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Exhibit 10.10

FIRST AMENDMENT
TO STOCK PURCHASE AGREEMENT

        This FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT (this "First
Amendment") is dated as of July 26, 2006 and entered into by and between MAGNA
ENTERTAINMENT CORP., a Delaware corporation ("Seller"), and PA MEADOWS, LLC, a
Delaware limited liability company ("Purchaser"), and is made with reference to
that certain Stock Purchase Agreement, dated as of November 8, 2005
(the "Purchase Agreement"), by and between Seller and Purchaser. Capitalized
terms used herein without definition shall have the same meanings herein as set
forth in the Amended Purchase Agreement (as defined below).

RECITALS

        WHEREAS, as a result of further negotiations between Seller and
Purchaser since the signing of the Purchase Agreement, Seller and Purchaser have
decided to amend the terms of the Purchase Agreement by entering into this First
Amendment in order to, (i) reduce the Purchase Price for the Shares from
$225,000,000 to $200,000,000, (ii) reduce the Holdback Amount from $39,000,000
to $25,000,000, (iii) permit the payment of the Purchase Price in the form of
two notes, a Tranche A Note for $175,000,000 and a Tranche B Note for
$25,000,000 and (iv) amend other provisions of the Purchase Agreement as set
forth in the Amended Purchase Agreement;

        NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:

Section 1. AMENDMENT OF PURCHASE AGREEMENT

        As of the date hereof, the Purchase Agreement and the exhibits thereto
shall be and are hereby amended and modified to read in their entirety as set
forth in Annex A hereto (as set forth in such Annex A, the "Amended Purchase
Agreement"), and as so amended are hereby ratified, approved and confirmed in
each and every respect. The parties hereto agree and acknowledge that the
schedules to the Purchase Agreement delivered on November 8, 2005 shall be the
schedules to the Amended Purchase Agreement, and Seller has delivered a
certificate as of the date hereof to Purchaser in accordance with
Section 8.03(b) of the Amended Purchase Agreement related to such schedules.

Section 2. MISCELLANEOUS

         2.1    Fees and Expenses.    Except as otherwise expressly provided in
the Amended Purchase Agreement, all costs and expenses, including, without
limitation, fees and disbursements of counsel, financial advisors and
accountants, incurred in connection with this First Amendment and the
transactions contemplated hereby shall be paid by the party incurring such costs
and expenses.

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         2.2    Notices.    All notices, requests, claims, demands and other
communications hereunder shall be made as set forth in Section 11.02 of the
Amended Purchase Agreement.

         2.3    Public Announcements.    Unless otherwise required by applicable
law or stock exchange requirements, no party to this First Amendment shall make
any public announcements in respect of this First Amendment or the transactions
contemplated hereby or otherwise communicate with any news media without prior
consent of the other party, and the parties will cooperate as to the timing and
contents of any such announcement. Seller and Purchaser acknowledge that OCM
HoldCo LLC and Seller will be making filings with the Securities and Exchange
Commission and each of Seller and Purchaser agrees to cooperate in reviewing and
providing any comments on such submissions in a timely fashion.

         2.4    Headings.    The headings contained in this First Amendment are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this First Amendment.

         2.5    Severability.    If any term or other provision of this First
Amendment is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this First Amendment
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this First Amendment so as to effect the
original intent of the parties as closely as possible in a mutually acceptable
manner in order that the transactions contemplated hereby be consummated as
originally contemplated to the greatest extent possible.

         2.6    Assignment.    This First Amendment shall not be assigned by
operation of law or otherwise, except that prior to the Closing, Purchaser,
without the consent of Seller, but with at least 10 Business Days' prior written
notice, may transfer or cause to be transferred all of the equity interests of
Purchaser to a wholly owned direct or indirect subsidiary of Cannery Casino
Resorts, LLC, a Nevada limited liability company.

         2.7    No Third-Party Beneficiaries.    This First Amendment is for the
sole benefit of the parties hereto and their permitted assigns and, except as
otherwise expressly provided in the Amended Purchase Agreement, nothing herein,
express or implied, is intended to or shall confer upon any other Person or
entity any legal or equitable right, benefit or remedy of any nature whatsoever
under or by reason of this First Amendment.

         2.8    Amendment.    This First Amendment may not be amended or
modified except by an instrument in writing signed by Seller and Purchaser.

         2.9    Governing Law; Jurisdiction; Service of Process.    This First
Amendment shall be governed by, and construed in accordance with, the laws of
the State of New York. Seller and Purchaser hereby agree and consent to the
exclusive jurisdiction of, and service of process and venue in, the
United States District Court for the Southern District of New York and the
courts of the State of New York located in the County of New York, State of
New York and waives any objection with respect thereto, for the purpose of any
action, suit or proceeding arising out of or relating to this First Amendment.

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         2.10    WAIVER OF JURY TRIAL.    EACH OF PURCHASER AND SELLER HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THIS FIRST AMENDMENT OR THE ACTIONS OF PURCHASER OR SELLER IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF.

         2.11    Counterparts.    This First Amendment may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.

         2.12    Specific Performance.    The parties hereto agree that
irreparable damage would occur in the event any provision of this First
Amendment was not performed in accordance with the terms hereof and that the
parties shall be entitled to specific performance of the terms hereof, in
addition to any other remedy at law or equity.

         2.13    Prevailing Party.    The prevailing party or parties in any
arbitration, mediation, court action, or other adjudicative proceeding arising
out of or relating to this First Amendment shall be reimbursed by the party or
parties who do not prevail for their reasonable attorneys, accountants and
experts fees and for the costs of such proceeding.

        [The remainder of page intentionally left blank.]

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        IN WITNESS WHEREOF, the parties hereto have caused this First Amendment
to be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.

    PA MEADOWS, LLC
 
 
By:
/s/        

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Name:
Title:
 
 
MAGNA ENTERTAINMENT CORP.
 
 
By:
/s/        

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Name:
Title: Authorized Signatory
 
 
By:
/s/        

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Name:
Title: Authorized Signatory

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STOCK PURCHASE AGREEMENT

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dated November 8, 2005

between

MAGNA ENTERTAINMENT CORP.

and PA MEADOWS, LLC

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TABLE OF CONTENTS

 
  Page

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ARTICLE I — DEFINITIONS   1   SECTION 1.01   Certain Defined Terms   1 ARTICLE
II — PURCHASE AND SALE   10   SECTION 2.01   Purchase and Sale   10  
SECTION 2.02   Purchase Price   10   SECTION 2.03   Closing   10 ARTICLE
III — REPRESENTATIONS AND WARRANTIES OF SELLER   11   SECTION 3.01  
Incorporation and Authority of Seller   11   SECTION 3.02   Organization,
Authority and Qualification of the Companies   11   SECTION 3.03   Capital Stock
of the Companies; Ownership of the Shares   12   SECTION 3.04   Subsidiaries  
12   SECTION 3.05   No Conflict   14   SECTION 3.06   Consents and Approvals  
15   SECTION 3.07   Financial Information, Books and Records   15   SECTION 3.08
  No Undisclosed Liabilities   16   SECTION 3.09   Conduct in the Ordinary
Course; Absence of Certain Changes, Events and Conditions   16   SECTION 3.10  
Litigation   17   SECTION 3.11   Compliance with Applicable Laws   18  
SECTION 3.12   Environmental Matters   18   SECTION 3.13   Title to Assets; Real
Property   20   SECTION 3.14   Intellectual Property Rights   22   SECTION 3.15
  Insurance   22   SECTION 3.16   Employee Benefit Matters   23   SECTION 3.17  
Labor Matters   26   SECTION 3.18   Taxes   27   SECTION 3.19   Material
Contracts   29   SECTION 3.20   Racing License   31

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  SECTION 3.21   Suppliers   31   SECTION 3.22   Books and Records   31  
SECTION 3.23   Brokers   31   SECTION 3.24   Racing Days   31   SECTION 3.25  
Related Parties   32 ARTICLE IV — REPRESENTATIONS AND WARRANTIES OF PURCHASER  
32   SECTION 4.01   Incorporation and Authority of Purchaser   32   SECTION 4.02
  No Conflict   33   SECTION 4.03   Consents and Approvals   33   SECTION 4.04  
Investment Purpose   33   SECTION 4.05   Financing   34   SECTION 4.06   Brokers
  34   SECTION 4.07   Specified Investors; Cannery Casino Resorts   34 ARTICLE
V — ADDITIONAL AGREEMENTS   34   SECTION 5.01   Conduct of Business Prior to the
Closing   34   SECTION 5.02   Access to Information   35   SECTION 5.03   Books
and Records   36   SECTION 5.04   Governmental Approvals and Consents;
Application Fee; Closing Conditions   36   SECTION 5.05   Confidentiality   41  
SECTION 5.06   Use of Magna Name   42   SECTION 5.07   Investigation   43  
SECTION 5.08   Limited Non-Compete   43   SECTION 5.09   Remediation   44  
SECTION 5.10   No Negotiation   45   SECTION 5.11   Title   45   SECTION 5.12  
Further Action   45   SECTION 5.13   Excluded Items   46   SECTION 5.14  
Estoppels   46

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  SECTION 5.15   Cooperation in Preparation of Alternative Application   46  
SECTION 5.16   Financial Statements   46   SECTION 5.17   Separation   48  
SECTION 5.18   Notification   48   SECTION 5.19   Environmental Report   48  
SECTION 5.20   XpressBet Matters   48   SECTION 5.21   [Reserved]   48  
SECTION 5.22   Phase I   48   SECTION 5.23   Slot Machine Taxes   49 ARTICLE
VI — EMPLOYEE MATTERS   49   SECTION 6.01   Arrangements; Payroll Obligations  
49   SECTION 6.02   Benefit Plans and Transferred Employee Related Obligations  
49   SECTION 6.03   Intentionally Omitted   50   SECTION 6.04   Intentionally
Omitted   50   SECTION 6.05   Employee Benefits Indemnity   50   SECTION 6.06  
Third-Party Claims   51   SECTION 6.07   Survival   51 ARTICLE VII — TAX MATTERS
  51   SECTION 7.01   Indemnity   51   SECTION 7.02   Returns and Payments   52
  SECTION 7.03   Refunds   53   SECTION 7.04   Contests   53   SECTION 7.05  
Time of Payment   54   SECTION 7.06   Cooperation and Exchange of Information  
55   SECTION 7.07   Conveyance Taxes   55   SECTION 7.08   Miscellaneous   55
ARTICLE VIII — CONDITIONS TO CLOSING   56   SECTION 8.01   Conditions
to Obligations of All Parties   56

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  SECTION 8.02   Conditions to Obligations of Seller   57   SECTION 8.03  
Conditions to Obligations of Purchaser   58 ARTICLE IX — INDEMNIFICATION   60  
SECTION 9.01   Survival   60   SECTION 9.02   Indemnification by Purchaser   61
  SECTION 9.03   Indemnification by Seller   63   SECTION 9.04   Indemnification
Procedures, Etc   66   SECTION 9.05   Payments   69 ARTICLE X — TERMINATION,
AMENDMENT AND WAIVER   69   SECTION 10.01   Termination   69   SECTION 10.02  
Effect of Termination   70   SECTION 10.03   Waiver   71 ARTICLE XI — GENERAL
PROVISIONS   71   SECTION 11.01   Expenses; Pro-rations   71   SECTION 11.02  
Notices   72   SECTION 11.03   Public Announcements   73   SECTION 11.04  
Headings   73   SECTION 11.05   Severability   73   SECTION 11.06   Entire
Agreement   73   SECTION 11.07   Assignment   73   SECTION 11.08   No
Third-Party Beneficiaries   74   SECTION 11.09   Amendment   74   SECTION 11.10
  Governing Law; Jurisdiction; Service of Process   74   SECTION 11.11   WAIVER
OF JURY TRIAL   74   SECTION 11.12   Counterparts   74   SECTION 11.13  
Specific Performance   74   SECTION 11.14   Prevailing Party   74

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EXHIBITS

Exhibit 1.01A   Form of Note Agreement Exhibit 1.01B   Meadows Facility
Exhibit 1.01C   MEC Items Exhibit 1.01D   Off-Track Betting Facilities
Exhibit 1.01E   Racing Services Agreement Exhibit 1.01F   XpressBet Amendments
Exhibit 5.11   Title Commitment Exhibit 5.13   Excluded Items Exhibit 8.02(g)  
Form of Opinion of Purchaser Parties' Counsel Exhibit 8.03(j)   Form of Opinion
of Seller Parties' Counsel

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        STOCK PURCHASE AGREEMENT, dated November 8, 2005 (this "Agreement"),
between MAGNA ENTERTAINMENT CORP., a Delaware corporation ("Seller"), and PA
MEADOWS, LLC, a Delaware limited liability company ("Purchaser").

        WHEREAS, Seller owns (a) all the issued and outstanding shares of common
stock of MEC Pennsylvania Racing, Inc., a Pennsylvania corporation ("MECPenn"),
(b) all the issued and outstanding shares of common stock of Mountain Laurel
Racing, Inc., a Delaware corporation ("MLR"), and (c) all the issued and
outstanding shares of common stock of Washington Trotting Association, Inc., a
Delaware corporation ("WTA") (MECPenn, MLR and WTA being collectively referred
to herein as the "Companies," and each individually as a "Company," and the
issued and outstanding shares of common stock of the Companies being referred to
herein collectively as the "Shares"); and

        WHEREAS, Seller wishes to sell to Purchaser, and Purchaser wishes to
purchase from Seller, the Shares upon the terms and subject to the conditions
set forth herein;

        NOW, THEREFORE, in consideration of the premises and of the mutual
agreements and covenants hereinafter set forth, Seller and Purchaser hereby
agree as follows:

ARTICLE I
DEFINITIONS

        SECTION 1.01 Certain Defined Terms. (a) As used in this Agreement, the
following terms shall have the following meanings:

        "Action" means any claim, action, suit, arbitration, inquiry, proceeding
or investigation by or before any Governmental Authority.

        "Affiliate" of a specified Person means a Person that, directly or
indirectly, through one or more intermediaries, Controls, is Controlled By or is
Under Common Control With, such specified Person, including such specified
Person's Subsidiaries.

        "Business Day" means any day that is not a Saturday, a Sunday or other
day on which banks are required or authorized by law to be closed in the City of
Toronto or the City of Los Angeles.

        "Code" or "Internal Revenue Code" means the Internal Revenue Code of
1986, as amended.

        "Commission" means the Pennsylvania Harness Racing Commission
established by the Pennsylvania Act.

        "Company Disclosure Schedule" means the Disclosure Schedule dated as of
the date hereof delivered to Purchaser by Seller.

        "Consummation Date" shall have the meaning assigned to such term in the
Note Agreement.

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        "Control" (including the terms "Controlled By" and "Under Common Control
With") means the possession, directly or indirectly or as a trustee or executor
(in each case, acting in a fiduciary capacity), of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ownership of voting securities, as trustee or executor (in each case, acting in
a fiduciary capacity), by contract or credit arrangement or otherwise.

        "Employee" means those Persons employed by the Companies and
Subsidiaries immediately prior to the Closing, including those employees on any
authorized leave of absence, including, without limitation, vacation, disability
(work-related or otherwise) or sick leave, whether or not such employees return
to active employment with any Company or Subsidiary.

        "Encumbrance" means a pledge, lien, security interest, mortgage, charge,
adverse claim of ownership or use, option, right of way, right of first refusal
or other encumbrance of any kind.

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

        "ERISA Affiliate" shall have the meaning assigned to such term in the
Note Agreement.

        "Escrow Agreement" shall have the meaning ascribed to such term in the
Holdback Agreement.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended,
and any successor law and regulations issued pursuant thereto.

        "Excluded Subsidiaries" means Allegheny Harness Racing
Association, Inc., Allegheny Thoroughbred Racing Association, Inc. and
20002 Delaware Inc.

        "GAAP" means United States generally accepted accounting principles in
effect from time to time applied consistently throughout the period involved.

        "Gaming Act" means the Pennsylvania Race Horse Development and Gaming
Act, as amended, and any rules or regulations promulgated thereunder.

        "Gaming Board" means the Pennsylvania Gaming Control Board established
by the Gaming Act.

        "Governmental Authority" means any government, any governmental or
government-appointed entity, department, commission, board, agency, regulatory
authority or instrumentality, and any court, tribunal, or judicial body, whether
federal, state, local or foreign, or any arbitral body, including, without
limitation, the Commission and the Gaming Board.

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        "Governmental Order" means any order, writ, judgment, injunction,
decree, stipulation, determination or award entered by or with any
Governmental Authority.

        "Gulfstream Loan Agreement" means the Amended and Restated Loan
Agreement dated July 22, 2005 by and among Gulfstream Park Racing
Association, Inc., MID Islandi SF, MECPenn, MLR, WTA, Remington Park, Inc.
and GPRA Thoroughbred Training Center, Inc., as amended, restated or modified
from time to time.

        "Holdback Agreement" means the Holdback Agreement by and between Seller
and Purchaser, substantially in the form attached to the Note Agreement as
Exhibit H, as it may be amended from time to time.

        "Holdback Documents" means the Holdback Agreement, the Escrow Agreement,
the Escrow Security (as defined in the Holdback Agreement), any other documents
entered into in replacement or substitution thereof and any other documents or
instruments executed and delivered in connection therewith.

        "HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended, and the rules and regulations promulgated thereunder.

        "Intellectual Property Rights" means all (a) patent and patent
applications, (b) trademarks, service marks, logos, trade dress, trade names and
corporate names and registrations and applications for registration thereof,
including without limitation, the name "The Meadows", (c) copyrights, whether
registered or unregistered, and registrations and applications for registration
thereof and (d) trade secrets, formulas, inventions, invention disclosures,
computer software and other proprietary business and intellectual property
rights that have been in the last three years or are employed in the conduct of
the business of the Companies and the Subsidiaries as it is now being conducted,
but excluding the Magna Name.

        "IRS" means the Internal Revenue Service of the United States.

        "knowledge of Seller" or "Seller's knowledge" means the actual knowledge
of Drew Shubeck, David Wiegmann, Michael Jeannot, Tom Hodgson, Brian Budden,
Andrew Staniusz and Scott Daruty or such other knowledge that such applicable
person should reasonably have acquired through the performance of his job in
accordance with his duties.

        "Law" or "Laws" means any statute, law, ordinance, regulation, rule,
code, order, other requirement or rule of law of any country or any state,
province, locality, region or area therein, or any other jurisdiction.

        "Lease" means the Lease Agreement, dated as of July 22, 2003, as
modified by that certain Lease Renewal, dated as of July 30, 2004, as further
modified by that certain Lease Renewal, dated as of March 3, 2005 by and between
MEC Penn, as tenant, and D. Fuchs Enterprises, LLC, as landlord.

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        "Liabilities" means any and all debts, liabilities and obligations of
any kind, character or nature whatsoever, whether accrued or fixed, known or
unknown, asserted or unasserted, absolute or contingent, matured or unmatured,
secured or unsecured or determined or determinable, including, without
limitation, those arising under any Law (excluding any Environmental Law),
Action or Governmental Order and those arising under any contract, agreement,
arrangement, commitment, guarantee or undertaking.

        "Losses" of a Person means any and all claims, actions or causes of
action, assessments, losses, damages, deficiencies, liabilities, costs, awards,
judgments and expenses (including reasonable legal and expert fees and expenses,
interest, penalties, and all reasonable amounts paid in investigation, defense
or settlement of any of the foregoing) suffered or incurred by such Person.

        "Material Adverse Effect" means any circumstance, change in, or effect
on any Company or Subsidiary that is or would reasonably be expected to be
materially adverse to the business, assets, condition (financial or otherwise),
or the results of operations of the Companies and the Subsidiaries, taken as a
whole, and taking into account the prospects of obtaining and maintaining a
Conditional Category 1 license and a Category 1 license under the Gaming Act and
developing a casino on the Real Property (it being understood that such taking
into account of such prospects shall in no event be interpreted as any Company
or any Subsidiary being required to be qualified or licensed to conduct any
gaming operations in any jurisdiction on or prior to the Closing Date);
provided, however, that "Material Adverse Effect" shall not include any
circumstance, change in or effect on any Company or any Subsidiary directly or
indirectly arising out of or attributable to (a) changes or effects in the
financial or securities markets or the regulatory conditions or the economy in
general that generally affect the gaming industry or the industries in which the
Companies and their respective Subsidiaries operate, (b) any actions taken or
omitted to be taken by Seller or the Companies or any Subsidiary pursuant to the
terms of this Agreement or any actions taken by Purchaser or (c) any effects
resulting solely from the announcement of the transactions contemplated by
this Agreement.

        "Meadows Facility" means the racetrack facility, buildings,
improvements, land and other assets located on the land described on
Exhibit 1.01B hereto.

        "MEC Items" means those items as set forth on Exhibit 1.01C.

        "MID Bridge Loan Agreement" means the Bridge Loan Agreement dated
July 22, 2005 by and among Seller, MECPenn, MLR, WTA and MID Islandi SF, as
amended, restated or modified from time to time.

        "MID Loan Documents" means the Magna Loan Documents (as defined in the
Note Agreement).

        "Note Agreement" means that certain Post-Closing and Note Issuance
Agreement dated on or about the Closing Date among Purchaser in its capacity as
purchaser hereunder and borrower thereunder, certain Affiliates of Purchaser,
Seller in its capacity as seller hereunder and agent thereunder, and the holders
of the Tranche A Note and Tranche B Note party thereto from time to time,
substantially in the form attached hereto as Exhibit 1.01A, as it may be amended
from time to time.

