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EXHIBIT 10.3

MAGNA ENTERTAINMENT CORP.

AMENDED AND RESTATED LONG-TERM INCENTIVE PLAN

I. INTRODUCTION

        1.1    Purposes.    The purposes of the Long-Term Incentive Plan
(the "Plan") of Magna Entertainment Corp. (the "Company") are (i) to align the
interests of the Company's stockholders and the recipients of awards under this
Plan by increasing the proprietary interest of such recipients in the Company's
growth and success, (ii) to advance the interests of the Company by attracting
and retaining outside directors, officers, employees, consultants, independent
contractors and agents and (iii) to motivate such persons to act in the
long-term best interests of the Company and its stockholders.

1.2    Certain Definitions.

        "Agreement" shall mean the written Stock Option Agreement evidencing an
award hereunder between the Company and the recipient of such award.

        "Board" shall mean the Board of Directors of the Company.

        "Bonus Stock" shall mean shares of Common Stock which are not subject to
a Restriction Period or Performance Measures.

        "Bonus Stock Award" shall mean an award of Bonus Stock under this Plan.

        "Cause" shall mean the willful and continued failure substantially to
perform the duties assigned by the Company (other than a failure resulting from
the optionee's Disability), the willful engaging in conduct which is
demonstrably injurious to the Company or any Subsidiary, monetarily or
otherwise, including conduct that, in the reasonable judgment of the Company, no
longer conforms to the standard of the Company's executives or employees, any
act of dishonesty, commission of a felony, or a significant violation of any
statutory or common law duty of loyalty to the Company.

        "Code" shall mean the Internal Revenue Code of 1986, as amended.

        "Committee" shall mean the Corporate Governance, Human Resources and
Compensation Committee of the Board.

        "Common Stock" shall mean the Class A Subordinate Voting Stock of the
Company.

        "Company" has the meaning specified in Section 1.1.

        "Disability" shall mean the inability of the holder of an award to
perform substantially such holder's duties and responsibilities for a continuous
period of at least six months, as determined solely by the Committee.

        "Eligible Participants" shall mean the persons specified in
Section 1.4(a).

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        "Eligible Director" shall mean those Outside Directors specified in
Section 1.4(b).

        "ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.

        "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

        "Fair Market Value" shall mean the closing transaction price of a share
of Common Stock as reported on The Nasdaq Stock Market on the trading day
immediately prior to the date as of which such value is being determined;
provided, however, that Fair Market Value may be determined by the Committee by
whatever means or method as the Committee, in the good faith exercise of its
discretion, shall at such time deem appropriate.

        "Free-Standing SAR" shall mean a SAR which is not issued in tandem with,
or by reference to, an option, which entitles the holder thereof to receive,
upon exercise, shares of Common Stock (which may be Restricted Stock), cash or a
combination thereof with an aggregate value equal to the excess of the Fair
Market Value of one share of Common Stock on the date of exercise over the base
price of such SAR, multiplied by the number of such SARs which are exercised.

        "Incentive Stock Option" shall mean an option to purchase shares of
Common Stock that meets the requirements of Section 422 of the Code, or any
successor provision, which is intended by the Committee to constitute an
Incentive Stock Option.

        "Insider" means (i) an insider as defined in the Securities Act
(Ontario), other than a person who falls within that definition solely by virtue
of being a director or senior officer of a Subsidiary; and (ii) an associate of
any person who is an insider by virtue of (i).

        "Mature Shares" shall mean previously-acquired shares of Common Stock
for which the holder thereof has good title, free and clear of all liens and
encumbrances and which such holder either (i) has held for at least six months
or (ii) has purchased on the open market.

        "Non-Statutory Stock Option" shall mean an option to purchase shares of
Common Stock which is not an Incentive Stock Option.

        "Outstanding Issue" means the total number of shares of Common Stock,
Class B stock of the Company and Common Stock reserved for issuance by the
Company upon the exchange, retraction or redemption, of the Exchangeable Shares
of MEC (Holdings) Inc. issued and outstanding at the date of calculation
(excluding any such shares issued pursuant to share compensation arrangements
during the 12-month period prior to the date of calculation).

        "Outside Director" shall mean directors of the Company who are not
officers or employees of the Company or any affiliate.

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        "Performance Measures" shall mean the criteria and objectives,
established by the Committee, which shall be satisfied or met (i) as a condition
to the exercisability of all or a portion of a Stock Option or SAR, (ii) as a
condition to the grant of a Stock Award or (iii) during the applicable
Restriction Period or Performance Period as a condition to the holder's receipt,
in the case of a Restricted Stock Award, of the shares of Common Stock subject
to such award, or, in the case of a Performance Share Award, of the shares of
Common Stock subject to such award and/or of payment with respect to such award.
In the sole discretion of the Committee, the Committee may amend or adjust the
Performance Measures or other terms and conditions of an outstanding award in
recognition of unusual or nonrecurring events affecting the Company or its
financial statements or changes in law or accounting principles. Such criteria
and objectives may include one or more of the following: the attainment by a
share of Common Stock of a specified Fair Market Value for a specified period of
time, earnings per share, return to stockholders (including dividends), return
on equity, earnings of the Company, revenues, market share, cash flow or cost
reduction goals, or any combination of the foregoing. If the Committee desires
that compensation payable pursuant to any award subject to Performance Measures
be "qualified performance-based compensation" within the meaning of
Section 162(m) of the Code, the Performance Measures (i) shall be established by
the Committee no later than 90 days after the beginning of the Performance
Period or Restriction Period, as applicable (or such other time designated by
the Internal Revenue Service) and (ii) shall satisfy all other applicable
requirements imposed under Treasury Regulations promulgated under Section 162(m)
of the Code, including the requirement that such Performance Measures be stated
in terms of an objective formula or standard.

