ECP Canterbury Park Holding Corp

CANTERBURY PARK HOLDING CORPORATION

1100 Canterbury Road
Shakopee, Minnesota 55379
(952) 445-7223

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

June 5, 2008

Notice is hereby given that the Annual Meeting of Shareholders of Canterbury Park Holding Corporation will be held at Canterbury Park, 1100 Canterbury Road, Shakopee, Minnesota 55379, on Thursday, June 5, 2008, beginning at 4:00 p.m., Central Daylight Time, for the following purposes:

1.                                        To elect six (6) directors to hold office until the 2009 Annual Meeting of Shareholders or until their successors are elected.

2.                                        To transact such other business as may properly come before the meeting or any adjournment or adjournments thereof.

The Board of Directors has fixed the close of business on April 11, 2008 as the record date for the determination of shareholders entitled to notice of and to vote at the meeting.

CANTERBURY PARK HOLDING CORPORATION

PROXY STATEMENT

TABLE OF CONTENTS

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CANTERBURY PARK HOLDING CORPORATION

PROXY STATEMENT

GENERAL INFORMATION

Information Regarding the Annual Meeting

This Proxy Statement is furnished to the shareholders of Canterbury Park Holding Corporation (“CPHC” or “we”) in connection with the solicitation of proxies by CPHC’s Board of Directors to be voted at the Annual Meeting of Shareholders to be held at Canterbury Park, 1100 Canterbury Road, Shakopee, Minnesota 55379, on Thursday, June 5, 2008, beginning at 4:00 p.m., Central Daylight Time, or at any adjournment or adjournments thereof.  The cost of this solicitation will be paid by us.  In addition to solicitation by mail, our officers, our directors and our employees may solicit proxies by telephone, telegraph or in person.  We may also request banks and brokers to solicit their customers who have a beneficial interest in our Common Stock registered in the names of nominees and will reimburse such banks and brokers for their reasonable out-of-pocket expenses.

Solicitation and Revocation of Proxies

A proxy may be revoked at any time before it is voted by submitting a new proxy properly signed and dated later than any prior proxy or by attending the Annual Meeting in person and completing a ballot at the Meeting.  If not revoked, the shares represented by a valid proxy will be voted by the persons designated as proxies in accordance with the specifications indicated on the proxy.  If not specified, the designated proxies will vote such shares “FOR” each of the director nominees’ names in Proposal One.  In the event any other matters properly come before the meeting and call for a vote of shareholders, the persons named as proxies will vote in accordance with their judgment on such matters.  Our corporate offices are located at 1100 Canterbury Road, Shakopee, Minnesota 55379, and its telephone number is (952) 445-7223.  The mailing of this Proxy Statement to our shareholders commenced on or about April 30, 2008.

Voting Securities and Record Date

The total number of shares outstanding and entitled to vote at the meeting as of April 11, 2008 consisted of 4,106,782 shares $0.01 par value Common Stock.  Each share of Common Stock is entitled to one vote.  Cumulative voting in the election of directors is not permitted.  Only shareholders of record at the close of business on April 11, 2008 will be entitled to vote at the meeting.  The presence in person or by proxy of the holders of a majority of the shares entitled to vote at the Annual Meeting of Shareholders constitutes a quorum for the transaction of business.

Under Minnesota law, each item of business properly presented at a meeting of shareholders generally must be approved by the affirmative vote of the holders of a majority of the voting power of the shares present, in person or by proxy, and entitled to vote on that item of business.  However, if the shares present and entitled to vote on any particular item of business would not constitute a quorum for the transaction of business at the meeting, then that item must be approved by holders of a majority of the minimum number of shares that would constitute such a quorum.  Votes cast by proxy or in person at the Annual Meeting of Shareholders will be tabulated at the meeting to determine whether or not a quorum is present.  Abstentions on a particular item of business will be treated as shares that are present and entitled to vote for purposes of determining the presence of a quorum, but as unvoted for purposes of determining the approval of the matter.  For shares held in street name, if a broker indicates on the proxy that it does not have discretionary authority as to such shares to vote on a particular matter, those shares will not be considered as present and entitled to vote with respect to that matter, but they are counted as present for the purpose of determining the presence of a quorum.

