The Executioner's Pride is a special task in 
Kuttenberg added with the free Horse Races expansion content (Patch 1.3), which also introduces Horses for Courses (Horses for Courses, guide). You help a superstitious executioner forge a lucky blade and earn a large cash reward, with a memorable ghost-horse detour.
How to start The Executioner's Pride
Complete Speak of the Devil (
Speak of the Devil) first. Go to the Hole in the Wall inn in southeast Kuttenberg. Speak with innkeeper Mole, ask about local rumors. He points you toward the city executioner who needs help.
Leave through the east wall and find Executioner Heinz by the scaffold. He blames a streak of bad luck on a botched job in Rattay (the same executioner Henry can sabotage in KCD1) and wants four lucky talismans forged into a new executioner's sword.
Executioner Heinz starting area:
Gathering the rare ingredients
You need four items for the special blade. Order is flexible, though some steps are trickier than others.
Hanged Man's Noose
Go north of Kuttenberg near 
Sedletz Monastery. Quest marker A leads to a tree with a hanged body.
A nervous thief may be looting the corpse. You usually do not need to fight, he often runs off. Loot the noose from the body.
Ghostly Horseshoe
Travel to the burnt forest north of Kuttenberg (marker B).
The Phantom Horse only appears after midnight. If you are early, use the tree stump interaction to skip time until midnight.
When the black horse spawns, follow it through the trees. No stealth required. Do not attack or rush it or it can vanish. When it stops mourning its former owner, interact and pull the horseshoe from its hoof.
You also learn the Ghostly Horseshoes recipe in your blacksmithing book.
How to own Phantom Horse?
You can mount the Phantom Horse and ride to the Kuttenberg stables (south of the western gate) and register it as your main horse. That replaces Pebbles on the saddle icon.
To keep the horse loaded in the world, do not skip time on the ride. Wait in real time (or otherwise play without time skip) until the stables are open. Skipping time on the way can cause the Phantom Horse to despawn.
Is Phantom Horse better than Pebbles?
Pebbles still wins on stats if you unlocked Good Old Pebbles after riding roughly 20 km on her. Phantom is about the flavor and the quest moment.
Bezoar
Buy a Bezoar from the Kuttenberg apothecary during the day for about 45 Groschen.
Hare Pelt
Grab any Hare Pelt. Fastest: butcher on Kuttenberg market square (about 8 Groschen). The butcher in Pschitoky also stocks pelts. Buying one here also helps with the Lent achievement requirements.
Forging the lucky sword
With all four pieces, use any Kuttenberg blacksmith forge. On the anvil, craft the Executioner's Sword under Longswords. It pairs strong combat stats with the talisman theme.
Returning to Heinz
Bring the blade to Heinz and say it is ready. For the final beat he may offer a small "lucky cut" with the new sword. You can accept or refuse; accepting matches the ritual tone.
The Executioner's Pride rewards
Completing the task pays 475 Groschen.
If you already finished Forbidden Fruit (
Forbidden Fruit) and Thou art but dust… (Thou art but dust…, Sedletz cemetery guide), you unlock 
Boneworks.
The Executioner's Pride FAQ
When can I start The Executioner's Pride?
After Speak of the Devil. Talk to Mole at Hole in the Wall, then Heinz east of the walls. Requires Patch 1.3 Horse Races content.
How do I keep Phantom Horse from despawning?
Avoid skip time on the ride to the stables. Wait until they open in real play time.
Is Phantom Horse better than Pebbles?
Usually no on raw stats if Pebbles has Good Old Pebbles after ~20 km.
What four items does Heinz want?
Noose, ghost horseshoe, bezoar, hare pelt. Order is flexible.
What rewards and achievements?
475 Groschen. With Forbidden Fruit and Thou art but dust… done, you get Boneworks.
Should I accept the lucky cut?
Optional. Accepting matches the ritual; it is not required for payout.