        "Performance Period" shall mean any period designated by the Committee
during which the Performance Measures applicable to a Performance Share Award
shall be measured.

        "Performance Share" shall mean a right, contingent upon the attainment
of specified Performance Measures within a specified Performance Period, to
receive one share of Common Stock, which may be Restricted Stock, or in lieu of
all or a portion thereof, the Fair Market Value of such Performance Share
in cash.

        "Performance Share Award" shall mean an award of Performance Shares
under this Plan.

        "Post-Termination Exercise Period" shall mean the period specified in or
pursuant to Section 2.3(a), Section 2.3(b), Section 2.3(d) or Section 2.3(e)
following termination of employment with or the service to the Company during
which a Stock Option or SAR may be exercised.

        "Restricted Stock" shall mean shares of Common Stock which are subject
to a Restriction Period.

        "Restricted Stock Award" shall mean an award of Restricted Stock under
this Plan.

        "Restriction Period" shall mean any period designated by the Committee
during which the Common Stock subject to a Restricted Stock Award may not be
sold, transferred, assigned, pledged, hypothecated or otherwise encumbered or
disposed of, except as provided in this Plan or the Agreement relating to
such award.

        "Retirement" shall mean termination of employment with or service to the
Company by reason of retirement on or after age 60 with the consent of
the Company.

        "SAR" shall mean a stock appreciation right which may be a Free-Standing
SAR or a Tandem SAR.

        "Stock Award" shall mean a Restricted Stock Award or a Bonus Stock
Award.

        "Stock Option" shall mean an Incentive Stock Option or a Non-Statutory
Stock Option.

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        "Subsidiary" and "Subsidiaries" shall have the meanings set forth in
Section 1.4.

        "Tandem SAR" shall mean an SAR which is granted in tandem with, or by
reference to, a Stock Option (including a Non-Statutory Stock Option granted
prior to the date of grant of the SAR), which entitles the holder thereof to
receive, upon exercise of such SAR and surrender for cancellation of all or a
portion of such Stock Option, shares of Common Stock (which may be Restricted
Stock), cash or a combination thereof with an aggregate value equal to the
excess of the Fair Market Value of one share of Common Stock on the date of
exercise over the base price of such SAR, multiplied by the number of shares of
Common Stock subject to such Stock Option, or portion thereof, which
is surrendered.

        "Tax Date" shall have the meaning set forth in Section 5.5.

        "Ten Percent Holder" shall have the meaning set forth in Section 2.1(a).

        1.3    Administration.    This Plan shall be administered by the
Committee. Any one or a combination of the following awards may be made under
this Plan to eligible persons: (i) Stock Options in the form of Incentive Stock
Options or Non-Statutory Stock Options, (ii) SARs in the form of Tandem SARs or
Free-Standing SARs, (iii) Stock Awards in the form of Restricted Stock or Bonus
Stock and (iv) Performance Shares. The Committee shall, subject to the terms of
this Plan, select eligible persons for participation in this Plan and determine
the form, amount and timing of each award to such persons and, if applicable,
the number of shares of Common Stock, the number of SARs and the number of
Performance Shares subject to such an award, the exercise price or base price
associated with the award, the time and conditions of exercise or settlement of
the award and all other terms and conditions of the award, including, without
limitation, the form of the Agreement evidencing the award. The Committee may,
in its sole discretion and for any reason at any time, take action such that
(i) any or all outstanding Stock Options and SARs shall become exercisable in
part or in full, (ii) all or a portion of the Restriction Period applicable to
any outstanding Restricted Stock Award shall lapse, (iii) all or a portion of
the Performance Period applicable to any outstanding Performance Share Award
shall lapse and (iv) the Performance Measures applicable to any outstanding
award (if any) shall be deemed to be satisfied at the maximum or any other
level. Any such action by the Committee shall be subject to the requirements of
Section 162(m) of the Code and regulations thereunder in the case of an award
intended to be qualified performance-based compensation, except if the action is
determined in good faith by the Committee to be necessary in order to facilitate
a transaction involving a Change of Control of the Company. The Committee shall,
subject to the terms of this Plan, interpret this Plan and the application
thereof, establish rules and regulations it deems necessary or desirable for the
administration of this Plan and may impose, incidental to the grant of an award,
conditions with respect to the award, such as limiting competitive employment or
other activities. All such interpretations, rules, regulations and conditions
shall be final, binding and conclusive.

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        The Committee may delegate some or all of its power and authority
hereunder to the Board, the Chairman of the Board, the President and Chief
Executive Officer or other executive officer of the Company as the Committee
deems appropriate; provided, however, that (i) the Committee may not delegate
its power and authority to the Board, the Chairman of the Board, or the
President and Chief Executive Officer or other executive officer of the Company
with regard to the grant of an award to any person who is a "covered employee"
within the meaning of Section 162(m) of the Code or who, in the Committee's
judgment, is likely to be a covered employee at any time during the period an
award hereunder to such employee would be outstanding and (ii) the Committee may
not delegate its power and authority to the Chairman of the Board, President and
Chief Executive Officer or other executive officer of the Company with regard to
the selection for participation in this Plan of an officer or other person
subject to Section 16 of the Exchange Act or decisions concerning the timing,
pricing or amount of an award to such an officer or other person.

        A majority of the Committee shall constitute a quorum. The acts of the
Committee shall be either (i) acts of a majority of the members of the Committee
present at any meeting at which a quorum is present or (ii) acts approved in
writing by all of the members of the Committee without a meeting.