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        "Note Documents" shall have the meaning assigned to such term in the
Note Agreement.

        "OTB Facilities" means the off track betting facilities identified on
Exhibit 1.01D hereto.

        "Pennsylvania Act" means the Pennsylvania Race Horse Industry Reform
Act, as amended, and the rules and regulations of the Commission
promulgated thereunder.

        "Permits" means all permits, licenses, franchises, approvals,
authorizations, registrations, certificates, variances and similar rights
obtained, or required to be obtained, from Governmental Authorities (other than
Environmental Permits).

        "Person" means an individual, corporation, partnership, joint venture,
limited liability company, person (including, without limitation, a "person" as
defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended),
trust, association or another entity.

        "Post-Closing Period" means any Tax period beginning after the Closing
Date.

        "Pre-Closing Period" means any Tax period ending on or before the
Closing Date.

        "Purchaser Disclosure Schedule" means the Disclosure Schedule dated as
of the date hereof delivered to Seller by Purchaser.

        "Purchaser Material Adverse Effect" means any circumstance, change in,
or effect on Purchaser that is or would reasonably be expected to be materially
adverse to the business, assets, condition (financial or otherwise), or the
results of operations of Purchaser, taken as a whole and taking into account the
prospects of obtaining and maintaining a Conditional Category 1 license and a
Category 1 license under the Gaming Act and developing a casino on the Real
Property (it being understood that such taking into account of such prospects
shall in no event be interpreted as Purchaser being required to be qualified or
licensed to conduct any gaming operations in any jurisdictions on or prior to
the Closing Date); provided, however, that "Purchaser Material Adverse Effect"
shall not include any circumstance, change in or effect on Purchaser directly or
indirectly arising out of or attributable to (a) changes or effects in the
financial or securities markets or the regulatory conditions or the economy in
general that generally affect the gaming industry or the industries in which
Purchaser operates, (b) any actions taken or omitted to be taken by Purchaser
pursuant to the terms of this Agreement or any actions taken by Seller or
(c) any effects resulting solely from the announcement of the transactions
contemplated by this Agreement.

        "Purchaser Note Developments" shall have the meaning assigned to such
term in the Note Agreement.

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        "Purchaser's Accountants" means Piercy Bowler Taylor & Kern.

        "Racing Services Agreement" means the Racing Services Agreement by and
between Affiliates of Purchaser and Seller in the form attached hereto as
Exhibit 1.01E, as it may be amended from time to time.

        "Real Property" means the real property owned, leased or subleased by
any Company or any Subsidiary, together with all buildings, structures and
facilities located thereon.

        "Reference Balance Sheet Date" means December 31, 2004.

        "Reference Balance Sheet" means with respect to the Companies and their
Subsidiaries the audited combined balance sheet of the Companies and their
Subsidiaries dated as of December 31, 2004, a copy of which is set forth in
Section 3.07 of the Company Disclosure Schedule, including the notes and
schedules thereto.

        "Regulation S-X" means Regulation S-X promulgated by the Securities and
Exchange Commission.

        "Repayment Date" means the date on which (i) Purchaser shall have paid
the Tranche A Note in cash in full in accordance with its terms and (ii) the
Holdback Documents shall have been executed and delivered in accordance with
Section 3.2 of the Note Agreement in replacement of the Tranche B Note.

        "Seller Note Certificate Date" shall have the meaning assigned to such
term in the Note Agreement.

        "Seller Note Developments" shall have the meaning assigned to such term
in the Note Agreement.

        "Seller Notes" means the Tranche A Note and the Tranche B Note.

        "Seller's Accountants" means Ernst & Young, L.L.P.

        "Specified Funds" means the two funds that own, as of the date hereof,
all of the indirect non-voting interest in Purchaser.

        "Specified Investor" means each Person that owns as of the date hereof a
5% or greater partnership interest in the Specified Funds (other than the
principals of Purchaser's equity sponsor and other than any owners of Millennium
Gaming, Inc. (including without limitation Mr. William Paulos and
Mr. William Wortman)).

        "Stock Transfer" shall have the meaning assigned to such term in the
Note Agreement.

        "Stock Transfer Trigger Date" shall mean the earlier of (i) the date on
which any of the events set forth in clauses (i)-(vi) of Section 3.10(a) of the
Note Agreement occurs or (ii) the date any remedies under Section 8.2(c) of the
Note Agreement may be exercised by Seller.

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        "Subsidiary" or "Subsidiaries" means any and all corporations,
partnerships, joint ventures and other entities Controlled By any Company,
directly or indirectly through one or more intermediaries other than the
Excluded Subsidiaries. As of the date hereof, Subsidiaries of Companies are set
forth on Section 3.04(a) of the Company Disclosure Schedule and shall, for the
sake of clarity, include MECRacing and exclude the Excluded Subsidiaries. All
references to "Subsidiary" or "Subsidiaries" herein including any reference to
any Company's Subsidiary or "its Subsidiaries" or "their Subsidiaries"
(referring to any Company's Subsidiaries) shall exclude the
Excluded Subsidiaries.

        "Tax" or "Taxes" means any and all U.S. federal, state, local or foreign
taxes, fees, levies, duties, tariffs, imposts, and other charges of any kind
(together with any and all interest, penalties, additions to tax and additional
amounts imposed with respect thereto) imposed by any government or taxing
authority or amount owing to any party relating to Taxes arising under any Tax
law or agreement (including any joint venture or partnership agreement),
including, without limitation: taxes or other charges on or with respect to
income, franchises, windfall or other profits, gross receipts, property, sales,
use, capital stock, payroll, employment, social security, workers' compensation,
unemployment compensation, or net worth; taxes or other charges in the nature of
excise, withholding, ad valorem, stamp, transfer, value added, or gains taxes;
license, registration and documentation fees; and customs duties, tariffs and
similar charges, whether disputed or not and including any obligations to
indemnify or otherwise assume or succeed to the Tax liability of any
other Person.

        "Tax Return" means any return, declaration, report, claim for refund,
form of other information or return or statement relating to Taxes, including
any schedule or attachment thereto, and including any amendments thereof.

        "Tranche A Note" means the Tranche A Junior Notes issued by Purchaser on
the Closing Date pursuant to the Note Agreement in an aggregate principal amount
of $175,000,000, as it may be amended or replaced from time to time in
accordance with the Note Agreement.

        "Tranche B Note" means the Tranche B Junior Notes issued by Purchaser on
the Closing Date pursuant to the Note Agreement in an aggregate principal amount
of $25,000,000, as it may be amended or replaced from time to time in accordance
with the Note Agreement.

        "Transaction Documents" means this Agreement, the Racing Services
Agreement, the XpressBet Amendments and the Holdback Documents.

        "XpressBet Amendments" means the XpressBet Lease Amendment, XpressBet
Wagering Agreement Amendment and the XpressBet Banking Agreement Amendment.

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        "XpressBet Banking Agreement Amendment" means the First Amendment to the
letter agreement regarding Pennsylvania account wageror bank accounts, dated as
of October 5, 2005, by and between WTA and MLR, on the one hand, and
XpressBet, Inc., on the other hand, substantially in the form attached hereto as
Exhibit 1.01F-1.

        "XpressBet Lease Amendment" means the First Amendment to the Lease
Agreement, dated July 15, 2005, by and between MECPenn and XpressBet, Inc.,
substantially in the form attached hereto as Exhibit 1.01F-2.

        "XpressBet Wagering Agreement Amendment" means the First Amendment to
the Advanced Account Wagering and Services Agreement, effective as of July 15,
2005 and dated as of August 9, 2005, by and between WTA and MLR, on the one
hand, and XpressBet, Inc., on the other hand, substantially in the form attached
hereto as Exhibit 1.01F-3.

(b)Each of the following terms is defined in the section set forth opposite such
terms below:

Term

--------------------------------------------------------------------------------

  Section

--------------------------------------------------------------------------------

2004 Audited Balance Sheet   5.16(b) 2005 Audited Financial Statements   5.16(a)
2006 Interim Financial Statements   5.16(a) 2005 Quarterly Financial Statements
  5.16(a) Action Notice   8.03(m) Agreement   Preamble Applicable Date   9.02(a)
Applicable Local Authorities   9.03(a) Alternative Scenario   5.04(c)(i) Annual
Applicable Amount   9.03 Assets   3.13(a) Benefit Plans   3.16(a) CERCLA  
3.12(c) Claim Notice   9.04(a) Closing   2.03(a) Closing Date   2.03(a) COBRA  
6.02(c) Commission Approval   8.01(c) Company; Companies   Recitals Company
Employees   6.01 Company Financial Statements   3.07(a) Company Interim
Financial Statements   3.07(a) Company Plans   3.16(a) Confidentiality Agreement
  5.05(a) Contest   7.04(b) Election   7.08(a) Employee Agreements   3.16(a)
Environmental Actions   3.12(c) Environmental Laws   3.12(c) Environmental
Permits   3.12(c)

8

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Term

--------------------------------------------------------------------------------

  Section

--------------------------------------------------------------------------------

Excluded Items   5.13 Existing Stock   5.06(b) Former Subsidiaries   3.04(d)
Fundamental Representations   9.01 Gaming Application   5.04(c)(i) Gaming
Application Fee   5.04(d) Hazardous Materials   3.12(c) Indemnified Party  
9.04(a) Indemnifying Party   9.04(a) Insured Exception   5.11(c) lease   3.19(a)
Local Applicable Date   9.03(a) Local Share Assessment Losses   9.03(a) Local
Tax Assessment Date   9.03(a) Magna Name   5.06(a) Material Contracts   3.19(a)
MEC Health Plan   6.02(a) MECPenn   Recitals MECPenn Common Stock   3.03(a)
MECRacing   3.20 MLR   Recitals MLR Common Stock   3.03 Multiemployer Plans  
3.16(a) Non-Competition Covenant   5.08(a) Non-Competition Period   5.08(a)
Other Purchaser Materials   5.04(e) Paddock Refurbishment   3.13(e) Pension
Survival Period   9.03(a)(viii) Permitted Exceptions   3.13(a) Phase I   5.22
Proposed Development   3.13(e) Purchaser's Notice   5.11(c) Purchase Price  
2.02 Purchaser   Preamble Purchaser Application Materials   5.04(e) Purchaser
Developments   8.02(b) Qualified Plans   3.16(h) Releases   3.12(c) Replacement
Trigger   5.04(d) RCRA   3.12(c) Seller   Preamble Seller Developments   8.03(b)
Shares   Recitals Specified Notes   5.01(c) Survey   5.11(a)

9

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Term

--------------------------------------------------------------------------------

  Section

--------------------------------------------------------------------------------

Tax Adjusted Local Share Assessment Losses   9.03(a) Tax Benefit   9.03(a)
Terminating Purchaser's Breach   10.01(d) Terminating Seller's Breach   10.01(c)
Title Commitment   5.11(a) Title Company   5.11(a) Title Objection   5.11(b)
Title Policy   8.03(k) Transaction Scenario   5.04(c)(i) Transferred Employees  
6.01 True-Up   9.03(a) WTA   Recitals WTA Common Stock   3.03

ARTICLE II
PURCHASE AND SALE

        SECTION 2.01 Purchase and Sale. Upon the terms and subject to the
conditions set forth in this Agreement, Seller agrees to sell to Purchaser, and
Purchaser agrees to purchase from Seller, on the Closing Date, the Shares.

        SECTION 2.02 Purchase Price. The aggregate purchase price for the Shares
(and the limited non-compete set forth in Section 5.08) shall be $200,000,000
(the "Purchase Price"), of which (i) $175,000,000 shall be paid with the
issuance of the Tranche A Note to Seller or its permitted designee in accordance
with the Note Agreement on the Closing Date as provided in Section 2.03(c)
and (ii) $25,000,000 shall be paid with the issuance of the Tranche B Note to
Seller or its permitted designee in accordance with the Note Agreement on the
Closing Date as provided in Section 2.03(c) (in each case together with the
execution and delivery of each of the other Note Documents). Within 30 days
after Closing, Seller will provide Purchaser with an allocation of the Purchase
Price (less the $2,000,000 allocated pursuant to Section 5.08 hereof) among
MECPenn, MLR, WTA and the Subsidiaries for approval, such approval not to be
unreasonably withheld. The allocation shall be adjusted by the parties to
reflect any payments made under the Seller Notes in a manner consistent with the
initial allocation. The parties agree that the allocation determined under this
Section 2.02 shall be binding and the parties shall not take a position that is
inconsistent with such allocation in any matter.

        SECTION 2.03 Closing. (a) Subject to the terms and conditions of this
Agreement, the sale and purchase of the Shares contemplated hereby shall take
place at a closing (the "Closing") to be held at 10:00 a.m., New York time, no
later than two Business Days after the last of the conditions to Closing set
forth in Sections 8.01, 8.02 and 8.03 has been satisfied or waived (other than
conditions which, by their nature, are to be satisfied on the Closing Date). The
Closing will occur at the offices of O'Melveny & Myers LLP, 7 Times Square,
New York, New York, or at such other time or on such other date or at such other
place as Seller and Purchaser may mutually agree upon in writing (the day on
which the Closing takes place being the "Closing Date").

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        (b)   At the Closing, Seller shall deliver or cause to be delivered to
Purchaser stock certificates evidencing the Shares duly endorsed in blank or
accompanied by stock powers duly executed in blank, in proper form for transfer
and with all required stock transfer tax stamps affixed.

        (c)   At the Closing, against delivery of the stock certificates
evidencing the Shares, Purchaser shall deliver to Seller or its permitted
designee in accordance with the Note Agreement (i) the executed Tranche A Note
in an aggregate principal amount equal to $175,000,000 and (ii) the executed
Tranche B Note in an aggregate principal amount equal to $25,000,000, in each
case together with the other Note Documents executed by each party thereto
(other than Seller).

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER

        Seller represents and warrants to Purchaser as of the date hereof (other
than such representations and warranties as are made as of another date)
as follows:

        SECTION 3.01 Incorporation and Authority of Seller. Seller is a
corporation duly incorporated, validly existing and in good standing under the
laws of Delaware. Seller is duly qualified as a foreign corporation to do
business in each jurisdiction where the character of its properties owned,
operated or leased or the nature of its activities as currently conducted makes
such qualification necessary, except for such failures to be so qualified that
would not have a Material Adverse Effect. Seller has all necessary corporate
power and authority to enter into this Agreement and the other Transaction
Documents to which Seller is a party, to carry out its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby or thereby.
The execution and delivery by Seller of this Agreement and any other Transaction
Document to which Seller is a party, the performance by Seller of its
obligations hereunder and thereunder and the consummation by Seller of the
transactions contemplated hereby and thereby have been duly authorized by all
requisite corporate action on the part of Seller. This Agreement has been duly
executed and delivered by Seller, and (assuming due authorization, execution and
delivery by Purchaser) this Agreement constitutes a legal, valid and binding
obligation of Seller enforceable against it in accordance with its terms,
subject to the effect of any applicable bankruptcy, reorganization, insolvency,
moratorium or similar laws affecting creditors' rights generally and subject, as
to enforceability, to the effect of general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
When each Transaction Document to which Seller is or will be a party has been
duly executed and delivered by Seller (assuming due authorization, execution and
delivery by each other party thereto), such Transaction Document will constitute
a legal and binding obligation of Seller enforceable against it in accordance
with its terms, subject to the effect of any applicable bankruptcy,
reorganization, insolvency, moratorium or similar laws affecting creditors'
rights generally and subject, as to enforceability, to the effect of general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).

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        SECTION 3.02    Organization, Authority and Qualification of the
Companies.    Each Company is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of incorporation and has all
necessary corporate power and authority to own, operate or lease the properties
and assets now owned, operated or leased by it and to carry on its business as
it has been and is currently conducted. Section 3.02 of the Company Disclosure
Schedule sets forth each jurisdiction in which each Company is licensed or
qualified to do business, and each Company is duly licensed or qualified to do
business and is in good standing in each jurisdiction in which the properties
owned or leased by it or the operation of its business as currently conducted
makes such licensing or qualification necessary, except as set forth on
Section 3.02 of the Company Disclosure Schedule and except for such failures
which would not have a Material Adverse Effect. All corporate actions taken by
each Company in connection with this Agreement and the other Transaction
Documents will be duly authorized on or prior to the Closing, and none of the
Companies has taken any such action that conflicts with, constitutes a default
under or results in a violation of any provision of its Certificate of
Incorporation (or Articles of Incorporation) or By-laws. True, complete and
correct copies of the Certificate of Incorporation and By-laws (or similar
organizational documents) of each Company, each as in effect on the date hereof,
have been delivered by Seller to Purchaser.

        SECTION 3.03    Capital Stock of the Companies; Ownership of the
Shares.    (a) The authorized capital stock of MECPenn consists of 1,000 shares
of common stock, par value $1.00 per share ("MECPenn Common Stock"), the
authorized capital stock of MLR consists of 10,000 shares of common stock, no
par value ("MLR Common Stock"), and the authorized capital stock of WTA consists
of 10,000 shares of common stock, no par value ("WTA Common Stock"). As of the
date hereof, 100 shares of MECPenn Common Stock, 100 shares of MLR Common Stock
and 100 shares of WTA Common Stock are issued and outstanding, all of which have
been validly authorized and are validly issued, fully paid and nonassessable.
None of the Shares was issued in violation of any preemptive rights. There are
no options, warrants, convertible securities or other rights, agreements,
arrangements or commitments of any character relating to the capital stock of
any Company or obligating Seller or any Company to issue or sell any shares of
capital stock of, or any other interest in, any Company. Except as set forth in
Section 3.03 of the Company Disclosure Schedule or except as may arise from the
MID Loan Documents or the Note Documents, there are no outstanding contractual
obligations of any Company to repurchase, redeem or otherwise acquire any shares
of its common stock or to provide funds to, or make any investment (in the form
of a loan, capital contribution or otherwise) in, any other Person. Except as
disclosed in Section 3.03 of the Company Disclosure Schedule, the Shares
constitute all the issued and outstanding capital stock of the Companies and are
owned of record and beneficially solely by Seller free and clear of all
Encumbrances (other than the Encumbrances contemplated by the MID Loan Documents
or the Note Documents).

        (b)   Upon consummation of the transactions contemplated by this
Agreement and registration of the Shares in the name of Purchaser in the
respective stock records of the Companies, Purchaser, assuming it shall have
purchased the Shares for value in good faith and without notice of any adverse
claim, will own all the issued and outstanding capital stock of each Company
free and clear of all Encumbrances (other than the Encumbrances contemplated by
the MID Loan Documents or the Note Documents), assuming the release of the
Encumbrances disclosed in Section 3.03 of the Company Disclosure Schedule, and
the Shares will be fully paid and nonassessable. There are no voting trusts,
stockholder agreements, proxies or other agreements or understandings in effect
with respect to the voting or transfer of any of the Shares.

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        SECTION 3.04    Subsidiaries.    (a) Section 3.04(a) of the Company
Disclosure Schedule sets forth a true and complete list of all Subsidiaries,
listing for each Subsidiary its name, type of entity, the jurisdiction and date
of its incorporation or organization, its authorized capital stock, partnership
capital or equivalent, the number and type of its issued and outstanding shares
of capital stock, partnership interests or similar ownership interests and the
current ownership of such shares, partnership interests or similar ownership
interests. All such shares, partnership interests or similar ownership interests
have been validly authorized and are validly issued, fully paid and
nonassessable. None of such shares, partnership interests or similar ownership
interests was issued in violation of any preemptive rights. There are no
options, warrants, convertible securities or other rights, agreements,
arrangements or commitments of any character relating to the shares, partnership
interests or similar ownership interests of any Subsidiary or obligating any
Company or Subsidiary to issue or sell any shares, partnership interests or
similar ownership interests of, or any other interest in, any Subsidiary. Except
as set forth in Section 3.04 of the Company Disclosure Schedule or except as may
arise from the MID Loan Documents or the Note Documents, there are no
outstanding contractual obligations of any Subsidiary to repurchase, redeem or
otherwise acquire any of its shares, partnership interests or similar ownership
interests or to provide funds to, or make any investment (in the form of a loan,
capital contribution or otherwise) in, any other Person. Except as disclosed in
Section 3.04(a) of the Company Disclosure Schedule, the shares, partnership
interests or similar ownership interests set forth in Section 3.04(a) of the
Company Disclosure Schedule constitute all the issued and outstanding shares,
partnership interests or similar ownership interests of the Subsidiaries and are
owned of record and beneficially solely by the Company or Companies indicated on
Section 3.04(a) of the Company Disclosure Schedule, free and clear of all
Encumbrances (other than the Encumbrances contemplated by the MID Loan Documents
or the Note Documents).

        (b)   Except as set forth on Section 3.04(b) of the Company Disclosure
Schedule, other than the Subsidiaries, there are no other corporations,
partnerships, joint ventures, associations or other entities in which any
Company owns, of record or beneficially, any direct or indirect equity or other
interest or any right (contingent or otherwise) to acquire the same. Except as
set forth on Section 3.04(b) of the Company Disclosure Schedule, other than the
Subsidiaries, none of the Companies is a member of (nor is any part of the
business of Company and its Subsidiaries as currently conducted on the date of
this Agreement conducted through) any partnership. Except as set forth in
Section 3.04(b) of the Company Disclosure Schedule, none of the Companies is a
participant in any joint venture or similar arrangement.