CORPORATE GOVERNANCE AND BOARD MATTERS

General

Our Board of Directors is committed to sound and effective corporate governance practices.  We periodically review our governance policies and practices and compare them to those suggested by authorities in corporate governance and the practices of other public companies.  We also review the provisions of the rules of the Securities and Exchange Commission (the “SEC”) and listing standards of the American Stock Exchange (“AMEX”) to ensure our continued compliance.

You can access the most recently adopted versions of the charters of our Audit Committee and our Compensation Committee, our Code of Conduct and our Corporate Governance Guidelines in the Investor Relations section of our website at www.canterburypark.com or by writing to the Investor Relations Department at:  Canterbury Park Holding Corporation, 1100 Canterbury Road, Shakopee, Minnesota 55379, or by emailing our Investor Relations Department at investorrelations@canterburypark.com.

Director Independence

The Board of Directors has adopted director independence guidelines that are consistent with the definitions of “independence” set forth in the AMEX listing standards.  In accordance with these guidelines, the Board of Directors has reviewed and considered facts and circumstances relevant to the independence of each of our directors and director nominees and has determined that, each of the following directors qualifies as “independent” under AMEX listing standards:   Patrick R. Cruzen, Burton F. Dahlberg, Carin J. Offerman, and Dale H. Schenian.  Our directors Curtis A. Sampson and Randall D. Sampson are not independent under AMEX listing standards.  Randall D. Sampson does not qualify as independent because he is our President, Chief Executive Officer and General Manager and has been since 1994.  Curtis A. Sampson does not qualify as independent under the AMEX listing standards because he is an immediate family member (father) of Randall D. Sampson, our executive officer.

Board Committees and Committee Independence

Board Committees .  Our Board of Directors has established three committees, an Audit Committee, a Compensation Committee and a Strategic Planning Committee.  The composition and function of each of these committees are set forth below.

Audit Committee.   The Audit Committee is responsible for the engagement, retention and replacement of the independent auditors, approval of transactions between us and a director or executive officer unrelated to service as a director or officer, approval of non-audit services provided by our independent auditor, oversight of the our accounting, financial reporting and internal controls and the receipt, retention and treatment of complaints regarding accounting, internal controls and auditing matters.  Deloitte & Touche, LLP, the member firms of Deloitte Touche Tohmatsu, and their respective affiliates (collectively, the “Deloitte Entities”), our independent public accountants, report directly to the Audit Committee.  The Audit Committee operates under a formal charter, which was most recently amended as of March 29, 2004.  The current members of the Audit Committee are Patrick R. Cruzen (Chair), Burton F. Dahlberg and Carin J. Offerman, each of whom is independent under Rule 10A-3 of the Exchange Act and AMEX listing standards.  Further, the Board of Directors has reviewed the education, experience and other qualifications of each of the members of the Audit Committee. After review, the Board of Directors has determined that Mr. Cruzen meets the Securities and Exchan ge Commission definition of an “audit committee financial expert”.  As required by its charter, all of the members of the Audit Committee meet the AMEX requirements regarding financial literacy and financial sophistication.  The Audit Committee met four times during 2007, including four times in executive session without management present.  The report of the Audit Committee is found on page 13.

Compensation Committee.   The Compensation Committee provides oversight of our overall compensation strategy, reviews and recommends to the Board of Directors the compensation of our Chief Executive Officer and the other executive officers, administers our equity based compensation plans and oversees our 401(k) Plan and similar employee benefit plans.  The Compensation Committee operates under a charter approved by the Board on

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March 29, 2004.  The current members of the Compensation Committee are Dale H. Schenian (Chair), Patrick R. Cruzen, and Carin J. Offerman each of whom is independent under AMEX listing standards.  The charter of the Compensation Committee also requires members to meet the independence requirements of the Securities and Exchange Commission, including rules under Section 16b-3 of the Securities Exchange Act of 1934, and the requirements of Section 162(m) of the Internal Revenue Code.  The Compensation Committee met two times during 2007, including two times in executive session without management present.

