Exhibit 10.1

RESTATED ASSIGNMENT AGREEMENT

Agreement No. 06-0102

This Restated Assignment Agreement (“Agreement”) is made and entered into in
Sacramento, California, between Premier Waterworld Sacramento, Inc. (“Premier”),
a California corporation and wholly-owned subsidiary of Premier Parks
Operations, Inc., the assignor; Palace Entertainment Holdings, Inc. (“Palace
Entertainment”), a Delaware corporation, the assignee; and California Exposition
& State Fair (“Cal Expo”), an independent entity of state government.  As a
matter of convenience, Palace Entertainment and Cal Expo may be referred to
herein as “the Parties.”

Recitals

A.                Whereas, Premier and Cal Expo, on or about December 30, 1999,
entered into an Amended and Restated Lease Agreement (“Premier Agreement”) for
the purpose of operating, maintaining, and improving a water park, consisting of
water slides, wave pools, water rides, and other attractions, on the property of
Cal Expo.

B.                  Whereas, on or about January 26, 2006, pursuant to Section
21.1 of the Premier Agreement, Premier notified Cal Expo that it was exercising
its option to terminate the lease effective at the end of the 2006 Operating
Season.  Premier further notified Cal Expo that it would be removing its
personal property, including water slides and other rides, at termination in
accordance with Section 8.8.2 of the Premier Agreement.

C.                  Whereas, in February 2006, Cal Expo notified Premier that
prior to termination, Cal Expo would consider either a buy out under Section 20
or an assignment of Premier’s rights and interests to a qualified third party
under Section 24 of the Premier Agreement.

D.                 Whereas, in November 2006, after extensive negotiations with
interested third parties, Premier and Cal Expo have reached agreement that
Palace Entertainment would be assigned Premier’s rights and interests in the
Premier Agreement on the following terms and conditions:  Palace Entertainment
shall pay Premier the sum of $950,000.00 for the ownership rights to all the
remaining personal property belonging to Premier, including water slides and
other rides; Cal Expo shall pay to Premier the final balance (estimated at
$240,000.00) for the purchase of the FRC Premises as full accord and
satisfaction of the “Acquisition Agreement” between Cal Expo and Premier dated
June 9, 1999 (a copy of the Acquisition Agreement is attached as Exhibit 1);
Palace Entertainment enters into an agreement with Cal Expo, whereby Palace
Entertainment accepts the assignment from Premier on the terms and conditions as
amended and restated in this Agreement; and by accepting such assignment
pursuant to Section 20 of the Premier Agreement, Cal Expo and Premier forever
release and discharge the other from any and all claims which may in any way be
connected or based on the Premier Agreement and Acquisition Agreement.

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E.                   Whereas, in connection with the Restated Assignment
Agreement, due to many changed circumstances and to clarify amended terms and
conditions, Palace Entertainment and Cal Expo desire to amend and restate the
Premier Agreement such that the Restated Assignment Agreement supersedes the
Premier Agreement and will be a new and separate agreement.

Now, therefore, the Parties agree as follows:

Terms and Conditions

1.                    Based on and in accordance with the foregoing recitals,
Premier hereby assigns all of its rights and interests in the Premier Agreement
to Palace Entertainment; Cal Expo hereby consents to the assignment, and Palace
Entertainment hereby accepts the assignment from Premier on the terms and
conditions set forth below.

2.                    Premises

A.                Grant of Rights, Definition of Terms:  Cal Expo grants to
Palace Entertainment the exclusive right to equip, improve, operate and maintain
an aquatic park consisting of water slides, wave pools, water rides and
attractions, and other related developments and facilities on its premises as
described and set forth in Exhibit A hereto.  Although the rights conveyed under
this Agreement, except as stated otherwise, are exclusive year-round, the
parties anticipate that the primary commercial use of the Water Park will be May
through September of each year.  Subject to Cal Expo’s approval, Palace
Entertainment may provide programs and events at other times during the year
which do not conflict or compete with other events and programs held at
Cal Expo.  Palace Entertainment shall pay the same rent as described in this
Agreement from revenues from these programs and events.  All such property and
rights, together with the Water Park Premises, shall be referred to in this
Agreement as the “Premises.”

B.                  Warranties:  Cal Expo warrants that it has the power to
consummate the transactions and take the actions contemplated under this
Agreement, including the transfer (or ratification thereof) of the rights under
this Agreement, and warrants the quiet enjoyment of the Water Park to Palace
Entertainment for the purposes set forth in this Agreement, subject only to
those encumbrances and limitations set forth in this Agreement.  Palace
Entertainment warrants that it has the power to consummate the transactions and
take the actions contemplated under this Agreement.

C.                  Premises Taken “As Is”:  Palace Entertainment accepts the
Premises in its presently existing condition “as is.”  Except as otherwise
described in this Agreement, Cal Expo shall not be obligated to make any
alterations, additions or betterments thereto.

D.                 Consent to Jurisdiction and Venue:  This Agreement is to be
performed in the County of Sacramento, State of California.  Palace
Entertainment hereby expressly agrees and consents to the personal jurisdiction
of the Courts of the State of California in the

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County of Sacramento for any purpose or matter whatsoever alleged by any
petition, complaint, or other pleading by Cal Expo relating to this Agreement. 
Palace Entertainment further consents and agrees that service of any process
necessary in connection with any proceeding alleged to arise out of this
Agreement may be made by Cal Expo on Palace Entertainment by registered mail,
postage prepaid, to Palace Entertainment at its main offices in Sacramento,
which service of process shall be fully effective in all respects as personal
service lawfully made on Palace Entertainment in the State of California.

3.                    Term:  The term of this Agreement shall commence on
December 15, 2006, and shall terminate on December 31, 2015, unless it is either
extended or sooner terminated in accordance with the provisions of this
Agreement.

A.                Option 1:  Palace Entertainment shall have an option to extend
this Agreement for an additional ten (10) years, that is, until December 31,
2025, provided that Palace Entertainment meets and satisfies the following
investment and performance criteria:  (1) on or before May 30, 2009, Palace
Entertainment shall invest $2.5 million in capital improvements and deferred
maintenance as approved by Cal Expo; (2) in addition to the requirement set
forth in (1) above, on or before May 30, 2010, Palace Entertainment shall invest
a minimum of $350,000.00 on capital improvements as approved by Cal Expo; and
(3) in addition to the requirements set forth in (1) and (2) above, Palace
Entertainment  shall invest a minimum of $400,000.00 on capital improvements, on
or before May 30, 2013, as approved by Cal Expo.  In the event Palace
Entertainment opts to invest more than the $2.5 million minimum requirement set
forth in (1) above, any overage shall be applied to the requirements set forth
in (2) and (3).  In addition to the investment criteria set forth above in (1),
(2) and (3), Palace Entertainment must attain an average annual gross revenue
for 2007 through 2013 (adjusted for inflation based on the wholesale price
index) that is greater than $2.8 million.

In order to exercise this option, Palace Entertainment must provide written
notice to Cal Expo no later than May 1, 2014, of its intent to exercise the
option; satisfy the investment and performance criteria as set forth in the
foregoing paragraph; shall reach agreement with Cal Expo on a schedule of
capital improvements and deferred maintenance which must be completed during
this ten-year extension; and not be in default under the terms of this
Agreement.  In the event this Agreement is extended for an additional ten years,
it is agreed that this ten-year extension shall be subject to all the terms and
conditions of this Agreement, unless otherwise agreed to in writing by the
Parties.

B.                  Option 2:  In the event this Agreement is extended pursuant
to Option 1, Cal Expo, in the exercise of its sole discretion, shall have an
option to extend this Agreement for an additional five (5) years, that is, until
December 31, 2030.  In order to exercise this option, Cal Expo must provide
written notice to Palace Entertainment no later than May 1, 2024, of its intent
to exercise this option.  In the event this Agreement is extended for an
additional five years, it is agreed that this five-year extension shall be

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subject to all the terms and conditions of this Agreement, unless otherwise
agreed to in writing by the Parties.  In the event the option is not exercised
by Cal Expo, the Agreement will expire December 31, 2025.

4.                    Payment by Palace Entertainment to Cal Expo:

A.                Annual Payment:  Palace Entertainment shall pay Cal Expo an
amount equal to eight percent (8%) of the total Gross Revenues generated for
each year of this Agreement commencing January 1, 2007, and each year
thereafter.

B.                  Monthly Installments:  In making the Annual Payment set
forth in (A) above, Palace Entertainment shall make equal monthly payments
calculated from the Gross Revenues received from the preceding year of this
Agreement.  Palace Entertainment shall make such payments on or before the tenth
day of each month.

C.                  Annual Report and Reconciliation:  Within ninety (90) days
after December 31 of each year of this Agreement, Palace Entertainment shall
furnish to Cal Expo a statement of the Gross Revenues audited for the preceding
calendar year, certified by a Public Accountant.  In the event that such audit
statement shows that Palace Entertainment’s total monthly payments is less than
the required Annual Payment, then Palace Entertainment shall pay to Cal Expo the
balance due within thirty (30) days after the audit statement is certified by
the Public Accountant.  Alternatively, in the event that such audit shows that
Palace Entertainment’s total monthly payments exceed the Annual Payment, then
Cal Expo shall refund the excess balance to Palace Entertainment within thirty
(30) days of receipt of the audit statement certified by the Public Accountant
or, if not so refunded, at Palace Entertainment’s option, shall be offset
against the monthly payment(s) next due and payable by Palace Entertainment.

D.                 Notwithstanding sub-paragraph 4B, for the 2007 calendar year
only, Palace Entertainment shall make monthly payments in the amount of
$25,000.00 on the tenth day of each month of 2007.

E.                   Notwithstanding sub-paragraph 4A, for calendar years 2007
and 2008, Cal Expo shall grant Palace Entertainment a total Annual Payment
credit of $200,000.00 to be applied as follows:  $100,000.00 for calendar year
2007 and $100,000.00 for calendar year 2008.  This payment credit may be made,
at Cal Expo’s option, either in the form of a rent credit or a payment to Palace
Entertainment.  In either event, Palace Entertainment shall deem the two
payments as marketing contributions.

F.                   Place of Payment: All payments shall be made by Palace
Entertainment to Cal Expo at 1600 Exposition Boulevard, Sacramento, California,
or at such other location as shall be designated in writing by Cal Expo.

G.                  Late Payments:  In the event a payment is not made on or
before the due date herein provided, Palace Entertainment shall pay to Cal Expo
a late charge on said unpaid

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payment at the rate of one and one-half (1 1/2) percent per month from and after
the due date thereof until the date of payment.  Should there be unusual or
extenuating circumstances for not paying said payment on or before the due date
herein provided, Cal Expo in its sole discretion may waive the late charge on
the unpaid payment.

