Churchill Sells Part of Kentucky Downs Interest to Businessman Kelley

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Edited from Churchill Downs release
Churchill Downs Inc. announced Tuesday that it sold a 19% stake in Kentucky Downs, including debt owed to CDI, to Kelley Farms Racing.

As part of the terms of the transaction, former CDI board member Brad M. Kelley exchanged shares of CDI stock valued at $3.2 million for the stake. The sale reduces CDI's ownership of Kentucky Downs to a total of 5%.

Thomas H. Meeker, CDI's president and chief executive officer, said the company's divesture was in the best interests of both parties.

"CDI sold a portion of its Kentucky Downs ownership for fair value, which includes a contingency payout should the facility be approved for alternative gaming legislation," said Meeker. "The sale also afforded us the opportunity to monetize a currently non-productive asset. For Brad Kelley, the transaction increased his stake in a racetrack that he has sought additional ownership in for some time. He is a gifted businessman from the Franklin, Ky. area who is well-suited to advance the strategic interests of Kentucky Downs."

In addition, as part of the transaction, the company redeemed an additional amount of CDI stock from Kelley in exchange for a convertible promissory note. In total, CDI redeemed 539,489 shares of Company stock valued at $19.9 million, reducing Kelley's ownership of CDI stock to 4.9%.

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