        1.4    Eligibility.    (a) Participants in this Plan shall consist of
such officers and other employees, consultants, independent contractors and
agents of the Company, its subsidiaries from time to time and any other entity
designated by the Board or the Committee (individually a "Subsidiary" and
collectively the "Subsidiaries") as the Committee in its sole discretion may
select from time to time. For purposes of this Plan, references to employment
shall also mean an agency or independent contractor relationship and references
to employment by the Company shall also mean employment by a Subsidiary. The
Committee's selection of a person to participate in this Plan at any time shall
not require the Committee to select such person to participate in this Plan at
any other time; and (b) Outside Directors shall also be participants in
the Plan.

        1.5    Shares Available.    Subject to adjustment as provided in
Section 5.7, 108,000,000 shares of Common Stock shall be available for awards
under this Plan, consisting of: (i) 8,000,000 shares of Common Stock which shall
be available for issuance pursuant to Stock Options and Tandem SARs, and
(ii) 2,000,000 shares of Common Stock which shall be available for issuance
pursuant to any type of award under this Plan other than Stock Options and
Tandem SARs. To the extent that shares of Common Stock subject to an outstanding
Stock Option (except to the extent shares of Common Stock are issued or
delivered by the Company in connection with the exercise of a Tandem SAR),
Free-Standing SAR, Stock Award or Performance Share are not issued or delivered
by reason of the expiration, termination, cancellation or forfeiture of such
award or by reason of the delivery or withholding of shares of Common Stock to
pay all or a portion of the exercise price of an award, if any, or to satisfy
all or a portion of the tax withholding obligations relating to an award, then
such shares of Common Stock shall again be available under this Plan.

        Shares of Common Stock shall be made available from authorized and
unissued shares of Common Stock, or authorized and issued shares of Common Stock
reacquired and held as treasury shares or otherwise or a combination thereof.

        To the extent necessary for an award to be qualified performance-based
compensation under Section 162(m) of the Code and the regulations thereunder,
the maximum number of shares of Common Stock with respect to which Stock Options
or SARs or a combination thereof may be granted during any calendar year to any
person shall be 4,000,000, subject to adjustment as provided in Section 5.7.

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        Notwithstanding anything else in the Plan, at no time shall:

(a)the aggregate number of shares of Common Stock reserved for awards under the
Plan (subject to adjustment as provided in Section 5.7), together with the
number of shares of Common Stock of the Company reserved for issuance under any
other share compensation arrangements of the Company, result in the number of
shares of Common Stock of the Company reserved for issuance pursuant to share
compensation arrangements exceeding 10% of the Outstanding Issue;

(b)the number of shares of Common Stock reserved for awards under the Plan to
any one person (subject to adjustment as provided in Section 5.7), exceed 5% of
the Outstanding Issue;

(c)the aggregate number of shares of Common Stock issued within a one-year
period pursuant to awards under the Plan, together with the number of shares of
Common Stock of the Company issued within such period under any other share
compensation arrangements of the Company, exceed 10% of the Outstanding Issue;

(d)the aggregate number of shares of Common Stock reserved for awards under the
Plan to Insiders of the Company, together with the number of shares of Common
Stock of the Company reserved for issuance to such persons under any other share
compensation arrangements of the Company, exceed 10% of the Outstanding Issue;

(e)the aggregate number of shares of Common Stock issued within a one-year
period to Insiders of the Company pursuant to awards under the Plan, together
with the number of shares of Common Stock of the Company issued within such
period to such persons under any other share compensation arrangements of the
Company, exceed 10% of the Outstanding Issue; or

(f)the aggregate number of shares of Common Stock issued within a one-year
period to any one Insider of the Company and that Insider's associates
(as defined in the Securities Act (Ontario)) pursuant to awards under the Plan,
together with the number of shares of Common Stock of the Company issued within
such period to such persons under any other share compensation arrangements of
the Company, exceed 5% of the Outstanding Issue.

        For the purposes of paragraphs (d), (e) and (f) above, shares of Common
Stock of the Company issued and awards granted to a person prior to such person
becoming an Insider may be excluded in determining the number of shares of
Common Stock of the Company issuable to Insiders.

II. STOCK OPTIONS AND STOCK APPRECIATION RIGHTS

        2.1    Stock Options.    The Committee may, in its discretion, grant
Stock Options to purchase shares of Common Stock to such Eligible Participants
as may be selected by the Committee. Each Stock Option, or portion thereof, that
is not an Incentive Stock Option, shall be a Non-Statutory Stock Option. An
Incentive Stock Option may not be granted to any person who is not an employee
of the Company or any parent or subsidiary (as defined in Section 424 of the
Code). Each Incentive Stock Option shall be granted within ten years of the date
this Plan is adopted by the Board. To the extent that the aggregate Fair Market
Value (determined as of the date of grant) of shares of Common Stock with
respect to which Stock Options designated as Incentive Stock Options are
exercisable for the first time by a participant during any calendar year (under
this Plan or any other plan of the Company, or any parent or subsidiary as
defined in Section 424 of the Code) exceeds the amount (currently $100,000)
established by the Code, such Stock Options shall constitute Non-Statutory
Stock Options.

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        The Committee shall grant Stock Options to purchase 10,000 shares of
Common Stock to each Eligible Director in each of the following circumstances:

(i)immediately following each such Eligible Director's election to the
Board; and

(ii)immediately following the completion of each five (5) years of continuous
service as a director of the Corporation.

        Stock Options granted to Eligible Directors shall vest as to 20% of the
shares of Common Stock included in each such grant to Eligible Directors on the
date of such grant, with an additional 20% of the shares vesting on each of the
second, third, fourth and fifth anniversary dates of each such grant.