H.                 Computation of Gross Revenues and Definition of Terms:  For
all purposes under this Agreement, the term “Gross Revenues” shall mean all
monies or money equivalents paid or payable to Palace Entertainment for sales
made or services rendered at or from the Water Park Premises described on
Exhibit A hereto, or from any other source including parking revenue received
from Cal Expo related directly or indirectly to the Water Park through the
implementation of the Agreement, without any deductions, provided that “Gross
Revenues” shall not include any sales taxes or other admissions and/or amusement
taxes imposed by any governmental entities and collected by Palace
Entertainment.  “Gross Revenues” shall not include “trade-outs” or other
arrangements whereby Palace Entertainment engages in advertising or promotion of
the Water Park in exchange for non-cash benefits.

5.                    Capital Improvements:  Palace Entertainment shall make the
following capital improvements:

A.                Prior to May 30, 2009, Palace Entertainment shall invest not
less than $2.5 million in capital improvements and deferred maintenance,
adjusted by the Wholesale Price Index, of which $650,000.00 shall be spent, not
later than May 30, 2007, on a new attraction.

B.                  In addition to the requirements of paragraph 5(A) above,
Palace Entertainment shall invest a minimum of $350,000.00 in capital
improvements prior to May 30, 2010.

C.                  In addition to the requirements of paragraphs 5(A) and 5(B)
above, Palace Entertainment shall invest a minimum of $400,000.00 in capital
improvements prior to May 30, 2013.

D.                 The foregoing capital improvements shall carry forward if
Palace Entertainment invests more than the required amount in capital
improvements prior to December 31, 2009 (i.e., the overage will apply toward the
2010 and 2013 target date requirements).

E.                   Should the Agreement be extended in accordance with
paragraph 3 of this Agreement, the Parties shall agree to a schedule of capital
improvements and deferred maintenance investment during the extension period
(2016 through 2025, and 2025 through 2030).

F.                   All capital improvements purchased by Palace Entertainment
from Six Flags, and all capital improvements provided under this Agreement,
shall become the property of Cal Expo at Cal Expo’s sole and exclusive option
upon termination of the Agreement for any reason other than Cal Expo’s exercise
of its buy-out option pursuant to paragraph 23 of this Agreement.  Cal Expo, if
not exercising its buy-out option pursuant to paragraph 23, may also require
that one or more or all capital improvements be removed at Palace
Entertainment’s sole expense.

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G.                  For the purposes of this Agreement, the definition of a
“capital improvement” shall be any of the following:

1)                  A structure and/or a fixture permanently attached to the
structure and structural or nonstructural improvements of a permanent nature.

2)                  A structure is an improvement of a permanent nature which is
constructed or built.

3)                  A fixture is a permanent attachment to a permanent structure
(of a permanent nature structure or fixture) which augments the intended use of
the structure.

4)                  Permanent nature means that the intent is of an enduring or
fixed nature not temporary or transient.

5)                  Extensive remodeling and replacement of an existing facility
may qualify as a capital improvement if the useful life of the facility is
extended or its usefulness increased.

6.                    Quitclaim Deed:  Upon the termination or sooner
cancellation of this Agreement in accordance with the terms hereof, including
the cancellation of this Agreement by Cal Expo by virtue of an Event of Default
described in paragraph 22 below by Palace Entertainment, Palace Entertainment
shall execute and deliver to Cal Expo, within thirty (30) days after such
termination or sooner cancellation (but in no event until Cal Expo has paid the
required buy-out price if terminated under paragraph 23 hereof), a Quitclaim
Deed assigning, transferring and conveying any rights of Palace Entertainment to
the Premises (other than Palace Entertainment’s personal property (including,
but not limited to, water slides and other rides)) arising hereunder, which
Quitclaim Deed shall be recorded at the sole cost and expense (including payment
of all real property transfer taxes arising therefrom) of: (a) Cal Expo, if the
expiration or sooner termination of this Agreement is for any reason other than
an Event of Default (as defined in paragraph 22) by Palace Entertainment,
including but not limited to the exercise by Cal Expo of the its buy-out option
with respect to the Water Park, set forth in paragraph 23 herein, and assuming
Cal Expo has paid the required buy-out price thereunder; or (b) Palace
Entertainment, if the termination occurs by reason of any Event of Default
(defined under paragraph 22) by Palace Entertainment.  The granting of said
Quitclaim Deed pursuant to this Section, however, shall not constitute an
admission by Palace Entertainment of any breach or acquiescence in any
termination, and shall not prevent or estop Palace Entertainment from pursuing
all available remedies at law or in equity.  Should Palace Entertainment fail or
refuse to deliver said Quitclaim Deed, a written notice by Cal Expo reciting
said failure shall after ten (10) days from the date of recordation of said
notice be conclusive evidence of such termination against Palace Entertainment
and all persons claiming an interest in the Water Park Premises under this
Agreement.

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7.                    Parking and Access to Premises

A.                Parking:  Cal Expo shall provide convenient and adequate
parking areas for customers of Palace Entertainment at all times that Palace
Entertainment is conducting activities at the Water Park in accordance with this
Agreement.  Cal Expo may charge for such parking in accordance with the terms of
this Agreement.  Cal Expo is not required to provide an exclusive parking area
for Palace Entertainment’s customers, but Cal Expo shall not provide to any
other party parking rights that would exclude Palace Entertainment’s customers
from parking areas convenient to the Water Park.  Cal Expo shall provide, at no
charge, reasonably convenient parking for employees and service personnel of
Palace Entertainment (which parking need not be as convenient as customer
parking) at such areas as Cal Expo shall designate and redesignate.  Such
parking areas may be changed, at Cal Expo’s discretion, during the annual
California State Fair (“State Fair”).  Cal Expo shall further provide at no
charge convenient access to the Water Park for construction equipment, service
and supply vehicles related to Palace Entertainment’s activities pursuant to
this Agreement.

1)                  Subject to the terms hereof, parking shall be under control
of Cal Expo.  Cal Expo expressly reserves the right to charge for parking
provided to customers of the Water Park.  Any fees charged by Cal Expo to Palace
Entertainment’s customers shall not exceed stated public parking fees during the
State Fair (excluding for this purpose Cal Expo’s car pooling rates or any other
parking promotions).

2)                  Except during the period of the annual State Fair, Cal Expo
shall pay to Palace Entertainment one-half (1/2) of the net proceeds of any
parking fees charged to Palace Entertainment’s customers. Such payments shall be
made to Palace Entertainment no later than twenty (20) days following the end of
each month.

3)                  For purposes of this paragraph 7, “net proceeds” shall be
determined by deducting from gross parking revenues paid by Palace
Entertainment’s customers, the expenses of Cal Expo reasonably incurred for
traffic control and fee collection related to those customers.  In the event
that Cal Expo should conclude it cannot practically determine actual gross
parking revenues from Palace Entertainment’s customers, Cal Expo, upon written
notification to and consultation with Palace Entertainment, shall establish a
reasonable formula for estimating such gross parking revenues based upon other
ascertainable indicia.  In the event that such expenses exceed the total gross
parking revenues Cal Expo has collected from Palace Entertainment’s customers,
Palace Entertainment shall reimburse Cal Expo for such excess expenses upon
Palace Entertainment’s receipt of written verification thereof.

B.                  “Drop Off” Area:  Except during the period of the State
Fair, Cal Expo shall exercise its best efforts to provide a separate automobile
“drop-off” area at points convenient to the pedestrian access through the State
Fair site to the Water Park, and shall permit customers of Palace Entertainment
access to these areas at no charge.  The initial automobile drop-off area for
the Water Park Premises shall be at the point closest to the Water Park Premises
entrance on the turnaround at Cal Expo’s Main Gate.

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C.                  Pedestrian Access:  Cal Expo shall continue to provide: (1)
pedestrian access through the Cal Expo grounds to the Premises for customers,
employees, service personnel, and agents of Palace Entertainment, and (2) access
to the Premises over the back service road for Palace Entertainment and its
agents, employees, vendors and contractors, all of which shall be related to
Palace Entertainment’s activities pursuant to this Agreement.  The initial
pedestrian access for customers of the Water Park shall be through Cal Expo’s
Main Gate and along Palm Avenue to the Water Park.  Should Cal Expo make changes
in the physical layout of the State Fair site, it may redesignate customer
pedestrian access for Palace Entertainment, provided Cal Expo shall exercise
best efforts to insure that such redesignated access shall be equivalent in
convenience and quality of appearance to the initial access.

D.                 Gates and Parking Lots:  All references to particular gates
and parking lots in this Agreement shall refer to the particular gates and
parking lots as they are designated on the date of this Agreement.

8.                    Reserved Rights of Cal Expo

A.                Cal Expo’s Control Over Balance of Grounds:  Except as limited
in this Agreement, Cal Expo expressly reserves the right to grant, during the
term hereof or any extension, the right to operate concessions on the State Fair
site other than the Premises including, but not limited to, concessions for food
and beverage, souvenirs, novelties, crafts, commercial items and other items and
services provided at fairs, expositions, or other interim events on the Cal Expo
grounds.

B.                  Cal Expo’s Right to Levy Charges

1)                  During the period of the State Fair, Cal Expo may levy a
charge for admission to the State Fair site, and, notwithstanding any other
provision of this Agreement, such charge shall be applicable to all of Palace
Entertainment’s customers.

2)                  During periods other than the State Fair, Cal Expo may, from
time to time, in addition to any charge for parking, levy a separate charge for
admission to portions of the Cal Expo grounds, other than the Premises
pedestrian access areas, drop off areas and parking areas provided under this
Agreement, and such charge may apply to Palace Entertainment’s customers,
employees and service personnel, provided that such charge shall not be levied
for the sole privilege of access to the Premises.

C.                  Review of Items Sold:  Except as limited in this Agreement,
Cal Expo reserves the right to prohibit the sale or rental of any item which it
reasonably deems objectionable from the standpoint of taste, quality, or
compatibility with Cal Expo’s activities, but shall not

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exercise this right for the purpose of controlling the economic return to Palace
Entertainment or to protect exclusive licensing or similar arrangements between
Cal Expo and others.  Palace Entertainment, upon written request of Cal Expo,
shall submit items for approval within a reasonable time prior to proposed sale
or rental.  Cal Expo shall respond to requests for approval within five (5) days
of receipt of written request for approval.

D.                 Cal Expo’s Right to Make Improvements:  Cal Expo expressly
reserves the right to inspect, investigate, survey, construct, reconstruct,
replace, repair, maintain, and operate water lines, sewer lines, telephone
lines, electrical power lines together with appurtenant facilities along the
route of such lines and facilities existing throughout the Premises, and to
authorize others to do so as necessary as determined by Cal Expo, for the
administrative management and development of the Cal Expo grounds.  Palace
Entertainment will be given reasonable notice when such work may become
necessary and shall adjust its operations in such manner that Cal Expo may
proceed expeditiously.  Cal Expo shall not exercise this right in such a way as
to unreasonably interfere substantially with Palace Entertainment’s operations
or customer access to the Water Park or in such a way as to unreasonably detract
from the appearance of the Water Park or unreasonably deter or discourage
patronage of the Water Park.