Strategic Planning Committee.   The Strategic Planning Committee was established to consider and investigate available options and alternatives in regard to the use and development of unused and underutilized portions of the property owned by the Company in Shakopee, Minnesota.  The current members of the Strategic Planning Committee are Burton F. Dahlberg (Chairman), Patrick R. Cruzen and Dale H. Schenian.  The Strategic Planning Committee formally met one time during 2007, in addition to informal telephone conferences and meetings with outside parties.

Meeting Attendance

Our Board of Directors meets regularly during the year to review matters affecting CPHC and to act on matters requiring Board approval.  The Board met six times during 2007, including six times in executive session without the presence of non-independent directors and management.

Each of our directors is expected to make a reasonable effort to attend all meetings of the Board, applicable committee meetings and our annual meeting of shareholders.  Each of the directors attended at least 75% of the meetings of the Board and committees on which they served during 2007.  In addition, all of the directors attended CPHC’s 2007 Annual Meeting of Shareholders.

Director Nominations

The independent members of our Board of Directors are responsible for nominating the director nominees that will stand for election at our annual shareholder meetings.  In selecting the nominees, the Board reviews the composition of the full Board to determine the qualifications and areas of expertise needed to further enhance the composition of the Board and works with management in attracting candidates with those qualifications.  Among other things, the Board considers relevant experience, integrity, ability to make independent analytical inquiries, ownership of or commitment to purchase our Common Stock, understanding of our business, relationships and associations related to our business, personal health and a willingness to devote adequate time and effort to Board responsibilities, all in the context of an assessment of our perceived needs.

Nominations by Shareholders

Although we have never received a submission in the past, the Board of Directors will consider qualified candidates for director that are submitted by our shareholders.  Shareholders can submit qualified candidates, together with appropriate biographical information, to the Board of Directors at:  Canterbury Park Holding Corporation, 1100 Canterbury Road, Shakopee, Minnesota 55379, Attention:  Chief Executive Officer.  Any shareholder desiring to submit a director candidate for consideration at our 2009 Annual Meeting must ensure that the submission is received by us no later than December 1 , 2008 in order to provide adequate time for the Board to properly consider the candidate.

Code of Conduct

We have adopted a Code of Conduct (the “Code”) applicable to all of our officers, directors, employees and consultants that specifies guidelines for professional and ethical conduct in the workplace.  The Code also incorporates a special set of guidelines applicable to our senior financial officers, including the chief executive officer, principal financial officer, principal accounting officer and others involved in the preparation of the our financial reports, that are intended to promote the ethical handling of conflicts of interest, full and fair disclosure in periodic reports filed by us and compliance with laws, rules and regulations concerning such periodic reporting.

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Contacting the Board of Directors

Any shareholder who desires to contact our Board of Directors may do so by writing to the Board of Directors, generally, or to an individual director at:  Canterbury Park Holding Corporation, 1100 Canterbury Road, Shakopee, Minnesota 55379.  Communications received electronically or in writing are distributed to the full Board of Directors, a committee or an individual director, as appropriate, depending on the facts and circumstances described in the communication received.  For example, a complaint regarding accounting, internal accounting controls or auditing matters will be forwarded to the Chair of the Audit Committee for review.  Complaints and other communications may be submitted on a confidential or anonymous basis.

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PROPOSAL 1:
ELECTION OF DIRECTORS

The independent members of the Board of Directors have nominated and recommend for election as our directors the six persons named below, each of whom is a current director of CPHC.  The Board of Directors believes that each nominee named below will be able to serve, but should a nominee be unable to serve as a director, the persons named in the proxies have advised that they will vote for the election of such substitute nominee as the independent members of the Board of Directors may propose.

