination or due to death, disability
        (as provided under Paragraph 5.B.(2)) or in the event the Executive's Retirement
        Date (as defined in the Company's Supplemental Benefit Plan) occurs during
        the
        Term, the Executive (or his estate or his beneficiaries, as the case may
        be),
        shall be entitled to receive the following accrued but unpaid benefits ("Accrued
        But Unpaid Benefits"): 

      


      a. Base
        Salary through the date of termination;

      


      b. All
        accrued vacation or PTO pay due to the Executive; and

      


      c. Any
        other
        benefits or payments due to the Executive under and subject to applicable
        plans
        or programs maintained by the Company in which the Executive participated
        at the
        time of termination; provided, however, that this provision shall not result
        in
        any duplicative benefits or payments otherwise provided for
        hereunder.

      


      (5) Severance
        Benefits Due Upon Termination Without Cause,
        Constructive Termination
        or
        Termination Due to Death, Disability, or Retirement.
        In the
        event the Executive’s employment is terminated by the Company without Cause, due
        to Disability or death, in
        the
        event there is a Constructive Termination,
        in
        the
        event the Executive's Retirement Date (as defined under the Supplemental
        Benefit
        Plan) occurs during the Term,
        the
        Executive shall be entitled to the following benefits and payments (the
“Severance Benefits”) (the estimated value of such Severance Benefits is
        outlined in Exhibit B attached hereto):

      


      
        
          
          

        

        
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      a. Base
        Salary, at the annual
        rate in
        effect on the date of termination of the Executive’s employment (or in the event
        a reduction in Base Salary is the basis for a Constructive Termination, then
        the
        Base Salary in effect immediately prior to such reduction), payable in
        a lump
        sum;

      b. Any
        pro
        rata annual bonus for the year in which the Executive’s termination occurs,
        based, at a minimum, on the Target Bonus (as defined in an Incentive
        Compensation Plan maintained by the Company at that time) but calculated
        as
        provided for in the Plan and subject to and payable in accordance with the
        Plan
        and the customary practices of the Company for other executives;

      


      c. An
        amount
        equal to the
        greater of (i) any Target Bonus amount for the year in which the termination
        occurs or (ii)
        the
        highest annual bonus paid to the Executive within the past three years of
        employment with the Company,
        which
        shall be payable in
        a lump
        sum;

      


      d. The
        balance of any annual or long-term cash incentive awards, if any, earned
        (but
        not yet paid)
        for the
        year in which the termination occurs
        subject
        to and pursuant to the terms of the applicable plan or program maintained
        by the
        Company and in which the Executive participated at the time of the
        termination;

      


      e. Any
        outstanding stock option, restricted stock or other similar equity based
        award
        shall become
        fully vested and exercisable immediately prior to the time of the termination
        and otherwise shall be
        governed by the applicable plan or agreement maintained by the
        Company;

      


      f. Continued
        participation in the other employee benefits described in Paragraph 4.4 above
        in
        which the Executive participated in
        immediately prior to his termination date until
        the
        first anniversary of
        the date
        of termination
        and
        assignment to the Executive of the life insurance policy described in Paragraph
        3.F (subject to and in accordance with the terms of such policy);
        provided however, that the Company’s obligation under this Paragraph 5.B.(5).f
        shall be reduced or eliminated, as applicable, to the extent that the Executive
        receives similar coverage and/or benefits under the plans and programs of
        a
        subsequent employer; and provided, further, that if the Executive is precluded,
        by operation of law, from continuing his participation in any employee benefit
        plan or program as provided in this Paragraph 5.B.(5).f, he shall be provided
        with the after-tax economic equivalent of the benefits provided under the
        plan
        or program in which he is unable to participate; 

      


      g. Any
        other
        benefit or perquisite made available to him by the Company as of the date
        of
        termination with such benefit or perquisite continuing to be provided to
        the
        Executive until
        the
        first anniversary
        of the date of termination
        subject
        to the terms and conditions thereof;

       

      
        
          
          

        

        
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      h. Subject
        to the
        terms and conditions of
        the
        Supplemental Benefit Plan, for purposes of determining the Executive’s Monthly
        Retirement Income (as defined under the Supplemental Benefit Plan) under
        such
        plan, the Executive shall be credited with additional months of employment
        service through October 1, 2007.
        Additionally, the amount that the Executive is entitled to pursuant to Paragraph
        5.B.(5).c above shall be treated as the "highest incentive compensation award,"
        for purposes of determining his “Average Monthly Earnings” under the
        Supplemental Benefit Plan to the extent that it would result in a greater
        amount
        of the benefits payable to the Executive under such plan; and