E.                   Security:  Palace Entertainment will be allowed to provide
limited security staff to work with the Cal Expo Police Department to ensure the
safety of the park and the guests.  Nothing contained in this Agreement shall be
construed to limit Cal Expo’s authority to determine minimum levels of security
reasonably necessary to protect public health and safety, including assigning a
police officer(s) and security guards during operating hours as determined by
the Cal Expo Chief of Police.  Palace Entertainment agrees to pay Cal Expo its
reimbursable rate for such security provided by Cal Expo at the Water Park
Premises in accordance with Palace Entertainment’s request, including the costs
and expenses actually incurred by Cal Expo in connection with any lawful arrests
made in furtherance of providing such security, including requisite time spent
at bookings and court appearances.  Cal Expo assumes no responsibility for any
loss or damage to the property of Palace Entertainment as a result of  Palace
Entertainment’s decisions regarding security at the Water Park.

9.                    Special Duties of Cal Expo

A.                Quality of Support Services, Documentation of Costs:  Parking
services, security services and any other support service now or later required
of Cal Expo under this Agreement shall be of a reasonable commercial standard as
measured by the standards of other facilities and operations comparable to those
of Palace Entertainment under this Agreement.  Cal Expo shall provide to Palace
Entertainment, at reasonable times and upon reasonable notice, records of costs
and receipts of parking operations and reasonable documentation supporting
actual costs of security operations or other reimbursable items which support
the cost reimbursement claims and profit share determinations made by Cal Expo.

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B.                  Restriction on Commercial Activities in Certain Areas:

1)                  Cal Expo shall not permit or conduct any sales, concessions,
promotions or other commercial use of the parking areas which are directed
toward or substantially affect Palace Entertainment’s customers, nor adversely
affect the attractiveness of Palace Entertainment’s goods or services to such
customers.

2)                  Except during the period of the State Fair, Cal Expo shall
not permit or conduct any sales, concessions, promotions or other commercial use
of the pedestrian access areas provided for Palace Entertainment’s customers
except during periods that other contractors are sharing that pedestrian access
for other activities on the Cal Expo grounds, and during these periods such
activities shall be limited to those directly related to such other use, and
shall not be directed primarily at Palace Entertainment’s customers or interfere
with their access to the Premises.

10.              Rights of Palace Entertainment

A.                Palace Entertainment Activities

1)                  Permitted Activities:  Unless otherwise authorized by Cal
Expo, Palace Entertainment may use the Water Park Premises for commercial
purposes only as follows: all activities normally associated with aquatic park
and family oriented entertainment facilities, including, without limitation,
various water-oriented entertainments and rides, games, competitions,
promotions, concessions, musical, dramatic or other stage shows or similar
presentations, and may use the remainder of the Premises for purposes ancillary
or incidental thereto (including but not limited to ingress and egress) and
otherwise as permitted in this Agreement.

2)                  In addition to the obligation set forth in paragraph 15,
Palace Entertainment agrees that in the event of any litigation or claim of
damages for copyright infringement or violation by Palace Entertainment, its
agents or licensees, arising from its conducting or licensing musical,
cinematic, dramatic or other similar shows at the Water Park, Palace
Entertainment will hold Cal Expo harmless and Palace Entertainment will
indemnify and defend Cal Expo in the event of any such action for or claim of
infringement or violation of copyright by Palace Entertainment, its agents and
licensees.

3)                  Exclusive Commercial Rights on Designated Premises:

a)                   The rights conveyed under this Agreement include the
exclusive right to commercial use of the Water Park Premises, except as limited
by this Agreement.

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b)                  Palace Entertainment shall have the sole and exclusive right
to enter into concession, licensing, promotion or sponsorship agreements or
exclusive use arrangements relating to the Water Park (or any portion thereof),
provided that any privileges granted to others by these agreements, including
but not limited to signage, public address announcements, distribution of any
material (including but not limited to coupons, fliers and product samples) and
access to the Premises for hospitality purposes shall be directed to Palace
Entertainment’s customers and shall not be visible to, audible to, or designed
to impact any persons other than Palace Entertainment’s customers, and shall not
be directed toward any other persons on the Cal Expo grounds or the general
public without prior written approval of Cal Expo.

c)                   Cal Expo recognizes that Palace Entertainment does not have
complete control over ambient noise or incidental visibility; while the volume
of public address announcements will be modulated to the level necessary to be
audible to Water Park patrons, it is possible that these announcements may be
audible outside the Water Park.  Palace Entertainment agrees to abide by the
City of Sacramento noise control ordinance, Chapter 66 (commencing with Section
66.101) of the Sacramento City Code, adopted by the City of Sacramento and in
effect on December 1, 1983.  Amendments to the ordinance made after December 1,
1983, are not directly applicable to the California Exposition and State Fair.

4)                  Palace Entertainment’s Right to Levy Charges:

a)                   Palace Entertainment may charge fees, rates or prices as
follows:  (1) for the initial admission to the Water Park (except as may be
limited by this Agreement for the period of the State Fair); (2) for rides on
amusement facilities; (3) for use of all other facilities operated by Palace
Entertainment upon the Premises which are authorized by Cal Expo in accordance
with this Agreement; (4) for sales of food and beverages, goods, services and
other concession items on the Premises; and (5) for use of the Premises by
concessionaires, licensees, and other third parties otherwise authorized by this
Agreement.

b)                  Palace Entertainment’s fees, rates or prices shall be at a
competitive level with similar items throughout the Cal Expo grounds.  Palace
Entertainment agrees to submit price lists to Cal Expo for review.  If Cal Expo
expresses concern over prices charged, the parties will cooperate to mutually
agree on appropriate fees.  If no resolution can be reached, the parties will
proceed with dispute resolution as described in paragraph 18 of this Agreement.

B.                  Control of Ticket Sales:  Except during the period of the
State Fair, Palace Entertainment shall operate ticket sales for its operations.
 Cal Expo and Palace Entertainment shall, from time to time, agree upon
appropriate locations for ticket sale

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outlets on the Cal Expo grounds.  Palace Entertainment will follow reasonable
revenue control procedures approved by Cal Expo to monitor revenues.  Cal Expo
shall have reasonable access to the ticket sale operations to review records of
receipts and verify accuracy of the operations themselves.  Cal Expo may, at
Palace Entertainment’s expense, retain personnel to conduct such review and
verification, provided that Palace Entertainment’s obligations to compensate Cal
Expo for the costs of such activities shall not exceed One Thousand Dollars
($1,000.00) in any one year.

C.                  Identifying Signs:

1)                  Water Park Sign:  Palace Entertainment has an identifying
sign on the existing pylon at the main entrance to Cal Expo, identifying the
Water Park.  Cal Expo shall have the right to review and approve any
replacements to this sign desired to be made by Palace Entertainment, at its own
cost and discretion, including but not limited to location, size, design,
content, method of attachment (if any), and materials used to manufacture the
sign; provided, however, Cal Expo hereby acknowledges and consents to any signs
existing as of the date hereof..

2)                  Other Signs:  Palace Entertainment, subject to the sole
discretion of Cal Expo, and on terms mutually agreed upon by the parties,
including reasonable charges levied by Cal Expo for such rights, may locate
other identifying or directional signs at other points on the Cal Expo grounds.

3)                  Approval:  Cal Expo shall not unreasonably withhold approval
of any signs proposed by Palace Entertainment pursuant to this paragraph 10(C).
 In evaluating any signs proposed by Palace Entertainment, Cal Expo shall use
the same standards applied by Cal Expo to its own signs in the area for which
the sign is proposed, or, if Cal Expo has no signs in such area, in comparable
areas of the Cal Expo grounds.  Palace Entertainment shall have the right to
maintain the current entry signage at the pedestrian entrance of the Water Park,
or replacement signage of equivalent quality, size, readability and visibility.

D.                 Promotion and Advertising:  Palace Entertainment shall have
sole control over advertising and promotion of its facilities and attractions,
provided that, without further consent of Cal Expo, Palace Entertainment shall
have the right to use the names “Cal Expo”, “State Fair” or similar terms only
for purposes of identifying the location of its facilities.  Cal Expo, in its
sole discretion, may provide to Palace Entertainment the right to advertise or
promote, on other portions of the Cal Expo grounds, its facilities and
activities on the Premises, and Cal Expo may levy a separate charge for such
right.

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11.              Duties of Palace Entertainment

A.                Quality of Operation

1)                  Palace Entertainment shall operate the Water Park for a
commercially reasonable period each year, including during the State Fair.  The
operations shall be of first class quality in all respects which is comparable
to similar operations of Palace Entertainment.  Palace Entertainment shall
diligently pursue a promotional program to increase the use of its services and
facilities.

2)                  Palace Entertainment shall contract continuously for the
personal services of an expert resident manager of the Water Park (the
“Manager”).

3)                  Palace Entertainment shall establish and schedule hours of
operation pursuant to operating plans that will maximize economic return from
operations in Palace Entertainment’s sole business judgment.  Palace
Entertainment shall prepare and submit to Cal Expo a proposed schedule of
operating hours.

B.                  Palace Entertainment’s Employees:

1)                  Palace Entertainment agrees that at all times its employees
shall be clean in appearance and courteous in manner and shall be fully
instructed and trained so that the public and patrons at Cal Expo shall be
treated and served with every reasonable consideration and courtesy.  If, in the
reasonable opinion of Cal Expo, any of Palace Entertainment’s employees fail to
meet reasonably such standards then upon written request of Cal Expo setting
forth in detail the reasons for such request, Palace Entertainment shall
forthwith cause such employee to meet such standards or discontinue the
employment of any such employee or employees at the Water Park.

2)                  Palace Entertainment’s employees engaged where food and
beverage is sold shall comply with all applicable federal, state, city and
county sanitary regulations.

C.                  Expenditures on Advertising and Promotion:

1)                  Palace Entertainment will expend annually on advertising and
promotion of the Water Park, as a minimum, eight percent (8%) of annual gross
revenues.

a)                   For purposes of this requirement, monies expended by or on
behalf of Palace Entertainment for advertising and other forms of promotion may
be taken into account, so long as the expenditures are made for the primary
purpose of promoting the Water Park and activities conducted thereat by Palace
Entertainment, but there shall not be taken into account the discounting of
tickets or in-kind promotions.

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b)                  If Palace Entertainment fails to make the required
expenditures on advertising and promotion in any year, Palace Entertainment
shall pay Cal Expo the amount of the shortfall.

2)                  Nothing in this paragraph 11(C) shall limit the discretion
of Palace Entertainment to determine the method and amount of advertising and
promotion expenditures so long as Palace Entertainment complies with the minimum
expenditure requirements set forth above.

D.                 Expenditures on Capital Improvements:  Palace Entertainment
shall make new capital improvements on the Water Park Premises as outlined in
paragraph 5 of this Agreement.

1)                  Palace Entertainment shall annually prepare or revise and
submit to Cal Expo a current Capital Improvements Plan (sometimes referred to
herein as the “Plan”) that identifies contemplated capital improvements,
including any substantial changes or alterations in any existing improvements,
during the next following five years.  Except as provided in this Agreement,
Palace Entertainment shall not be required to carry out such improvements, but
Palace Entertainment shall not carry out any improvements unless those
improvements are set forth in the Plan.