Information regarding the directors, including information regarding their principal occupations currently and for the preceding five years, is set forth below.  Beneficial ownership of our Common Stock is as of April 11, 2008.  Shares not outstanding but deemed beneficially owned by virtue of the right of a person to acquire them within 60 days are treated as outstanding only when determining the amount and percent owned by such person.  Unless otherwise noted, each person possesses sole voting and investment power with respect to the shares.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
A VOTE “FOR” EACH OF THE NOMINEES LISTED ABOVE

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, based upon information available as of April 11, 2008, the beneficial ownership of shares of our Common Stock (i) by each person known by us to own of record or beneficially five percent (5%) or more of our Common Stock, (ii) by the Named Executive Officers listed in the Summary Compensation Table below, and (iii) by all of our current executive officers and directors as a group.  Information regarding the beneficial ownership of our directors and director nominees can be found on page 5 under “Election of Directors.” Unless otherwise indicated, the persons listed below may be reached at 1100 Canterbury Road, Shakopee, Minnesota 55379.

†              Named Executive Officer.

*              Indicates ownership of less than one percent.

(1)                                   Shares not outstanding but deemed beneficially owned by virtue of the right of a person to acquire them within 60 days are treated as outstanding only when determining the amount and percent owned by such person.

(2)                                   Includes the following number of shares that could be purchased upon exercise of stock options exercisable within sixty (60) days of April 11, 2008:  Mr. C. Sampson, 27,000 shares; Mr. Schenian, 25,000 shares; Mr. R. Sampson, 73,000 shares; Mr. Hansen, 22,500 shares; Mr. Fuller, 12,000 shares; Mr. Harty, 15,000 shares; Mr. Garin, 50,500 shares; and all director and officers as a group, 351,500 shares.

(3)                                   Based upon a Schedule 13D filed by Gabelli Asset Management, Inc. on October 4, 2006, which covers shares owned by Gabelli Funds, LLC, GAMCO Asset Management Inc., MJG Associates, Inc., and Gabelli Advisers, Inc.

(4)                                   Based upon a Schedule 13G filed by River Road Asset Management, LLC on March 24, 2008 in which the shareholder, an investment advisor, reports sole dispositive power over 344,928 shares and sole voting power over 251,198 shares.

(5)                                   Includes 11,300 shares held by Mr. C. Sampson’s spouse as to which beneficial ownership is disclaimed.

(6)                                   Includes 33,000 shares held by Mr. Schenian’s spouse as to which beneficial ownership is disclaimed.

(7)                                   Includes 17,700 shares held by Mr. R. Sampson’s children.

(8)                                   Includes 300 shares held by Mr. Garin’s children.

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EXECUTIVE COMPENSATION

Role of the Compensation Committee in the Compensation Process

The Compensation Committee has the following duties and responsibilities:

·                   review, approve and oversee our overall compensation strategy;

·                   review and approve the compensation and other terms of employment of our Chief Executive Officer;

·                   oversee the establishment of performance goals and objectives for our other executive officers and recommend to the entire Board the compensation and the other terms of employment of these officers;

·                   make recommendations to the Board regarding the amount of directors’ fees for Board members, including retainer, Board meeting, committee and committee chair fees and stock option grants or awards;

·                   administer our incentive- or equity-based compensation plans and shall periodically consider and recommend changes in existing plans or the adoption of other or additional equity-based compensation plans; and

·                   review and approve our 401(k) Plan and ESOP, and any similar ERISA plans, including such matters as available investment options, performance, participation, administration, and review and approve generally the cost and scope of our other employee benefit plans.

Under its charter, the Committee also has the authority to engage the services of outside advisors, experts and others to assist it in performing its duties.  Denarius Human Resources, Inc. (“DHR”) has served as a consultant to the Compensation Committee since late 2005 to assist in compensation program design and to advise regarding the amount and form of executive officer and director compensation.  The Compensation Committee also reviews surveys, reports and other market data against which it measures the competitiveness of our compensation program.

