CHURCHILL DOWNS INCORPORATED Notice of Annual Meeting of Shareholders 2017 Proxy Statement 2016 Annual Report on Form 10-K Chairman and CEO’s Message Dear Fellow Shareholders, The extraordinary core strength for our Company has been the Kentucky Derby and our ability to continue to consistently invest in, and grow, it year over year. As our Company diversified over recent years into (i) online wagering through Twinspires.com, (ii) brick and mortar casinos through greenfield development opportunities and strategic acquisitions and (iii) online and mobile social casino and casual free-to-play games through Big Fish Games, some of our other attributes have been increasingly important... • We run our businesses leanly and efficiently with a constant focus on sensible cost out opportunities; • We focus on generating very strong cash flow and we never lose sight of that metric on any project we do; • We are careful about our leverage ratio and have always grown our Company without compromising our balance sheet; and • We seek organic growth first but are also deeply experienced in strategic M&A and will take advantage of opportunities when we find them. As we look forward to 2017 and beyond, we will continue to invest in Kentucky Derby Week and in Twinspires.com. We expect to continue to see the return on our invested capital. We will also continue to invest in our brick and mortar casinos to grow them and will selectively acquire or build new properties if the opportunities fit our investment profile. Finally, we see plenty of opportunity as well as capability with Big Fish Games in the online and mobile social casino and casual free-2-play games spaces. In fact, we need to do a better job harvesting the opportunities we have in this space. A few comments on 2016 Kentucky Derby Week set all time-records for Adjusted EBITDA, attendance and all sources wagering. Our ongoing investment in our facility reflects our commitment to growing this iconic event. TwinSpires continued to deliver strong growth in 2016 with wagering of $1.1 billion, up 13.7% compared to 2015. We outpaced the industry growth by 13.1 percentage points in 2016 - reflecting the ongoing shift away from brick and mortar outlets to mobile online wagering as well as our focus on growth from big events such as the Triple Crown races and the Breeders’ Cup World Championships. Our Calder, Miami Valley Gaming and Oxford gaming properties delivered strong organic growth and we benefited from a full year of equity income and management fee revenue from our equity investment in Saratoga. Our Louisiana and Mississippi gaming properties remain challenged by a weak economic environment and robust competition for customers. We expanded our Casinos segment through two equity investments. In November, we acquired a 25% interest in Saratoga Casino Black Hawk in Colorado. And, in January 2017, we partnered with Saratoga to acquire the casino and racetrack at Ocean Downs in Maryland. Big Fish Games delivered $486 million in bookings, up 7.3% compared to 2015. While the growth in bookings was disappointing overall given our user acquisition spending, we remain committed to the long-term growth of this business. Our collective mix of businesses generates strong cash flow and our disciplined approach to leverage provides financial strength and flexibility to take advantage of future growth opportunities. We delivered record results in 2016 making key strategic investments in our businesses while also returning $58 million to shareholders through dividends and share repurchases. As we look to 2017 and beyond, we remain committed to delivering strong financial results for our shareholders and positioning our company for long-term sustainable growth. We are confident in our leadership team and dedicated employees who work hard every day to grow the company – creating long term value for you, our shareholders. G. Watts Humphrey, Jr. William C. Carstanjen Chairman of the Board Chief Executive Officer Financial Highlights Year Ended December 31, $ in millions, except per share data 2014 2015 2016 Consolidated Financial Results Net Revenue $ 812 $ 1,212 $ 1,309 Operating Income 90 124 194 Net Income $ 46 $ 65 $ 108 EPS - Diluted $ 2.64 $ 3.71 $ 6.42 Adjusted EBITDA $204.1 $ 302.5 $ 334.5 Consolidated Balance Sheet Total Assets $2,356 $ 2,277 $ 2,254 Total Debt 764 782 922 Total Liabilities 1,656 1,660 1,569 Shareholders’ Equity $ 700 $ 617 $ 685 Cash Flow and Liquidity Cash Flows from Operating Activities $ 142 $ 265 $ 227 Capital Maintenance Expenditures $ 23 $ 31 $ 31 Net Leverage Ratio1 3.4x 2.3x 2.6x Shareholder Data: Dividends Declared per Common Share $ 1.00 $ 1.15 $ 1.32 Common Stock Share Repurchases $ 62 $ 138 $ 28 