      


      (6) Gross
        Up Payment.
        In the
        event any
        of
        the Severance
        Benefits made or provided to the Executive under this Paragraph 6 or
        under
        any of the other
        plans and programs of the Company (the “Aggregate Payment”) is determined to
        constitute a Parachute Payment, as such term is defined in Section 280G(b)(2)
        of
        the Code,
        as
        amended, the Company shall pay to the Executive, prior to the time any excise
        tax imposed by section 4999 of the Code
        (the
“Excise Tax”) is payable with respect to such Aggregate Payment, an additional
        amount which, after the imposition of all federal, state and local income
        and
        excise taxes thereon, is equal to the Excise Tax on the Aggregate Payment.
        The
        determination of whether the Aggregate Payment constitutes a Parachute Payment
        and, if so, the amount to be paid to the Executive and the time of payment
        pursuant to this Paragraph 5.B
        shall
        be made by an independent auditor (the “Auditor”) jointly selected by the
        Company and the Executive and paid by the Company. The Auditor shall be a
        nationally recognized United States public accounting firm which has not
        acted
        in any way on behalf of the Company. If the Executive and Company cannot
        agree
        on the firm to serve as the Auditor, then the Executive and the Company shall
        each select one accounting firm and those firms shall jointly select the
        accounting firm to serve as the Auditor.

      


      C. No
        Obligation to Mitigate; No Right to Offset.
        In the
        event of any termination of employment under this
        Paragraph 5, the Executive shall be under no obligation to seek other employment
        and, except as specifically provided herein, there shall be no offset against
        amounts due to the Executive under this Agreement on account of any remuneration
        attributable to any subsequent employment that he may obtain or for any claims
        the Company may have against the Executive except claims for breach or violation
        of Paragraphs 9 or 10 of this Agreement.

      


      D. Nature
        of Severance Benefits.
        All
        Severance Benefits due and payable under this Agreement are considered to
        be
        reasonable by the Company and are not in the nature of a penalty.

      


      E. Exclusivity
        of Severance Benefits.
        Upon the
        termination of the Executive’s employment, he shall not be entitled to any other
        severance or other payments or severance or other benefits from the Company,
        other than as provided under the terms of this Agreement. Nor shall the
        Executive have any right to any payments by the Company on account of any
        claim
        by him of wrongful termination, including claims under any federal, state
        or
        local human and civil rights or labor laws, other than the payments and benefits
        provided under this Agreement, it being the intention of the parties that
        such
        payments and benefits shall be the Executive’s sole and exclusive
        remedy.

      


      
        
          
          

        

        
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      F. Section
        409A.
        Notwithstanding any provision to the contrary contained herein, to
        the
        extent necessary to avoid the imposition of any excise taxes under Section
        409A
        of the Code, none of the payments or benefits provided hereunder (including,
        but
        not limited to, the assignment of the life insurance policy as provided under
        Paragraph 5.B.(5).f and any benefit payable under the Supplemental Benefit
        Plan)
        shall be paid prior to the expiration of the six (6) month period following
        the
        Executive's "separation from service" (as defined under Section 409A of the
        Code) from the Company. In
        the
        event that the Severance Benefits payable under Paragraphs 5.B.(5).a, b or
        c are
        delayed pursuant to the proceding sentence, the Executive shall also be entitled
        to receive an additional payment in an amount equal to one-half percent (0.5%)
        monthly simple interest on the value of the payments that are subject to
        such
        delay calculated from the date of the Executive's "separation from service"
        to
        the date such Severance Benefits are paid, which interest payment shall be
        payable at the time such delayed payments are paid. 

      


      6. Retention
        Payment.
        In the
        event that Executive remains in the employ of the Company through March 13,
        2007, then effective as of such date, the Executive shall be entitled to
        receive
        the benefits that he would have been entitled to receive in the event he
        had
        been terminated by the Company without Cause (hereinafter referred to as
        the
        "Retention Payment").

      


      7. Release
        of Claims.
        As a
        condition of the Executive’s entitlement to Severance Benefits or
        the
        Retention Payment under
        this Agreement, the Executive shall, on the date of his termination
        or, if
        later, March 13, 2007,
        execute
        a release of claims substantially in the form set forth in Exhibit C, attached
        hereto.