        Stock Options shall be subject to the following terms and conditions and
shall contain such additional terms and conditions, not inconsistent with the
terms of this Plan, as the Committee shall deem advisable:

(a)Number of Shares and Purchase Price.    The number of shares of Common Stock
subject to a Stock Option, other than those granted to Eligible Directors and
the purchase price per share of Common Stock purchasable upon exercise of the
Stock Option shall be determined by the Committee; provided, however, that the
purchase price per share of Common Stock purchasable upon exercise of a Stock
Option shall not be less than 100% of the greater of (i) the Fair Market Value
of a share of Common Stock on the date of grant of such Stock Option and
(ii) the price of the last board lot of shares of Common Stock sold on The
Toronto Stock Exchange on the last business day prior to the date of grant of
such Stock Option on which a board lot of shares of Common Stock traded on The
Toronto Stock Exchange (the "TSE Permitted Price"); provided further, that if an
Incentive Stock Option shall be granted to any person who, at the time such
Stock Option is granted, owns capital stock possessing more than ten percent of
the total combined voting power of all classes of capital stock of the Company
(or of any parent or subsidiary as defined in Section 424 of the Code) (a "Ten
Percent Holder"), the purchase price per share of Common Stock shall be the
greater of (i) the price (currently 110% of Fair Market Value) required by the
Code in order to constitute an Incentive Stock Option and (ii) the TSE Permitted
Price.

(b)Option Period and Exercisability.    The period during which a Stock Option
may be exercised shall be determined by the Committee; provided, however, that
no Stock Option shall be exercisable later than ten years after its date of
grant and shall expire at the end of such period, unless if the expiry of such
Stock Option falls within a trading blackout, in which case the Committee may
grant an extension to such Stock Option for not more than ten business days
following the otherwise occurring expiry date of such Stock Option; provided
further, that if an Incentive Stock Option shall be granted to a Ten Percent
Holder, such Stock Option shall not be exercised later than five years after its
date of grant. The Committee may, in its discretion, establish Performance
Measures which shall be satisfied or met as a condition to the grant of a Stock
Option or to the exercisability of all or a portion of a Stock Option other than
those granted to Eligible Directors. The Committee shall determine whether a
Stock Option shall become exercisable in cumulative or non-cumulative
installments and in part or in full at any time. An exercisable Stock Option, or
portion thereof, may be exercised only with respect to whole shares of
Common Stock.

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(c)Method of Exercise.    A Stock Option may be exercised (i) by giving written
notice to the Company specifying the number of whole shares of Common Stock to
be purchased and accompanied by payment therefor in full (or arrangement made
for such payment to the Company's satisfaction) either (A) in cash, (B) by
delivery (either actual delivery or by attestation procedures established by the
Company) of Mature Shares having an aggregate Fair Market Value, determined as
of the date of exercise, equal to the aggregate purchase price payable by reason
of such exercise, (C) in cash by a broker-dealer acceptable to the Company to
whom the optionee has submitted an irrevocable notice of exercise or (D) a
combination of (A) and (B), in each case to the extent set forth in the
Agreement relating to the Stock Option, (ii) if applicable, by surrendering to
the Company any Tandem SARs which are canceled by reason of the exercise of the
Stock Option and (iii) by executing such documents as the Company may reasonably
request. The Company shall have sole discretion to disapprove of an election
pursuant to any of clauses (B)-(D). Any fraction of a share of Common Stock
which would be required to pay such purchase price shall be disregarded and the
remaining amount due shall be paid in cash by the optionee. No certificate
representing Common Stock shall be delivered until the full purchase price
therefor has been paid (or arrangement made for such payment to the Company's
satisfaction).

        2.2    Stock Appreciation Rights.    The Committee may, in its
discretion, grant SARs to Eligible Participants. The Agreement relating to a SAR
shall specify whether the SAR is a Tandem SAR or a Free-Standing SAR.

        SARs shall be subject to the following terms and conditions and shall
contain such additional terms and conditions, not inconsistent with the terms of
this Plan, as the Committee shall deem advisable:

(a)Number of SARs and Base Price.    The number of SARs subject to an award
shall be determined by the Committee. Any Tandem SAR related to an Incentive
Stock Option shall be granted at the same time that such Incentive Stock Option
is granted. The base price of a Tandem SAR shall be the purchase price per share
of Common Stock of the related Stock Option. The base price of a Free-Standing
SAR shall be determined by the Committee; provided, however, that such base
price shall not be less than 100% of the greater of (i) the Fair Market Value of
a share of Common Stock on the date of grant of such SAR or (ii) the price of
the last board lot of shares of Common Stock sold on The Toronto Stock Exchange
on the last business day prior to the date of grant of such SAR on which a board
lot of shares of Common Stock traded on The Toronto Stock Exchange.

(b)Exercise Period and Exercisability.    The Agreement relating to an award of
SARs shall specify whether such award may be settled in shares of Common Stock
(including shares of Restricted Stock) or cash or a combination thereof. The
period for the exercise of an SAR shall be determined by the Committee;
provided, however, that no Tandem SAR shall be exercised later than the
expiration, cancellation, forfeiture or other termination of the related Stock
Option; provided further, that no SAR shall be exercisable later than ten years
after its date of grant and shall expire at the end of such period. The
Committee may, in its discretion, establish Performance Measures which shall be
satisfied or met as a condition to the grant of an SAR or to the exercisability
of all or a portion of an SAR. The Committee shall determine whether an SAR may
be exercised in cumulative or non-cumulative installments and in part or in full
at any time. An exercisable SAR, or portion thereof, may be exercised, in the
case of a Tandem SAR, only with respect to whole shares of Common Stock and, in
the case of a Free-Standing SAR, only with respect to a whole number of SARs. If
an SAR is exercised for shares of Restricted Stock, a certificate or
certificates representing such Restricted Stock shall be issued in accordance
with Section 3.2(c) and the holder of such Restricted Stock shall have such
rights of a stockholder of the Company as determined pursuant to Section 3.2(d).
Prior to the exercise of an SAR for shares of Common Stock, including Restricted
Stock, the holder of such SAR shall have no rights as a stockholder of the
Company with respect to the shares of Common Stock subject to such SAR and shall
have rights as a stockholder of the Company in accordance with Section 5.9.

