Prizes for running in place?

July 20, 2006

The amended employment agreement recently filed by Kentucky Derby host Churchill Downs, Inc. (CHDN) discloses some interesting severance arrangements for outgoing CEO Thomas Meeker — as interesting as some of the other goodbye perks we’ve seen in recent weeks.  Although Meeker is stepping down as CEO, he’s transitioning to the all-important role of "management advisor" — but will still receive his full CEO pay and perks through March 13, 2007. The attached 8-K notes that "Meeker will further be entitled to a 2006 bonus without any pro-ration due to diminished responsibilities." That should help ease the sting of the change in title!

But, wait. That’s not all. Churchill is also providing Meeker and his wife with lifetime membership to Churchill Downs Racetrack’s Turf Club, and perhaps even more importantly, the Company is providing the Meekers with two lifetime VIP parking passes each year on the days of the running of the Kentucky Oaks and Kentucky Derby.  (And we thought that asking for power cords in a severance agreement was a bit picayune!). Just imagine having to park with the commoners — might make it difficult for them to reach their personal table at the track.

Speaking of commoners, the common stockholders might be less than thrilled with the stock’s performance during the end of Meeker’s term.  Unlike the racehorses at the Derby, CHDN stock has been basically running in place for the last two years.

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