        (c)   Each Subsidiary that is a corporation: (i) is a corporation duly
organized and validly existing under the laws of its jurisdiction of
incorporation, (ii) has all necessary power and authority to own, operate or
lease the properties and assets owned, operated or leased by such Subsidiary and
to carry on its business as it has been and is currently conducted by such
Subsidiary, and (iii) is duly licensed or qualified to do business and is in
good standing in each jurisdiction in which the properties owned or leased by it
or the operation of its business makes such licensing or qualification necessary
or desirable, except as set forth in Section 3.04(c) of the Company Disclosure
Schedule and except for such failures which would not have a Material Adverse
Effect. Each Subsidiary that is not a corporation: (i) is duly organized and
validly existing under the laws of its jurisdiction of organization, (ii) has
all necessary power and authority to own, operate or lease the properties and
assets owned, operated or leased by such Subsidiary and to carry on its business
as it has been and is currently conducted by such Subsidiary and (iii) is duly
licensed or qualified to do business and is in good standing in each
jurisdiction in which the properties owned or leased by it or the operation of
its business makes such licensing or qualification necessary or desirable,
except as set forth in Section 3.04(c) of the Company Disclosure Schedule and
except for such failures which would not have a Material Adverse Effect.
Section 3.04(c) of the Company Disclosure Schedule sets forth each jurisdiction
in which each Subsidiary is licensed or qualified to do business. All corporate
or entity actions taken by each Subsidiary in connection with this Agreement and
the other Transaction Documents will be duly authorized on or prior to the
Closing, and none of the Subsidiaries has taken any such action that conflicts
with, constitutes a default under or results in a violation of any provision of
its Certificate of Incorporation (or Articles of Incorporation) or By-laws
(or similar organizational documents). True, complete and correct copies of the
Certificate of Incorporation and By-laws (or similar organizational documents)
of each Subsidiary, each as in effect on the date hereof, have been delivered by
Seller to Purchaser.

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        (d)   Section 3.04(d) of the Company Disclosure Schedule sets forth a
true and complete list of any and all former Subsidiaries of the Companies or
the Subsidiaries (the "Former Subsidiaries"). Neither of the Former Subsidiaries
has engaged in or conducted any business or transactions or entered into any
material contracts or agreements. Each of the Former Subsidiaries was dissolved
in accordance with the laws of the State of Delaware, and at the time of
dissolution, all Liabilities of the Former Subsidiaries were satisfied by
Seller, and Seller has received confirmation from the applicable Governmental
Authorities that the entities have been dissolved in accordance with applicable
Law and that all Tax Liabilities have been satisfied.

        SECTION 3.05    No Conflict.    The execution, delivery and performance
by Seller of this Agreement and the other Transaction Documents to which Seller
is or will be a party do not and will not (a) violate, conflict with or result
in the breach of any provision of the Certificate of Incorporation or By-laws
(or similar organizational documents) of Seller, the Companies or any
Subsidiary, (b) assuming that all consents, approvals, authorizations and other
actions described in Section 3.06 have been obtained and all filings and
notifications listed in Section 3.06 of the Company Disclosure Schedule have
been made, conflict with or violate, or give any Governmental Authority the
right to challenge the transactions contemplated by this Agreement or any other
Transaction Document to which Seller is a party, or to exercise any remedy or
obtain any relief under, any Law or Governmental Order, including without
limitation any state takeover or similar statute or regulation, applicable to
Seller, the Companies or any Subsidiary or (c) assuming that all consents,
approvals, authorizations and other actions described in Section 3.06 have been
obtained and all filings and notifications listed in Section 3.06 of the Company
Disclosure Schedule have been made, except as set forth in Section 3.05(c) of
the Company Disclosure Schedule, conflict with, result in any breach of,
constitute a default (or event which with the giving of notice or lapse of time,
or both, would become a default) under, require any consent or provision of
notice under, or give to others any rights of termination, amendment,
acceleration, suspension, revocation or cancellation of, or result in the
creation of any Encumbrance on any of the Shares or on any of the assets or
properties of Seller, the Companies or any Subsidiary (other than the
Encumbrances contemplated by the MID Loan Documents or the Note Documents)
pursuant to, any (i) Material Contract, (ii) any Permit under which the
consequences of a default or termination would have a Material Adverse Effect or
(iii) any Environmental Permit.

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        SECTION 3.06    Consents and Approvals.    The execution and delivery by
Seller of this Agreement and any other Transaction Document to which Seller is a
party do not or will not, and the performance by Seller of this Agreement and
any other Transaction Document to which Seller is a party will not, require any
consent, approval, authorization or other action by, or filing with or
notification to, any Governmental Authority, except (a) the notification
requirements of the HSR Act, (b) as described in Section 3.06 of the Company
Disclosure Schedule, and (c) as may be necessary as a result of any facts or
circumstances relating solely to Purchaser. Except for the consent of MID
Islandi SF in connection with the MID Bridge Loan Agreement, the Gulfstream Loan
Agreement and the documents related thereto, the execution and delivery by
Seller of this Agreement and any other Transaction Document contemplated hereby
to which Seller is a party do not or will not, and the performance by Seller of
this Agreement and any Transaction Document to which Seller is a party will not,
require the consent, approval or authorization of the shareholders of Seller.

        SECTION 3.07    Financial Information, Books and Records.    (a) True,
complete and correct copies of the audited combined balance sheet of the
Companies and their Subsidiaries as of December 31, 2004 and the audited
combined financial statements for each of the two fiscal years ended as of
December 31, 2003 and 2002 and the related audited combined statements of income
and cash flows of the Companies and their Subsidiaries, together with all
related notes and schedules thereto (the "Company Financial Statements") and
(B) the combined statement of income of the Companies and their Subsidiaries for
the 9 month period ending September 30, 2005 (the "Company Interim Financial
Statements") have been delivered by Seller to Purchaser. The Company Financial
Statements and the Company Interim Financial Statements (i) were prepared in
accordance with the books of account and other financial records of the
Companies and the Subsidiaries, (ii) present fairly the financial condition and
results of operations of the Companies and the Subsidiaries as of the dates
thereof or for the periods covered thereby, (iii) have been prepared in
accordance with GAAP, applied on a basis consistent with the past practices of
Seller and the Companies and (iv) include all adjustments (consisting only of
normal recurring accruals) that are necessary for a fair presentation of the
financial condition of the Companies and the Subsidiaries and the results of the
operations of the Companies and the Subsidiaries as of the dates thereof or for
the periods covered thereby. To the extent delivered prior to the Closing Date,
the financial statements delivered pursuant to Section 5.16, when delivered
(i) will be prepared in accordance with the books of account and other financial
records of the Companies and the Subsidiaries, (ii) will present fairly the
financial condition and results of operations of the Companies and the
Subsidiaries as of the dates thereof or for the periods covered thereby,
(iii) will have been prepared in accordance with GAAP, applied on a basis
consistent with the past practices of Seller and the Companies and (iv) will
include all adjustments (consisting only of normal recurring accruals) that are
necessary for a fair presentation of the financial condition of the Companies
and the Subsidiaries and the results of the operations of the Companies and the
Subsidiaries as of the dates thereof or for the periods covered thereby.

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        (b)   The books of account and other financial records of the Companies
and the Subsidiaries: (i) reflect all items of income and expense and all assets
and Liabilities required to be reflected therein in accordance with GAAP applied
on a basis consistent with the past practices of the Companies and the
Subsidiaries, respectively and (ii) are in all material respects complete and
correct, and do not contain or reflect any material inaccuracies or
discrepancies. The Companies and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that
transactions are recorded as necessary to permit preparation of financial
statements in accordance with GAAP.

        (c)   All accounts receivable of the Companies and the Subsidiaries,
whether reflected on the Company Financial Statements or otherwise, represent
sales actually made in the ordinary course of business or finance charges
imposed in the ordinary course of business related to such sales. The allowance
for possible losses as reflected on the Company Financial Statements as of and
for the period ended on the Reference Balance Sheet Date was adequate as of such
date and was calculated consistent with past practice.

        SECTION 3.08    No Undisclosed Liabilities.    To the knowledge of
Seller, except as set forth in Section 3.08 of the Company Disclosure Schedule
and except under the Note Documents, there are no Liabilities of any Company or
any Subsidiary, other than Liabilities (a) reflected or reserved against on the
Reference Balance Sheet and (b) incurred since the date of the Reference Balance
Sheet in the ordinary course of the business, consistent with the past practice,
of the Companies and the Subsidiaries.

        SECTION 3.09    Conduct in the Ordinary Course; Absence of Certain
Changes, Events and Conditions.    Since the Reference Balance Sheet Date,
except as disclosed in Section 3.09 of the Company Disclosure Schedule and
except for entry into the Note Documents, and the MID Forbearance Agreement, the
business of the Companies and the Subsidiaries has been conducted in the
ordinary course and consistent with past practice. As amplification and not
limitation of the foregoing, except as disclosed in Section 3.09 of the Company
Disclosure Schedule and except for entry into the Note Documents and the MID
Forbearance Agreement, since the Reference Balance Sheet Date until the date
hereof, neither the Companies nor any Subsidiary has:

(a)changed any Company's or Subsidiary's authorized or issued shares of capital
stock, partnership interests or similar ownership interests; granted any option
or right to purchase any such shares, partnership interests or similar ownership
interests; issued any security convertible into such shares, partnership
interests or similar ownership interests; granted any registration rights; or
purchased, redeemed, retired, or otherwise acquired any such shares, partnership
interests or similar ownership interests;

(b)other than as described in Section 5.01(c) or Section 8.03(p), declared, set
aside or paid any dividend or made any distribution with respect to any
Company's or Subsidiary's shares of capital stock, partnership interests or
similar ownership interests (whether in cash or in kind);

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(c)amended the organizational documents of any Company or Subsidiary;

(d)paid or increased any material bonuses, salaries, or other compensation to
any stockholder, director, officer, or (except in the ordinary course of
business) employee or entered into any material employment, severance, or
similar Material Contract with any director, officer, or employee;

(e)adopted, or materially increased the payments to or benefits under, any
profit sharing, deferred compensation, savings, insurance, pension, retirement,
or other employee benefit plan for or with any employees of any Company
or Subsidiary;

(f)suffered any damage to or destruction or loss of any asset or property of any
Company or Subsidiary not covered by insurance and in excess of $100,000;

(g)entered into, amended, extended, terminated, or received notice of
termination of, or acceleration of obligations under, (i) any license, lease,
distributorship, dealer, sales representative, joint venture, partnership,
credit, collective bargaining, indemnification or similar agreement, or (ii) any
contract, agreement or transaction involving a total remaining commitment by or
to any Company or Subsidiary of at least $100,000;

(h)sold, leased, or otherwise disposed of any material asset or property of any
Company or Subsidiary or mortgaged, pledged, or suffered the imposition of any
Encumbrance on any material asset or property of any Company or Subsidiary,
including the sale, lease, or other disposition of any material Intellectual
Property Rights;

(i)committed to make any capital expenditures, in excess of $1,000,000 in the
aggregate for the period from the Reference Balance Sheet Date until
September 30, 2005, or in excess of $500,000 in the aggregate for the period
from October 1, 2005 until the Closing Date, in each case except as set forth on
the Reference Balance Sheet;

(j)compromised, canceled, waived or released any claims or rights with a value
to any Company or Subsidiary in excess of $100,000;

(k)made any material change in the accounting methods used by the Companies or
the Subsidiaries at the time of preparation of the Reference Balance Sheet;

(l)made any material election with respect to Taxes affecting any Company or
Subsidiary or settlement or compromise affecting any Company or Subsidiary of
any material Tax liability or refund;

(m)suffered any Material Adverse Effect; or

(n)entered into any agreement to do any of the foregoing.

        SECTION 3.10    Litigation.    Except as set forth in Section 3.10 of
the Company Disclosure Schedule, there are no Actions pending or, to the
knowledge of Seller, threatened against or by either any Company or Subsidiary
or affecting any of their respective assets or properties (or by or against
Seller or any Affiliate thereof and relating to the Companies and the
Subsidiaries), which involve a claim or potential claim or group of related
claims of liability in excess of $25,000 or which seek or would seek to restrain
or enjoin any activities of any Company or Subsidiary or to impose any criminal
or civil penalties or sanctions on any Company or any Subsidiary. Except as set
forth in Section 3.10 of the Company Disclosure Schedule, none of the Companies
or Subsidiaries nor any of their assets or properties is subject to any
Governmental Order, nor, to the knowledge of Seller, are there any such
Governmental Orders threatened to be imposed by any Governmental Authority.

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        SECTION 3.11    Compliance with Applicable Laws.    (a) Except as set
forth in Section 3.11(a) of the Company Disclosure Schedule, since April 5,
2001, no Company or Subsidiary has violated or failed to comply with any
statute, law, regulation, rule, or Governmental Order of any Governmental
Authority applicable to its business or operations as currently being conducted
in any respect that would have a material effect to the detriment of the
business or operations of the Companies and Subsidiaries. The conduct of the
business of each Company and Subsidiary as currently being conducted is in
conformity with all federal, state and local governmental and regulatory
requirements applicable to its business and operations, except where such
nonconformities would not have a material effect to the detriment of the
business or operations of the Companies and Subsidiaries. No Company or
Subsidiary, or any officer or agent thereof, has made any illegal or improper
payment to, or provided any illegal or improper benefit or inducement for, any
government official, supplier, customer or other person in an attempt to
influence any person to take or refrain from taking any action relating to any
Company or Subsidiary, except where such illegal or improper payment, benefit or
inducement would not have a material effect to the detriment of the business or
operations of the Companies and the Subsidiaries.

        (b)   Each Company and Subsidiary has all material Permits required to
own and use its assets and to conduct its business as now being conducted. Each
such Permit is set forth on Section 3.11(b) of the Company Disclosure Schedule
and is valid and in full force and effect. Each Company and Subsidiary is in
compliance with all such Permits and no Company or Subsidiary is in default
under any such Permit or has received any notice of violation or noncompliance
or claim of default with respect thereto, except where such noncompliance,
default or the effect of receipt of such notice would not, individually or in
the aggregate, have a Material Adverse Effect.

        SECTION 3.12    Environmental Matters.    (a) Except as disclosed in
Section 3.12 of the Company Disclosure Schedule: (i) to Seller's knowledge, the
Companies and the Subsidiaries are, and have been since April 5, 2001, in
material compliance with all applicable Environmental Laws and have obtained and
are, and have been since April 5, 2001, in compliance with all required
Environmental Permits, which are set forth on Section 3.12 of the Company
Disclosure Schedule, and are valid and in full force and effect; (ii) there are
no Environmental Actions pending or threatened in writing against any of Seller,
the Companies or Subsidiaries with respect to the business or operations of the
Companies or Subsidiaries or the Real Property; (iii) to Seller's knowledge, no
Hazardous Materials have been released into the environment by any of the
Companies or Subsidiaries on any of the Real Property except as authorized under
Environmental Law and no condition exists that would require investigation or
remediation under any Environmental Law; (iv) to Seller's knowledge, there are
no underground storage tanks at any facilities owned or operated by any Company
or Subsidiary; (v) to Seller's knowledge, all underground storage tanks
maintained at such facilities are in good working order, do not leak into soil
or groundwater, and are in compliance with Environmental Laws or for which there
is any pending or threatened action seeking to require remediation or clean up;
(vi) to Seller's knowledge, none of such facilities contains any asbestos or
polychlorinated biphenyls; (vii) to Seller's knowledge, none of the Companies
nor any Subsidiary has sent Hazardous Materials to a disposal location owned or
operated by a third party that requires remediation or clean up or for which
there is any pending or threatened Action seeking to require remediation or
clean up; and (viii) Seller has provided Purchaser with copies of any and all
written environmental assessment or audit reports generated within the last
three years and in the possession of Seller or their respective attorneys,
agents or consultants, that relate to the business of the Companies and the
Subsidiaries or the Real Property. Except as disclosed in Section 3.12 of the
Company Disclosure Schedule, Seller, the Companies and the Subsidiaries have not
received since April 5, 2001 any written notice of any actual, alleged or
potential noncompliance with, liability under, or claimed violation of, any
Environmental Laws, including without limitation, from any government agency or
prosecutor, from any private citizen acting in the public interest or from any
prior owner or operator of the Real Property, and, to the knowledge of Seller,
there has not occurred and there does not exist any event or condition which
would cause noncompliance with, liability under, or violation of, any
Environmental Laws. Except as disclosed in Section 3.12 of the Company
Disclosure Schedule, Seller, the Companies and the Subsidiaries have not
received any notice of violation or noncompliance or claim of default with
respect to any Environmental Permit.

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        (b)   Purchaser acknowledges that (i) the representations and warranties
contained in Section 3.05 (as it relates to Environmental Permits) and this
Section 3.12 are the only representations and warranties being made with respect
to compliance with or liability under Environmental Laws or with respect to any
environmental matter, including natural resources, related in any way to the
Companies, the Subsidiaries or the Real Property or to this Agreement or its
subject matter, and (ii) no other representation contained in this Agreement
shall apply to any such matters and no other representation or warranty, express
or implied, is being made with respect thereto.

(c)For purposes of this Agreement:

"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.

"Environmental Actions" means any and all Actions arising out of, or related to
the presence, Release or threatened Release of any Hazardous Materials,
including Actions alleging common law liability arising out of, or related to
the presence, Release or threatened Release of any Hazardous Materials.

"Environmental Laws" means any civil and criminal Laws, rules, Permits or
Governmental Orders relating to or addressing pollution or protection of the
environment, public health or safety, including, without limitation, those
relating to the presence, use, production, processing, generation, handling,
labeling transportation, treatment, storage, disposal, distribution, testing,
processing, Release, threatened Release or discharge, investigation, control,
exposure or cleanup of Hazardous Materials, wastes, substances, storm water or
waste water.

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"Environmental Permits" means any permit, approval, identification number,
license or other authorization obtained, or required of any Company or
Subsidiary to be obtained, under any Environmental Law.

"Hazardous Materials" means (a) any petroleum, petroleum products, by-products
or breakdown products, radioactive materials, asbestos-containing materials,
urea formaldehyde foam, heavy metals or polychlorinated biphenyls, (b) any
waste, chemical, material or substance defined or regulated as toxic or
hazardous under any applicable Environmental Law or (c) anything that is a
"hazardous substance" pursuant to CERCLA or any similar applicable state law,
anything that is a "solid waste" or "hazardous waste" pursuant to RCRA or any
similar applicable state law or any "pesticide," "pollutant," "contaminant,"
"toxic chemical" or "noise."

"RCRA" means the Resource Conservation and Recovery Act, as amended.

"Release" means any release, spill, emission, leaking, dumping, injection,
pouring, deposit, discharge, dispersal, leaching or migration of a Hazardous
Material into the environment (including ambient air, surface water, ground
water, land surface or subsurface strata) or within any building, structure
or facility.

        SECTION 3.13    Title to Assets; Real Property.    (a) Except as set
forth in Section 3.13(a) of the Company Disclosure Schedule, and excluding the
Real Property, each Company and Subsidiary has good and marketable title to, or
valid leasehold interests in, all the tangible personal properties and personal
assets used by it or located on its premises that are material to the conduct of
its business or which are shown on the Company Financial Statements
(collectively, the "Assets"), except for such as are no longer useful in the
conduct of its business or as have been disposed of in the ordinary course of
business. All such assets and properties (including leasehold interests) are
free and clear of Encumbrances except for (i) Encumbrances that would not
unreasonably interfere with the use or operation of the Assets; (ii) liens for
taxes not yet due or being contested in good faith by appropriate procedures and
for which there are adequate reserves on the books; (iii) mechanics, carriers,
workmen's, repairmen's or other like liens arising or incurred in the ordinary
course of business for amounts that are not delinquent and which are not,
individually or in the aggregate, material to the business of the Companies and
the Subsidiaries, (iv) in the case of Assets other than Real Property, liens
arising under original purchase price conditional sales contracts and equipment
leases with third parties entered into in the ordinary course of business,
(v) any Encumbrances for the obligations of third party lessors, (vi) those
items set forth in Section 3.13(a) of the Company Disclosure Schedule, or
(vii) Encumbrances contemplated by the MID Loan Documents or the Note Documents
(the "Permitted Exceptions"). The Real Property will be free and clear of all
monetary Encumbrances as of the Closing, other than Encumbrances contemplated by
the MID Loan Documents or the Note Documents. Seller has no knowledge of any
matters that would affect the marketability of title of the Real Property other
than as set forth on the applicable Title Policy.

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        (b)   Section 3.13(b) of the Company Disclosure Schedule lists: (i) the
street address of each parcel of Real Property; (ii) if such property is owned
by any Company or Subsidiary, the owner of such property; (iii) if such property
is leased or subleased by any Company or Subsidiary as lessee, the landlord
under the lease, the rental amount currently being paid, and the expiration of
the term of such lease or sublease; and (iv) the current use of such property.
Seller has delivered or made available to Purchaser true, complete and correct
copies of any leases affecting the Real Property.

        (c)   As is the case with most harness racing facilities of the age of
the Meadows Facility, most of the Assets are old and need periodic repair and
replacement. Nevertheless, to Seller's knowledge, as of the date hereof and as
of the Closing (subject to Seller Developments in the latter case) (i) all of
the material equipment, inventory and other items of tangible property and
assets included in the Assets are at such times in a condition sufficient for
the operation of the business currently being conducted at the Real Property and
(ii) each material building or material improvement on any of the Real Property
is at such times in a condition sufficient for the operation of the business
currently being conducted at the Real Property.