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(c)Method of Exercise.    A Tandem SAR may be exercised (i) by giving written
notice to the Company specifying the number of whole SARs which are being
exercised, (ii) by surrendering to the Company any Stock Options which are
canceled by reason of the exercise of the Tandem SAR and (iii) by executing such
documents as the Company may reasonably request. A Free-Standing SAR may be
exercised (i) by giving written notice to the Company specifying the whole
number of SARs which are being exercised and (ii) by executing such documents as
the Company may reasonably request.

2.3    Termination of Employment or Service.

(a)Disability.    Unless otherwise specified in the Agreement relating to a
Stock Option or SAR, as the case may be, if the employment with or service to
the Company of the holder of a Stock Option or SAR terminates by reason of
Disability, each Stock Option and SAR held by such holder shall be fully
exercisable and may thereafter be exercised by such holder (or such holder's
legal representative or similar person) until and including the earliest to
occur of (i) in the case of a holder who is an employee of the Company, the date
which is three (3) years or, in the case of a holder who is not an employee of
the Company, the date which is one (1) year, (or such other period as set forth
in the Agreement relating to such Stock Option or SAR) after the effective date
of such holder's termination of employment or service and (ii) the expiration
date of the term of such Stock Option or SAR.

(b)Retirement.    Unless otherwise specified in the Agreement relating to a
Stock Option or SAR, as the case may be, if the employment with or service to
the Company of the holder of a Stock Option or SAR terminates by reason of
Retirement, each Stock Option and SAR held by such holder shall be fully
exercisable and may thereafter be exercised by such holder (or such holder's
legal representative or similar person) until and including the earliest to
occur of (i) in the case of a holder who is an employee of the Company, the date
which is three (3) years or, in the case of a holder who is not an employee of
the Company, the date which is one (1) year, (or such other period as set forth
in the Agreement relating to such Stock Option or SAR) after the effective date
of such holder's termination of employment or service and (ii) the expiration
date of the term of such Stock Option or SAR.

(c)Death.    Unless otherwise specified in the Agreement relating to a Stock
Option or SAR, as the case may be, if the employment with or service to the
Company of the holder of a Stock Option or SAR terminates by reason of death,
each Stock Option and SAR held by such holder shall be fully exercisable by such
holder's executors, administrators, legal representatives, beneficiaries, or
similar person until and including the earliest to occur of (i) the date which
is 1 year (or such other period as set forth in the Agreement relating to such
Stock Option or SAR) after the date of death and (ii) the expiration date of the
term of such Stock Option or SAR.

(d)Other Termination.    Unless otherwise specified in the Agreement relating to
a Stock Option or SAR, as the case may be, if the employment with the Company of
the holder of a Stock Option or SAR terminates for any reason other than
Disability, Retirement, death, or for Cause, each Stock Option and SAR held by
such holder shall be exercisable only to the extent that such Stock Option or
SAR is exercisable on the effective date of such holder's termination of
employment or service and may thereafter be exercised by such holder (or such
holder's legal representative or similar person) until and including the
earliest to occur of (i) the date which is three (3) months (or such other
period as set forth in the Agreement relating to such Stock Option or SAR) after
the effective date of such holder's termination of employment and (ii) the
expiration date of the term of such Stock Option or SAR.

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(e)Cause.    Notwithstanding anything to the contrary in this Plan or in any
Agreement relating to a Stock Option or SAR, as the case may be, if the
employment with or service to the Company of the holder of a Stock Option or SAR
is terminated by the Company for Cause, each Stock Option and SAR held by such
holder shall be automatically canceled by the Company on the effective date of
such holder's termination of employment or service.

III. STOCK AWARDS

        3.1    Stock Awards.    The Committee may, in its discretion, grant
Stock Awards to Eligible Participants. The Agreement relating to a Stock Award
shall specify whether the Stock Award is a Restricted Stock Award or Bonus
Stock Award.

        3.2    Terms of Stock Awards.    Stock Awards shall be subject to the
following terms and conditions and shall contain such additional terms and
conditions, not inconsistent with the terms of this Plan, as the Committee shall
deem advisable.

(a)Number of Shares and Other Terms.    The number of shares of Common Stock
subject to a Restricted Stock Award or Bonus Stock Award and the Performance
Measures (if any) and Restriction Period applicable to a Restricted Stock Award
shall be determined by the Committee.

(b)Vesting and Forfeiture.    The Agreement relating to a Restricted Stock Award
shall provide, in the manner determined by the Committee, in its discretion, and
subject to the provisions of this Plan, for the vesting of the shares of Common
Stock subject to such award (i) if specified Performance Measures are satisfied
or met during the specified Restriction Period or (ii) if the holder of such
award remains continuously in the employment of or service to the Company during
the specified Restriction Period and for the forfeiture of all or a portion of
the shares of Common Stock subject to such award (x) if specified Performance
Measures are not satisfied or met during the specified Restriction Period or
(y) if the holder of such award does not remain continuously in the employment
of or service to the Company during the specified Restriction Period.