In discharging its responsibilities, the Compensation Committee solicits certain information and advice from Randall D. Sampson, our President and Chief Executive Officer, and from David C. Hansen, our Chief Financial Officer.  Such officers participate in the deliberations of the Compensation Committee regarding compensation of other employees, including providing information regarding salary history, historical bonus practices and related financial data, the responsibilities and performance of employees and recommendations regarding the appropriate levels of compensation, but do not take part in deliberations regarding their own compensation.

Objectives of Compensation Programs

It is the objective of the Compensation Committee to provide competitive levels of compensation that will attract, motivate and retain executives with superior leadership and management abilities and to provide incentives to executive officers so that we may achieve superior financial performance and to structure the forms of compensation paid in such a way as to align the interests of our executive officers with those of CPHC.  With these objectives in mind, it has been our practice to provide a mix of base salary, bonus compensation, equity-based compensation and retirement compensation.  The Compensation Committee has historically set base salary at more than 50% of the total value of executive officer compensation, with cash bonus, the value of long-term equity compensation and retirement compensation comprising the remainder.  The Compensation Committee believes that these forms of compensation provide an appropriate combination of fixed and variable pay and incentives for short-term operational performance balanced with incentives to achieve long-term stock price performance.

Design of Specific Compensation Programs

As discussed above, our compensation of executives consists of base salary, bonus compensation, equity-based compensation and retirement compensation.

Base Salary .  Base salaries of our executive officers are generally established by reference to base salaries paid to executives in similar positions with similar responsibilities.  Base salaries are reviewed annually and adjustments are usually made in March of each year based primarily on individual and Company performance during the immediately preceding fiscal year.  Consideration is given by the Compensation Committee to both

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measurable financial performance, as well as subjective judgments by the Compensation Committee in regard to factors such as development and execution of strategic plans, changes in areas of responsibility, the development and management of employees and participation in industry, regulatory and political initiatives beneficial to our business. The Compensation Committee does not, however, assign specific weights to these various quantitative and qualitative factors in reaching its decisions.

Bonus Compensation .  Cash bonuses are intended to provide all employees, including executive officers, with an opportunity to receive additional cash compensation, but only if they earn it through individual performance and CPHC’s financial performance. After our year-end results are available, the Compensation Committee determines the amount of executive officers’ bonuses in its discretion, after receiving information from the Chief Financial Officer and the Chief Executive Officer regarding CPHC financial performance and reviews of individual performance.  The amount of the bonus is based on our financial performance, as well as the Compensation Committee’s assessment of individual performance in the executives’ area of responsibility based on objective and subjective factors.  In reviewing our financial performance, the Compensation Committee focuses in particular on increase or decrease net income before taxes as compared to the prior year as being a particularly useful measure of the performance of our business from year to year.  The bonus plan may be changed, suspended or terminated at any time in the discretion of the Board.

Equity Based Compensation .  Long-term equity compensation has historically consisted of grants of stock options.  In 2006, the Compensation Committee adopted a long-term equity compensation program which emphasized the granting shares of restricted stock to executive officers and certain key employees. The first grants under the long-term equity compensation program were in February 2006 for performance in 2005.  The Compensation Committee anticipates that shares of restricted stock will be granted every other year and that the next opportunity for grants will be in 2008 for performance in 2007 and 2006.  The Compensation Committee believes that restricted stock awards provide an immediate and direct link to shareholder interests and in this way, support the objectives of long-term equity compensation by aligning management interests with those of shareholders.  Awards of restricted stock and options are made to our executive officers under the shareholder-approved 1994 Stock Plan usually in connection with the annual reviews of our financial performance for the prior fiscal year and employee performance reviews in February or March of each year.