        (d)   To the knowledge of Seller, the real property improvements at the
Real Property, and the current use and operation thereof, are in compliance with
and authorized by applicable zoning and other land use regulations and none of
Seller, the Companies or the Subsidiaries has received any written notice that
any Governmental Authority or other Person considers any of the Real Property,
or the improvements thereat, to violate any such regulations. There is no Action
pending or, to the knowledge of Seller, threatened: (i) to take all or any
portion of the Real Property or the improvements through eminent domain, (ii) to
modify the zoning or other governmental rules or restrictions applicable to the
use or development of the Real Property or improvements, or (iii) that would
reasonably be expected to have a material adverse effect on the ownership or
leasehold interest in the Real Property. There is no Action brought with respect
to the Real Property, pending against Seller, the Companies or the Subsidiaries,
or as to which Seller has knowledge, or, to the knowledge of Seller, threatened,
that would have a Material Adverse Effect on the value, use, development or
occupancy of the Real Property, other than Actions that are general in nature
concerning the Gaming Act or not based upon land, zoning, use or Laws related to
the ownership and development of real property interests. The Companies and the
Subsidiaries are permitted by the appropriate Governmental Authorities to occupy
the Meadows Facility.

        (e)   Immediately following the consummation of the transactions
contemplated by this Agreement, either a Company or a Subsidiary, as the case
may be, will continue to own, or lease, under valid and subsisting leases, or
otherwise retain its respective interest in the Assets without incurring any
material penalty or other adverse consequence, including, without limitation,
any material increase in rentals, royalties, or licenses or other fees imposed
as a result of, or arising from the consummation of the transactions
contemplated by this Agreement, and, except as otherwise contemplated in the
Racing Services Agreement, collectively, the Companies and the Subsidiaries will
have all of the assets and rights that are necessary and sufficient for the
conduct of the business of the Companies and the Subsidiaries in substantially
the same manner as currently conducted. Except as otherwise contemplated in the
Racing Services Agreement, immediately following the Closing, either a Company
or a Subsidiary, as the case may be, shall own and possess all documents, books,
records, agreements, contracts, Permits, warranties, plans, specifications,
drawings, customer lists, supplier lists and financial data of any sort used in
the conduct of the business of the Companies and the Subsidiaries as
currently conducted.

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        (f)    Seller acknowledges that it intended, and that Purchaser intends,
to (i) develop a portion of the owned Real Property located in North Strabane
Township in the Commonwealth of Pennsylvania with a casino and certain uses
ancillary thereto (the "Proposed Development") and (ii) refurbish the paddock
area currently located on such property (the "Paddock Refurbishment"). None of
Seller, the Companies or any Subsidiary has received any written notice from a
Governmental Authority indicating that either the Proposed Development or the
Paddock Refurbishment will be prohibited by any Governmental Authority, Law or
Environmental Law or challenged by any Governmental Authority.

        (g)   The Real Property is connected to adequate sanitary sewer, storm
sewer, water, electricity, gas, telephone and all other utilities and services
necessary for the current use of the Real Property in accordance with all
applicable Laws of any Governmental Authority having or claiming jurisdiction
thereover and to the knowledge of Seller, there has not occurred any event or
condition which would result in termination of such connections. There is to the
knowledge of Seller, no present or threatened ban or moratorium on new
connections or additional flows to the sewage treatment plant serving the
Real Property.

        SECTION 3.14    Intellectual Property Rights.    The Companies and the
Subsidiaries each have good, valid and marketable title to, or the right to use,
all Intellectual Property Rights. To the knowledge of Seller, all current and
former employees of the Companies and the Subsidiaries have assigned to each,
respectively, all Intellectual Property Rights that such employees have created
while in the scope of their employment with each, respectively, including,
without limitation, copyrights in works made for hire and patents, except where
failure to assign such Intellectual Property Rights could not reasonably be
expected to materially impair the ability of the Companies or the Subsidiaries
to continue to obtain free of charge the benefits of such Intellectual Property
Rights. Section 3.14 of the Company Disclosure Schedule lists each registered
Intellectual Property Right owned by the Companies and the Subsidiaries. The
Company Disclosure Schedule lists each material contract, license and agreement
with respect to Intellectual Property Rights pursuant to which any of the
Companies or the Subsidiaries has granted any Person the right to reproduce,
distribute, market or exploit Intellectual Property Rights. There is no Action,
pending, or to Seller's knowledge, threatened that challenges the validity of
ownership or use of any Intellectual Property Rights of the Companies and the
Subsidiaries. To Seller's knowledge, no third party's operations or products
infringe on the Intellectual Property Rights in any material respect. To
Seller's knowledge, neither the Companies' nor any Subsidiary's operations and
products infringe in any material respect on the intellectual property rights of
any other Person. Seller, the Companies and the Subsidiaries have not received
since April 5, 2001 any written claim of infringement with respect to any
Intellectual Property Rights used by the Companies or the Subsidiaries.

        SECTION 3.15    Insurance.    Section 3.15 of the Company Disclosure
Schedule sets forth a complete list of all material insurance policies
(including policies providing property, casualty, liability and workers'
compensation coverage and bond and surety arrangements) with respect to which
any Company or Subsidiary is a party, a named insured or otherwise the
beneficiary of coverage (together with the policy owner, limit and premium for
each such policy). Such coverage or similar insurance coverage has been
maintained with respect to the Companies and the Subsidiaries at all times in
the past three years. With respect to each such insurance policy: (a) such
policy is in full force and effect; (b) no Company or Subsidiary, nor Seller,
nor, to the knowledge of Seller, any other party to such policy is in material
breach or default thereunder and all premiums due are currently paid, and no
event has occurred which, with or without notice or the lapse of time, would
constitute such a material breach or default, or permit termination,
modification or acceleration under such policy; (c) no party to such policy has
repudiated any material provision thereof; and (d) none of Seller, any Company
or any Subsidiary has received any written notice that such policy has been or
will be cancelled or terminated or will not be renewed on substantially the
same terms.

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        SECTION 3.16    Employee Benefit Matters.    (a) Section 3.16(a) of the
Company Disclosure Schedule lists (i) each employee benefit plan, program,
arrangement and contract (including, without limitation, any "employee benefit
plan" as defined in Section 3(3) of ERISA) maintained, contributed to or
sponsored by any Company or any Subsidiary excluding Multiemployer Plans
(the "Benefit Plans"), (ii) all Benefit Plans as to which any Company or
Subsidiary is or was the "administrator" or "plan sponsor," as those terms are
defined in Section 3 of ERISA, without regard to whether or not such Plan is an
ERISA plan, at any time within the past three years (the "Company Plans"),
(iii) all material employment, termination, severance or other contracts or
agreements (including, without limitation, collective bargaining agreements and
other labor union agreements), in respect of any Employee, to which a Company or
a Subsidiary is a party or, with respect to which, a Company or a Subsidiary has
any obligation (collectively, the "Employee Agreements") and (iv) any
multiemployer plans (as defined in Section 3 (37) of ERISA), pursuant to which
Seller, a Company or a Subsidiary contributes, or has an obligation to
contribute, in respect of any Employee, former employee, officer or director of
the Companies or Subsidiaries (together with any multiemployer plans to which
Seller, a Company or a Subsidiary has contributed, or had an obligation to
contribute, since April 5, 2001, the "Multiemployer Plans"). Section 3.16(a) of
the Disclosure Schedule identifies which Benefit Plans are Company Plans and
Multiemployer Plans and, for each Multiemployer Plan, sets forth, to the extent
such information is in the possession of Seller, a Company or a Subsidiary, the
amount of potential withdrawal liability of the Companies as of its last
valuation date.

        (b)   Seller has made available to Purchaser a copy of (i) the most
recent three annual reports (Form 5500) filed with the IRS, including all
schedules and attachments thereto for each Benefit Plan, (ii) a copy of each
Benefit Plan, (iii) if applicable, each trust agreement relating to such Benefit
Plan, (iv) the most recent summary plan description for each Benefit Plan for
which a summary plan description is required and the most recent summaries and
descriptions furnished to participants regarding Company Plans for which a
summary plan description is not required, (v) the most recent determination
letter, if any, issued by the IRS with respect to any Benefit Plan qualified
under Section 401(a) of the Internal Revenue Code, (vi) all Company personnel
and employment manuals and policies, (vii) all collective bargaining agreements
pursuant to which contributions are being made or obligations are owed by a
Company or Subsidiary, (viii) all registration statements filed with respect to
any Company Plan, (ix) all insurance policies purchased by or to provide
benefits under any Company Plan, (x) all contracts with third party
administrators, actuaries, investment managers, consultants, and other
independent contractors that relate to any Company Plan, (xi) all reports
submitted within the three years preceding the date of this Agreement by third
party administrators, actuaries, investment managers, consultants, or other
independent contractors with respect to any Company Plan, and all such reports
in the possession of Seller, a Company or a Subsidiary relating to a
Multiemployer Plan, (xii) all notices that were given by any Company or any
Subsidiary with respect to any Company Plan, or by any Company Plan, to the IRS
or the PBGC pursuant to statute, within the three years preceding the date of
this Agreement, including notices that are expressly mentioned elsewhere in this
Section 3.16, (xiii) all notices that were given by the IRS, the PBGC, or the
Department of Labor to a Company or a Subsidiary with respect to any Company
Plan if such notice could result in material liability to a Company, a
Subsidiary or to any Company Plan, within the three years preceding the date of
this Agreement, and (xiv) all other material correspondence with any
Governmental Authority relating to any Benefit Plan.

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(c)No Benefit Plan is subject to Title IV of ERISA.

        (d)   Seller has made available to Purchaser (i) copies of all material
employment agreements with officers of the Companies and the Subsidiaries;
(ii) copies of all material severance agreements, programs and policies of the
Companies and the Subsidiaries with or relating to the Employees; and
(iii) copies of all material plans, programs, agreements and other arrangements
of the Companies and the Subsidiaries with or relating to the Employees which
contain change in control provisions.

        (e)   Except as provided in Section 3.16(e) of the Company Disclosure
Schedule or as otherwise required by Law, no Company Plan provides retiree
medical or retiree life insurance benefits to any person.

        (f)    Set forth in Section 3.16(f) of the Company Disclosure Schedule
is a true and complete list of all individuals employed by the Companies or any
Subsidiary as of the date hereof that receive annual salary and wages in excess
of $100,000 annually, the position of and base compensation payable to each such
individual and bonus, deferred or contingent compensation and other like
benefits paid or payable in 2004 to each such individual.

        (g)   Seller, each Company and each Subsidiary has complied in all
material respects with the provisions of each Benefit Plan, with ERISA, the Code
and other applicable Laws, and has timely made all contributions and other
payments required by and due under the terms of each Benefit Plan and each
Multiemployer Plan. To the knowledge of Seller, all Companies and Subsidiaries
have made appropriate entries in their financial records and financial
statements for all obligations and liabilities of such Companies and
Subsidiaries under such Benefit Plans that have accrued but are not yet due. To
the knowledge of Seller, no Action is pending or threatened with respect to any
Multiemployer Plan or the assets of any Multiemployer Plan (other than claims
for benefits in the ordinary course). No Action is pending or, to the knowledge
of Seller, threatened with respect to any Benefit Plan or the assets of any
Benefit Plan (other than claims for benefits in the ordinary course) and, to the
knowledge of Seller, no fact or event exists that could give rise to any such
Action. There are no audits, inquiries or proceedings pending or, to the
knowledge of Seller, threatened by any Governmental Authority against any
Benefit Plan.

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        (h)   Each Benefit Plan that is intended to be qualified under
Section 401(a) of the Code (collectively, the "Qualified Plans") has timely
received a favorable determination letter from the IRS stating that the
Qualified Plan is so qualified and each trust established in connection with any
Qualified Plan which is intended to be exempt from federal income taxation under
Section 501(a) of the Code has received a determination letter from the IRS that
it is exempt, and, to the knowledge of Seller, no fact or event has occurred
since the date of such determination letter or letters from the IRS to adversely
affect the qualified status of any such Qualified Plan or the exempt status of
any such trust.

(i)Except as set forth in Section 3.16(i) of the Disclosure Schedule:

(i)To Seller's knowledge, no transaction prohibited by ERISA § 406 and no
"prohibited transaction" under Code Section 4975 has occurred with respect to
any Benefit Plan that would be expected to have a Material Adverse Effect.

(ii)To Seller's Knowledge, all filings required by ERISA and the Code as to each
Company Plan have been timely filed and all notices and disclosures to
participants required by ERISA or the Code have been timely provided.

(iii)All contributions and payments made or accrued with respect to all Benefit
Plans are deductible under Code Section 162 or Section 404. No amount or any
asset of any Benefit Plan is subject to tax as unrelated business
taxable income.

(iv)Each Company Plan that is not a Qualified Plan can be terminated within
thirty days, without payment of any additional contribution or amount and
without the vesting or acceleration of any benefits promised by such
Company Plan.

(v)To the knowledge of Seller, no event has occurred or circumstance exists that
could result in a material increase in premium costs of the Company Plans that
are insured, or a material increase in benefit costs of such Company Plans that
are self-insured.

(vi)No accumulated funding deficiency, whether or not waived, exists with
respect to any Benefit Plan, and no event has occurred or circumstance exists
that may result in an accumulated funding deficiency as of the last day of the
current plan year of any such Benefit Plan.

(vii)No Company or Subsidiary has withdrawn or partially withdrawn from any
Multiemployer Plan with respect to which there is any outstanding liability as
of the date of the Agreement. To the knowledge of Seller, no event has occurred
or circumstance exists, including but not limited to the transactions
contemplated by this Agreement, that presents a risk of the occurrence of any
withdrawal from, or the termination, reorganization, or insolvency of, any
Multiemployer Plan that could result in any liability of either Company, any
Subsidiary or Purchaser to a Multiemployer Plan.

(viii)No Company or Subsidiary has received notice from any Multiemployer Plan
that it is in reorganization or is insolvent, that increased contributions may
be required to avoid a reduction in plan benefits or the imposition of any
excise Tax, or that such plan intends to terminate or has terminated.

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(ix)To the knowledge of Seller, no Multiemployer Plan to which either Company or
any Subsidiary contributes, or has contributed since April 5, 2001, immediately
preceding the date hereof is a party to any pending merger or asset or liability
transfer or is subject to any proceeding brought by the PBGC.

(x)No payment that is owed or may become due to any director, officer, Employee,
or agent of either Company or Subsidiary will be non-deductible to such Company
or Subsidiary or subject to tax under Code Section 280G or Section 4999;
nor will either Company or Subsidiary be required to "gross up" or otherwise
compensate any such Person because of the imposition of any excise tax on a
payment to such person.

(xi)The consummation of the transactions contemplated by this Agreement will not
result in the payment, vesting, or acceleration of any benefit, except as may be
required by a Qualified Plan pursuant to Section 411(d)(3) of the Code.

(xii)No event has occurred that could result in any material liability of either
any Company or any Subsidiary as the result of it being treated, together with
one or more other Persons, as a single employer under Code Section 414
or similar provisions of ERISA.

        SECTION 3.17    Labor Matters.    Except as set forth on Section 3.17 of
the Company Disclosure Schedule: (a) there are no material Actions or
controversies pending or, to the knowledge of Seller, threatened, between any
Company or Subsidiary and any of the Employees or former employees of the
Companies or the Subsidiaries, and, to the knowledge of Seller, there is no
event or condition which would reasonably be expected to give rise to any such
Action or controversy; (b) no Company or Subsidiary is a party to any collective
bargaining agreement or other labor union contract applicable to Persons
employed thereby, and to Seller's knowledge, currently there are no organization
campaigns, petitions or other unionization activities seeking recognition of a
collective bargaining unit which could affect any Company or Subsidiary;
(c) during the past five years, there have been no unfair labor practice
complaints pending against any Company or Subsidiary before the National Labor
Relations Board; (d) during the past five years, there have been no strikes,
slowdowns, work stoppages, lockouts, or, to Seller's knowledge, threats thereof,
by or with respect to any employees of any Company or Subsidiary; (e) neither
the Companies nor any Subsidiaries have breached, in any material respect, or
otherwise failed to comply, in any material respect, with the provisions of any
collective bargaining or union contract and there are no grievances outstanding
against the Companies or Subsidiaries under any such agreement or contract;
(f) neither the Companies nor any Subsidiaries are parties to, or otherwise
bound by, any Governmental Order, consent decree with, or citation by, any
Governmental Authority relating to employees or employment practices; (g) there
is no charge or proceeding with respect to a violation of any occupational
safety or health standards that has been asserted or is now pending or, to
Seller's knowledge, threatened with respect to the Companies or Subsidiaries;
and (h) there is no charge of discrimination in employment or employment
practices, for any reason, including, without limitation, age, gender, race,
religion or other legally protected category, which has been asserted or is now
pending or, to Seller's knowledge, threatened before the United States Equal
Employment Opportunity Commission or any other Governmental Authority. The
relations of WTA and MLR with owners and trainers who have participated in
racing at the Meadows Facility within the past year are satisfactory, and, to
the knowledge of Seller, there is no event or condition that would reasonably be
expected to materially affect adversely such relations as a whole. Except as set
forth in Section 3.17 of the Company Disclosure Schedule, the persons employed
in the XpressBet, Inc. business are employees of XpressBet, Inc. and have no
employment relationship with any of the Companies or Subsidiaries nor are any
such persons entitled to payment from any Company or any Subsidiary for
services performed.

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        SECTION 3.18    Taxes.    (a) Except as set forth in Section 3.18 of the
Company Disclosure Schedule: (i) all Tax Returns in respect of Taxes required to
be filed with respect to the Companies and each Subsidiary (including the
consolidated federal income tax return of Seller and any state Tax Return that
includes the Companies or any Subsidiary on a consolidated or combined basis)
have been timely filed; (ii) all Taxes owing with respect to the assets,
operations, and activities of the Companies and each Subsidiary have been timely
paid; (iii) all such Tax Returns are true, complete and correct in all material
respects; (iv) no adjustment relating to such Tax Returns has been proposed by
any Tax authority (insofar as either relates to the activities or income of the
Companies or any Subsidiary or could result in Liability of the Companies or any
Subsidiary on the basis of joint and/or several liability) and, to the knowledge
of Seller, no basis exists for any such adjustment; (v) there are no pending or,
to the knowledge of Seller, threatened Actions or proceedings for the assessment
or collection of Taxes against the Companies or any Subsidiary or (insofar as
either relates to the activities or income of the Companies or any Subsidiary or
could result in Liabilities of the Companies or any Subsidiary on the basis of
joint and/or several liability) any corporation that was included in the filing
of a Tax Return with Seller on a consolidated or combined basis; (vi) no claim
has been made by a Tax authority in a jurisdiction where Tax Returns are not
filed by or on behalf of the Companies or any Subsidiary that a Company or a
Subsidiary is or may be subject to taxation by that jurisdiction; (vii) from and
after January 1, 2001, the Companies and each Subsidiary (other than any such
Subsidiary which is not a partnership) have been and continue to be a member of
the affiliated group (within the meaning of Section 1504(a)(1) of the Code) with
which Seller files a consolidated Tax Return, and has not been includible in any
other consolidated Tax Return for any taxable period for which the statute of
limitations has not expired; (viii) all Tax Returns filed with respect to Tax
years of the Companies and each Subsidiary through the Tax year ended 2001 have
been examined and closed or are Tax Returns with respect to which the applicable
period for assessment under applicable law, after giving effect to extensions or
waivers, has expired; and (ix) there are no Encumbrances for Taxes (other than
Taxes not yet due and payable) upon any of the assets of the Companies or
any Subsidiary.

        (b)   Except as disclosed with reasonable specificity in Section 3.18 of
the Company Disclosure Schedule, there are no outstanding waivers or agreements
extending the statute of limitations for any period with respect to any Tax to
which the Companies or any Subsidiary may be subject.

        (c)   (i) Section 3.18 of the Company Disclosure Schedule lists all
income, franchise and similar Tax Returns (federal, state, local and foreign)
filed with respect to each of the Companies and the Subsidiaries for taxable
periods ended on or after January 1, 2001, indicates for which jurisdictions Tax
Returns have been filed on the basis of a unitary group, indicates the most
recent income, franchise or similar Tax Return for each relevant jurisdiction
for which an audit has been completed or the statute of limitations has lapsed
and indicates all Tax Returns that currently are the subject of audit;
(ii) Seller has delivered to Purchaser copies of all federal, state and foreign
income, franchise and similar Tax Returns, examination reports, and statements
of deficiencies assessed against or agreed to by the Companies or any Subsidiary
since January 1, 2001; (iii) Section 3.18 of the Company Disclosure Schedule
lists all closing agreements and Tax rulings received (and all such agreements
and rulings that, since January 1, 2001, have been requested) from any Tax
authority with respect to the Companies or any Subsidiary. None of the Companies
or Subsidiaries or their respective Affiliates, has received a Tax opinion with
respect to any transaction relating to a Company or a Subsidiary other than a
transaction in the ordinary course of business. Seller has delivered to
Purchaser copies of all pro forma federal income Tax Returns of the
Subsidiaries, prepared in connection with Seller's or any other consolidated
federal income Tax Return, accompanied by a schedule reconciling the items in
the pro forma Tax Return to the items as included in the consolidated Tax Return
for all taxable years ending on or after January 1, 2001.