        Bonus Stock Awards shall not be subject to any Performance Measures or
Restriction Periods.

(c)Share Certificates.    During the Restriction Period, a certificate or
certificates representing a Restricted Stock Award may be registered in the
holder's name or a nominee name at the discretion of the Company and may bear a
legend, in addition to any legend which may be required pursuant to Section 5.6,
indicating that the ownership of the shares of Common Stock represented by such
certificate is subject to the restrictions, terms and conditions of this Plan
and the Agreement relating to the Restricted Stock Award. As determined by the
Committee, all certificates registered in the holder's name shall be deposited
with the Company, together with stock powers or other instruments of assignment
(including a power of attorney), each endorsed in blank with a guarantee of
signature if deemed necessary or appropriate by the Company, which would permit
transfer to the Company of all or a portion of the shares of Common Stock
subject to the Restricted Stock Award in the event such award is forfeited in
whole or in part. Upon termination of any applicable Restriction Period (and the
satisfaction or attainment of applicable Performance Measures), or upon the
grant of a Bonus Stock Award, in each case subject to the Company's right to
require payment of any taxes in accordance with Section 5.5, a certificate or
certificates evidencing ownership of the requisite number of shares of Common
Stock shall be delivered to the holder of such award.

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(d)Rights with Respect to Restricted Stock Awards.    Unless otherwise set forth
in the Agreement relating to a Restricted Stock Award, and subject to the terms
and conditions of a Restricted Stock Award, the holder of such award shall have
all rights as a stockholder of the Company, including, but not limited to,
voting rights, the right to receive dividends and the right to participate in
any capital adjustment applicable to all holders of Common Stock; provided,
however, that a distribution with respect to shares of Common Stock, other than
a regular cash dividend, shall be deposited with the Company and shall be
subject to the same restrictions as the shares of Common Stock with respect to
which such distribution was made.

(e)Awards to Certain Executive Officers.    Notwithstanding any other provision
of this Article III, and only to the extent necessary to ensure the
deductibility to the Company of an award, the number of shares of Common Stock
subject to a Stock Award granted to a "covered employee" within the meaning of
Section 162(m) of the Code in any calendar year shall not exceed 4,000,000.

3.3    Termination of Employment or Service.

(a)Disability, Retirement and Death.    Unless otherwise set forth in the
Agreement relating to a Restricted Stock Award, if the employment with or
service to the Company of the holder of such award terminates by reason of
Disability, Retirement or death, the Restriction Period shall terminate as of
the effective date of such holder's termination of employment or service and all
Performance Measures, if any, applicable to such award shall be deemed to have
been satisfied at the minimum target level.

(b)Other Termination.    Unless otherwise set forth in the Agreement relating to
a Restricted Stock Award, if the employment with or service to the Company of
the holder of a Restricted Stock Award terminates for any reason other than
Disability, Retirement or death, the portion of such award which is subject to a
Restriction Period on the effective date of such holder's termination of
employment or service shall be forfeited by such holder and such portion shall
be automatically canceled by the Company.

IV. PERFORMANCE SHARE AWARDS

        4.1    Performance Share Awards.    The Committee may, in its
discretion, grant Performance Share Awards to Eligible Participants.

        4.2    Terms of Performance Share Awards.    Performance Share Awards
shall be subject to the following terms and conditions and shall contain such
additional terms and conditions, not inconsistent with the terms of this Plan,
as the Committee shall deem advisable.

(a)Number of Performance Shares and Performance Measures.    The number of
Performance Shares subject to any award and the Performance Measures and
Performance Period applicable to such award shall be determined by
the Committee.

(b)Vesting and Forfeiture.    The Agreement relating to a Performance Share
Award shall provide, in the manner determined by the Committee, in its
discretion, and subject to the provisions of this Plan, for the vesting of such
award, if specified Performance Measures are satisfied or met during the
specified Performance Period, and for the forfeiture of all or a portion of such
award, if specified Performance Measures are not satisfied or met during the
specified Performance Period.

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(c)Settlement of Vested Performance Share Awards.    The Agreement relating to a
Performance Share Award (i) shall specify whether such award may be settled in
shares of Common Stock (including shares of Restricted Stock) or cash or a
combination thereof and (ii) may specify whether the holder thereof shall be
entitled to receive, on a current or deferred basis, dividend equivalents, and,
if determined by the Committee, interest on or the deemed reinvestment of any
deferred dividend equivalents, with respect to the number of shares of Common
Stock subject to such award. If a Performance Share Award is settled in shares
of Restricted Stock, a certificate or certificates representing such Restricted
Stock shall be issued in accordance with Section 3.2(c) and the holder of such
Restricted Stock shall have such rights of a stockholder of the Company as
determined pursuant to Section 3.2(d). Prior to the settlement of a Performance
Share Award in shares of Common Stock, including Restricted Stock, the holder of
such award shall have no rights as a stockholder of the Company with respect to
the shares of Common Stock subject to such award and shall have rights as a
stockholder of the Company in accordance with Section 5.9.

4.3    Termination of Employment.

(a)Disability, Retirement and Death.    Unless otherwise set forth in the
Agreement relating to a Performance Share Award, if the employment with or
service to the Company of the holder of such award terminates by reason of
Disability, Retirement or death, all Performance Measures applicable to such
award shall be deemed to have been satisfied at the minimum target level and the
Performance Period applicable to such award shall thereupon terminate.

(b)Other Termination.    Unless otherwise set forth in the Agreement relating to
a Performance Share Award, if the employment with or service to the Company of
the holder of a Performance Share Award terminates for any reason other than
Disability, Retirement or death, the portion of such award which is subject to a
Performance Period on the effective date of such holder's termination of
employment shall be forfeited and such portion shall be automatically canceled
by the Company.

