Churchill Downs, Kentucky HBPA, KTA Announce Three-Year Purse, Simulcast Agreement.

LOUISVILLE, Ky. -- Churchill Downs Incorporated ("Company" or "CDI")(NASDAQ: CHDN), the Kentucky Horsemen's Benevolent and Protective Association ("HBPA"), and the Kentucky Thoroughbred Association ("KTA") have reached agreement on a three-year contract that establishes levels of race purses at the home of the Kentucky Derby. In addition, the Kentucky HBPA and CDI have agreed to dismiss their claims against one another in a lawsuit filed in United States District Court for the Western District of Kentucky in 2008. The agreement follows the expiration of the previous contract following the historic track's 2009 Spring Meet.

Churchill Downs has also agreed to provide a $1.5 million supplement to race purses divided evenly over the three years of the horsemen's agreement. That commitment includes a provision that would allow the track to distribute a greater share of that supplement early in the three-year period should race purses at Churchill Downs drop below anticipated levels.

"Churchill Downs is very pleased to be part of this long-term agreement that is good for horsemen, Churchill Downs, Kentucky's embattled horse industry and racing fans in Kentucky and throughout North America," said Kevin Flanery, president of Churchill Downs racetrack. "This three-year pact between our track and horsemen comes at a crucial time for Kentucky's horse industry as horses and horsemen are leaving our state to pursue the growing purses and breeding incentives that exist in states with slots and other expanded wagering options at their racetracks. Decisions are being made daily on where to breed and race in 2010 and beyond, and once horsemen, stallions and mares leave Kentucky, it will be very difficult to get them to return. Churchill Downs' commitment to provide an additional $1.5 million to purses is an effort to protect Kentucky racing from states that supplement their races with expanded gaming revenues. Our hope is that the purse supplement will help keep a few more horses and horsemen in Kentucky through 2010 while our united horse industry works for the passage of legislation that would allow additional gaming at racetracks and level our competitive playing field with tracks and breeding operations in those rival states."

"It's a good contract - I think it's good for both parties," said KHBPA President Rick Hiles. "I think it's going to work out well for the horsemen and for Churchill Downs. We're glad to get this behind us and we look forward to working together over the next three years in the effort to get all of Kentucky racing back on track."

"The KTA appreciates the professional and unified manner we experienced in working with Churchill Downs in our recent negotiations for a contract renewal," KTA President Don Robinson said. "We believe all parties, owners, trainers and the track will benefit as racing continues in these troubled economic times."

Churchill Downs Incorporated ("CDI" or "Company"), headquartered in Louisville, Ky., owns and operates world-renowned horse racing venues throughout the United States. CDI's four racetracks in Florida, Illinois, Kentucky and Louisiana host many of North America's most prestigious races, including the Kentucky Derby and Kentucky Oaks, Arlington Million, Princess Rooney Handicap and Louisiana Derby. CDI's racetracks have hosted seven Breeders' Cup World Championships. CDI also owns off-track betting facilities and has interests in various advance-deposit wagering, television production, telecommunications and racing services companies including a 50-percent interest in the national cable and satellite network HorseRacing TV, that support the Company's network of simulcasting and racing operations. CDI trades on the NASDAQ Global Select Market under the symbol CHDN and can be found on the Internet: www.churchilldownsincorporated.com.

Information set forth in this discussion and analysis contains various "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The Private Securities Litigation Reform Act of 1995 (the "Act") provides certain "safe harbor" provisions for forward-looking statements. All forward-looking statements made in this Quarterly Report on Form 10-Q are made pursuant to the Act. The reader is cautioned that such forward-looking statements are based on information available at the time and/or management's good faith belief with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements. Forward-looking statements speak only as of the date the statement was made. We assume no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. Forward-looking statements are typically identified by the use of terms such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "might," "plan," "predict," "project," "should," "will," and similar words, although some forward-looking statements are expressed differently. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from expectations include: the effect of global economic conditions, including any disruptions in the credit markets; the effect (including possible increases in the cost of doing business) resulting from future war and terrorist activities or political uncertainties; the overall economic environment; the impact of increasing insurance costs; the impact of interest rate fluctuations; the effect of any change in our accounting policies or practices; the financial performance of our racing operations; the impact of gaming competition (including lotteries and riverboat, cruise ship and land-based casinos) and other sports and entertainment options in those markets in which we operate; the impact of live racing day competition with other Florida and Louisiana racetracks within those respective markets; costs associated with our efforts in support of alternative gaming initiatives; costs associated with customer relationship management initiatives; a substantial change in law or regulations affecting pari-mutuel and gaming activities; a substantial change in allocation of live racing days; changes in Illinois law that impact revenues of racing operations in Illinois; the presence of wagering facilities of Indiana racetracks near our operations; our continued ability to effectively compete for the country's top horses and trainers necessary to field high-quality horse racing; our continued ability to grow our share of the interstate simulcast market and obtain the consents of horsemen's groups to interstate simulcasting; our ability to execute our acquisition strategy and to complete or successfully operate planned expansion projects; our ability to successfully complete any divestiture transaction; our ability to execute on our permanent slot facility in Louisiana and permanent slot facility in Florida; market reaction to our expansion projects; the loss of our totalisator companies or their inability to provide us assurance of the reliability of their internal control processes through Statement on Auditing Standards No. 70 audits or to keep their technology current; the need for various alternative gaming approvals in Louisiana; our accountability for environmental contamination; the loss of key personnel; the impact of natural disasters on our operations and our ability to adjust the casualty losses through our property and business interruption insurance coverage; any business disruption associated with a natural disaster and/or its aftermath; our ability to integrate businesses we acquire, including our ability to maintain revenues at historic levels and achieve anticipated cost savings; the impact of wagering laws, including changes in laws or enforcement of those laws by regulatory agencies; the outcome of pending or threatened litigation, including the outcome of claims arising in connection with a pending lawsuit in federal court in the Western District of Kentucky styled Churchill Downs Incorporated, et al v. Thoroughbred Horsemen's Group, LLC, Case #08-CV-225-S; changes in our relationships with horsemen's groups and their memberships; our ability to reach agreement with horsemen's groups on future purse and other agreements (including, without limiting, agreements on the sharing of revenues from gaming and advance deposit wagering); the effect of claims of third parties to intellectual property rights; and the volatility of our stock price.