Retirement Plans .  The Company has established an Employee Stock Ownership Plan and Trust (ESOP) and Savings Plan and Trust (401K Plan).  Executive officers, including the Named Executive Officers, participate in the 401K Plan on the same basis as all other employees of the Company.  However, Named Executive Officers are ineligible to participate in the ESOP.  Under the 401K Plan, for those employees that have been with the Company one to five years, the Company matches 25% of each employee’s contribution to the 401K Plan up to the first 6% the employee may contribute as a percentage of his or her compensation.  For those employees that have been with the Company six or more years, the Company matches 50% of each employee’s contribution to the 401K Plan up to the first 6% the employee may contribute as a percentage of his or her compensation.

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Summary Compensation Table

The following table shows information concerning compensation earned for services in all capacities during 2007 and 2006 for (i) Randall D. Sampson, who was our Chief Executive Officer in 2007; and, (ii) the two other most highly compensated executive officers of our company whose total compensation was at least $100,000 in 2007 (together referred to as our “Named Executive Officers”).

( † )  Represents an additional contribution from CPHC to the 401(k) Plan on behalf of the Named Executive Officer to correct calculation of employee deferrals in fiscal years 2000 and 2002 through 2006.

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Employment Arrangements with Named Executive Officers and Post-Employment Compensation

We do not have any employment agreements with any of our executive officers, each of whom serves “at will.”  Additionally, we do not have any contract, agreement, plan or arrangement, whether written or unwritten, that provides for payments to the Named Executive Officer at, following, or in connection with any termination or change-in-control.

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth certain information concerning equity awards outstanding to the Named Executive Officers at December 31, 2007.

(1)           Options vested and became exercisable over no less than one year.

(2)           Option vests and becomes exercisable 25% at the end of each of four years following the date of grant.

(3)           The expiration date of each option is either five or ten years from the date of grant.

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DIRECTOR COMPENSATION

Each non-employee member of the Board of Directors is currently paid a monthly fee of $1,200 plus $1,000 for each Board or Board Committee meeting attended.  In addition, Messrs. Sampson and Schenian receive monthly payments of $2,500 and $1,675, respectively, for their service as Chair and Vice Chair of the Board.

Under our 1994 Stock Plan, upon their election to the Board, each non-employee director receives an option to purchase 2,500 shares of our Common Stock and annually, on the first business day in February, each non-employee director also receives an option to purchase 3,000 shares of our Common Stock.  All such options granted to non-employee directors vest six months from the date granted and are exercisable over a ten-year period.  The purchase price of the shares of Common Stock subject to such options is the fair market value as determined under provisions of the 1994 Stock Plan.

Randall D. Sampson, our President, Chief Executive Officer and General Manager, receives no additional compensation for his service on the Board.

The following table shows for 2007, the cash and other compensation paid by us to each of our Board members:

(1)                                   Represents cash retainer and meeting fees for 2007 as described above.

(2)                                   Values expressed represent the actual compensation cost recognized by our company during fiscal 2007 for equity awards granted in 2007 as determined pursuant to SFAS 123R utilizing the assumptions discussed in Note 1, “Summary of Accounting Policies,” in the notes to consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2007.

(3)                                   Represents compensation paid by the Company in 2008 for services in 2007 as Chairman of the Strategic Planning Committee.

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CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS

Since the beginning of 2007, we have not entered into any transaction and there are no currently proposed transactions, in which we were or are to be a participant and the amount involved exceeds $120,000, and in which any related person had or will have a direct or indirect material interest.

The charter of our Audit Committee provides that the Audit Committee is responsible for reviewing, approving and providing oversight in regard to related party transactions .  Our Code of Conduct also prohibits our employees , including our executive officers, and our directors from engaging in conflict of interest transactions, certain of which may be also be transactions in which we and a related person has or will have a direct or indirect material interest.  By its charter, the Audit Committee is empowered to periodically review the Code of Conduct, as well as any other programs established to monitor compliance with any CPHC codes of conduct or business ethics policies established in the future.