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        (d)   Except as disclosed with reasonable specificity in Section 3.18 of
the Company Disclosure Schedule, each of the Companies and Subsidiaries have
withheld and paid each Tax required to have been withheld and paid in connection
with amounts paid or owing to any employee, independent contractor, creditor,
shareholder or other party, and complied with all information reporting and
backup withholding requirements, including maintenance of required records with
respect thereto.

        (e)   Except as disclosed with reasonable specificity in Section 3.18 of
the Company Disclosure Schedule, none of the Companies or Subsidiaries is a
party to any Tax allocation, Tax sharing or Tax reimbursement agreement or
arrangement with any Person.

        (f)    Except as disclosed with reasonable specificity in Section 3.18
of the Company Disclosure Schedule, no Company or Subsidiary will have any
taxable income or gain as a result of prior intercompany transactions that have
been deferred and that will be taxed as a result of the changes in ownership
contemplated by this Agreement.

        (g)   Except as disclosed with reasonable specificity in Section 3.18 of
the Company Disclosure Schedule, Purchaser is not required to withhold Tax on
the purchase of the Shares by reason of Section 1445 of the Code. Seller is not
a "foreign person" (as that term is defined in Section 1445 of the Code). Except
as disclosed with reasonable specificity in Section 3.18 of the Company
Disclosure Schedule, none of the Companies or Subsidiaries has entered into any
compensatory agreements with respect to the performance of services payment
under which would result in a nondeductible expense pursuant to Sections 162(m)
or 280G of the Code or an excise tax to the recipient of such payment pursuant
to Sections 409A or 4999 of the Code; none of the Companies or Subsidiaries has
agreed to make, and none is required to make, any adjustment under
Section 481(a) of the Code by reason of a change in accounting method or
otherwise; no Tax asset of a Company or Subsidiary is currently subject to a
limitation under Sections 382 or 383 of the Code or similar provisions of state,
local or foreign law; none of the Companies or Subsidiaries has been the
"distributing corporation" (within the meaning of Section 355(c)(2) of the Code)
with respect to a transaction described in Section 355 of the Code within the
3-year period ending as of the date of this Agreement; none of the Companies or
Subsidiaries has made or is bound by any election under Section 197 of the Code;
none of the Companies or Subsidiaries is a party to any understanding or
arrangement described in Section 6662(d)(2)(C)(ii) of the Code, a "reportable
transaction" within the meaning of Treasury Regulations Section 1.6011-4(b) or a
"listed transaction" within the meaning of Treasury Regulation
Section 1.6011-4(b)(2).

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        (h)   Except as disclosed with reasonable specificity in Section 3.18 of
the Company Disclosure Schedule, the amount of the liability for the Companies
and Subsidiaries for unpaid Taxes for all periods ending on or before the date
of the most recent Company Financial Statements does not, in the aggregate,
exceed the amount of the current liability accruals for Taxes (excluding
reserves for deferred Taxes) solely with respect to the Companies and
Subsidiaries as of such date, and the amount of their liability for unpaid Taxes
for all periods ending on or before the Closing Date shall not, in the
aggregate, exceed the amount of the current liability accruals for Taxes
(excluding reserves for deferred Taxes) as such accruals are reflected on the
Company Financial Statements, as adjusted for transactions through the Closing
Date that either (i) occur in the ordinary course of business or (ii) are
contemplated by this Agreement. Except as disclosed with reasonable specificity
in Section 3.18 of the Company Disclosure Schedule, no item of income or gain
reported for financial purposes in any Pre-Closing Period is required to be
included in taxable income for a Post-Closing Period.

        SECTION 3.19    Material Contracts.    (a) Section 3.19(a) of the
Company Disclosure Schedule lists each of the following contracts and agreements
of the Companies and the Subsidiaries other than the Note Documents and the MID
Forbearance Agreement, (such contracts and agreements, together with all
contracts, agreements, leases and subleases concerning the occupancy, management
or operation of any Real Property (including without limitation, brokerage
contracts) listed or otherwise disclosed in Section 3.13(a) or 3.13(b) of the
Company Disclosure Schedule to which the Companies or any Subsidiary is a party
and all agreements relating to Intellectual Property Rights set forth in
Section 3.14 of the Company Disclosure Schedule, being "Material Contracts"):

(i)each contract and agreement for the furnishing of services to or by the
Companies, any Subsidiary or otherwise related to the business of the Companies
and the Subsidiaries as currently conducted under the terms of which the
Companies or any Subsidiary: (A) is likely to receive, pay or otherwise give
consideration of more than $50,000 in the aggregate during the calendar year
ended December 31, 2005, (B) is likely to receive, pay or otherwise give
consideration of more than $100,000 in the aggregate over the remaining term of
such contract or (C) cannot be cancelled by the Companies or such Subsidiary
without penalty or further payment and without more than 30 days' notice;

(ii)all broker, distributor, dealer, manufacturer's representative, franchise,
agency, sales promotion, market research, marketing consulting and advertising
contracts and agreements to which the Companies or any Subsidiary is a party;

(iii)all management contracts and contracts with independent contractors or
consultants (or similar arrangements) to which the Companies or any Subsidiary
is a party and which are not cancelable without penalty or further payment and
without more than 30 days' notice;

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(iv)all contracts and agreements relating to indebtedness (including, without
limitation, guarantees) of the Companies or any Subsidiary;

(v)all contracts and agreements with any Government Authority to which any
Company or Subsidiary is a party;

(vi)all contracts or agreements to which any Company or any Subsidiary is a
party that provide for, or restrict, (A) the future acquisition or disposition
of Assets (other than in the ordinary course of business and other than
anti-assignment provisions) or (B) any merger or business combination;

(vii)all contracts and agreements that limit or purport to limit the ability of
the Companies or any Subsidiary to compete in any line of business or with any
Person or in any geographic area or during any period of time;

(viii)any contracts or agreements to which any Company or any Subsidiary is a
party that provide for any joint venture, partnership or similar arrangement by
any Company or any Subsidiary;

(ix)all contracts and agreements between or among the Companies or any
Subsidiary on the one hand and Seller or any Affiliate of Seller (other than the
Companies or any Subsidiary) on the other hand;

(x)any collective bargaining contracts or agreement or contracts or agreements
with any labor organization, union or association to which any Company or any
Subsidiary is a party;

(xi)any employment agreement involving payments of base cash compensation
annually by any Company or Subsidiary in excess of $100,000;

(xii)all contracts and agreements entered into by any Company or any Subsidiary
on or after April 5, 2001 that provide for indemnification by any Company or any
Subsidiary with respect to Liabilities relating to the Real Property or current
or former business or operations of the Companies and the Subsidiaries or any of
their predecessors or with respect to Liabilities under any Environmental Laws
or for the investigation, remediation or clean-up of any Hazardous
Materials; and

(xiii)any other contract or agreement to which any Company or any Subsidiary is
a party under which the consequences of a default or termination would have a
Material Adverse Effect.

        For purposes of this Section 3.19 and Sections 3.09, 3.13 and 3.14, the
term "lease" shall include any and all leases, subleases, occupancy agreements,
sale/leaseback agreements or similar arrangements.

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        (b)   Except as disclosed in Section 3.19(b) of the Company Disclosure
Schedule, each Material Contract: (i) is valid and binding on the Companies or a
Subsidiary and is in full force and effect and (ii) upon consummation of the
transactions contemplated by this Agreement, except to the extent that any
consents set forth in Section 3.05(c) of the Company Disclosure Schedule are not
obtained, shall continue in full force and effect without penalty or other
adverse consequence. Neither the Companies nor any Subsidiary is in breach of,
or default under, any Material Contract, and, to the knowledge of Seller, no
event or condition has occurred that, with or without notice or lapse of time or
both, would constitute a breach of or default under any Material Contract.

        (c)   Except as disclosed in Section 3.19(c) of the Company Disclosure
Schedule, to the knowledge of Seller, no other party to any Material Contract is
in breach thereof or breach thereunder.

        SECTION 3.20    Racing License.    Each of WTA and MLR has been granted
permission to conduct harness racing with pari-mutuel wagering pursuant to the
Pennsylvania Act. MEC Racing Management ("MECRacing") has received permission
from the Commission to own and operate the OTB Facilities pursuant to the
Pennsylvania Act, to conduct interstate simulcasting pursuant to the
Pennsylvania Act and to conduct intrastate simulcasting pursuant to the
Pennsylvania Act, all for and on behalf of WTA and MLR and pursuant to the
licenses held by WTA and MLR. The location and description of each OTB Facility
is set forth on Section 3.20 of the Company Disclosure Schedule. In 2003 and
2004, WTA and MLR have operated race meetings at the Meadows Facility in
fulfillment of their respective allocations of racing days by the Commission and
their obligations under their agreement with the Meadows Standardbred Owners'
Association. To Seller's knowledge, since April 5, 2001, except as disclosed on
Section 3.20 of the Company Disclosure Schedule, no Company or Subsidiary has:

(a)falsified answers or made misrepresentations to the Commission in any
document required to be filed under the Pennsylvania Act;

(b)issued or caused to be issued false or misleading advertisements which would
have a Material Adverse Effect;

(c)knowingly permitted on the grounds or within the enclosure of the Meadows
Facility or the OTB Facilities, illegal lotteries, pool selling, touting or
bookmaking or any other kind of illegal gambling which would have a Material
Adverse Effect.

        SECTION 3.21    Suppliers.    To the knowledge of Seller, no supplier of
any Company or Subsidiary intends to cease doing business with such Company or
Subsidiary or materially alter the amount of business it is presently doing with
such Company or Subsidiary.

        SECTION 3.22    Books and Records.    The minute books and corporate
records of each Company and Subsidiary contain, in all material respects,
accurate copies of the minutes of all formal board of directors or shareholder
or similar meetings held since April 5, 2001 and of all written consents
executed after April 5, 2001 in lieu of the holding of any such meeting to the
extent that such meetings or written consents involve material actions.

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        SECTION 3.23    Brokers.    No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement or any other Transaction
Document based upon arrangements made by or on behalf of Seller.

        SECTION 3.24    Racing Days.    Each of WTA and MLR meets the
eligibility requirements of Sections 1302 and 1303 of the Gaming Act. In each of
2003 and 2004, WTA and MLR conducted live racing at The Meadows for at least
100 days for each license held. In 2005, WTA and MLR are scheduled to conduct at
least 100 days of live racing at The Meadows for each license held. To Seller's
knowledge, there are no events or circumstances that have occurred or that are
planned by Seller or any Company or any Subsidiary that would, prior to Closing,
cause WTA or MLR to cease meeting the eligibility requirements of Sections 1302
and 1303 of the Gaming Act.

        SECTION 3.25    Related Parties.

        (a)   Except as set forth on Section 3.25 of the Company Disclosure
Schedule, and except as may arise from this Agreement or any other Transaction
Document or any Note Documents entered into in connection with the transactions
contemplated hereby and except under the MID Loan Documents, since April 5,
2001, neither Seller nor any Affiliate of Seller (other than the Companies and
the Subsidiaries) (a) has or has had any interest in any property (whether real,
personal or mixed and whether tangible or intangible) used in or pertaining to
the business or operations of the Companies and the Subsidiaries; (b) is, or has
owned (of record or as a beneficial owner), an equity interest or any financial
or profit interest or a Person that has had a material business dealing or a
material financial interest in any transaction with the Companies or
Subsidiaries; or (c) is a party to any contract with, or has any claim or right
against, the Companies or Subsidiaries that would survive after the
Closing Date.

        (b)   As of the date hereof, the relationship between WTA and MLR, on
the one hand, and XpressBet, Inc., on the other hand, has been formalized to
provide for (i) an agreement for the provision of account wagering services by
XpressBet, Inc. to WTA and MLR with respect to WTA's and MLR's Pennsylvania
account wagering customers and (ii) a lease for the premises occupied by
XpressBet, Inc. at the Meadows Facility. Such agreement and lease have been
approved by the Commission.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF PURCHASER

        Purchaser represents and warrants to Seller as of the date hereof (other
than such representations and warranties as are made as of another date)
as follows:

        SECTION 4.01    Incorporation and Authority of Purchaser.    Purchaser
is a limited liability company duly formed, validly existing and in good
standing under the laws of the state of Delaware and has all necessary limited
liability company power and authority to enter into this Agreement and the other
Transaction Documents to which Purchaser is a party, to carry out its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery by Purchaser of this
Agreement and any other Transaction Document to which Purchaser is a party, the
performance by Purchaser of its obligations hereunder and thereunder and the
consummation by Purchaser of the transactions contemplated hereby and thereby
have been duly authorized by all requisite action on the part of Purchaser. This
Agreement has been duly executed and delivered by Purchaser, and (assuming due
authorization, execution and delivery by Seller) constitutes a legal, valid and
binding obligation of Purchaser enforceable against Purchaser in accordance with
its terms, subject to the effect of any applicable bankruptcy, reorganization,
insolvency, moratorium or similar laws affecting creditors' rights generally and
subject, as to enforceability, to the effect of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law). When each Transaction Document to which Purchaser is a party
has been duly executed and delivered by Purchaser (assuming due authorization,
execution and delivery by each other party thereto), such Transaction Document
will constitute a legal and binding obligation of Purchaser enforceable against
it in accordance with its terms, subject to the effect of any applicable
bankruptcy, reorganization, insolvency, moratorium or similar laws affecting
creditors' rights generally and subject, as to enforceability, to the effect of
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

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        SECTION 4.02    No Conflict.    The execution, delivery and performance
by Purchaser of this Agreement and any other Transaction Document to which
Purchaser is or will be a party do not and will not (a) violate or conflict with
the certificate of formation or limited liability company agreement (or other
similar applicable documents) of Purchaser, (b) assuming that all consents,
approvals, authorizations and other actions described in Section 4.03 have been
obtained and all filings and notifications listed in Section 4.03 of Purchaser
Disclosure Schedule have been made, and except as may result from any facts or
circumstances relating solely to Seller, conflict with or violate, or give any
Governmental Authority the right to challenge the transactions contemplated by
this Agreement or any other Transaction Document to which Seller is a party, or
to exercise any remedy or obtain any relief under, any Law or Governmental
Order, including without limitation any state takeover or similar statute or
regulation, applicable to Purchaser or (c) assuming that all consents,
approvals, authorizations and other actions described in Section 4.03 have been
obtained and all filings and notifications listed in Section 4.03 of Purchaser
Disclosure Schedule have been made, and except as may result from any facts or
circumstances relating solely to Seller, result in any breach of, conflict with,
or constitute a default (or event which with the giving of notice or lapse of
time, or both, would become a default) under, require any consent or provision
of notice under, or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any Encumbrance on
any of the assets or properties of Purchaser pursuant to any material note,
bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument relating to such assets or properties to which
Purchaser or any of its subsidiaries is a party or by which any of such assets
or properties is bound or affected, other than Encumbrances contemplated by the
MID Loan Documents or the Note Documents.

        SECTION 4.03    Consents and Approvals.    The execution and delivery by
Purchaser of this Agreement and any other Transaction Document to which
Purchaser is a party do not, and the performance by Purchaser of this Agreement
and any other Transaction Document to which Purchaser is a party will not,
require any material consent, approval, authorization or other action by, or
filing with or notification to, any Governmental Authority, except (a) as set
forth on Section 4.03 of Purchaser Disclosure Schedule, (b) the notification
requirements of the HSR Act, and (c) as may be necessary as a result of any
facts or circumstances relating solely to Seller.

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        SECTION 4.04    Investment Purpose.    Purchaser is acquiring the Shares
solely for the purpose of investment and not with a view to, or for offer or
sale in connection with, any distribution thereof. Purchaser acknowledges that
the Shares are not registered under the Securities Act, and that the Shares may
not be transferred or sold except pursuant to the registration provisions of the
Securities Act or pursuant to an applicable exemption therefrom and subject to
state securities laws and regulations, as applicable.

        SECTION 4.05    Financing.    Purchaser has received and has provided to
Seller a commitment letter relating to the financing of the Purchase Price.
Purchaser has committed sources that would provide it with sufficient funds to
pay the Tranche A Notes on the Consummation Date subject to the conditions
contained in such commitment letter.

        SECTION 4.06    Brokers.    No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement or any other Transaction
Document based upon arrangements made by or on behalf of Purchaser.

        SECTION 4.07    Specified Investors; Cannery Casino Resorts.    There
are no more than five Specified Investors. Each Specified Investor is a
qualified purchaser as defined under the Investment Company Act of 1940, as
amended. Cannery Casino Resorts, LLC, a Nevada limited liability company,
directly or indirectly owns all of the assets related to the Cannery Casino and
Hotel and holds the management rights to the Rampart Casino.

ARTICLE V

ADDITIONAL AGREEMENTS

        SECTION 5.01    Conduct of Business Prior to the Closing.    (a) Unless
Purchaser otherwise agrees in writing and except as otherwise set forth in
Section 5.01 of the Company Disclosure Schedule, between the date of this
Agreement and the Closing Date, Seller shall cause each Company and Subsidiary
to (i) conduct its business only in the ordinary course and consistent with past
practice, (ii) use commercially reasonable efforts to preserve intact the
business organization, assets and prospects of each Company and Subsidiary,
subject to the conduct of its business in the ordinary course of business and
consistent with past practice, (iii) use commercially reasonable efforts to keep
available to Purchaser the services of the present officers and key employees of
each Company and Subsidiary and (iv) use commercially reasonable efforts to
preserve the current relationships of each Company and Subsidiary with its
respective customers, suppliers, distributors and other Persons with which each
Company and Subsidiary has significant business relationships. Seller shall
cause WTA and MLR to continue to operate race meetings at the Meadows Facility
in fulfillment of their respective allocations of racing days by the Commission
and their obligations under their agreement with the Meadows Standardbred
Owners' Association. Between the date hereof and the Closing Date, Seller will
cause the Companies and the Subsidiaries not to enter into any contract,
agreement or arrangement that would impose any restrictions or requirements on
the operation of a gaming operation on the Real Property.

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        (b)   Between the date hereof and the Closing Date, Seller shall cause
WTA and MLR to apply for allocations of racing days pursuant to Section 207 of
the Pennsylvania Act to conduct race meetings with pari-mutuel wagering in 2006.
The number of racing days sought shall be approximately 200 to 215 or such other
number of races as WTA, MLR and the Meadows Standardbred Owners' Association
shall agree, provided, that in no event shall the number of racing days be less
than the number set forth in Section 1303 of the Gaming Act. Between the date
hereof and the Closing Date, neither the Companies nor any Subsidiary will do
any of the things enumerated in the second sentence of Section 3.09 (including,
without limitation, clauses (a) through (n) thereof) to the extent any such
thing is within the control of Company and the Subsidiaries, without the prior
written consent of Purchaser; provided that the Companies and the Subsidiaries
shall have the right, without the consent of Purchaser, to engage in the
activities set forth in Section 5.01 of the Company Disclosure Schedule.

        (c)   Purchaser acknowledges that Seller intends to distribute as a
dividend or contribute as a capital contribution, or cause the distribution or
contribution of, prior to or at the Closing, (i) amounts owing pursuant to the
intercompany accounts between the Companies and the Subsidiaries, on the one
hand, and their respective Affiliates (including Seller and its Affiliates but
not including any Company or any Subsidiary), on the other hand, (ii) the
Excluded Subsidiaries, and (iii) one or more notes in an aggregate amount no
greater than $25,000,000 (the "Specified Notes"), and that such distribution or
contribution will not result in a breach of this Agreement. Purchaser
acknowledges that Seller intends to convert 20002 Delaware Inc. into a single
member limited liability company and subsequently cause MECPenn to distribute
all interest in such limited liability company to Seller as a dividend prior to
Closing. In the event that Magna pays or declares a dividend of the Specified
Notes, Magna agrees that it shall, the next Business Day and no later than one
Business Day before Closing, contribute the Specified Notes back to each of the
Companies making the respective distribution and causing each of the Companies'
net worth to be unaffected by the distribution of the Specified Notes and the
recontribution to the Companies.

        (d)   Seller agrees to cause intercompany accounts between Seller or its
Affiliates (other than the Companies and Subsidiaries), on the one hand, and the
Companies and Subsidiaries, on the other hand, to be settled prior to Closing.

        SECTION 5.02    Access to Information.    From the date hereof until the
Closing, Seller shall cause the officers, directors, employees, agents,
representatives, accountants and counsel of each Company and Subsidiary to:
(i) afford the officers, employees and authorized agents, accountants, counsel,
and representatives of Purchaser reasonable access, upon reasonable notice and
during normal business hours, to (A) the assets (including the Real Property)
for inspection and testing (it being understood that the cost of such inspection
and testing shall be borne by Purchaser and any testing that is other than a
Phase I testing shall be conducted only after obtaining the approval of Seller,
and Purchaser shall promptly indemnify Seller Indemnified Parties for any Losses
in accordance with Article IX hereof arising from injury to person or physical
damage to property incurred by any Company or any Subsidiary as a result of the
testing conducted pursuant to this Section 5.02, other than as a result of the
gross negligence or willful misconduct of Company or any Subsidiary and in no
event as a result of the discovery of an environmental matter as a result of
such testing) and (B) the officers, directors, employees, accountants and other
representatives of Seller and each Company and Subsidiary who have relevant
knowledge relating to any Company or Subsidiary; provided, however, that such
access shall not unreasonably interfere with any of the business or operations
of any Company or Subsidiary or the duties of any such officer, director,
employee, accountant or other representative, and (ii) promptly furnish to the
officers, employees, and authorized agents, accountants, counsel and
representatives of Purchaser such financial and operating data and other
information regarding employees, assets, properties, goodwill and business of
each Company and Subsidiary as Purchaser may reasonably request.