Year-End Closing Stock Prices $95.30 $141.49 $150.45 Equity Market Capitalization $1,665 $ 2,349 $ 2,480 Total Capitalization $2,429 $ 3,131 $ 3,402 1 Net leverage ratio is the ratio of total debt (less cash) to Adjusted EBITDA TOTAL SHAREHOLDER RETURN 1 Year 3 Year 5 Year 203% 72% 98% 96% 29% 12% 21% 7% 22% S&P 500 Russell 2000 CDI S&P 500 Russell 2000 CDI S&P 500 Russell 2000 CDI CHURCHILL DOWNS INCORPORATED 600 N. HURSTBOURNE PARKWAY, STE. 400 LOUISVILLE, KENTUCKY 40222 NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON APRIL 25, 2017 To the Shareholders of Churchill Downs Incorporated: Notice is hereby given that the Annual Meeting of Shareholders (the “Annual Meeting”) of Churchill Downs Incorporated (the “Company”), a Kentucky corporation, will be held at the Four Seasons Hotel Miami, located at 1435 Brickell Avenue, Miami, Florida 33131, on Tuesday, April 25, 2017, at 9:00 a.m. Eastern Daylight Savings Time, for the following purposes: Proxy Statement I. To elect the two (2) Class III Directors identified in this Proxy Statement for a term of three (3) years (Proposal No. 1); II. To ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for fiscal year 2017 (Proposal No. 2); III. To approve the performance goals used for performance-based awards under the Churchill Downs Incorporated Executive Annual Incentive Plan (Proposal No. 3); IV. To conduct an advisory vote on executive compensation (Proposal No. 4); V. To conduct an advisory vote on the frequency of holding future advisory votes on executive compensation (Proposal No. 5); and VI. To transact such other business as may properly come before the meeting or any adjournment thereof, including matters incident to its conduct. The close of business on March 2, 2017, has been fixed as the record date for determining the shareholders entitled to notice of, and to vote at, the Annual Meeting. Only shareholders of record at that time will be entitled to notice of and to vote at the Annual Meeting and at any adjournments thereof. Shareholders who do not expect to attend the meeting in person are urged to vote by telephone or over the Internet, or by requesting and promptly signing and returning a Proxy Card. By Order of the Board of Directors. BRADLEY K. BLACKWELL Senior Vice President, General Counsel and Secretary March 16, 2017 IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON APRIL 25, 2017 The Company’s Proxy Statement for the 2017 Annual Meeting of Shareholders and the Annual Report to Shareholders for the fiscal year ended December 31, 2016 are available at http://www.churchilldownsincorporated.com/proxy CHURCHILL DOWNS INCORPORATED 600 N. HURSTBOURNE PARKWAY, STE. 400 LOUISVILLE, KENTUCKY 40222 PROXY STATEMENT Annual Meeting of Shareholders to be held on April 25, 2017 The Board of Directors (the “Board of Directors” or “Board”) of Churchill Downs Incorporated (“Company,” “CDI,” or “CHDN”) is soliciting proxies to be voted at the 2017 Annual Meeting of Shareholders to be held on Tuesday, April 25, 2017, at 9:00 a.m. Eastern Daylight Saving Time (the “Annual Meeting”), at the Four Seasons Hotel Miami, 1435 Brickell Avenue, Miami, Florida 33131, and any adjournments thereof. Certain officers and directors of the Company and persons acting under their instruction may solicit proxies on behalf of the Board of Directors by means of telephone calls, personal interviews and mail at no additional expense to the Company. The Notice of Internet Availability of Proxy Materials (the “Notice”) was first mailed Proxy Statement on or about March 16, 2017. Voting Rights Only holders of record of the Company’s Common Stock, no par value (“Common Stock”), on March 2, 2017, are entitled to notice of and to vote at the Annual Meeting. On that date, 16,430,884 shares of Common Stock were outstanding and entitled to vote. Each shareholder has one vote per share on all matters coming before the Annual Meeting. The shareholders of the Company do not have cumulative voting rights in the election of directors. Abstentions and broker non-votes are not counted in determining the number of votes required for the election of a director or passage of any matter submitted to the shareholders. Abstentions and broker non-votes are counted for purposes of determining whether a quorum exists. Whether or not you plan to attend the meeting in person, to ensure the presence of a quorum, please vote over the Internet or by telephone as instructed in these materials as promptly as possible. If a shareholder executes and returns the Proxy Card, but does not specify otherwise, the shares represented by the shareholder’s proxy will be voted: (i) for the election of each of the two director nominees listed below under “Election