2)                  Cal Expo may object to the inclusion of any contemplated
capital improvement in the Plan if the improvement is materially inconsistent
with appropriate standards of appearance or safety, as measured by the standards
applied in other similar facilities or on the balance of the Cal Expo grounds. 
Cal Expo shall, within forty-five (45) days of receipt of the Plan, notify
Palace Entertainment in writing of such objections.  Failure of Cal Expo to make
such objection shall be deemed a waiver of Cal Expo’s right to object to the
proposed capital improvement in concept, but shall not waive its right to final
review and approval of the plans and specifications for such improvement as set
forth in this Agreement.  Cal Expo’s refusal to accept a designated capital
improvement as part of the Plan shall not reduce Palace Entertainment’s
obligations to provide capital improvements as set forth in this Agreement.  Cal
Expo’s right to withhold consent on the basis of incompatibility with the
balance of the Cal Expo grounds is intended to insure reasonable compatibility
taking into account not only the interests of Cal Expo in the rest of the
Cal Expo grounds, but the purposes of this Agreement to establish a commercially
successful Water Park for the duration of this Agreement.  Nothing contained in
this provision authorizes Cal Expo to reject improvements that are reasonably
functionally appropriate for the uses permitted to Palace Entertainment under
this Agreement, although the provision does authorize Cal Expo to impose
reasonable requirements with respect to the design and appearance of such
improvements based upon the need for compatibility with the balance of the
Cal Expo grounds.

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3)                  If Palace Entertainment fails to make the required
expenditures on capital improvements in any year, Palace Entertainment shall
notify Cal Expo of said failure within 30 days after the completion of that year
and submit a written plan to Cal Expo, for Cal Expo’s written approval, showing
increased expenditures for the Water Park in the following year of 110 percent
of the amount of the shortfall.  Cal Expo may, in its sole discretion, agree in
writing to alternative methods to resolve any such shortfalls.

4)                  Within ninety (90) days of submission of a Capital
Improvements Plan first containing a planned improvement, Cal Expo shall notify
Palace Entertainment in writing if Cal Expo concludes that any contemplated
improvement is not a true capital improvement that can be credited toward Palace
Entertainment’s expenditure obligations under this provision.

5)                  Except as set forth in this paragraph 11(D), the timing of
any capital improvements shall be entirely within the discretion of Palace
Entertainment.

E.                   Charges During State Fair Period:  Palace Entertainment and
Cal Expo will agree during the period of the State Fair to a schedule of
attractions, entertainment, and admission pricing that will be offered on the
Water Park Premises during that period.

F.                   Non-Discrimination Clause:  During the performance of this
Agreement, Palace Entertainment and its subcontractors shall not unlawfully
discriminate, harass, or allow harassment against any employee or applicant for
employment because of sex, race, color, ancestry, religious creed, national
origin, physical disability (including HIV and AIDS), mental disability, medical
condition (cancer), age (over 40), marital status, and denial of family care
leave.  Palace Entertainment and subcontractors shall insure that the evaluation
and treatment of their employees and applicants for employment are free from
such discrimination and harassment.  Palace Entertainment and subcontractors
shall comply with the provisions of the Fair Employment and Housing Act (Gov.
Code §12990 (a-f) et seq.) and the applicable regulations promulgated thereunder
(California Code of Regulations, Title 2, Section 7285 et seq.).  The applicable
regulations of the Fair Employment and Housing Commission implementing
Government Code Section 12990 (a-f), set forth in Chapter 5 of Division 4 of
Title 2 of the California Code of Regulations, are incorporated into this
Agreement by reference and made a part hereof as if set forth in full.  Palace
Entertainment and its subcontractors shall give written notice of their
obligations under this clause to labor organizations with which they have a
collective bargaining or other agreement.  Palace Entertainment shall include
the nondiscrimination and compliance provisions of this clause in all
subcontracts to perform work under this Agreement.

G.                  Americans With Disabilities Act:  Palace Entertainment, by
signing this Agreement, assures Cal Expo that it, Palace Entertainment, and each
of its subcontractors, vendors, exhibitors, promoters, agents, and employees, if
any, comply with the Americans With Disabilities Act (“ADA”) of 1990 (42 U.S.C.
12101 et. seq.) and California Disability

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Access statutes including, but not limited to, the Unruh Civil Rights Act (Cal.
Civ. Code §51 et. seq.), the California Disabled Persons Act (Cal. Civ. Code §54
et. seq.), and all relevant provisions of the Health and Safety and Business and
Professions Codes, as well as all applicable regulations and guidelines issued
pursuant to the ADA, namely the Americans With Disabilities Act Accessibility
Guidelines (“ADAAAG”) and all applicable regulations and guidelines issued
pursuant to California law including Title 24 of California’s Building Code. 
Failure to comply may subject Palace Entertainment to civil liability and
damages.  Palace Entertainment further agrees that this covenant to comply with
state and federal disability access requirements continues for the duration of
the Agreement.

H.                 Acknowledgement of Cal Expo’s Title, Acquiescence in
Reversion to Cal Expo:

1)                  Palace Entertainment hereby acknowledges the fee title of
Cal Expo in and to the Water Park Premises, including real property improvements
existing thereon but excluding Palace Entertainment’s personal property
(including, but not limited to, waters1ides and other rides), and hereby
covenants and agrees never to contest said title.

2)                  At the termination of this Agreement or in the event of an
Event of Default by Palace Entertainment and cancellation of the Agreement by
Cal Expo as a result thereof, other than if Cal Expo exercises its buy-out
provision under paragraph 23 of this Agreement, title to the facilities and
improvements constructed by the Palace Entertainment and those purchased by
Palace Entertainment from Six Flags in accordance with the terms of this
Agreement and any fixtures or appurtenances in connection therewith reverts to
Cal Expo.  Within thirty (30) days of such termination, Palace Entertainment
shall remove any of its moveable personal property located on the Water Park
Premises.

I.                      No Liens:

1)                  During the term provided for in this Agreement, subject to
the terms hereof, Palace Entertainment (including any of its contractors or
concessionaires), will not in any way encumber or cloud its title to all or any
portion of the Water Park Premises real property, or any improvements to it, and
will promptly pay and discharge any and all debts contracted by it in reference
thereto for labor, material, or services, or anything connected with or used by
it upon the Premises to the end that no such liens shall attach unless being
contested by or on behalf of Palace Entertainment in accordance with paragraph
11(I)(2).

2)                  Cal Expo shall have the right to post such notices as it may
desire in order to protect its interest in the Water Park Premises, and any
portions thereof, against liens.  If, nevertheless, any such lien shall be
recorded and Palace Entertainment, within sixty (60) days after notice from Cal
Expo shall fail to pay, settle, or otherwise release such lien, Cal Expo may pay
or otherwise dispose of said lien, or

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defend, settle, or compromise any suit brought to foreclose the same, in its
sole discretion, and all amounts so paid by it or any loss sustained by Cal Expo
on that account, including a reasonable amount for its reasonable attorneys’
fees, shall be repaid to Cal Expo by Palace Entertainment and shall be in
addition to any other payments by way of rental, or otherwise, required under
the terms of this Agreement, provided that, if Palace Entertainment elects to
contest the lien, Palace Entertainment may postpone Cal Expo’s payment of the
lien by (a) making a deposit in escrow with a California bank or trust company
of a sum sufficient to satisfy such lien in full, or (b) posting a performance
bond with a reputable California licensed surety assuring payment of the claims
secured by the lien in the event that such claim proves valid.  In the event Cal
Expo does pay such a lien in accordance with its rights under this Paragraph,
Palace Entertainment’s failure to repay any such sum to Cal Expo within thirty
(30) days of when Cal Expo has mailed a bill therefor to Palace Entertainment
shall constitute a breach of this Agreement.

J.                     Permits:  Palace Entertainment shall at all times abide
by and comply with all applicable federal, state, and local laws and at all
times shall have in good standing necessary licenses or permits to conduct its
operation on the Cal Expo grounds.

12.              Conduct of Capital Improvements:

A.                Submission of Plans and Specifications:  At least forty-five
(45) days prior to undertaking any planned capital improvement, Palace
Entertainment shall submit to Cal Expo plans and specifications for such
improvement, prepared or approved by professional engineer or architect licensed
by the State of California, together with a proposed construction and inspection
schedule.  Palace Entertainment shall also submit an equipment schedule,
including catalog cuts, for approval.  Cal Expo may examine the submitted
materials to ascertain:

1)                  That the proposed improvement is consistent with the
improvement described in the Capital Improvement Plan or otherwise consistent
with the standards by which Cal Expo has reviewed and approved the Plan.

2)                  That the proposed construction activities and schedule are
consistent with Cal Expo’s planned activities on the balance of the Cal Expo
grounds

B.                  Cal Expo Comment on Plans and Specifications:  If Cal Expo
disapproves any drawings, plans or specifications, Palace Entertainment shall
submit necessary modifications and revisions.  Cal Expo shall give approval or
specify changes within fifteen (15) days of receipt of such working drawings,
plans and specifications, and if Cal Expo fails to so approve or specify change,
then approval is deemed to be given at the end of the I5-day period.

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C.                  Scheduling of Capital Improvements:  Cal Expo, in its
reasonable discretion, may require phasing or rescheduling construction of
capital improvements to prevent conflict with the annual State Fair and other
uses of the Cal Expo grounds.

D.                 Construction in Conformance with Plans:  The design and
construction of each capital improvement will conform to the working drawings,
plans, specifications and inspection schedule approved by Cal Expo. No
substantial changes or alterations shall be made without prior written approval
of Cal Expo.  Time for completion may be extended for a reasonable period due to
factors beyond the reasonable control of Palace Entertainment, such as fires,
riots, floods, earthquakes, wars, civil disturbances, major labor disturbances,
acts of God or laws.  Upon completion, Palace Entertainment shall file a Notice
of Completion of Construction with Cal Expo.

E.                   Professional Review:  Palace Entertainment shall utilize
the services of an architect or engineer and contractor all licensed by the
State of California, for the construction of said capital improvements.  Copies
of the agreement between Palace Entertainment and its architect or engineer and
its contractor, and all inspection reports, shall be furnished to and consented
to in writing by Cal Expo.  The architect or engineer’s services shall include
the preparation or approval of working drawings, detailed specifications,
estimates of cost of construction, supervision, stage inspection.  Upon
completion of construction, Palace Entertainment shall provide certification by
its architect or engineer that the project to be in substantial accordance with
the original plans and specifications.  Cal Expo shall designate a member of its
engineering staff to monitor and inspect the progress of the construction at no
cost to Palace Entertainment.

F.                   Verification of Costs:

1)                  Within ten (10) days of filing such Notice of Completion
with Cal Expo, Palace Entertainment will submit a verified cost statement
accompanied by substantiating invoices and bills for all direct out-of-pocket
expenses incurred in the construction of a capital improvement that it wishes to
include in partial satisfaction of its capital improvement obligations under
this Agreement.  These costs shall include the following:  costs of all permits,
fees, and licenses; the aggregate amount for the furnishing of labor, materials
and tools, financing and related costs; and the cost of any and all professional
fees, such as architectural and engineering services, directly related to the
project described in such Notice of Completion.