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        SECTION 5.03    Books and Records.    (a) In order to facilitate the
resolution of any claims made against or incurred by Seller prior to the
Closing, or for any other reasonable purpose, for a period of five years after
the Closing, Purchaser shall (i) retain the books and records (including
personnel files) of the Companies and Subsidiaries relating to periods prior to
the Closing in a manner reasonably consistent with the prior practices of the
respective Companies and Subsidiaries and (ii) upon reasonable notice, afford
the officers, employees and authorized agents and representatives of Seller
reasonable access (including the right to make, at Seller's expense,
photocopies), during normal business hours, to such books and records.

        (b)   In order to facilitate the resolution of any claims made by or
against or incurred by Purchaser, the Companies or any Subsidiary after the
Closing, or for any other reasonable purpose, for a period of five years
following the Closing, Seller shall (i) retain the books and records (including
personnel files) of Seller which relate to the Companies and the Subsidiaries
and their operations for periods prior to the Closing and (ii) upon reasonable
notice, afford the officers, employees and authorized agents and representatives
of Purchaser, the Companies or any Subsidiary reasonable access (including the
right to make, at Purchaser's expense, photocopies), during normal business
hours, to such books and records.

        (c)   Neither Purchaser nor Seller shall be obligated to provide the
other party with access to any books or records (including personnel files)
pursuant to this Section 5.03 where such access would violate any Law or
Environmental Law.

        SECTION 5.04    Governmental Approvals and Consents; Application Fee;
Closing Conditions.    (a) Each party hereto will use its commercially
reasonable efforts to obtain all authorizations, consents, orders and approvals
of all Governmental Authorities that may be or become necessary for its
execution and delivery of this Agreement and the performance of its obligations
pursuant to this Agreement and any agreement or document contemplated hereby and
will cooperate fully with the other party in promptly seeking to obtain all such
authorizations, consents, orders and approvals. Each party hereto agrees to make
an appropriate filing of a Notification and Report Form pursuant to the HSR Act
with respect to the transactions contemplated hereby no later than January 15,
2006 and to supply promptly any additional information and documentary material
that may be requested pursuant to the HSR Act. The parties hereto will not
willfully and unreasonably take any action that will have the effect of
delaying, impairing or impeding the receipt of any required approvals.

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        (b)   Purchaser and Seller shall as soon as practicable, but in no event
later than 30 days after the date hereof, unless sooner required by the
Pennsylvania Act, the regulations of the Commission or the Commission, together
file with the Commission the applications, affidavits (including without
limitation the affidavits specified pursuant to Section 204 of the Pennsylvania
Act) and other information required pursuant to the Pennsylvania Act and
regulations of the Commission necessary to obtain approval from the Commission
for the purchase of the Companies by Purchaser and for Seller's management of
the racing operations of the Meadows Facility under the Racing Services
Agreement. In addition, both Purchaser and Seller shall furnish to the
Commission such other information, financial statements and other documentation
as the Commission requires concerning Purchaser or Seller or any of their
respective Affiliates and will make available representatives of Purchaser or
Seller to meet with the Commission, or its staff, to expedite the ability of the
Commission to complete its work and make the determinations required by
Article VIII of this Agreement as expeditiously as practicable. Purchaser and
Seller agree to provide formal notice to the Commission of the change of
ownership of the Companies within 10 days after the Closing Date.

(c)Gaming Application.

(i)Until the earlier of (A) the Repayment Date and (B) the date of the Stock
Transfer, Purchaser and Seller each will use commercially reasonable efforts to
promptly make available or file with the Gaming Board such information as it or
its staff may request under the Gaming Act. Purchaser and Seller will, not later
than December 20, 2005 (or two weeks before such other date as the Gaming Board
may select for submission of applications so long as filing on such later date
does not provide an advantage to other applicants or is otherwise detrimental to
the Companies' application or to their right to timely obtain a Conditional
Category 1 license or Category 1 license for gaming from the Gaming Board), file
with the Gaming Board the application for Conditional Category 1 license as
required by the Gaming Act (the "Gaming Application"). The Gaming Application
will be drafted to reflect two different scenarios — one in which Purchaser is
the operator and owner of the Meadows Facility and the operator of the gaming
operations with an Affiliate of Seller serving as a manager of the racing
operations of the Meadows Facility (such scenario, the "Transaction Scenario")
and one in which Seller or one or more of its Affiliates is the operator and
owner of the Meadows Facility (the "Alternative Scenario"). In addition, until
the earlier of (A) the Repayment Date and (B) the date of the Stock Transfer,
both Purchaser and Seller shall furnish to the Gaming Board such other
information, financial statements and other documentation as the Gaming Board
requires concerning Purchaser or Seller and will make available representatives
of Purchaser or Seller to meet with the Gaming Board, or its staff, to expedite
the ability of the Gaming Board to complete its work. For the avoidance of
doubt, while Purchaser and Seller will both use reasonable efforts to accomplish
the matters set forth in this Section and to assemble such application,
Purchaser shall be responsible for all items with respect to the Gaming
Application other than the MEC Items. Prior to the Closing Date, Purchaser and
Seller agree to discuss with the Gaming Board whether there are any deficiencies
in the MEC Items that have been provided to the Gaming Board in respect of the
Gaming Application filed by Purchaser and Seller agrees to use its commercially
reasonable efforts to remedy such deficiencies. Seller agrees that, after the
Closing Date and until the earlier of (i) the Repayment Date, and (ii) a Stock
Transfer Trigger Date, it shall use its commercially reasonable efforts to
fulfill any requirements related to the MEC Items and any other items requested
from Seller by the Gaming Board with respect to the Gaming Application filed
by Purchaser.

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(ii)Each of Purchaser and Seller agrees to use its best efforts to complete the
Gaming Application for submission to the Gaming Board on or before December 20,
2005, and agrees to have a weekly scheduled telephone call or meeting at which
the individuals with responsibility for organizing each of the Purchaser's and
Seller's efforts in connection with the filing of the Gaming Application review
and discuss the progress being made to complete the Gaming Application.

(iii)Either party shall notify the other upon becoming aware that the Gaming
Board may consider, identify or support an Action that could jeopardize Seller's
ability to obtain a Conditional Category 1 license or Category 1 license in its
own name if Seller continues to pursue a Conditional Category 1 license or a
Category 1 license with Purchaser prior to the Closing Date. Prior to
termination of this Agreement, Seller and Purchaser agree not to take any action
that could reasonably be expected to impede the consideration of the Gaming
Application for the Transaction Scenario (it being acknowledged that Seller's
exercise of its rights under Section 5.15 or under the Note Documents or
Seller's or Purchaser's exercise of rights under Section 10.01 shall not be
considered an action that constitutes a breach of the obligations set forth in
this sentence). Prior to the earlier of Closing or termination of this
Agreement, Seller and Purchaser agree to use their best efforts, to permit
Seller and Purchaser to jointly pursue the Gaming Application for the
Transaction Scenario (it being acknowledged that Seller's exercise of its rights
under Section 5.15 or Seller's or Purchaser's exercise of rights under
Section 10.01 shall not be considered an action that constitutes a breach of the
obligations set forth in this sentence). Seller agrees to make itself available
to participate in meetings, appearances and hearings to assist in the joint
efforts of Seller and Purchaser to pursue the Gaming Application for the
Transaction Scenario.

        (d)   Simultaneously with the submission of the Gaming Application,
Purchaser shall at its cost take such steps as are necessary, including but not
limited to the posting of a letter of credit, the posting of a bond or the
payment of a fee, to satisfy any monetary or financial requirements that the
Gaming Board may require in conjunction with submission and maintenance of the
Gaming Application (the "Gaming Application Fee"). Until thirty days after the
earlier of (i) the date on which this Agreement is terminated prior to Closing
and (ii) the date of the Stock Transfer (the earlier of clause (i) and (ii)
being the "Replacement Trigger"), Purchaser shall maintain the Gaming
Application Fee. If (i) the fee is paid by Purchaser in cash to the Gaming Board
to satisfy the requirements of the Gaming Board, (ii) a Replacement Trigger
occurs, (iii) Seller uses such fee in furtherance of its application with the
Gaming Board after such Replacement Trigger (or to the extent Seller actually
receives the benefit of such fee), and (iv) Purchaser executes documentation in
form and substance satisfactory to Seller confirming that Seller is entitled to,
and has full rights with respect to, the fee that Purchaser has paid to the
Gaming Board and that Purchaser releases all rights with respect thereto, then
Seller shall, to the extent Purchaser does not receive a refund of such fee from
the Gaming Board and to the extent Seller receives the benefit of such fee,
reimburse Purchaser for the Gaming Application Fee (but only to the extent
Seller receives the benefit of such fee) promptly, and in any event within
30 days of the occurrence of the circumstances set forth in clauses (i)
through (iv) above (or if Seller does not use such fee in furtherance of its
application with the Gaming Board but instead actually receives the benefit of
such fee, then within thirty days after receipt by Seller of such benefit). To
the extent that Purchaser has not received a refund of its Gaming Application
Fee, Seller agrees to use its commercially reasonable efforts to receive the
benefit from the fee should Seller or any Affiliate pursue a gaming license and
to reimburse Purchaser in accordance with the preceding sentence to the extent
of the benefit received. To the extent that Seller intends to continue with its
application with the Gaming Board after the Replacement Trigger, Seller agrees
to use commercially reasonable efforts to replace within thirty days the Gaming
Application Fee theretofore maintained by Purchaser as expeditiously as possible
after the Replacement Trigger, and to use its commercially reasonable efforts in
cooperating with Purchaser to cause the withdrawal of such Gaming Application
Fee. For the period of up to thirty days after the Replacement Trigger during
which Purchaser maintains a letter of credit to maintain the Gaming Application
Fee, Seller agrees to reimburse Purchaser for the letter of credit fee incurred
by Purchaser in maintaining such letter of credit for such 30 day period after
the Replacement Trigger (it being understood that such reimbursement obligation
shall only apply to the extent the incurrence of such costs resulted in out of
pocket expenditures by Purchaser and equity holders of Purchaser (rather than
out of pocket expenditures by any of the Companies or any of their
respective Subsidiaries)).

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        (e)   Upon the termination of this Agreement for any reason other than
consummation of the transactions contemplated by this Agreement, Purchaser and
Seller agree to take such actions as are necessary as soon as possible to amend
the Gaming Application to remove the Transaction Scenario. In addition, upon the
termination of this Agreement for any reason other than consummation of the
transactions contemplated by this Agreement or, after the Closing, upon the
consummation of the Stock Transfer, Purchaser shall permit Seller to use and
continue to have submitted with the Gaming Application all architectural, design
and construction plans and any other materials prepared by Purchaser or its
agents or consultants (the "Purchaser Application Materials"); provided, however
that Seller agrees to reimburse Purchaser for the reasonable and direct costs
incurred by Purchaser with respect to the Purchaser Application Materials used
by Seller (it being understood that such reimbursement obligation shall only
apply to the extent the incurrence of such costs resulted in out of pocket
expenditures by Purchaser and equity holders of Purchaser (rather than out of
pocket expenditures by any of the Companies or any of their respective
Subsidiaries)). Purchaser shall also permit Seller to use any other plans and
materials developed or obtained by Purchaser in connection with the development
and construction of the casino or other gaming activities at the Meadows
(the "Other Purchaser Materials"); provided, however, that Seller agrees to
reimburse Purchaser for the reasonable and direct costs incurred by Purchaser
with respect to the Other Purchaser Materials used by Seller (it being
understood that such reimbursement obligation shall only apply to the extent the
incurrence of such costs resulted in out of pocket expenditures by Purchaser and
equity holders of Purchaser (rather than out of pocket expenditures by any of
the Companies or any of their respective Subsidiaries)). In addition, Seller
acknowledges that it has separate reimbursement obligations to Purchaser
pursuant to a letter dated May 24, 2006 for expenses for other
professional services.

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(f)Upon the Closing, Purchaser and Seller agree to take such actions as are
necessary as soon as possible to amend the Gaming Application to remove the
Alternative Scenario. On and after the Closing Date and until the earlier of
(i) the Repayment Date and (ii) a Stock Transfer Trigger Date, Seller agrees to
use commercially reasonable efforts to support the application of Purchaser
under the Transaction Scenario and Seller and Purchaser agree to use
commercially reasonable efforts to obtain all necessary approvals from
Governmental Authorities for MEC Pennsylvania Racing Services, Inc. to undertake
its responsibilities under the Racing Services Agreement. After the Closing
Date, Seller agrees to provide Purchaser for filing with the Gaming Board the
information (if any) that Purchaser reasonably considers necessary, or that the
Gaming Board requests, in order to qualify Seller as a lender in connection with
the Tranche A and Tranche B Notes, and thereafter, to use its commercially
reasonable efforts to obtain the necessary approvals, if any, from the Gaming
Board to permit the Tranche A and Tranche B Notes to remain outstanding in
accordance with the terms of the Note Documents.

(g)Seller and Purchaser shall use commercially reasonable efforts to give all
notices to and obtain all consents from all third parties and Governmental
Authorities that are described in Section 3.05(c) or Section 3.06 of the Company
Disclosure Schedule and Section 4.03 of Purchaser Disclosure Schedule, including
but not limited to the Commission Approval. Seller and Purchaser agree to
consider comments and input from Governmental Authorities and to use
commercially reasonable efforts to consider means in which to address such
comments and input without resulting in changing or adversely affecting the
economics of the transactions contemplated hereby or the ability of either party
to close such transactions.

(h)Without limiting the generality of the parties' undertakings pursuant to
Section 5.04(a) though (g), each of the parties hereto shall use all reasonable
efforts to (i) respond to any inquiries by any Governmental Authority regarding
antitrust or other matters with respect to the transactions contemplated by this
Agreement or any agreement or document contemplated hereby, (ii) avoid the
imposition of any order or the taking of any action that would restrain, alter
or enjoin the transactions contemplated by this Agreement and (iii) in the event
any Governmental Order adversely affecting the ability of the parties to
consummate the transactions contemplated by this Agreement or any agreement or
document contemplated hereby has been issued, to have such Governmental Order
vacated or lifted.

(i)If any consent, approval or authorization necessary to preserve any right or
benefit under any lease, license, contract, commitment or other agreement or
arrangement to which the Company or any Subsidiary is a party is not obtained
prior to the Closing, Seller shall, subsequent to the Closing, cooperate with
Purchaser and the Companies in attempting to obtain such consent, approval or
authorization as promptly thereafter as practicable. If such consent, approval
or authorization cannot be obtained, Seller shall use its commercially
reasonable efforts to provide such Company or such Subsidiary, as the case may
be, with the rights and benefits of the affected lease, license, contract,
commitment or other agreement or arrangement for the term thereof, and, if
Seller provides such rights and benefits, such Company or such Subsidiary, as
the case may be, shall assume all obligations and burdens thereunder. Seller
shall have no obligation under this Section 5.04(i) after a Stock Transfer
Trigger Date.

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(j)From the date hereof until the Closing, each party hereto shall, and Seller
shall cause each Company and Subsidiary to, use all commercially reasonable
efforts to take such actions as are necessary to expeditiously satisfy the
closing conditions set forth in Article VIII hereof. From the Closing Date until
the earlier of (i) the Consummation Date and (ii) a Stock Transfer Trigger Date,
(a) Purchaser shall, and Purchaser shall cause each Company and Subsidiary to,
use its respective commercially reasonable efforts to take such actions as are
necessary to cause the Consummation Date to occur, including, without
limitation, satisfying its lenders with respect to any condition imposed by the
Gaming Board in its approval for issuance of the Conditional Category 1 or
Category 1 License to WTA, and (b) Seller shall use its commercially reasonable
efforts to cooperate with Purchaser with respect thereto.

(k)[Reserved]

(l)Until the earlier of (i) the Repayment Date and (ii) the date of the Stock
Transfer, all analyses, appearances, meetings, discussions, presentations,
memoranda, briefs, filings, arguments, and proposals made by or on behalf of
either party before any Governmental Authority, including the Gaming Board and
the Commission, or the staff or regulators of any Governmental Authority, in
connection with the transactions contemplated hereunder (but, for the avoidance
of doubt, not including any interactions between Seller, the Companies or the
Subsidiaries with Governmental Authorities in the ordinary course of the conduct
of its business operations, any disclosure which is not permitted by law or any
disclosure containing confidential information) shall be disclosed to the other
party hereunder in advance of any filing, submission or attendance, it being the
intent that the parties will consult and cooperate with one another, and
consider in good faith the views of one another, in connection with any such
analyses, appearances, meetings, discussions, presentations, memoranda, briefs,
filings, arguments, and proposals. Until the earlier of (i) the Repayment Date
and (ii) the date of the Stock Transfer, each party shall give notice to the
other party with respect to any meeting, discussion, appearance or contact with
any Governmental Authority or the staff or regulators of any Governmental
Authority, with such notice being sufficient to provide the other party with the
opportunity to attend and participate in such meeting, discussion, appearance
or contact.

(m)Notwithstanding anything in this Agreement to the contrary, the parties agree
that at any time after the date which is 14 days prior to the date, if any,
identified by the Gaming Board after which continued pursuit by Seller of a
Conditional Category 1 license with Purchaser pursuant to the Gaming Application
would jeopardize Seller's ability to obtain a Conditional Category 1 license or
a Category 1 license in its own name, Seller shall not have any obligation
during the period of such jeopardy to comply with any of its obligations under
Section 5.04, Section 5.12 and any other provision of this Agreement that would
require Seller to directly or indirectly comply with any of its obligations
under Section 5.04 or 5.12; provided, however, if the Closing hereunder is
reasonably capable of occurring prior to the date identified by the Gaming
Board, then Seller shall continue to comply with its obligations under
Section 5.04 and 5.12 and any other provision of this Agreement that would
require Seller to directly or indirectly comply with any of its obligations
under Section 5.04 or 5.12 until such time as Seller terminates the Agreement in
accordance with the provisions of Section 10.01(k) hereof.

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        SECTION 5.05 Confidentiality. (a) The terms of the letter agreement
dated September 9, 2005 (the "Confidentiality Agreement") between Seller and
Millennium Management Group, LLC are hereby incorporated herein by reference as
if Purchaser were a party thereto and shall continue in full force and effect
until the Repayment Date, at which time such Confidentiality Agreement and the
obligations of Purchaser under this Section 5.05 shall terminate; provided,
however, that the Confidentiality Agreement shall terminate only in respect of
that portion of the Information (as defined in the Confidentiality Agreement)
exclusively relating to the transactions contemplated by this Agreement. If this
Agreement is, for any reason, terminated prior to the Closing or if the Closing
occurs but the Repayment Date does not occur, the Confidentiality Agreement
shall continue in full force and effect.

(b)Prior to a Stock Transfer Trigger Date, Seller agrees to, and shall cause its
agents, representatives, Affiliates, employees, officers and directors to,
protect (and not disclose or provide access to any Person) all confidential
information relating to trade secrets, price, customer and supplier lists and
pricing and marketing plans with respect to the business of the Companies and
the Subsidiaries and all other information that Seller regards as confidential
information as of the date hereof with respect to the business of the Companies
and the Subsidiaries as currently conducted, by using the same degree of care,
but no less than a reasonable degree of care, to prevent the unauthorized
disclosure or use of such confidential information, as Seller uses to protect
its own confidential information of a like nature; provided, however, that this
sentence shall not apply to any information that, at the time of disclosure,
(i) is disclosed by and between Seller and its agents, representatives,
Affiliates, employees, officers or directors on a need-to-know basis (provided
that such Persons are bound by a duty of confidentiality), (ii) is available
publicly and was not disclosed in breach of this Agreement by Seller or its
respective agents, representatives, Affiliates, employees, officers or directors
(provided that information provided to or filed with the Commission or any other
Governmental Authority shall not be deemed to be publicly available by virtue of
such filing), or (iii) is required to be disclosed in compliance with
Section 5.04 of this Agreement, federal and state laws or regulations or the
regulations governing any national securities exchange or quotation system or is
requested by a regulatory body that has authority over Seller or Purchaser
(provided that Seller provides prompt notice to Purchaser of the disclosure
requirement and uses its reasonable efforts to disclose only such confidential
information as is legally required to be disclosed and exercises reasonable
efforts to obtain assurance that such confidential information will be accorded
confidential treatment); provided, further that, so long as the Tranche A Note
or Tranche B Note is outstanding, this Section 5.05(b) shall not apply to the
exceptions to confidentiality set forth in Section 10.14 of the Note Agreement.