      


      8. Termination
        at Will.
        Notwithstanding anything herein to the contrary, the Executive’s employment with
        the Company is terminable at will with or without Cause or notice; provided,
        however, that a termination of the Executive’s employment shall be governed by
        the terms and conditions of this Agreement.

      


      9. Restrictive
        Covenants.
        For and
        in consideration of the compensation and benefits to be provided by the Company
        hereunder, and further in consideration of the Executive’s exposure to and
        knowledge of the proprietary information of the Company, the Executive agrees
        that he shall not, during the Term and for a period of two (2) years following
        any termination of employment, engage in any of the activities or take any
        action inconsistent with the provisions set forth below.

      


      A. Non
        Competition.
        For any
        reason, without the express written approval of the Board of Directors of
        the
        Company, the Executive shall not, directly or indirectly, own, manage, operate,
        join, control, be employed by, or participate in the ownership, management,
        operation or control of or be connected or associated in any manner, including,
        but not limited to, holding the positions of officer, director, manager,
        shareholder, consultant, independent contractor, employee, partner, or investor,
        with any Competing Enterprise; provided, however, that the Executive may
        invest
        in stocks, bonds, or other securities of any corporation or other entity
        (but
        without participating in the business thereof) if such stocks, bonds, or
        other
        securities are listed for trading on a national stock exchange and the
        Executive’s investment does not exceed 5% of the issued and outstanding shares
        of capital stock, or in the case of bonds or other securities, 5% of the
        aggregate principal amount thereof issued and outstanding. “Competing Enterprise
“ shall mean and be limited to any entity whose principal business involves
        the
        operation of a pari-mutuel or casino gaming business within the continental
        United States.

      


      
        
          
          

        

        
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      B. Non
        Solicitation.
        For any
        reason, without the express written approval of the Board of Directors of
        the
        Company, the Executive shall not (i) directly or indirectly, in on or a series
        of transactions, recruit, solicit or otherwise induce or influence any employee
        of the Company to terminate his or her employment with the Company or, (ii)
        employ or seek to employ or cause any Competing Enterprise to employ or seek
        to
        employ any employee of the Company.

      


      10. Confidential
        Information.
        At no
        time shall the Executive divulge or furnish to anyone (other than the Company
        or
        any persons employed by or designated by the Company) any knowledge or
        information of any type whatsoever of a confidential or proprietary nature
        obtained by the Executive during his employment with the Company, including,
        without limitation, all types of trade secrets, contractual information or
        non-public financial or other information regarding the Company.

      


      11. Attorneys'
        Fees.
        In the
        event any person or entity causes or attempts to cause the Company to refuse
        to
        comply with its obligations under this Agreement, or may cause or attempt
        to
        cause the Company to institute litigation seeking to have this Agreement
        declared unenforceable, or take, or attempt to take, any action to deny the
        Executive the benefits intended under this Agreement, then, in such event,
        the
        Company irrevocably authorizes the Executive to retain counsel of his choice
        at
        the sole expense of the Company to represent the Executive in connection
        with
        the initiation or defense of any litigation or other legal action in connection
        with the enforcement of the terms of this Agreement. All expenses shall be
        fully
        paid by the Company if the Executive prevails in the final, binding,
        non-appealable outcome of the litigation or other legal action. The Company
        agrees to reimburse the Executive for his expenses under this Paragraph
11
        on a
        regular basis upon presentation by the Executive of a statement prepared
        by such
        counsel in accordance with the customary practices, up to a maximum aggregate
        amount of $500,000. The Executive agrees to repay all reimbursed expenses
        under
        this Paragraph 11
        in the
        event the Company prevails in the final, binding, non-appealable outcome
        of the
        litigation or other legal action. Notwithstanding the foregoing, the Company
        shall reimburse the Executive for any legal fees incurred in connection with
        the
        negotiation of this Agreement up to an amount not to exceed
        $5,000.00.

      


      
        
          
          

        

        
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      12. Successors;
        Binding Agreement.

       

      A. To
        the
        Company.
        The
        Company may assign this Agreement and shall require any successor (whether
        direct or indirect, by purchase, merger, consolidation or otherwise) to all
        or
        substantially all of the business and/or assets of the Company, by agreement
        in
        form and substance reasonably satisfactory to the Executive, to expressly
        assume
        and agree to perform this Agreement in the same manner and to the same extent
        that the Company would be required to perform it if no such succession had
        taken
        place.