2)                  After examination by Cal Expo of both construction and
equipment cost statements, Cal Expo will establish the cost of the constructed
capital improvements and the equipment in connection therewith.

3)                  In the event the cost statements are not filed by Palace
Entertainment within the ten (10) day period above stated, Cal Expo shall
thereupon estimate the cost of either or both cost statements, if necessary, and
such estimate or estimates will become final within ten (10) days after notice
thereof to Palace Entertainment.

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4)                  In the event of a discrepancy or dispute between Cal Expo
and Palace Entertainment as to the statement of construction costs or the
statement of equipment costs, which discrepancy or dispute cannot be reconciled
between Cal Expo and Palace Entertainment, the cost statement or statements
shall be submitted to an independent auditor selected by mutual agreement of the
parties.  It is agreed that the decision of the independent auditor shall be
final and that the costs of said audit shall be borne equally by Cal Expo and
Palace Entertainment.

13.              Records, Reports and Audits:

A.                Maintenance and Disclosure of Records:  Palace Entertainment
shall keep true and accurate books and records showing all of its business
transactions concerning its operations on the Premises in separate records of
account in a manner acceptable to Cal Expo and Cal Expo shall have the right
through its representative, and at all reasonable times, to inspect such books
and records including State of California sales tax return and other amusement
and/or admissions tax records.  Palace Entertainment hereby agrees that all such
records and instruments are available to Cal Expo.

B.                  Statement Upon Termination:  In the event this Agreement is
terminated, Palace Entertainment shall submit to Cal Expo, within ninety (90)
days after such termination, a gross receipts statement for the period of
operations not previously reported, certified by a Public Accountant or
Certified Public Accountant.  Cal Expo further reserves the right to examine all
such books and records at any time during the one (1) year period following the
termination of this Agreement.

C.                  Cash Register Equipment:  Palace Entertainment agrees that
as part of its record-keeping activity it shall, at its own cost and expense,
install and maintain such cash register equipment as may be deemed necessary by
Cal Expo.  Such cash register equipment shall contain a continuous registering
tape or other vehicle for providing an audit trail acceptable to Cal Expo for
the accurate recording of gross receipts.

14.              Security, Letter of Credit and Bonds:

A.                Security Requirement:  Pursuant to that certain Agreement for
Deposit of Funds to Secure Performance by Premier Waterworld Sacramento Inc.
between Cal Expo and Palace Entertainment (the “Escrow Agreement”), Palace
Entertainment shall have deposited with Cal Expo the amount of Two Hundred
Thousand Dollars ($200,000) (the “Security Deposit” or “Escrow Funds”) as
security for the faithful and continuing performance by Palace Entertainment of
all the terms and conditions of this Agreement during the entire term of this
Agreement, including but not restricted to the operation and maintenance of the
facilities constituting the Water Park as well as any additional future
developments by Palace Entertainment, and the payment of all rent, fees, taxes
or other charges.  In the event that Palace Entertainment fails to remedy any
Event of Default in the terms of this Agreement ninety (90) days from the
receipt by Palace

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Entertainment of written notice by Cal Expo, Cal Expo may terminate the
Agreement and take possession of the Water Park Premises and seek redress from
the Escrow Funds, and, whether or not it does so may pursue other remedies for
such breach available at law or equity.

B.                  Bonding Requirement:  Prior to the commencement of
construction of any capital improvement or deferred maintenance item with a cost
in excess of One Hundred Thousand Dollars ($100,000), Palace Entertainment shall
furnish to Cal Expo a Payment Bond of a surety corporation licensed to transact
business by the State of California and in a form satisfactory to Cal Expo, with
the persons selected by Palace Entertainment to construct such capital
improvements in accordance with this Agreement to be named as principals, in a
sum not less than fifty percent (50%) of the total contract cost of the
construction of the said improvement, guaranteeing the payment for all
materials, provisions, provender, supplies and equipment used in, upon, for or
about the performances of said construction work or labor done thereon of any
kind whatsoever and protecting Cal Expo from any and all liability, losses or
damages, arising therefrom.

15.              Hold Harmless Agreement:

A.                Waiver of Contribution Right:  Palace Entertainment hereby
waives all claims and recourse against Cal Expo including the right to
contribution for loss or damage to person or property resulting from any
activities on the Water Park Premises, except for claims arising from the sole
negligence of Cal Expo, its officers, agents or employees, and claims arising
out of conditions or occurrences with respect to adjacent areas existing or
occurring on or prior to the date of the Premier Agreement, which conditions or
occurrences do not comply with or may give rise to liability under regulations
of any governmental authority, and claims arising under or by virtue of the
Premier Agreement.

B.                  Indemnification and Hold Harmless:

1)                  Palace Entertainment shall indemnify, hold harmless and
defend Cal Expo and the State of California, its officers, agents and employees
against any and all claims, suits, actions of every name, kind and description,
brought forth from, or on account of, damage to property or injuries to or death
of any person, including but not limited to workers or the public, resulting
from any activities on the Premises, except for (1) claims arising out of the
sole negligence of Cal Expo and the State of California, its officers, agents or
employees, and (2) claims arising out of conditions or occurrences with respect
to the Premises and adjacent areas occurring or existing prior to the date of
this Agreement, which conditions or occurrences do not comply with, or may
result in liability under the environmental laws or regulations of any
governmental authority.

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2)                  Cal Expo shall indemnify, hold harmless, and defend Palace
Entertainment, its officers, agents and employees against any and all claims,
suits, actions of every name, kind and description, brought forth from, or on
account of, damage to property or injuries to or death of any person, including
but not limited to workers and the public, arising out of (1) the sole
negligence of Cal Expo, its officers, agents or employees, or (2) any conditions
or occurrences with respect to the Premises and adjacent areas existing or
occurring prior to the date of this Agreement, which conditions or occurrences
do not comply with, or may result in liability under the environmental laws or
regulations of any governmental authority.

3)                  Palace Entertainment hereby waives all claims and recourse
against Cal Expo and the State of California including the right to contribution
for loss or damage to persons or property arising from, growing out of, or in
any way connected with or incident to this Agreement.  The duty of Palace
Entertainment to indemnify and save harmless includes the duties to defend as
set forth in section 2778 of the Civil Code.

4)                  Palace Entertainment waives any and all rights to any type
of express or implied indemnity against Cal Expo and the State of California,
its officers or employees.

5)                  In the event Cal Expo is named as co-defendant, Palace
Entertainment shall notify Cal Expo of such fact and shall represent Cal Expo in
such legal action unless Cal Expo undertakes to represent itself as co-defendant
in such legal action, in which event Palace Entertainment shall bear Cal Expo’s
litigation costs, expenses, and attorney’s fees.

6)                  Notwithstanding paragraph 15(B), Cal Expo shall not be
liable for loss or damage to the property owned, leased, or operated by Palace
Entertainment.

16.              Insurance:

A.                Liability Insurance:  Palace Entertainment shall provide a
general liability insurance policy in the minimum sum of Ten Million Dollars
($10,000,000) per occurrence and annual aggregate, or its equivalent providing
coverage for, but not limited to, the following: Bodily Injury and Property
Damage, Premises/Operations, Products/Completed Operations, Independent
Contractors, Automobiles owned, hired and leased, and be in accordance with all
of the limits, terms and conditions set forth herein. The limits may be
satisfied by a combination of primary and excess liability policies.  Palace
Entertainment agrees that this coverage shall be provided on a primary basis to
any other coverage(s) provided or available to Cal Expo.  The policy shall
contain the following special endorsements: (1) State of California, California
Exposition and State Fair, its Board of Directors, officers, agents, employees,
and servants are included as additional insureds; (2) the insurer will not
cancel or reduce the insured’s coverage without thirty (30) days prior written
notice to Cal Expo; (3)

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Cal Expo will not be responsible for the payment of any premiums or assessments
on the policy; and (4) the policy shall include coverage (“Access Area
Coverage”) for all claims, suits, actions of any name, kind and description,
brought forth from, or on account of, damaged property or injuries to or death
of any person, including but not limited to workers and the public, arising out
of the use of the Cal Expo grounds’ roadways, pedestrian walkways, and parking
lots, by Palace Entertainment’s customers for ingress or egress to and from the
Water Park, excluding from coverage the period of the State Fair each year.

Notwithstanding the foregoing, if at any time from and after the date of this
Agreement, the percentage increase (from the date of this Agreement) in Palace
Entertainment’s annual liability insurance premiums solely attributable to
Access Area Coverage exceeds the percentage increase (from the date of this
Agreement) in Palace Entertainment’s total annual liability insurance premiums
for the Water Park (excluding Access Area Coverage), and the dollar amount of
such excess is greater than $15,000, then Palace Entertainment shall have the
right, 90 days following written notice of such event to Cal Expo, to terminate
the Access Area Coverage; provided, however, that following such notice to
Cal Expo, Palace Entertainment and Cal Expo shall use all reasonable efforts to
negotiate in good faith an alternative approach for obtaining Access Area
Coverage.

For example, assume the annual liability insurance premiums for Access Area
Coverage increase from $10,000 to $30,000, and the total annual liability
insurance premiums for the Water Park (excluding Access Area Coverage) increase
from $40,000 to $80,000 during the same period.  In this example, the percentage
increase in premiums attributable to Access Area Coverage (200%) exceeds the
percentage increase in total non-Access Area Coverage premiums (100%), but the
dollar amount of such excess, $10,000 (100% of $10,000), is less than $15,000. 
Therefore, under this example, Palace Entertainment would not have the right to
terminate Access Area Coverage pursuant to this paragraph.

By way of additional example, assume the annual liability insurance premiums for
Access Area Coverage increase from $10,000 to $40,000 and the total annual
liability insurance premiums for the Water Park (excluding Access Area Coverage)
increase from $40,000 to $80,000 during the same period.  In this example, the
percentage increase in premiums attributable to Access Area Coverage (300%)
exceeds the percentage increase in total non-Access Area Coverage premiums
(100%) , and the dollar amount of such excess, $20,000 (200% of $10,000), is
greater than $15,000.  Therefore, under this example, Palace Entertainment would
have the right to terminate Access Area Coverage pursuant to this paragraph.

Notwithstanding anything in this Agreement to the contrary, if Palace
Entertainment is unable to obtain Access Area Coverage (conforming to the other
requirements of this paragraph) because insurance companies refuse to provide
Access Area Coverage for the Water Park due to factors beyond Palace
Entertainment’s control, then after Palace

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Entertainment and Cal Expo have exhausted all reasonable efforts to provide some
alternative approach for obtaining Access Area Coverage, Palace Entertainment
shall not be required by this paragraph to obtain such Access Area Coverage.

The policy with the endorsements shall be submitted to Cal Expo for approval by
California Fair Services Authority (“CFSA”).

Palace Entertainment agrees that the policy herein provided for shall be in
effect at all times during the term of this Agreement.  In the event said
insurance expires at any time or times during the term of this Agreement, Palace
Entertainment agrees to provide at least thirty (30) days prior to said
expiration date, a new certificate of insurance evidencing insurance coverage as
provided for herein for not less than one (1) year.  New certificates of
insurance are subject to the approval of CFSA, and Palace Entertainment agrees
that no work or services shall be performed prior to the giving of such
approval.  Said certificate of insurance for all areas affected by this
Agreement, shall be issued by an insurance company that is acceptable to CFSA,
and Cal Expo shall have the right to reconsider insurance requirements during
the term of the Agreement.  The failure of Palace Entertainment to keep in
effect at all times insurance coverage as herein provided will constitute a
breach of this Agreement.