        SECTION 5.06 Use of Magna Name. (a) Purchaser hereby acknowledges that
all right, title and interest in and to the trade names of Seller, the names
"Magna," "MEC," "XpressBet," and "Call-A-Bet" and all similar or related names
and all derivations or acronyms thereof and all trademarks, service marks, trade
names, collective marks, certification marks, trade dress, designs or logos
containing or incorporating the foregoing, including registrations and
applications for registration thereof (collectively, the "Magna Name"), are
owned exclusively by Seller and its Affiliates (other than the Companies and
their Subsidiaries), and that, except as provided in Section 5.06(b), any
and all right of the Companies and the Subsidiaries in the Magna Name shall
terminate as of the Closing Date and shall immediately revert back to Seller and
its Affiliates (other than the Companies and their Subsidiaries). On or before
the Closing Date, Seller shall take any and all actions necessary to transfer
the domain name of "meadowsracing.com" and any rights associated therewith to an
entity designated by Purchaser. To the extent that the transfer is not made
prior to the Closing Date, Seller and such entity designated by Purchaser shall
enter into such arrangements as may be reasonably acceptable to each to provide
such designee with the right to use the domain name.

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(b)Purchaser shall, promptly following the Closing Date, cause each Company and
Subsidiary to remove or obliterate the Magna Name from all of its existing
stocks of signs, letterheads, advertisements and promotional materials and other
documents and materials ("Existing Stock") or to cease using such Existing
Stock. Notwithstanding the foregoing, in the event that removal or obliteration
of the Magna Name from certain items of Existing Stock or the cessation of the
use thereof is impracticable, each Company and Subsidiary may use such items of
Existing Stock, so long as a mark or some other designation identifying that
each Company or Subsidiary is an Affiliate of Purchaser (and not of Seller) is
clearly indicated on such items of Existing Stock, until such items of Existing
Stock is depleted, or a period of three (3) months from the Closing Date,
whichever occurs first. Except as expressly provided in this Agreement, no other
right to use the Magna Name is granted by Seller to Purchaser, Companies and
Subsidiaries, whether by implication or otherwise.

(c)Purchaser shall, as soon as practicable after the Repayment Date, but in no
event later than 10 Business Days after such date, cause MECPenn, MEC
Pennsylvania Food Service, Inc. and MECRacing to file amended articles of
incorporation with the appropriate authorities changing their corporate names to
a corporate name that does not contain the word "Magna" or any Magna Name.

        SECTION 5.07 Investigation. (a) Purchaser acknowledges and agrees that
(i) has made its own inquiry and investigation into, and, based thereon, has
formed an independent judgment concerning, the Companies and Subsidiaries and
(ii) it has not, for purposes of entering into this Agreement, relied on any
representation or warranty or other statement or omission of Seller or any of
its directors, officers, employees, agents, stockholders, Affiliates,
consultants, counsel, accountants, investment bankers or representatives, other
than the representations and warranties contained in this Agreement (including
the Exhibits and the Company Disclosure Schedule).

(b)In connection with Purchaser's investigation of the Companies and
Subsidiaries, Purchaser has received from Seller certain estimates, projections,
forecasts, plans and budgets for the Companies and Subsidiaries, including,
without limitation, projected income statement and balance sheet information.
Purchaser acknowledges that there are uncertainties inherent in attempting to
make such estimates, projections, forecasts, plans and budgets, that Purchaser
is familiar with such uncertainties and that Purchaser is taking full
responsibility for making its own evaluation of the adequacy and accuracy of all
estimates, projections, forecasts, plans and budgets so furnished to it.
Accordingly, Seller makes no representation or warranty with respect to any
estimates, projections, forecasts, plans or budgets referred to in this
Section 5.07, except that they have been prepared in the ordinary course of
business consistent with past practice.

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        SECTION 5.08 Limited Non-Compete. (a) As an inducement for Purchaser to
enter into this Agreement and in consideration of the receipt of $2,000,000
(which amount is included in the Purchase Price), Seller agrees that for a
period commencing on the Closing Date and ending on the later of (i) five years
from the Closing Date and (ii) twelve months after the termination of the Racing
Services Agreement for any reason (the "Non-Competition Period"), except with
Purchaser's prior written consent, Seller shall not directly or indirectly
(including through MEC Pennsylvania Racing Services, Inc.) own or operate a
pari-mutuel wagering facility with expanded gaming within 100 miles of the
Meadows Facility (the "Non-Competition Covenant"). Notwithstanding the
foregoing, the Non-Competition Covenant shall not apply (i) to Thistledown
(located in North Randall, Ohio) or operation of the Meadows Facility pursuant
to the Racing Services Agreement or (ii) after a Stock Transfer Trigger Date.

(b)Seller, for itself and its Affiliates, agrees that a breach or violation of
the Non-Competition Covenant shall entitle Purchaser, as a matter of right, to
an injunction issued by any court of competent jurisdiction restraining any
further or continued breach of violation of such covenant. Such right to an
injunction shall be cumulative, and in addition to, and not in lieu of, any
other remedies to which Purchaser may show itself justly entitled. Further,
during any period in which Seller or any of its Affiliates are in breach of the
Non-Competition Covenant, the time period of such covenant shall be extended for
an amount of time that Seller or any of its Affiliates are in breach hereof,
with the effect that the total duration of the Non-Competition Covenant shall be
the original period plus the actual amount of time that Seller or any of its
Affiliates are in breach.

(c)Further, Seller, for itself and its Affiliates, agrees that the
Non-Competition Covenant is appropriate and reasonable when considered in light
of the nature and extent of the business conducted by Purchaser. Seller, for
itself and its Affiliates, acknowledges and agrees that: (i) Purchaser would not
enter into this Agreement unless Seller, for itself and its Affiliates, agreed
to the Non-Competition Covenant; and (ii) it has read and understands the terms
of this Agreement, including, without limitation, the Non-Competition Covenant,
and has been provided the opportunity to discuss this Agreement and such
covenant with Purchaser and counsel of its choice and has carefully considered
the nature and extent of the restrictions upon it and the rights and remedies
conferred upon Purchaser hereunder. Seller, for itself and its Affiliates,
hereby acknowledges and agrees that Purchaser has a legitimate interest in
protecting its business and that the Non-Competition Covenant is reasonable in
limitations as to time, scope, geographical area and activity, and is fully
required and is no greater than necessary to protect the legitimate business
interests of Purchaser. Seller, for itself and its Affiliates, further agrees
that the Non-Competition Covenant is not unduly harsh or oppressive to Seller,
or any of its Affiliates, in curtailing their legitimate efforts to earn a
livelihood and does not stifle the inherent skill and experience of Seller, or
any of its Affiliates, or confer a benefit upon Purchaser disproportionate to
the detriment to Seller, or any of its Affiliates, or harm in any manner
whatsoever the public interest or operate as a bar to the sole means of support
of Seller, or any of its Affiliates.

(d)Seller, for itself and its Affiliates, agrees that if the Non-Competition
Covenant should be held by any Governmental Authority to be void or
unenforceable in any particular area or jurisdiction, then Purchaser and Seller
shall consider this Agreement to be modified so as to eliminate that particular
area or jurisdiction as to which the Non-Competition Covenant is held to be void
or otherwise enforceable, and as to all other areas and jurisdictions and scope
covered by this Agreement, the terms hereof shall remain in full force and
effect as originally written. Further, if the Non-Competition Covenant should be
held by any Governmental Authority to be effective in any particular area or
jurisdiction or scope only if said covenant is modified to limit its duration or
scope, then Seller and Purchaser shall consider the Non-Competition Covenant to
be amended and modified with respect to that particular area or jurisdiction so
as to comply with the order of any Governmental Authority, and as to all other
political subdivisions of the United States, the Non-Competition Covenant shall
remain in full force and effect as originally written.

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        SECTION 5.09 Remediation. Seller hereby agrees that after the Repayment
Date it will complete items (1) and (2) on Part D of NPDES Permit
#PA0252905 issued on August 11, 2005 by the Department of Environmental
Protection of the Commonwealth of Pennsylvania on or before the deadline for
completion specified in such items, but only to the extent such items are not
completed in connection with the backside improvements required by Section 1404
of the Gaming Act. Seller further agrees it will complete any other matters
arising under the NPDES Permit # PA0252905 during the two years on and after the
Repayment Date.

        SECTION 5.10 No Negotiation. Until the earlier of (a) the Closing Date
and (b) such time, if any, as this Agreement is terminated pursuant to this
Agreement, Seller will not, and will cause the Companies and the Subsidiaries,
and each of their employees, financial advisors, attorneys, accountants and
other representatives, not to directly or indirectly solicit, initiate, or
encourage any inquiries or proposals from, discuss or negotiate with, or provide
any non-public information to, any Person (other than Purchaser) relating to any
transaction involving the sale of any of the Companies or the Subsidiaries or
the Assets (other than sales of Assets in the ordinary course of business) of
the Companies or the Subsidiaries or any of the capital stock of the Company or
the Subsidiaries, or any merger, consolidation, business combination, or similar
transaction involving the Companies or the Subsidiaries.

        SECTION 5.11 Title.

(a)Seller has provided Purchaser, for each parcel of owned Real Property, with a
title commitment issued by First American Title Insurance Company (the "Title
Company"), in the form attached as Exhibit 5.11 hereto (the "Title Commitment"),
together with complete and legible copies of all recorded documents listed as
exceptions. Purchaser shall cause an ALTA survey of the owned Real Property
certified in favor of Purchaser, Seller and Title Company (the "Survey") to be
prepared at Purchaser's expense, and Seller shall cooperate with Purchaser in
the preparation of the Survey.

(b)At the Closing, the Title Company shall irrevocably commit to issue (i) an
ALTA extended coverage owner's title insurance policy in the form of the Title
Commitment for each of Seller's interests in the owned Real Property containing
the endorsements set forth on Exhibit 5.11 hereto and (ii) such other title
insurance policy or policies as are required by the Note Documents. Seller
covenants and agrees that it will provide such information and execute such
documents as are reasonable and customary as required by the Title Company to
issue the applicable Title Policy in conformity with the Title Commitment.

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(c)If, after the date hereof and prior to the Closing, the Title Company revises
the Title Commitment to disclose any title exception or the Survey depicts any
matter (each, a "Title Objection"), in each case, that is not a Permitted
Exception, then Purchaser may provide written notice of objection to Seller
("Purchaser's Notice") of such matters within 10 days after receiving written
notice of such Title Objection and complete and legible copies of any recorded
documents relating thereto. Seller shall make reasonable efforts to cure each
Title Objection included in Purchaser's Notice or to cause the Title Company to
eliminate each Title Objection as an exception to the Title Commitment or to
remove it from the Survey. Any Title Objection that is cured or that the Title
Company is willing to insure over on terms acceptable to Seller and Purchaser is
herein referred to as an "Insured Exception." The Insured Exceptions shall be
deemed to be acceptable to Purchaser. If any Title Objection cannot be cured and
the Title Company will not insure over it on terms acceptable to Seller and
Purchaser, then Purchaser shall have a right to terminate this Agreement if such
Title Objection would have a Material Adverse Effect.

        SECTION 5.12 Further Action. Each of the parties hereto shall execute
and deliver such documents and other papers and take such further actions as may
be reasonably required to carry out the provisions hereof and give effect to the
transactions contemplated by this Agreement.

        SECTION 5.13 Excluded Items. The parties agree that all assets
exclusively related to Seller's account wagering operations
(i.e., XpressBet, Inc. (formerly known as Call-A-Bet)) and all Liabilities
associated therewith (the "Excluded Items") have been or will be transferred to
XpressBet, Inc. prior to Closing. Seller will transfer, sell or otherwise
dispose of the Excluded Items identified on Exhibit 5.13 prior to the Closing
Date so that none of the Companies or Subsidiaries shall have any direct or
indirect ownership in, or any Liability (other than Liability under any
agreement by and between any Company or Subsidiary and XpressBet, Inc.) for, the
Excluded Items as of the Closing Date.

        SECTION 5.14 Estoppels. Prior to the Closing, Seller shall use
commercially reasonable efforts to obtain estoppel certificates from third
parties under the leases of Real Property, in a form consistent with the form of
any estoppel certificates incorporated into such leases, or has been delivered
in the past under such leases.

        SECTION 5.15 Cooperation in Preparation of Alternative Application. Any
time on or after December 1, 2005, upon the request of Seller, Purchaser shall
assist Seller in compiling an application for a Conditional Category 1 license
and Category 1 license to conduct slot machine gaming pursuant to the Gaming Act
on the basis that Seller will be submitting such application as the operator and
owner of the Meadows Facility, which efforts shall include, without limitation,
allowing Seller to use and submit with its application all Purchaser Application
Materials; provided, however that Seller agrees to reimburse Purchaser for the
reasonable and direct costs incurred by Purchaser with respect to the Purchaser
Application Materials used by Seller in the event that this Agreement
is terminated.

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        SECTION 5.16 Financial Statements. (a) Seller agrees to prepare, and use
its commercially reasonable efforts, including expending additional funds for
expediting fees or similar fees to Seller's Accountants, to cause Seller's
Accountants to assist Seller in preparing the following materials in a timely
fashion after execution of this Agreement or, in the case of periods ending on
and after the date of this Agreement, in a timely fashion after passage of the
ending date for such period: (i) an audited combined balance sheet of the
Companies and their Subsidiaries (excluding the Excluded Subsidiaries) as of
December 31, 2005 and the related audited statements of income, equity and cash
flows for the year then ended in compliance with GAAP and meeting all
requirements of Regulation S-X (the "2005 Audited Financial Statements");
(ii) unaudited combined balance sheets of the Companies and their Subsidiaries
(excluding the Excluded Subsidiaries) as of March 31, 2005, June 30, 2005 and
September 30, 2005 and the related statements of income, equity and cash flows
for the three months, six months and nine months, respectively, then ended in
compliance with GAAP and meeting all requirements of Regulation S-X (taking into
account Rule 10-01 thereunder) (the "2005 Quarterly Financial Statements"),
together with a SAS 100 review thereof by Seller's Accountants in a form
reasonably satisfactory to Purchaser and Purchaser's Accountants; and (iii) with
respect to each fiscal quarter in 2006 ending prior to the Repayment Date and
any shorter period from the prior quarter end to the Repayment Date, an
unaudited combined balance sheet of the Companies and their Subsidiaries
(excluding, the Excluded Subsidiaries) as of the last day of each such fiscal
quarter or such shorter period and the related statements of income, equity and
cash flows for the latest year-to-date period ended as of such day in compliance
with GAAP and meeting all requirements of Regulation S-X (taking into account
Rule 10-01 thereunder) (the "2006 Interim Financial Statements"), together with
a SAS 100 review thereon by Seller's Accountants in a form reasonably
satisfactory to Purchaser and Purchaser's Accountants. On and after the Closing
and through the Repayment Date, Purchaser agrees to cooperate with Seller and
Seller's Accountants in connection with the preparation of any unaudited
financial statements for any period ending on the Repayment Date, or any fiscal
quarter ending prior to the Repayment Date. To the extent that Purchaser
requires any audited financial statement for any period beginning and ending
within 2006 for which an audit has not already been prepared by Seller's
Accountant on or prior to the Closing Date, then Seller and Purchaser shall
cooperate with Seller's Accountants or such other accountants as are required,
if Seller's Accountants are not able to prepare such financial statements, to
prepare audited financial statements for the requested period.

(b)Seller shall, and shall cause the officers, directors, employees, agents,
representatives, accountants and counsel of Seller and each Company and
Subsidiary to, cooperate with Purchaser and its financing sources and their
respective officers, employees and authorized agents, accountants, counsel and
representatives in connection with the obtaining of financing of the Purchase
Price (and any refinancings thereof) (each, a "Financing") and any Securities
and Exchange Commission registration process contemplated by a Financing or any
filings otherwise required to be made with the Securities and Exchange
Commission by Purchaser, its Affiliates or OCM HoldCo, LLC. Such cooperation
shall include, without limitation: (i) the provision of auditor's consents with
respect to the inclusion of the audited combined balance sheet of the Companies
and their Subsidiaries (excluding the Excluded Subsidiaries) as of December 31,
2004 (the "2004 Audited Balance Sheet") and the 2005 Audited Financial
Statements in filings and marketing materials; (ii) the provision of
accountant's comfort letters with respect to the 2004 Audited Balance Sheet,
2005 Audited Financial Statements, 2005 Quarterly Financial Statements, the 2006
Interim Financial Statements, financial data derived from books and records
prior to Closing and customary negative assurances with respect to matters
relating to the foregoing; (iii) the provision of customary representations to
accountants in connection with audits, reviews and comfort letters;
(iv) provision of the unaudited combined balance sheets of the Companies and
their Subsidiaries (excluding the Excluded Subsidiaries) as of March 31, 2004,
June 30, 2004 and September 30, 2004 and the related statements of income,
equity and cash flows for the three, six and nine months, respectively, then
ended; (v) responding to due diligence requests from financing sources; and
(vi) providing customary legal opinions to financing sources. Notwithstanding
the foregoing, Seller shall not be required to provide or prepare audited
financial statements for any period prior to January 1, 2006, other than the
2004 Audited Balance Sheet and the 2005 Audited Financial Statements.

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(c)Purchaser shall pay for all costs and expenses reasonably incurred by Seller
after the Closing as a result of Seller's efforts under the last sentence of
Section 5.16(a); provided that, in the event that the Repayment Date occurs,
Seller shall reimburse Purchaser for the first audit requested pursuant to the
last sentence of Section 5.16(a) for any period on or prior to the Repayment
Date. Seller shall reimburse Purchaser on the Repayment Date, and if such
payment is not made in cash, then Seller or Agent under the Note Agreement shall
provide a direction letter that permits Purchaser to retain a portion of the
amount to be paid on the Tranche A Note equal to the reimbursement owed by
Seller. To the extent that the reimbursement obligation is not known until after
the Repayment Date, Seller shall pay any reimbursable amount in cash or
Purchaser may offset the amount against any amount owed to Seller or its
Affiliates under any Transaction Document.

        SECTION 5.17 Separation. Seller shall use commercially reasonable
efforts to separate the agreement listed on Section 5.17 of the Company
Disclosure Schedule, such that WTA and MLR are licensees of, and responsible
for, only those seat licenses allocated as of the date hereof to the Meadows
Facility and the OTB Facilities. If such separation has not occurred prior to
the Closing Date, Seller shall indemnify WTA and MLR for any Losses related to
sites authorized to use software under the agreement listed on Section 5.17 of
the Company Disclosure Schedule other than the Meadows Facility and the
OTB Facilities.

        SECTION 5.18 Notification. Seller and Purchaser shall promptly, and in
any event prior to the Closing, notify the other party in writing of all events,
circumstances, facts and occurrences which such party becomes aware of if such
events, circumstances, facts and occurrences would reasonably be expected to
result in a Purchaser Material Adverse Effect or a Material Adverse Effect.

        SECTION 5.19 Environmental Report. Seller shall exercise its best
efforts (at no material cost to Seller) to cause the consultant(s) which issued
the Phase I Environmental Site Assessment dated October 28, 2005 prepared by
AMEC Earth & Environmental and the Phase I obtained by Seller pursuant to
Section 5.22 to permit Purchaser and any lender providing financing to Purchaser
with respect to or secured by any of the Real Property, to rely on such reports
to the full extent that Seller may rely on such reports.

        SECTION 5.20 XpressBet Matters. Seller shall use commercially reasonable
efforts to complete on or before the Closing Date the formalization of the
relationship between WTA and MLR, on the one hand, XpressBet, Inc., on the other
hand, to enter into (i) a formal agreement for the provision of banking services
by XpressBet, Inc. to WTA and MLR with respect to the accounts of WTA's and
MLR's Pennsylvania account wagering customers and (ii) separate tote structures
and service agreements for WTA and MLR, on the one hand, and XpressBet, Inc., on
the other hand. Seller shall seek Commission approval for each of
such agreements.

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        SECTION 5.21 [Reserved]

        SECTION 5.22 Phase I. Seller agrees to cause, at its expense, a Phase I
environmental assessment to be conducted by AMEC Earth and Environmental, Inc.
(or other reputable consultant agreed to by Purchaser) on the real property
located on Section 5.22 of the Company Disclosure Schedule (the "Phase I").
Seller shall deliver the Phase I to Purchaser within sixty days after the date
hereof. Seller and Purchaser acknowledge that to the extent a circumstance,
event or occurrence is disclosed in the Phase I that, if known by Seller as of
the date hereof, would have resulted in Seller's representations in Section 3.12
being untrue, that such a circumstance, event or occurrence constitutes a Seller
Development as defined in Section 8.03(b).

        SECTION 5.23 Slot Machine Taxes. Seller and Purchaser shall use
commercially reasonable efforts to support the interpretation by all relevant
Governmental Authorities that the local share assessment payable by each slot
machine licensee under Section 1403(b) of the Gaming Act shall not in any
circumstance exceed four percent (4%) of the gross terminal revenue from slot
machines in operation at such licensee's facility, including amounts payable by
such licensee in respect of such local share assessment to the State Gaming Fund
established by Section 1403(a) of the Gaming Act and amounts to be paid to any
other Governmental Authorities under Section 1403(c).

ARTICLE VI
EMPLOYEE MATTERS

        SECTION 6.01 Arrangements; Payroll Obligations. (a) Immediately prior to
Closing, all employees of the Company and its Subsidiaries (other than those
listed on Schedule 6.01(a) of the Company Disclosure Schedules, which listed
employees are hereinafter referred to as the "Company Employees") shall be
transferred to MEC Pennsylvania Racing Services, Inc. and shall be employees of
MEC Pennsylvania Racing Services, Inc. rather than any Company or any of its
Subsidiaries. Such employees who are so transferred shall be referred to as the
"Transferred Employees". Seller agrees that Purchaser shall not assume or be
responsible for, and shall be indemnified against, any and all Liabilities
related to the Transferred Employees and the transfer of the Transferred
Employees to MEC Pennsylvania Racing Services, Inc., including without
limitation, any payroll, vacation, sick leave, severance, WARN Act, COBRA costs
or similar amounts.