      


      B. To
        the
        Executive.
        This
        Agreement is personal to the Executive and may not be assigned by the Executive.
        All rights of the Executive hereunder shall inure to the benefit of and be
        enforceable by the Executive's personal or legal representatives, executors,
        administrators, successors, heirs, distributes, devisees and legatees. If
        the
        Executive should die while any amounts would still be payable to him hereunder
        if he had continued to live, all such amounts, unless other otherwise provided
        herein, shall be paid in accordance with the terms of this Agreement to the
        Executive's devisee, legatee or other designee designated by the Executive
        and
        communicated to the Company or, if there be no such designee, to the Executive's
        estate.

      


      13. Notices.
        All
        notices, requests, demands and other communications provided for by this
        Agreement shall be in writing and shall be sufficiently given if and when
        mailed
        in the continental United States by registered or certified mail or personally
        delivered to the party entitled thereto at the address stated below or to
        such
        changed address as the addressee may have given by a similar
        notice:

      


      To
        the
        Company:     Churchill
        Downs Incorporated

      Attention:
        General Counsel

      700
        Central Avenue 

      Louisville,
        Kentucky 40208

      


      To
        the
        Executive:     Thomas
        H.
        Meeker

      1110
        Red
        Fox Road

      Louisville,
        Kentucky 40205

      


      14. Amendment
        or Modification; Waiver.
        No
        provision of this Agreement may be amended, modified or waived unless such
        amendment, modification or waiver shall be authorized by the Board of Directors
        of the Company or any authorized committee of the Board of Directors and
        shall
        be agreed to in writing, and signed by the Executive and by a duly authorized
        officer of the Company. Except as otherwise specifically provided in this
        Agreement, no waiver by either party hereto of any breach by the other party
        hereto of any condition or provision of this Agreement to be performed by
        such
        other party shall be deemed a waiver of a subsequent breach of such condition
        or
        provision or a waiver of a similar or dissimilar provision or condition at
        the
        same or at any prior or subsequent time.

      


      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      15. Severability.
        In the
        event that any provision or portion of this Agreement shall be determined
        to be
        invalid or unenforceable for any reason, the remaining provisions and portions
        of this agreement shall be unaffected thereby and shall remain in full force
        and
        effect to the fullest extent permitted by law.

      


      16. Survival.
        The
        respective rights and obligations of the parties to this Agreement shall
        survive
        any termination of the Executive’s employment to the extent necessary to the
        intended preservation of such rights and obligations. 

      


      17. Applicable
        Law.
        This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        Commonwealth of Kentucky. The parties agree that any litigation involving
        this
        Agreement shall be brought in Jefferson County, Kentucky Circuit Court or
        the
        United States District Court, Western District of Kentucky and hereby waive
        any
        objection to the jurisdiction or venue of such courts.

      


      IN
        WITNESS WHEREOF, the parties have executed this Agreement the day and year
        first
        above written.

      


      CHURCHILL
        DOWNS INCORPORATED                     "EXECUTIVE"

      


      


      


      By:_____/s/
        William C. Carstanjen_________                   ___/s/
        Thomas H. Meeker________________

      William
        C. Carstanjen                              Thomas
        H.
        Meeker

      Executive
        Vice President, General

      Counsel
        and Chief Development Officer

      


      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      


      Exhibits
        to Exhibit 10.1, other than Exhibit A and Exhibit B, have
        been intentionally omitted because they are not material.  The registrant
        agrees to furnish such omitted exhibits supplementally to the Commission
        upon
        request.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
 

      EXHIBIT
        A

      


      The
        Company maintains a 2005 Amended and Restated Supplemental Benefit Plan as
        of
        January 1, 2005 (the "Plan") in which Mr. Meeker is currently the only
        participant. The Plan provides that if a participant remains in the employ
        of
        the Company until age 55 or becomes totally and permanently disabled, the
        participant will be paid a monthly benefit equal to 45% of the "highest average
        monthly earnings," as defined in the Plan, prior to the time of disability
        or
        age 55, reduced by certain other benefits as set forth in the Plan. Benefits
        commence at retirement on or after attainment of age 55, and continue as
        a 50%
        joint and survivor annuity. The benefit payable under the Plan is increased
        by
        1% for each year Mr. Meeker remains in the employment of the Company after
        age
        55, to a maximum benefit of 55% of the highest average monthly earnings at
        age
        65. The Plan further provides that the monthly benefit will be reduced by
        [a]
        50% of the primary insurance amount under social security payable to a
        participant determined as of the later of the participant's retirement date
        or
        attainment of age 62; and [b] 100% of the participant's monthly benefit
        calculated in the form of a 50% joint and survivor annuity under the Company's
        terminated Pension Plan. 