B.                  Additional Insurance Provisions:  Palace Entertainment
agrees to procure and continuously maintain and carry throughout the term hereof
at its own cost and expense the following:

1)                  Workers’ Compensation Insurance:  All employees of Palace
Entertainment shall be covered by workers’ compensation insurance as required by
law.  Palace Entertainment shall have the right to act as a self-insurer after
qualifying under the laws of the State of California and submitting a copy of
their Certificate of Consent to Self-Insure to Cal Expo.

a)                   Evidence of workers’ compensation insurance shall be
submitted prior to commencement of term; or

b)                  Palace Entertainment has no paid or volunteer employees and
Palace Entertainment executes and submits an “Exemption from Workers’
Compensation” form.  This certification does not alter or affect compliance with
the workers’ compensation requirements in the Labor Code of the State of
California.

2)                  Palace Entertainment shall carry all risk insurance for
fire, storms, wind and other possible casualties in an amount and type
satisfactory to Cal Expo.  Such insurance on the improvements, fixtures,
furnishings, equipment, and all other personal property, including supplies of
Palace Entertainment on the premises, shall be in an amount adequate to insure
the replacement of said property in the event of loss.

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3)                  All insurance required hereunder shall be for the protection
of Cal Expo and the State of California, as well as Palace Entertainment, shall
be written by such company or companies as Cal Expo shall approve and, in the
absence of agreement as to amount, shall be in the amounts customarily carried
in each category by operators of comparable facilities as a minimum.  All losses
under any such policies of insurance shall be so written as to be payable to
“Palace Entertainment, a Delaware corporation” and/or Cal Expo, State of
California as their interests may appear.

4)                  Palace Entertainment shall submit copies of insurance
policies to Cal Expo for approval by CFSA prior to the commencement of operation
on the Water Park Premises.  At least thirty (30) days prior to the expiration
of any policy, a renewal policy of insurance showing that such insurance
coverage has been renewed, shall be filed with Cal Expo.

5)                  In the event Cal Expo reasonably determines, based upon
practices of comparable facilities, that other insurance than those types
specifically listed is believed by Cal Expo to be necessary for the protection
of the joint interest of the parties hereunder, Palace Entertainment likewise
agrees to procure, pay for and carry such other additional insurance.

C.                  Palace Entertainment’s Self Insurance:  At any time, Palace
Entertainment may submit to Cal Expo a plan whereby Palace Entertainment would
“self-insure” to the limits required under this paragraph 16.  Cal Expo shall
promptly review such proposed plan and shall not unreasonably refuse to approve
it as a means of satisfying Palace Entertainment’s insurance obligations under
this Paragraph.

17.              Taxes:  It is acknowledged by Palace Entertainment that this
Agreement will create a possessory interest in public property which is subject
to property taxation.  Palace Entertainment agrees to pay any property taxes
lawfully levied on such possessory interest.  Palace Entertainment agrees to pay
the above and all other lawful taxes, assessments or charges which at any time
may be levied by the State of California, County of Sacramento, City of
Sacramento, or any tax assessment levying body upon any interest in this
Agreement or any possessory right which Palace Entertainment may have in or to
the Water Park Premises covered hereby or the improvements thereon by reason of
its use or occupancy thereof or otherwise, as well as all taxes, assessments,
charges on goods, merchandise, fixtures, appliances, equipment, and property
owned by it in or about the Premises, provided that Palace Entertainment may
contest the imposition of any such tax and may withhold payment upon provision
of a bond or other financial assurance satisfactory to Cal Expo insuring that
funds are available for such payment.

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18.              Dispute Resolution:  The parties agree to the following dispute
resolution procedure to cover any and all disputes arising under the lease:

A.                Mediation:  In the event of a dispute, claim or controversy
arising out of or relating to the Agreement or the breach, termination,
enforcement, interpretation or validity thereof, and such dispute, claim or
controversy cannot be informally resolved by the parties, the parties agree to
formally mediate the dispute prior to initiating arbitration as set forth in
subparagraph (b) below.  The parties agree to share equally in the costs
associated with mediation.

B.                  Arbitration:  In the event mediation fails to resolve a
dispute, claim or controversy arising out of or relating to the Agreement or the
breach, termination, enforcement, interpretation or validity thereof, including
the determination of the scope of applicability of the Agreement to arbitrate,
the parties agree to submit the unresolved matter to arbitration and shall be
bound by the determination of one arbitrator in Sacramento, California.  The
arbitration shall be administered by JAMS pursuant to its Streamlined
Arbitration Rules and Procedures.  Judgment on the award may be entered in any
court having jurisdiction.  The arbitrator may, in the award, allocate all or
part of the costs of the arbitration, including the fees of the arbitrator and
the reasonable attorneys’ fees of the prevailing party.

C.                  Venue in Sacramento:  The parties to this Agreement agree
that any action at law or suit in equity, relating to this Agreement or any
provision thereof, shall only be instituted and maintained in a court of
competent jurisdiction in the County of Sacramento, State of California.  Each
party hereto waives the right to change of venue.

D.                 Notwithstanding the foregoing, in the event litigation is
instituted by one party against the other, the parties agree that, in addition
to any other remedies that this Agreement or the law may allow, the prevailing
party in such litigation shall recover all reasonable costs, including
reasonable attorney’s fees.

19.              Maintenance:

A.                Palace Entertainment’s Responsibilities:  Palace Entertainment
agrees to maintain any and all facilities at the Water Park in good order and
repair at its own cost and expense during the entire term of this Agreement.  At
the beginning of each year, Palace Entertainment shall provide Cal Expo with a
projected maintenance schedule for the upcoming year.

B.                  Cal Expo Inspection:  Cal Expo’s representative, as
designated by its General Manager, may make inspections of Palace
Entertainment’s facilities to determine if the maintenance of the facilities is
in conformity with this Agreement.  Palace Entertainment shall perform at its
own cost and expense, any required maintenance and repairs including structural
maintenance and landscape maintenance, and should Palace Entertainment fail,
neglect or refuse to do so, Cal Expo shall have the right to perform such
maintenance or repairs for Palace Entertainment’s account, and Palace
Entertainment agrees to promptly reimburse Cal Expo for the cost thereof,
provided, however, that Cal Expo shall first give Palace Entertainment ten (10)
days written

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notice of its intent to perform such maintenance or repairs.  Cal Expo shall not
be obligated to make any repairs to or maintain any improvements on the subject
premises.  Palace Entertainment hereby expressly waives the right to make
repairs at the expense of Cal Expo and the benefit of the provisions of Sections
1941 and 1942 of the Civil Code of the State of California relating thereto if
any.

C.                  Clean-up of Area Surrounding Water Park:  Palace
Entertainment expressly agrees at all times during the term of this Agreement,
at its own cost and expense, to maintain and operate the Water Park and areas
adjacent to said Park, to a distance of not less than fifty (50) feet, in a
clean, safe, wholesome and sanitary condition free of trash, garbage or
obstructions of any kind and in compliance with any and all present and future
laws, general rules or regulations of any governmental authority now or at any
time during the term of this Agreement in force relating to sanitation or public
health, safety, and welfare.  Palace Entertainment shall remedy without delay
any defective, dangerous or unsanitary conditions on said Water Park or within
the area described in this subparagraph.  Notwithstanding the foregoing, Palace
Entertainment’s obligations as described in this subparagraph shall not alter,
modify or diminish Cal Expo’s indemnity obligations as set forth in paragraph 15
above.

D.                 Other Maintenance Services:  Palace Entertainment further
agrees to assume and pay when due all operating expenses for pest control,
garbage and waste removal, janitorial services, and any other operating services
accruing or payable in connection with its occupancy of the Water Park and, any
part thereof, including deposits, fees, required by the supplier of any such
service.

20.              Utilities and Services:

A.                Payment of Utility Charges:  Palace Entertainment shall assume
and pay when due all charges for gas, power, telephone; light, and any other
utility services accruing or payable in connection with its occupancy of the
premises and any part thereof, including deposits, connection fees or charges
and equipment rental required by the supplier of any such utility service,
provided Palace Entertainment agrees to reimburse Cal Expo for utilities based
upon a reasonable estimate of the proportion of such utility services actually
used by Palace Entertainment if the utilities are not separately metered.

B.                  Refuse Disposal:  It is understood that Cal Expo has, and
will continue to have in the future, an exclusive agreement with a refuse
company for the disposal of refuse on the Cal Expo grounds and Palace
Entertainment hereby agrees that all of its facilities located on the Water Park
Premises will be subject to the terms, conditions and unit price of said
agreement for the disposal of its refuse.

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C.                  Water:

1)                  The Water Park Premises are currently served by a well
designated as Well Number Three, which will be maintained by Cal Expo.  No
charge shall be made by Cal Expo for water use by Palace Entertainment during
the term of this Agreement or extension thereof.  Cal Expo does not, however,
guarantee an adequate water supply to Palace Entertainment for the term of this
Agreement or extension thereof and in the event that the water supply from Well
Number Three diminishes or is insufficient to meet the needs of Palace
Entertainment, it is understood that Palace Entertainment, at its cost and
expense, will seek another source of supply from the City of Sacramento or other
governmental agency.

2)                  Cal Expo represents that it has no present information
indicating that the current water supply in Well Number Three is or will become
inadequate or unsuitable, and further covenants to cooperate in any reasonable
way in assisting Palace Entertainment in obtaining an alternate water supply
should that become necessary.

21.              Labor-Management Relations:  During the term of this Agreement,
Palace Entertainment shall take all reasonable steps (consistent with applicable
law) necessary to assure satisfactory labor-management relations to the end that
the operation of Palace Entertainment, Cal Expo or of exhibitors,
concessionaires, or others on the Cal Expo grounds shall in no way be affected
by strikes, picketing, boycotts, or other labor activities.  Palace
Entertainment, however, does not warrant or guarantee that there will be no such
strikes, picketing, boycotts or other labor activities.

22.              Termination Prior to Expiration of Term:

A.                Events of Default Defined:  Any of the following acts or
omissions shall constitute breach of this Agreement if not cured within
applicable notice and cure periods (each referred to herein as an “Event of
Default” or “breach” of this Agreement) which shall give Cal Expo the right to
terminate this Agreement as set forth in this paragraph if not cured within
applicable notice and cure periods and take such other actions to enforce this
Agreement as are permitted by law.  Due performance of this Agreement by Palace
Entertainment is an express condition of its continuance, as provided in this
paragraph.