V. GENERAL

        5.1    Effective Date and Term of Plan.    This Plan was approved by the
directors of the Company on March 1, 2000 and was approved by the written
consent of the holders of a majority of the votes attached to the outstanding
stock of the Company on March 1, 2000, which date is the effective date of this
Plan. This Plan was amended and approved by the Board of Directors of the
Company on March 21, 2007 and ratified at a meeting of the holders of a majority
of the votes attached to the outstanding stock of the Company on May 9, 2007.
This Plan shall terminate when shares of Common Stock are no longer available
for the grant, exercise or settlement of awards, unless terminated earlier by
the Board. Termination of this Plan shall not affect the terms or conditions of
any award granted prior to termination.

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        5.2    Amendments.    The Board may amend this Plan as it shall deem
advisable, subject to any requirement of stockholder approval required by
applicable law, rule or regulation, including Section 162(m) and Section 422 of
the Code; provided, however, that no amendment shall be made without stockholder
approval if such amendment would (i) increases the number of shares of Class A
Subordinate Voting Stock reserved for issuance under the Plan (other than an
increase in proportion to an increase in the number of shares of Class A
Subordinate Voting Stock outstanding as a result of a stock split, stock
dividend, recapitalization, reorganization, merger, combination, exchange of
shares, or other similar change in capitalization or event); (ii) reduces the
exercise price of a Stock Option held by insiders except for the purpose of
maintaining value of Stock Options in connection with a stock split, stock
dividend, recapitalization, reorganization, merger, consolidation, combination,
exchange of shares, liquidation, spin-off, sale of substantially all assets or
other similar change in capitalization or event, or any distribution to holders
of Class A Subordinate Voting Stock other than a regular cash dividend involving
MEC (for this purpose, cancellation or termination of a Stock Option of a Plan
participant prior to its expiry date for the purpose of reissuing Stock Options
to the same Plan participant with a lower exercise price shall be treated as an
amendment to reduce the exercise price of a Stock Option); (iii) extends the
term of a Stock Option held by an insider beyond the option period determined by
the Compensation Committee at the date of grant; (iv) extends eligibility to
participate in the Plan to persons other than officers and other employees,
consultants, independent contractors and agents of MEC, its subsidiaries from
time to time and any other entity controlled by MEC and directors of MEC who are
not officers or employees of MEC or any affiliate; (v) permits awards to be
transferable other than for normal estate settlement purposes; (vi) permits the
award of a Stock Option with an expiry date beyond ten (10) years from its date
of grant; or (vi) amends the provisions of this Plan respecting matters
requiring stockholder approval other than to add matters to be subject to
stockholder approval; or (vii) without the consent of the affected option
holder, amends any terms of Incentive Stock Options that is inconsistent
Section 422 of the Code, unless the Board has determined in good faith that such
change is inconsistent with Section 422 of the Code and is necessary in order to
facilitate a transaction involving a change of control of Company. The amendment
provisions of the Plan will provide that no amendment may materially impair the
rights of a holder of an outstanding award without the consent of such holder.

        5.3    Agreement.    No award shall be valid until an Agreement is
executed by the Company and the recipient of such award and, upon execution by
each party and delivery of the Agreement to the Company, such award shall be
effective as of the effective date set forth in the Agreement.

        5.4    Non-Transferability of Awards.    No award shall be transferable
other than by will or by the laws of descent and distribution. Each award may be
exercised or settled during the holder's lifetime only by the holder. Except to
the extent permitted by the second preceding sentence or the Agreement relating
to an award, no award may be sold, transferred, assigned, pledged, hypothecated,
encumbered or otherwise disposed of (whether by operation of law or otherwise)
or be subject to execution, attachment or similar process. Upon any attempt to
so sell, transfer, assign, pledge, hypothecate, encumber or otherwise dispose of
any such award, such award and all rights thereunder shall immediately become
null and void.

        5.5    Tax Withholding.    The Company shall have the right to require,
prior to the issuance or delivery of any shares of Common Stock or the payment
of any cash pursuant to an award made hereunder, payment by the holder of such
award of any Federal, state, local or other taxes which may be required to be
withheld or paid in connection with such award. An Agreement may provide that
(i) the Company shall withhold whole shares of Common Stock which would
otherwise be delivered to a holder, having an aggregate Fair Market Value
determined as of the date the obligation to withhold or pay taxes arises in
connection with an award (the "Tax Date"), or withhold an amount of cash which
would otherwise be payable to a holder, in the amount necessary to satisfy any
such obligation or (ii) the holder may satisfy any such obligation by any of the
following means: (A) a cash payment to the Company, (B) delivery (either actual
delivery or by attestation procedures established by the Company) to the Company
of Mature Shares having an aggregate Fair Market Value, determined as of the Tax
Date, equal to the amount necessary to satisfy any such obligation,
(C) authorizing the Company to withhold whole shares of Common Stock which would
otherwise be delivered having an aggregate Fair Market Value, determined as of
the Tax Date, or withhold an amount of cash which would otherwise be payable to
a holder, equal to the amount necessary to satisfy any such obligation, (D) in
the case of the exercise of a Stock Option, a cash payment by a broker-dealer
acceptable to the Company to whom the optionee has submitted an irrevocable
notice of exercise or (E) any combination of (A), (B) and (C), in each case to
the extent set forth in the Agreement relating to the award; provided, however,
that the Company shall have sole discretion to disapprove of an election
pursuant to any of clauses (B)-(E). Shares of Common Stock to be delivered or
withheld may not have an aggregate Fair Market Value in excess of the amount
determined by applying the minimum statutory withholding rate. Any fraction of a
share of Common Stock which would be required to satisfy such an obligation
shall be disregarded and the remaining amount due shall be paid in cash by
the holder.