While we do not have a written policy regarding the standards to be applied by our Audit Committee in reviewing these transactions, the provisions of Minnesota law provide for a procedure to be applied to conflicts of interest transactions between us and our directors which focuses on full disclosure of all of the material facts of the transaction to us, approval of the transaction by disinterested directors, and a showing that the transaction was fair and reasonable to us at the time it was authorized, approved, or ratified .  We believe the Audit Committee would apply these same standards to any potential transaction in which we are to be a participant and in which any related person had or will have a director or indirect material interest.

RELATIONSHIP WITH INDEPENDENT AUDITORS

Deloitte & Touche LLP (“Deloitte”) has been the auditor for CPHC since 1994 and has been selected by the Audit Committee to serve as such for the current fiscal year.  A representative of Deloitte is expected to be present at the Annual Meeting of Shareholders and will have an opportunity to make a statement and will be available to respond to appropriate questions.

Principal Accountant Fees and Services

The following is a summary of the fees billed to us by Deloitte for professional services rendered for the fiscal years ended December 31, 2007, and December 31, 2006.  The Audit Committee considered and discussed with Deloitte the provision of non-audit services to us and the compatibility of providing such services with maintaining its independence as our auditor.

Audit Fees .  This category consists of fees billed for professional services rendered for the audit of our annual financial statements and review of financial statements included in our quarterly reports.

Audit-Related Fees .  This category consists of fees billed for assurance and related services, such as our employee benefit plan audits, that are reasonably related to the performance of the audit or review of our financial statements and are not otherwise reported under “Audit Fees.”

Tax Fees .  This category consists of fees billed for professional services for tax compliance, tax advice and tax planning.  These services include assistance regarding federal and state tax compliance and acquisitions.

All Other Fees .  This category consists of fees billed for reviews of other SEC filings.

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Audit Committee Pre-approval Policies and Procedures

In addition to approving the engagement of the independent auditor to audit our consolidated financial statements, it is the policy of the Audit Committee to approve all uses of our independent auditor for non-audit services prior to any such engagement.  To minimize relationships that could appear to impair the objectivity of the independent auditor, it is the policy of the Audit Committee to restrict the non-audit services that may be provided to us by our independent auditor primarily to services that clearly would not compromise the independence of the auditor.

AUDIT COMMITTEE REPORT

The Audit Committee of the Board of Directors held four meetings during fiscal year 2007 with management and our independent registered public accounting firm, Deloitte & Touche LLP (“Deloitte”).  The meetings were designed to facilitate and encourage private communication between the Audit Committee and the auditors.

The Audit Committee reviewed and discussed the audited financial statements with management and Deloitte.  Management represented to the Audit Committee that our consolidated financial statements were prepared in accordance with generally accepted accounting principles, and the Audit Committee has reviewed and discussed the consolidated financial statements with management and the independent accountants.  The discussions with Deloitte also included the matters required by Statement on Auditing Standards No. 61, as amended by SAS 89 and SAS 90 (Audit Committee Communications).

Deloitte provided to the Audit Committee the written disclosures and the letter regarding its independence as required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees).  This information was discussed with the Audit Committee.

In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors that our audited consolidated financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2007 for filing with the Securities and Exchange Commission.

THE PRECEDING REPORT SHALL NOT BE DEEMED INCORPORATED BY REFERENCE BY ANY GENERAL STATEMENT INCORPORATING BY REFERENCE THIS PROXY STATEMENT INTO ANY FILING UNDER THE 1933 ACT OR THE 1934 ACT, EXCEPT TO THE EXTENT CPHC SPECIFICALLY INCORPORATES THIS INFORMATION BY REFERENCE, AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER THE 1933 ACT OR THE 1934 ACT.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires that executive officers and directors and beneficial holders of 10% or more of our securities file reports of their beneficial ownership with the Securities and Exchange Commission on Forms 3, 4 and 5.  According to our records, during the period from January 1, 2007 through December 31, 2007, a Form 4 was not timely filed in connection with the following transactions in the Company’s Common Stock: a purchase of stock by Mr. Halstrom in October 2007; a gifting of stock to dependents and immediate disposal by Mr. Erickson in November 2007; a gifting of stock by Mr. C. Sampson in December 2007; and a receipt of a gift of stock by Mr. R. Sampson in December 2007.  A Form 4 for each of the above transactions was subsequently filed with the SEC.  According to our records, all other reports required have been timely filed.