1)                  Cessation of Business:  If Palace Entertainment, without the
written consent of Cal Expo, during the period Palace Entertainment is required
to operate the Water Park under this Agreement, closes the Water Park to the
public for a period of either thirty (30) consecutive days or sixty (60) days
during any one year; or

2)                  Breach of Agreement:  If a material breach is made by Palace
Entertainment of any of the terms, conditions or covenants contained in this
Agreement or the Escrow Agreement (as defined in paragraph 14(A)) which is not
cured within 30 days of receipt of written notice thereof, or if not reasonably
capable of being cured within 30 days, as soon thereafter as is commercially
practicable so long as Palace Entertainment diligently prosecutes such cure to
completion; or

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3)                  Nonpayment of Rent:  If the required monthly rent is
delinquent in the amount of payment, or in the prescribed time of payment, for a
period in excess of fifteen (15) days (acceptance by Cal Expo of any portion of
the delinquent rent, at the option of Cal Expo shall not constitute waiver of
said breach); or

4)                  Nuisance:  If Palace Entertainment should create or allow to
be created a nuisance on the Water Park Premises.

B.                  Remedies for Breach:  In the event of a breach of this
Agreement by Palace Entertainment, Cal Expo may send written notice to Palace
Entertainment of said breach.  If Palace Entertainment shall fail to remedy (1)
commence cure of the breach described in such notice within 90 days of receipt
or (2) diligently prosecute such cure to completion thereafter, Cal Expo, at its
option, may declare this Agreement terminated and may thereupon take immediate
possession of the Water Park Premises.  In addition, Cal Expo may seek redress
against the Escrow Funds on deposit with Cal Expo as set forth in this Agreement
and the Escrow Agreement.

C.                  Bankruptcy:  Subject to the provisions of the United States
Bankruptcy Code, as amended, should Palace Entertainment file a voluntary
petition in bankruptcy or be adjudged a bankrupt either upon the voluntary
petition in bankruptcy of Palace Entertainment or upon the involuntary petition
of creditors of Palace Entertainment, or should Cal Expo seek a remedy afforded
by any statute of the United States relating to bankruptcy, or should Palace
Entertainment make an assignment for the benefit of its creditors, or should a
receiver be appointed over its assets, or should an attachment be levied, and
permitted to remain for a period of more than thirty (30) days, upon any
interest of Palace Entertainment under this Agreement, then, all interest of
Palace Entertainment in this Agreement, except such interest as may have been
validly assigned by Palace Entertainment pursuant to the conditions of this
Agreement, shall at the sole option of Cal Expo terminate upon ninety (90) days
written notice to Palace Entertainment and Cal Expo may enter and take
possession of the Water Park Premises.

23.              Buy-Out Provisions:  Notwithstanding any other provision in
this Agreement and in addition to any other remedy available, the parties agree
to the following buy-out provisions.

A.                Cal Expo’s Buy-Out

1)                  The buy-out provision cannot, at any time during the term or
any extension thereof, be utilized by Cal Expo to replace Palace Entertainment
as the operator (any termination for good cause will not be an exercise of the
buy-out provision).

2)                  The buy-out option may not be utilized by Cal Expo until the
end of the 2011 water park operating season (i.e., October 1, 2011).

3)                  Cal Expo will have from October 1, 2011, until December 31,
2011, to notify Palace Entertainment of its intent to exercise the buy-out
clause.

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4)                  If Cal Expo exercises the buy-out clause, Palace
Entertainment is entitled to remove (at its sole expense) whatever capital
improvements have been purchased on or for the site and will receive a lump sum
payment equivalent to two (2) times one (1) year’s gross revenue received by
Palace Entertainment (taking the average of the previous three (3) years’ gross
revenue).

5)                  If Cal Expo does not exercise the buy-out clause in 2011, it
will have a similar opportunity to do so from and between October 1, 2015, and
December 31, 2015, and again from and between October 1, 2020, and December 31,
2020, with the same buy-out payment and rights to the assets as set forth in
subparagraph 4) above, provided the Agreement is extended in accordance with
paragraph 3 of this Agreement.

B.                  Palace Entertainment’s Buy-Out

1)                  If Palace Entertainment elects to terminate this Agreement
prior to the expiration of the term or any extension thereof, it shall provide
Cal Expo with 12 months written notice and shall pay Cal Expo two (2) times the
annual rent (averaged over the last three (3) years of operation).  In addition
to the payment, Palace Entertainment agrees that all capital improvements
purchased by Palace Entertainment from Six Flags, and all capital improvements
constructed or implemented under the terms of this Agreement, shall become the
property of Cal Expo at Cal Expo’s sole and exclusive option upon early
termination of the Agreement.  Cal Expo, in the exercise of its sole discretion,
may require that one or more of the capital improvements be removed at Palace
Entertainment’s sole expense.

24.              Notices:  Any notices provided for in this Agreement, or which
otherwise may be given by either party to the other, shall be deemed to have
been fully given when made in writing and deposited in the United States mail,
certified as registered, postage prepaid and addressed as follows:

To Palace Entertainment at:

Palace Entertainment

 

Raging Waters Sacramento

 

1600 Exposition Boulevard

 

Sacramento, CA 95815

 

ATTN: General Manager

 

 

To Cal Expo at:

California Exposition & State Fair

 

1600 Exposition Boulevard

 

Sacramento, CA 95815

 

ATTN: General Manager

 

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25.              Assignments:

A.                No Transfer Without Cal Expo Consent:  Except as otherwise
provided herein, no transfer, conveyance, pledge or assignment by Palace
Entertainment of this Agreement or of any part thereof or interest therein
directly or indirectly, voluntarily or involuntarily, shall be made unless such
transfer, conveyance, pledge or assignment is first consented to in writing by
Cal Expo as required by, and pursuant to the provisions of this paragraph.

B.                  Assignment for Security:  Palace Entertainment’s possessory
interest in Palace Entertainment’s improvements under the terms of this
Agreement, for the purposes of affording security only, may be assigned,
transferred or encumbered when first consented to in writing by Cal Expo. 
Cal Expo shall give such consent upon verification that such assignee is a
responsible commercial lender and that such assignment is made consistent with
the requirements and restrictions of this Agreement.  No mortgage shall be
executed and no bonds or other evidence of interest in, or indebtedness upon the
assets or proposed assets of Palace Entertainment shall be issued except for the
purposes of acquiring, installing, enlarging or improving plant and equipment
and extending facilities for the accommodation of the public, and then only upon
prior consent in writing in each case obtained from Cal Expo.  In the event of
breach and foreclosure on such mortgage or such other indebtedness or of other
assignment, transfer or encumbrance, the purchaser under the foreclosure sale,
shall succeed to the possessory interest of Palace Entertainment.  Under these
circumstances, operating rights and privileges shall be as outlined in this
Agreement, however, the right of any person or persons to actually operate the
said premises is subject to the consent of Cal Expo.

C.                  Assignment for Other Than Security:  Except as provided in
paragraph 25(A),Palace Entertainment shall neither assign or otherwise convey
any interest of any sort granted by this Agreement, to any person or persons,
entity or entities whatsoever, without prior written consent and approval by
Cal Expo.  Before Cal Expo considers such assignment, Palace Entertainment shall
have adequately carried out the provisions of this Agreement for a period of no
less than three (3) years.  Cal Expo’s consent to an assignment by Palace
Entertainment shall not unreasonably be withheld.  In deciding whether to
consent, Cal Expo may consider the financial capability and stability of the
proposed assignee, the experience of the management of the assignee in operating
a water theme park, and the reputation of the assignee.  Cal Expo may further
review those provisions of the transfer documents dealing with the transition
from assignor to assignee of control over operations at the Water Park to ensure
a reasonably smooth transition of such control.  All of Cal Expo’s review
hereunder will be with a view to satisfy Cal Expo that the quality and financial
capability of the operator and the operations at the Water Park will not
materially suffer due to the assignment.  Palace Entertainment’s interest here
shall not be assignable in bankruptcy, nor shall said interest be assignable by
operation of law.  Any document by which an interest is granted, subject to the
prior written consent of Cal Expo, shall indicate that the person

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acquiring such interest has been advised of and takes his interest subject to
the terms and conditions of this Agreement.  However, in the event of
termination of this Agreement, Cal Expo, at its sole option, may elect to treat
any assignee, subtenant or holder of an interest conveyed by Palace
Entertainment as Cal Expo’s tenant, subject to the terms and conditions of this
Agreement.

D.                 Change in Stock Ownership:

1)                  Any single change in stock ownership, voluntary,
involuntary, by operation of law, or otherwise (excluding a change by reason of
inheritance or operation of the California Community Property Law), which
results in a transferee, who is other than either the stockholder of Palace
Entertainment at the time of executing this Agreement, or an Affiliate thereof,
such that such transferee owns a controlling interest of the stock after the
transfer, shall be deemed as an assignment prohibited by this paragraph unless
written consent of Cal Expo be obtained as provided in this paragraph. 
Cal Expo’s consent shall not be unreasonably withheld, nor shall any
unreasonable terms and conditions in connection therewith be imposed.
 Cal Expo’s consent shall be based upon consideration of the financial
responsibility, character, business ability, morality, and reputation of such
person obtaining stock by assignment covered by this paragraph.  In the event
that the stock of Palace Entertainment goes to a public issue, this paragraph
shall not apply but the list of stockholders owning more than 5% of the stock
and the amount of stock held shall be submitted to Cal Expo.  Notwithstanding
the foregoing, this paragraph shall not be applicable as long as at least 51% of
the outstanding shares of voting stock of Palace Entertainment are owned by the
current owners of all of its voting stock or by any persons, corporations or
other entities, which directly or indirectly control or are controlled by or
under common control with any such current owners.

2)                  As a condition of obtaining the written consent of Cal Expo,
as provided above, Palace Entertainment shall immediately upon the request of
Cal Expo obtain for and supply to Cal Expo in writing such information as
Cal Expo may reasonably request for the purpose of exercising its power of
consent.  The consent of Cal Expo need not be obtained if the person obtaining
stock contrary to provisions of this paragraph sells or transfers ownership or
beneficial interest to a person who was a stockholder at time of execution of
this Agreement.  The sale or transfer shall be accomplished prior to Cal Expo
terminating the Agreement for breach of this paragraph.

26.              Period of State Fair:  No Assurances to Continue Fair:  For
purposes of this Agreement, the period of the State Fair shall be a period
during which Cal Expo conducts the State Fair on all or a portion of the
Cal Expo grounds other than the Water Park Premises.  This period is typically a
three-week period in August and September in any year, but Cal Expo reserves the
right to schedule the State Fair or reschedule the State Fair in its sole
discretion.  By entering into this Agreement, however, Cal Expo makes no
representation or stipulation as

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to the type, size, location or duration of public facilities to be maintained at
the Cal Expo grounds, or to the continuation of Cal Expo ownership or operation
of the Cal Expo grounds, or the operation of the State Fair.

27.              Time of Essence:  Time shall be of the essence in the
performance of this Agreement.

28.              Conflict of Interest:  Palace Entertainment warrants and
covenants that no official or employee of Cal Expo nor any business entity in
which an official or employee of Cal Expo’s interested, (1) has been employed or
retained to solicit or aid in the procuring of this Agreement; (2) will be
employed in the performance of this Agreement without the immediate divulgence
of such fact to Cal Expo.  In the event Cal Expo determines that the employment
of any such official, employee or business entity is not compatible with such
official’s or employee’s duties as an official or employee of the State of
California, Palace Entertainment, upon request of Cal Expo, shall terminate such
employment immediately.  For breaches or violation of this paragraph, Cal Expo
shall have the right both to annul this Agreement without liability and, in its
discretion, recover the full amount of any such compensation paid to such
official, employee or business entity.