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        5.6    Restrictions on Shares.    Each award made hereunder shall be
subject to the requirement that if at any time the Company determines that the
listing, registration or qualification of the shares of Common Stock subject to
such award upon any securities exchange or under any law, or the consent or
approval of any governmental body, or the taking of any other action is
necessary or desirable as a condition of, or in connection with, the exercise or
settlement of such award or the delivery of shares thereunder, such award shall
not be exercised or settled and such shares shall not be delivered unless such
listing, registration, qualification, consent, approval or other action shall
have been effected or obtained, free of any conditions not acceptable to the
Company. The Company may require that certificates evidencing shares of Common
Stock delivered pursuant to any award made hereunder bear a legend indicating
that the sale, transfer or other disposition thereof by the holder is prohibited
except in compliance with the Securities Act of 1933, as amended, and the rules
and regulations thereunder.

        5.7    Adjustment.    Notwithstanding anything to the contrary contained
in this Plan, in the event of any stock split, stock dividend, recapitalization,
reorganization, merger, consolidation, combination, exchange of shares,
liquidation, spin-off, sale of substantially all assets or other similar change
in capitalization or event, or any distribution to holders of Common Stock other
than a regular cash dividend, the number and class of securities available under
this Plan, the number and class of securities subject to each outstanding Stock
Option and the purchase price per security, the per person limits imposed by
Sections 1.5 and 3.2 on grants of Stock of SAR's and Stock Awards in a Calendar
Year, the terms of each outstanding SAR, the number and class of securities
subject to each outstanding Stock Award, and the terms of each outstanding
Performance Share shall be adjusted by the Committee, such adjustments to be
made in the case of outstanding Stock Options and SARs without an increase in
the aggregate purchase price or base price. The decision of the Committee
regarding any such adjustment shall be final, binding and conclusive. If any
such adjustment would result in a fractional security being (a) available under
this Plan, such fractional security shall be disregarded, or (b) subject to an
award under this Plan, the Company shall pay the holder of such award, in
connection with the first vesting, exercise or settlement of such award in whole
or in part occurring after such adjustment, an amount in cash determined by
multiplying (i) the fraction of such security (rounded to the nearest hundredth)
by (ii) the excess, if any, of (A) the Fair Market Value on the vesting,
exercise or settlement date over (B) the exercise or base price, if any, of
such award.

        5.8    No Right of Participation or Employment.    No person shall have
any right to participate in this Plan other than Eligible Directors. Neither
this Plan nor any award made hereunder shall confer upon any person any right to
continued employment by the Company, any Subsidiary or any affiliate of the
Company or affect in any manner the right of the Company, any Subsidiary or any
affiliate of the Company to terminate the employment of any person at any time
without liability hereunder.

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        5.9    Rights as Stockholder.    No person shall have any right as a
stockholder of the Company with respect to any shares of Common Stock or other
equity security of the Company which is subject to an award hereunder unless and
until such person becomes a stockholder of record with respect to such shares of
Common Stock or equity security.

        5.10    Designation of Beneficiary.    If permitted by the Company, a
holder of an award may file with the Committee a written designation of one or
more persons as such holder's beneficiary or beneficiaries (both primary and
contingent) in the event of the holder's death. To the extent an outstanding
Stock Option or SAR granted hereunder is exercisable, such beneficiary or
beneficiaries shall be entitled to exercise such Stock Option or SAR.

        Each beneficiary designation shall become effective only when filed in
writing with the Committee during the holder's lifetime on a form prescribed by
the Committee. The spouse of a married holder domiciled in a community property
jurisdiction shall join in any designation of a beneficiary other than such
spouse. The filing with the Committee of a new beneficiary designation shall
cancel all previously filed beneficiary designations.

        If a holder fails to designate a beneficiary, or if all designated
beneficiaries of a holder predecease the holder, then each outstanding Stock
Option and SAR hereunder held by such holder, to the extent exercisable, may be
exercised by such holder's executor, administrator, legal representative or
similar person.

        5.11    Governing Law.    This Plan, each award hereunder and the
related Agreement, and all determinations made and actions taken pursuant
thereto, to the extent not otherwise governed by the Code or the laws of the
United States, shall be governed by the laws of the State of Delaware and
construed in accordance therewith without giving effect to principles of
conflicts of laws.

        5.12    Foreign Employees.    Without amending this Plan, the Committee
may grant awards to Eligible Participants or Eligible Directors who are foreign
nationals on such terms and conditions different from those specified in this
Plan as may in the judgment of the Committee be necessary or desirable to foster
and promote achievement of the purposes of this Plan and, in furtherance of such
purposes the Committee may make such modifications, amendments, procedures,
subplans and the like as may be necessary or advisable to comply with provisions
of laws in other countries or jurisdictions in which the Company or its
Subsidiaries operates or has employees in or in which an Eligible Director
resides.

Effective Date of Plan — March 1, 2000

        Revised to reflect an amendment made effective March 21, 2007 with the
approval of the board of directors and ratified by stockholders on May 9, 2007.

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QuickLinks

MAGNA ENTERTAINMENT CORP. AMENDED AND RESTATED LONG-TERM INCENTIVE PLAN I.
INTRODUCTION
II. STOCK OPTIONS AND STOCK APPRECIATION RIGHTS
III. STOCK AWARDS
IV. PERFORMANCE SHARE AWARDS
V. GENERAL