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OTHER INFORMATION

Shareholder Proposals For 2009 Annual Meeting

The proxy rules of the Securities and Exchange Commission permit our shareholders, after timely notice to us, to present proposals for shareholder action in our proxy statement where such proposals are consistent with applicable law, pertain to matters appropriate for shareholder action and are not properly omitted by CPHC action in accordance with the Commission’s proxy rules.  The next annual meeting of the shareholders of Canterbury Park Holding Corporation is expected to be held on or about June 4, 2009 and proxy materials in connection with that meeting are expected to be mailed on or about April 30, 2009.  Shareholder proposals prepared in accordance with the Commission’s proxy rules must be received at our corporate office, 1100 Canterbury Road, Shakopee, Minnesota 55379, Attention: President, by December 30, 2008, in order to be considered for inclusion in the Board of Directors’ Proxy Statement and proxy card for the 2009 Annual Meeting of Shareholders.  Any such proposals must be in writing and signed by the shareholder.

Our Bylaws establish an advance notice procedure with regard to (i) certain business to be brought before an annual meeting of our shareholders and (ii) the nomination by shareholders of candidates for election as directors.

Properly Brought Business .  Our Bylaws provide that at the annual meeting only such business may be conducted as is of a nature that is appropriate for consideration at an annual meeting and has been either specified in the notice of the meeting, otherwise properly brought before the meeting by or at the direction of the Board of Directors, or otherwise properly brought before the meeting by a shareholder who has given timely written notice to the Secretary of CPHC of such shareholder’s intention to bring such business before the meeting.  To be timely, the notice must be given by such shareholder to the Secretary of CPHC not less than 45 days nor more than 75 days prior to a meeting date corresponding to the previous year’s annual meeting.  Notice relating to the conduct of such business at an annual meeting must contain certain information as described in Section 2.9 of our Bylaws, which are available for inspection by our shareholders at our principal executive offices pursuant to Section 302A.461, subd. 4 of the Minnesota Statutes.  Nothing in the Bylaws precludes discussion by any shareholder of any business properly brought before the annual meeting in accordance with our Bylaws.

Shareholder Nominations .  Our Bylaws provide that a notice of proposed shareholder nominations for the election of directors must be timely given in writing to the Secretary of CPHC prior to the meeting at which directors are to be elected.  To be timely, the notice must be given by such shareholder to the Secretary of CPHC not less than 45 days nor more than 75 days prior to a meeting date corresponding to the previous year’s annual meeting.  The notice to us from a shareholder who intends to nominate a person at the meeting for election as a director must contain certain information as described in Section 3.7 of our Bylaws, which are available for inspection by shareholders as described above.  If the presiding officer of a meeting of shareholders determines that a person was not nominated in accordance with the foregoing procedure, such person will not be eligible for election as a director.

Annual Report

We are transmitting with this Proxy Statement our Annual Report for the year ended December 31, 2007.  Shareholders may request our 2007 Annual Report on Form 10-K as filed with the Securities and Exchange Commission by writing to the Secretary of CPHC at our address on the first page of this Proxy Statement or may obtain it without charge at our website, www.canterburypark.com.

Other Matters

Management knows of no other matters that will be presented at this 2008 Annual Meeting of Shareholders.  If any other matters are properly presented at the meeting, it is intended that the shares represented by the proxies in the accompanying form will be voted in accordance with the judgment of the persons named in the proxy.

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CANTERBURY PARK HOLDING CORPORATION

ANNUAL MEETING OF SHAREHOLDERS

June 5, 2008

4:00 p.m. Central Daylight Time

Canterbury Park Holding Corporation

1100 Canterbury Road

Shakopee, Minnesota