29.              Paragraph Titles:  The paragraph titles in this Agreement are
inserted only as a matter of convenience and for reference, and in no way
define, limit or describe the scope of intent of this Agreement or in any way
affect this Agreement.

30.              Alcoholic Beverages:  The sale of alcoholic beverages by Palace
Entertainment at the Water Park Premises is hereby approved by Cal Expo provided
that the required permits or licenses are obtained and maintained by Palace
Entertainment.

31.              Management Representative:

A.                Cal Expo Representative:  For purposes of this Agreement, the
General Manager for Cal Expo, herein called “General Manager,” is the Cal Expo
representative in direct charge of the Cal Expo grounds.  The General Manager
shall designate to staff the day-to-day administration of this agreement and to
be Palace Entertainment’s contact with Cal Expo for information, agreement
performance, and other problems that may arise.

B.                  Palace Entertainment Representative:  Palace Entertainment
shall designate in writing a representative (which may be the Manager) who shall
be available at the Water Park or otherwise reasonably available during the
period when Palace Entertainment’s facilities are in operation and who shall be
authorized to take immediate action when necessary upon request of Cal Expo.

C.                  Change in Representative:  Palace Entertainment may change
its designated representative from time to time by giving written notice thereof
to Cal Expo in the manner herein provided.

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D.                 Entire Understanding:  This Agreement contains and embraces
the entire Agreement between the parties hereto and neither it nor any part of
it may be changed, altered, modified, limited or extended orally except by
written amendment thereto signed by Cal Expo and Palace Entertainment, or their
successors in interest.

32.              Waiver of Claims:  Palace Entertainment hereby waives any claim
against the State of California, its officers, agents or employees for damage or
loss from delay or attorney’s fees caused by any suit or proceeding directly or
indirectly attacking the validity of this Agreement, or any part thereof, or by
any money judgment or award against Palace Entertainment in any suit or
proceeding declaring this Agreement null, void or voidable or delaying the same
or any part thereof from being carried out unless Cal Expo shall fail to defend
the validity of this Agreement in any such suit or proceeding.

33.              Cal Expo Approval Shall Be Reasonably Given:  Except as
specifically provided otherwise in this Agreement, in each case in this
Agreement in which Cal Expo is given a right to consent to or approve, or
otherwise has discretion with respect to, any act, policy, or decision of Palace
Entertainment, Cal Expo shall not unreasonably withhold or delay such consent or
approval, taking into account the standards established herein for such consent
or approval or exercise of discretion. If no standards are established, then the
standards shall be those that would reasonably apply to the prudent operation of
an enterprise similar in kind and quality to the Water Park.  The failure of
Cal Expo to respond to any requests by Palace Entertainment for its consent or
approval within the periods provided herein shall be deemed to be Cal Expo’s
consent to the matters which are the subject of such consent.

34.              Relationship of the Parties:  The parties hereto agree that
Palace Entertainment, its officers, agents, and employees in performance of this
Agreement shall act in an independent capacity and not as officials, employees,
or agents of Cal Expo.  Nothing in this Agreement shall be construed to create a
partnership, joint venture or agency relationship between the parties.

35.              Amendment:  No amendment or variation of the terms of this
Agreement shall be valid unless made in writing, signed by the parties and
approved as required.  No oral understanding or Agreement not incorporated in
the Agreement is binding on any of the parties.

36.              Force Majeure:  Neither party shall be liable to the other for
any delay in or failure of performance, nor shall any such delay in or failure
of performance constitute default, if such delay or failure is caused by “Force
Majeure.”  As used in this section, “Force Majeure” is defined as follows: Acts
of war and acts of god such as earthquakes, floods, and other natural disasters
such that performance is impossible.

37.              Miscellaneous

A.                Gender and Headings:  As used herein, whenever the context so
requires, the neuter gender includes the masculine and the feminine, and the
singular includes the plural and

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vice versa. Defined terms are to have their defined meanings regardless of the
grammatical form or number of tenses of such terms. The title headings of the
respective paragraphs of this Agreement are inserted for convenience only, and
shall not be deemed a part of this Agreement or considered in construing this
Agreement.

B.                  Covenants:  Whenever words or provisions imposing an
obligation or duty on either party are used herein, such word or provision shall
have the same force and effect as though phrased in the form of express
covenants.

C.                  Construction:  The language in all parts of this Agreement
shall in all cases be construed simply and according to its fair meaning and not
strictly for or against either of the parties.

D.                 Successors and Assigns:  The terms, provisions, and
conditions hereof shall be binding upon and inure to the benefit of the
successors and assigns of the parties hereto.  All rights, options, privileges
and obligations of Cal Expo may be assumed, enforced or performed by any person
designed by it or by its successors or assigns.

E.                   Definitions of “Person”:  “Person,” as used herein,
includes any individual, partnership, firm, association, corporation or other
entity, natural or artificial, including any instrumentality or agency of
government.

F.                   Diligence:  Palace Entertainment shall conduct the
activities authorized by this Agreement on and in connection with the Premises
with due diligence and efficiency and in like manner as comparable California
businesses are operated and by methods to produce the maximum net income which
may be produced by proper manner of operation.

G.                  Definition of “Law”:  “Law,” as used herein, includes all
valid laws, statutes, ordinances, rules, orders and regulations promulgated or
issued by federal, state, municipal, local and administrative authorities.

H.                 Partial Invalidity:  In the event that any term, covenant,
provision or condition of this Agreement or any article, section, subsection,
sentence, clause or phrase of this Agreement is held to be invalid by final
judgment or any court of competent jurisdiction, such invalidity shall not in
any way affect the remainder of this Agreement.

I.                      Representations Not Herein Contained:  This Agreement
contains all of the representations, provisions, agreements, understandings and
warranties either express or implied and it is understood that no person,
employee, agent or representative of Cal Expo or any instrumentality thereof,
has authority to make, and Palace Entertainment warrants that it is not relying
on any written or oral statement, express or implied, except as herein set
forth, leading up to or including it to execute or enter into this Agreement.

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J.                     Approval:  This Agreement shall not be binding upon Cal
Expo until it has been duly executed by Cal Expo and, if applicable, approved by
the Department of General Services.

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EXHIBIT A

Description of Water Park Premises

See Exhibit A-I attached hereto.

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EXHIBIT AA

Description of Non-exclusive Use Shared Area

1) Service entrance. The area designated as “Red” and shown in red on the map
attached hereto as Exhibit AA-l depicts the service entrance. All vehicles
servicing Palace Entertainment, including, but not limited to, delivery trucks
and those Palace Entertainment personnel who have credentials issued by Cal Expo
for parking, shall, so long as not blocked, enter gate 12 and exit from gate 12,
following the area marked in red.  No authorization is given to use or be on any
other portion of the Cal Expo grounds, so long as said gate 12 remains unblocked
and except as permitted in accordance with paragraph 2 below.

“2) Public entrance.  The area designated as “Blue” shown in blue on the map
attached hereto as Exhibit AA-l depicts the entrance and pathway which may be
used by the public to gain access to the Water Park. During normal business
hours the public will have access through the main gate, which faces Exposition
Boulevard, and over the foregoing pathway to the Water Park.  Other gates,
including, but not limited to, the “West Gate” shown on the attached in Lot B
may be made available by Cal Expo for entrance by the public to the Water Park.
 The public shall follow the designated route signs, if any, to the Water Park;
otherwise shall follow the foregoing pathway.

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EXHIBIT B

PERMITTED ENCUMBRANCES

1.                    THE LIEN OF SUPPLEMENTAL REAL ESTATE TAXES, IF ANY,
ASSESSED PURSUANT TO CHAPTER 3.5 COMMENCING WITH SECTION 75 OF THE CALIFORNIA
REVENUE AND TAXATION CODE.

2.                    ANY ASSESSMENTS AGAINST THE LAND HEREIN DESCRIBED AND ITS
PROPORTION OF ANY GENERAL OUTSTANDING INDEBTEDNESS OF AMERICAN RIVER FLOOD
CONTROL DISTRICT.

3.                    WATER RIGHTS, CLAIMS OR TITLE TO WATER, WHETHER OR NOT
SHOWN BY THE PUBLIC RECORD.

4.                    EASEMENT FOR UNDERGROUND ELECTRIC SYSTEM AND INCIDENTAL
PURPOSES THERETO, GRANTED TO SACRAMENTO MUNICIPAL DISTRICT, A MUNICIPAL UTILITY
DISTRICT IN THE INSTRUMENT RECORDED MARCH 25, 1992, BOOK 9203-25, PAGE 844,
OFFICIAL RECORDS.

5.                    EASEMENT FOR UNDERGROUND ELECTRIC SYSTEM AND INCIDENTAL
PURPOSES THERETO, GRANTED TO SACRAMENTO MUNICIPAL DISTRICT, A MUNICIPAL UTILITY
DISTRICT IN THE INSTRUMENT RECORDED JANUARY 6, 1992, BOOK 8201-06, PAGE 471,
OFFICIAL RECORDS.

6.                    ANY RIGHTS, INTEREST OR CLAIMS WHICH MAY EXIST OR ARISE BY
REASON OF THE FOLLOWING, AS SHOWN ON ALTA SURVEY DATED OCTOBER 28, 1996,
PREPARED BY WONG & ASSOCIATES, JOB NO. 96050.

a.                    ENCROACHMENT OF ONE STORY WOOD BUILDING ONTO THE EASEMENT
RECORDED IN BOOK 8201-06, PAGE 471, OFFICIAL RECORDS.

b.                   ENCROACHMENT OF MONORAIL ONTO THE SOUTHEAST PORTION OF SAID
LAND.

c.                    THE FACT THAT A CONCRETE PEDESTRIAL BRIDGE GOING FROM THE
SOUTH PARKING AREA INTO THE WATER PARK EXISTS ON SAID LAND.

d.                   ENCROACHMENT OF FENCELINE, SAND VOLLEYBALL COURT AND
COVERED CONCRETE PICNIC AREA ONTO ADJOINING PROPERTY TO THE NORTH.

e.                    ENCROACHMENT OF THE WATERSLIDE ONTO THE ADJOINING PROPERTY
TO THE WEST.

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f.                      ENCROACHMENT OF CHAIN LINK FENCE ONTO THE ADJOINING
PROPERTY TO THE SOUTH.

g.                   THE FACT THAT AN OPEN DRAINAGE CANAL EXISTS PARTIALLY ON
SAID LAND IN THE SOUTHEAST CORNER.

h.                   EASEMENTS FOR STORM DRAINS, SANITARY SEWER, WATER LINES,
AND ELECTRICAL BOXES AS DISCLOSED BY SAID SURVEY.

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EXHIBIT C

Copy of the Acquisition Agreement

Exhibit C-l attached hereto

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