      


      



      
        
          
            


          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
            


          

        

      



      
        	
                EXHIBIT
                  B

              	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
                T.
                  Meeker Severance and SERP (Retirement) Benefits

              	 	 	 	 	 	 	 	 
	
                Date
                  of Separation May 31, 2006

              	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
                Severance
                  Benefits:

              	 	 	 	 	
                Total

              	 	
                SERP
                  Benefits:

              	
                Monthly

              	 	
                Annual

              
	 	 	 	 	 	 	 	 	 	 	 
	
                Base
                  Salary

              	 	
                Payable
                  in lump sum 6 months 

              	
                N/A

              	 	
                $500,580

              	 	
                Base
                  Salary

              	
                $41,715
                  

              	 	
                $500,580

              
	 	 	
                from
                  date of separation

              	 	 	 	 	
                Bonus
                  (Target)

              	
                41,715

              	 	
                500,580

              
	
                Target
                  Bonus

              	 	
                Payable
                  in lump sum 6 months  

              	 	 	 	 	
                Total
                  Covered Compensation

              	
                83,430

              	 	
                1,001,160

              
	 	 	
                from
                  date of separation

              	
                N/A

              	 	
                500,580

              	 	
                Factor

              	
                54%

              	 	
                54%

              
	
                Pro-Rated
                  Bonus

              	 	
                Payable
                  in lump sum 6 months  

              	 	 	 	 	
                Target
                  Benefit

              	
                45,052

              	 	
                540,626

              
	 	 	
                from
                  date of separation

              	
                N/A

              	 	
                208,575

              	 	
                Less:

              	 	 	 
	
                Medical
                  Insurance

              	 	
                Monthly
                  for 12 months following

              	 	 	 	 	
                50%
                  of Social Security (est.)

              	
                (1,000)

              	 	
                (12,000)

              
	 	 	
                date
                  of separation (est.)

              	
                $687

              	 	
                8,244

              	 	
                Qualified
                  Plan Offset (est.)

              	
                (3,333)

              	 	
                (40,000)

              
	
                Life
                  Insurance

              	 	
                Monthly
                  for 12 months following

              	 	 	 	 	
                Total
                  SERP Payment Due From Company

              	
                $40,719

              	 	
                $488,626

              
	 	 	
                date
                  of separation (est.)

              	
                481

              	 	
                5,777

              	 	 	 	 	 
	
                Auto
                  Allowance

              	 	
                Monthly
                  for 12 months following

              	 	 	 	 	 	 	 	 
	 	 	
                date
                  of separation (est.)

              	
                900

              	 	
                10,800

              	 	 	 	 	 
	
                Club
                  Dues

              	 	
                Monthly
                  for 12 months following

              	 	 	 	 	 	 	 	 
	 	 	
                date
                  of separation (est.)

              	
                340

              	 	
                4,080

              	 	 	 	 	 
	
                Interest
                  on Deferred Payments

              	 	
                Calculated
                  at 6% simple interest 

              	 	 	 	 	 	 	 	 
	 	 	
                from
                  date of separation to date of payment

              	
                N/A

              	 	
                36,000
                  

              	 	 	 	 	 
	
                Other
                  Perquisites

              	 	 	 	 	
                2,500

              	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
                Total
                  of Severance Payments

              	 	 	 	 	
                $1,277,136

              	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	
                The
                  above sets forth the estimated severance benefits to be paid to
                  T. Meeker
                  assuming

              	 	 
	 	 	
                a
                  separation from service as of May 31, 2006. Should
                  this date vary, then the amount due for pro-

              	 	 
	 	 	
                rated
                   ICP will necessarily change. All amounts designated by (est)
                  represent those benefits due or 

              	 	 
	 	 	
                offsets
                  to the SERP calculation which are estimated at this time. Actual
                  amounts
                  will vary, but such 

              	 	 
	 	 	
                variances
                  should not be significant. 

              	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	
                The
                  initial SERP payment will be a lump sum equal to 6 months of benefits,
                  and
                  thereafter will be  

              	 	 
	 	 	
                paid
                  monthly as set forth above.

              	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	
                In
                  addition to the amounts shown hereon, T. Meeker will also receive
                  a cash
                  payment for any 

              	 
	 	 	
                unused
                  PTO
                  days, as well as a $250,000 life insurance policy on his
                  life.