(b)Seller will be responsible under the Racing Services Agreement for the
payroll obligations with respect to the Company Employees who are the
responsibility of MEC Pennsylvania Racing Services, Inc. under the Racing
Services Agreement (including, without limitation, the satisfaction of all
payroll withholding tax obligations) for the Companies and Subsidiaries payable
after the Closing Date. Subject to Section 6.03 and anything to the contrary in
the Racing Services Agreement, Seller agrees that Purchaser shall not assume or
be responsible for, and shall be indemnified against, any and all Liabilities
related to the Company Employees who are the responsibility of MEC Pennsylvania
Racing Services, Inc. under the Racing Services Agreement, including without
limitation, any payroll, vacation, sick leave, severance, WARN Act, COBRA costs,
workers compensation or similar amounts. Except with respect to any vacation
benefits, Multiemployer Plans and the MEC Health Plan, the Company Employees do
not participate in any Benefit Plans.

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        SECTION 6.02 Benefit Plans and Transferred Employee Related Obligations.
(a) Seller agrees to continue coverage of the Transferred Employees under its or
its Affiliates' employee benefit plans in accordance with their terms and its or
its Affiliates' personnel policies on and after the Closing Date. As of the
Closing Date, each Company Employee who was covered by the health plan listed on
Section 6.02 of the Company Disclosure Schedule (the "MEC Health Plan") shall
cease to be covered by such health plan. Seller agrees, at its sole cost and
expense, to create a separate employee plan in the name of Purchaser to provide
to such Company Employees substantially similar benefits to those provided for
under the MEC Health Plan, except in instances where the benefit cannot be
replicated because of the different provider. Seller shall remain obligated for
any and all benefits and benefit entitlements under the Benefit Plans that were
earned or accrued by any Company Employee or any Transferred Employee or former
employees of any Company or Subsidiary on and prior to the Closing Date. With
respect to the Benefit Plans that provide welfare benefits, Seller represents,
warrants and agrees that there will be no disruption in the coverage for the
Transferred Employees under such welfare plans as a result of their transfer to
MEC Pennsylvania Racing Services, Inc. To the extent that there is a termination
in coverage under the MEC Health Plan for the Company Employees covered thereby
as of the Closing Date, Seller represents, warrants and agrees that either it or
the applicable insurance carrier, as set forth in the MEC Health Plan, shall
remain obligated to reimburse such Company Employees for eligible health care
benefit expenses and services incurred prior to the Closing; provided that such
Company Employees' claims for reimbursement for such expenses and services are
delivered to the appropriate party within applicable time limits, as set forth
in the MEC Health Plan. An expense or service is deemed to be incurred, with
respect to the MEC Health Plan, when the medical services are performed, and,
with respect to plans that provide welfare benefits other than medical or dental
benefits, when the event giving rise to such expense or service occurs.

(b)Seller agrees that it shall remain obligated for any expenses or Losses
incurred in connection with any claim of an Employee or a former employee of any
Company or Subsidiary arising on or prior to the Closing Date under the workers'
compensation laws of any state (a "Workers' Compensation Claim").

(c)Seller agrees to remain obligated to provide continuation health care
coverage, in accordance with Section 4980B of the Code and Sections 601 to 608
of ERISA ("COBRA"), to all Employees or former employees of any Company or
Subsidiary and their qualified beneficiaries (i) who incur a qualifying event on
or prior to the Closing Date and (ii) to whom Seller, any Company, or any
Subsidiary are, on the Closing Date, (A) providing such continuation coverage or
(B) under an obligation to provide such continuation coverage at the election of
the Employee or former employee or his or her qualified beneficiary.

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        (d)   Seller agrees that it shall be obligated to make contributions on
behalf of Companies and Subsidiaries to any Multiemployer Plan in respect of the
Company Employees to the extent set forth in the Racing Services Agreement.

SECTION 6.03        Intentionally Omitted.

SECTION 6.04        Intentionally Omitted.

SECTION 6.05        Employee Benefits Indemnity.

        (a)   Seller agrees to indemnify Purchaser against and hold Purchaser
harmless from all Losses arising out of:

        (i)    the breach of any representation, warranty, covenant or agreement
of Seller made in Section 3.16 or Section 3.17 hereof or this Article VI;

        (ii)   any and all Liabilities related to, arising out of or associated
with the Transferred Employees (including their transfer to MEC Pennsylvania
Racing Services, Inc.);

        (iii)  any and all Liabilities arising prior to the Closing under or
with respect to employment, working conditions, wages and/or compensation,
benefits, claims and all other matters related to employees, agents and other
personnel of the Companies and the Subsidiaries and of Seller and its
subsidiaries; and

        (iv)  any and all Actions by, and all Liabilities related to, employees
or independent contractors of Companies and the Subsidiaries and of Seller and
its subsidiaries arising prior to the Closing, including without limitation, any
Actions or Liabilities arising out of any employee benefit plan or arrangement,
any Actions or Liabilities for accrued vacation and sick time of the employees,
Seller's, the Companies' or any of their Affiliates' failure to deposit or fund
any amounts withheld from employees pursuant to any retirement plan or
arrangement or retiree medical plan or arrangement, or any unfunded retirement
plan or arrangement (whether or not payment is currently due under Law) or any
obligations to current or former plan participants or beneficiaries under any
plan or arrangement intended to provide benefits to current or former employees
of Seller, the Companies or any of their Affiliates.

        (b)   Purchaser agrees to indemnify Seller against and hold Seller
harmless from all Losses arising out of the breach of any representation,
warranty, covenant or agreement of Purchaser made in this Article VI.

                SECTION 6.06        Third-Party Claims. Nothing in this
Agreement is intended, or shall be construed, to confer upon any person, other
than the parties hereto and their successors and permitted assigns, any rights
or remedies by reason of this Article VI.

                SECTION 6.07        Survival. The covenants and agreements of
the parties hereto contained in this Article VI shall survive the Closing and
shall remain in full force and effect indefinitely.

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ARTICLE VII

TAX MATTERS

                SECTION 7.01        Indemnity. (a) Seller agrees to indemnify
and hold harmless Purchaser, the Companies and each Subsidiary against the
following Taxes in excess of the amount, if any, paid on account of Taxes
pursuant to Section 15.6.5 of the Racing Services Agreement to the extent taken
into account in determining the payment pursuant to such section, and, except as
otherwise provided in Section 7.04, against any loss, damage, liability or
expense, including reasonable fees for attorneys and other outside consultants,
incurred in contesting or otherwise in connection with any such Taxes: (i) Taxes
imposed on the Companies or any Subsidiary with respect to taxable periods of
such Person ending on or before the Closing Date; (ii) with respect to taxable
periods beginning before the Closing Date and ending after the Closing Date,
Taxes imposed on the Companies or any Subsidiary which are allocable, pursuant
to Section 7.01(b), to the portion of such period ending on the Closing Date;
(iii) Taxes imposed on any member of any affiliated group with which any of the
Companies and the Subsidiaries file or have filed a Tax Return on a consolidated
or combined basis that includes the Companies' and the Subsidiaries' taxable
periods ending on or before the Closing Date; and (iv) any and all Taxes of any
Person (other than the Companies and the Subsidiaries) imposed on any of the
Companies or the Subsidiaries as a transferee or successor, by contract or
pursuant to any Law. Purchaser shall be responsible for and agrees to pay all
Taxes and associated expenses not allocated to Seller pursuant to the first
sentence hereof; and Purchaser agrees to indemnify and hold harmless Seller
against all such Taxes and expenses.

        (b)   In the case of Taxes that are payable with respect to a taxable
period that begins before the Closing Date and ends after the Closing Date, the
portion of any such Tax that is allocable to the portion of the period ending on
the Closing Date shall be:

        (i)    in the case of Taxes that are either (x) based upon or related to
income or receipts, or (y) imposed in connection with any sale or other transfer
or assignment of property (real or personal, tangible or intangible) (other than
conveyances pursuant to this Agreement, as provided under Section 7.07), deemed
equal to the amount which would be payable if the taxable year ended with the
Closing Date; and

        (ii)   in the case of Taxes imposed on a periodic basis with respect to
the assets of the Companies or any Subsidiary, or otherwise measured by the
level of any item, deemed to be the amount of such Taxes for the entire period
(or, in the case of such Taxes determined on an arrears basis, the amount of
such Taxes for the immediately preceding period), multiplied by a fraction the
numerator of which is the number of days in the period ending on the Closing
Date and the denominator of which is the number of days in the entire period.

        Purchaser shall provide Seller for its review and comment any Tax
Returns filed by or with respect to any of the Companies or any of the
Subsidiaries during the period beginning on the day after the Closing Date and
ending on the earlier of the Repayment Date and the date of the Stock Transfer.

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        (c)   Any indemnity payable under this Section 7.01 shall be net of any
Tax benefit enjoyed by the applicable indemnified party, determined in a manner
consistent with the last two sentences in Section 9.02(b) or
Section 9.03(c) hereof.

            SECTION 7.02    Returns and Payments. (a) From the date of this
Agreement through and after the Closing Date, Seller shall prepare and file or
otherwise furnish in proper form to the appropriate Governmental Authority
(or cause to be prepared and filed or so furnished) in a timely manner all Tax
Returns relating to the Companies and the Subsidiaries that are due on or before
or relate to any taxable period ending on or before the Closing Date
(and Purchaser shall do the same with respect to any taxable period ending after
the Closing Date). Tax Returns of the Companies and the Subsidiaries not yet
filed for any taxable period that begins before the Closing Date shall be
prepared in a manner consistent with past practices employed with respect to the
Companies and the Subsidiaries (except to the extent counsel for Seller or the
Companies renders a legal opinion that there is no reasonable basis in law
therefor or determines that a Tax Return cannot be so prepared and filed without
being subject to penalties). With respect to any Tax Return required to be filed
by Purchaser or Seller with respect to the Companies and the Subsidiaries and as
to which an amount of Tax is allocable to the other party under Section 7.01(b),
the filing party shall provide the other party and its authorized
representatives with a copy of such completed Tax Return and a statement
certifying the amount of Tax shown on such Tax Return that is allocable to such
other party pursuant to Section 7.01(b), together with appropriate supporting
information and schedules at least 20 Business Days prior to the due date
(including any extension thereof) for the filing of such Tax Return, and such
other party and its authorized representatives shall have the right to review
and comment on such Tax Return and statement prior the filing of such
Tax Return.

        (b)   Seller shall pay or cause to be paid when due and payable all
Taxes described in Sections 7.01(a)(i) and 7.01(a)(ii), and Purchaser shall so
pay or cause to be paid Taxes for any taxable period ending after the Closing
Date (subject to its right of indemnification from Seller by the date set forth
in Section 7.05 for Taxes attributable to the portion of any Tax period that
includes the Closing Date pursuant to Sections 7.01(a) and 7.01(b)).

            SECTION 7.03    Refunds. Any Tax refund (including any interest with
respect thereto), and any equivalent benefit through a reduction in tax
liability for a post-Closing Date period, relating to the Companies or any
Subsidiary for any taxable period prior to the Closing Date shall be the
property of Seller, and if received by Purchaser or the Companies or any
Subsidiary shall be paid over to Seller within five Business Days of the earlier
of receipt or entitlement thereto; provided, however, that any Tax benefit
obtained by Purchaser, the Companies or any Subsidiary as a result of utilizing
any net operating loss carryforward or other carryforward (which may be subject
to adjustments) which is allocable to the Companies or any Subsidiary shall be
retained by Purchaser, the Companies or such Subsidiary. Purchaser shall cause
the Companies and the Subsidiaries to elect, where permitted by law, to carry
forward any net operating loss, charitable contribution or other item arising
after the Closing Date that could, in the absence of such election, be carried
back to a taxable period of the Companies ending on or before the Closing Date
in which the Companies are included in a consolidated, combined or unitary Tax
return; provided that, if such election to carry forward an item is not
available, any cash refund received by Seller with respect to such carryback
shall be paid over to Purchaser within five Business Days of actual receipt.
Purchaser shall, if Seller so requests and at Seller's expense, cause the
relevant entity to file for and obtain any refunds or equivalent amounts to
which Seller is entitled under this Section 7.03. Purchaser shall permit Seller
to control (at Seller's expense) the prosecution of any such refund claim, and
shall cause the relevant entity to authorize by appropriate power of attorney
such persons as Seller shall designate to represent such entity with respect to
such refund claim; provided, however, that Seller shall not take any action in
the prosecution of such refund claims that would be materially detrimental to
Purchaser, the Companies or the Subsidiaries (including for this purpose the tax
positions of such entities). In the event that any refund or credit of Taxes for
which a payment has been made to Seller pursuant to this Section 7.03 is
subsequently reduced or disallowed, Seller shall indemnify and hold harmless the
payor for any Tax Liability, including interest and penalties assessed against
such payor by reason of the reduction or disallowance.

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            SECTION 7.04    Contests. (a) After the Closing, Purchaser shall
promptly notify Seller in writing upon the commencement of any Tax audit or
administrative or judicial proceeding that could affect Seller, and shall also
separately notify Seller, in writing, of a proposed assessment or claim in an
audit or administrative or judicial proceeding of Purchaser or of any of the
Companies and the Subsidiaries which, if determined adversely to the taxpayer,
would be grounds for indemnification under this Article VII. If Purchaser fails
to give Seller prompt notice of an asserted Tax liability as required by this
Section 7.04, then (a) if Seller is precluded by the failure to give notice
within 30 days of the commencement of such proceeding from contesting the
asserted Tax liability in both the administrative and judicial forums, then
Purchaser shall have sole responsibility for such Tax liability or (b) if Seller
is not precluded from contesting but such failure to give notice within 30 days
of the commencement of such proceeding results in detriment to Seller, then any
amount that Seller is otherwise required to pay to Purchaser pursuant to
Section 7.01 with respect to such liability shall be reduced by the amount of
such detriment.

        (b)   Seller may elect to direct, through counsel of its own choosing
and at its own expense, any audit, claim for refund and administrative or
judicial proceeding involving any asserted liability with respect to which
indemnity may be sought under this Article VII (any such audit, claim for refund
or proceeding relating to an asserted tax liability are referred to herein
collectively as a "Contest"). If Seller elects to direct the Contest of an
asserted Tax liability, it shall within 30 days of receipt of the notice of
asserted tax liability notify Purchaser of its intent to do so, and Purchaser
shall cooperate and shall cause each Subsidiary and any successor to a
Subsidiary or its successor to cooperate, at Seller's expense, in each phase of
such Contest. Purchaser also may participate in any such audit or proceeding
and, if Seller does not assume the defense of any such audit or proceeding,
Purchaser may defend the same in such manner as it may deem appropriate,
including, but not limited to, settling such audit or proceeding after giving
five Business Days' prior written notice to Seller setting forth the terms and
conditions of settlement. In the event that issues relating to a potential
adjustment for which Seller would be liable are required to be dealt with in the
same proceeding as separate issues relating to a potential adjustment for which
Purchaser would be liable, Purchaser shall have the right, at its expense, to
control the audit or proceeding with respect to the latter issues. If Seller
chooses to direct the Contest, Purchaser shall promptly empower and shall cause
the appropriate Subsidiary or its successor promptly to empower (by power of
attorney and such other documentation as may be appropriate) such
representatives of Seller as it may designate to represent Purchaser or the
Subsidiary or its successor in the Contest insofar as the Contest involves an
asserted tax liability for which Seller would be liable under this Article VII.
If Seller assumes the defense of a Contest, Seller shall not enter into any
compromise or agree to settle any claim pursuant to any Tax audit or proceeding
which would adversely affect Purchaser for any taxable year without the written
consent of Purchaser, which consent shall not be unreasonably withheld.

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            SECTION 7.05    Time of Payment. Payment by Seller of any amounts
due under this Article VII shall be made (i) at least three Business Days before
the due date of the applicable estimated or final Tax Return required to be
filed by Purchaser on which is required to be reported income for a period
ending after the Closing Date for which Seller is responsible under
Sections 7.01(a) and 7.01(b) and with respect to which Tax must be paid, and
(ii) within five Business Days following an agreement between Seller and
Purchaser that an indemnity amount is payable or a "determination" as defined in
Section 1313(a) of the Code. If liability under this Article VII is in respect
of costs or expenses other than Taxes, payment by Seller of any amounts due
under this Article VII shall be made within five Business Days after the date
when Seller has been notified by Purchaser that Seller has a liability for a
determinable amount under this Article VII and is provided with calculations or
other materials supporting such liability.

            SECTION 7.06    Cooperation and Exchange of Information. Upon the
terms set forth in Section 5.02 of this Agreement, Seller and Purchaser will
provide each other with such cooperation and information as either of them
reasonably may request of the other in filing any Tax Return, amended Tax Return
or claim for refund, determining a liability for Taxes or a right to a refund of
Taxes, participating in or conducting any audit or other proceeding in respect
of Taxes or making representations to or furnishing information to parties
subsequently desiring to purchase any of the Companies or the Subsidiaries or
any part of the business of the Companies and the Subsidiaries from Purchaser.
Such cooperation and information shall include providing copies of relevant Tax
Returns or portions thereof, together with accompanying schedules, related work
papers and documents relating to rulings or other determinations by Tax
authorities. Each of Seller and Purchaser shall retain all Tax Returns,
schedules and work papers, records and other documents in its possession
relating to Tax matters of the Companies and the Subsidiaries for each taxable
period first ending after the Closing Date and for all prior taxable periods
until the later of (i) the expiration of the statute of limitations of the
taxable periods to which such Tax Returns and other documents relate, without
regard to extensions except to the extent notified by the other party in writing
of such extensions for the respective Tax periods, or (ii) six years following
the due date (without extension) for such Tax Returns. Any information obtained
under this Section 7.6 shall be kept confidential except as may be otherwise
necessary in connection with the filing of Tax Returns or claims for refund or
in conducting an audit or other proceeding.

            SECTION 7.07    Conveyance Taxes. Seller and Purchaser shall each
pay 50% of any real property transfer or gains, sales, use, transfer, value
added, stock transfer, and stamp taxes, any transfer, recording, registration,
and other fees, and any similar Taxes which become payable in connection with
the transactions contemplated by this Agreement, and shall file such
applications and documents as shall permit any such Tax to be assessed and paid
on or prior to the Closing Date in accordance with any available pre-sale filing
procedure. Each party hereto shall execute and deliver all instruments and
certificates necessary to enable the other party or parties to comply with
the foregoing.

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            SECTION 7.08    Miscellaneous. (a) Seller and Purchaser agree to
treat all payments made by either of them to or for the benefit of the other
(including any payments to the Companies or any Subsidiary) under this
Article VII, under other indemnity provisions of this Agreement and for any
misrepresentations or breaches of warranties or covenants as adjustments to the
Purchase Price or as capital contributions for Tax purposes and that such
treatment shall govern for purposes hereof.

        (b)   All amounts payable under any tax sharing agreement or arrangement
between Seller and the Companies or any Subsidiary for any taxable period ending
on or prior to the Closing Date shall be calculated on a basis consistent with
that used to date and shall be considered as an intercompany account owing to or
from an Affiliate as of the Closing Date for purposes of Section 5.01(c). Any
tax sharing agreement or arrangement between Seller and/or its Affiliates, on
the one hand, and the Companies or any Subsidiary, on the other hand, shall be
terminated immediately prior to the Closing and shall have no further effect for
any taxable year or period (whether past, present or future) and no additional
payments shall be made thereunder in respect of a redetermination of tax
liabilities or otherwise.

        (c)   Notwithstanding any provision in this Agreement to the contrary,
the obligations of Seller to indemnify and hold harmless Purchaser, the
Companies and the Subsidiaries pursuant to this Article VII, and the
representations and warranties contained in Section 3.18, shall terminate at the
close of business on the 60th day following the expiration of the applicable
statute of limitations with respect to the Tax liabilities in question (giving
effect to any waiver, mitigation or extension thereof).

        (d)   For purposes of this Article VII, "Purchaser" and "Seller,"
respectively, shall include each member of the affiliated group of corporations
of which it is or becomes a member (other than the Companies and the
Subsidiaries, except to the extent expressly referenced).

        (e)   In the event that Purchaser transfers the Shares back to Seller in
satisfaction of the Notes pursuant to Section 3.10 of the Note Agreement, then
Seller and Purchaser shall treat the acquisition of the Shares by Purchaser from
Seller as being rescinded for all tax purposes and neither Seller nor Purchaser
nor any other Person shall take any position inconsistent therewith unless
otherwise required by a "determination" (as defined in Section 1313(a)(1) of the
Code) or by applicable state or local income or franchise tax law.

ARTICLE VIII

CONDITIONS TO CLOSING

            SECTION 8.01    Conditions to Obligations of All Parties. The
obligations of each party hereto to consummate the transactions contemplated by
this Agreement shall be subject to the fulfillment, at or prior to the Closing,
of each of the following conditions:

        (a)   HSR Act.    Any waiting period (and any extension thereof) under
the HSR Act applicable to the purchase of the Shares contemplated hereby shall
have expired or shall have been terminated;

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        (b)   No Order.    No Governmental Authority shall have enacted, issued,
promulgated, enforced or entered any Governmental Order which is in effect and
has the effect of making the transactions contemplated by this Agreement
illegal, otherwise restraining or prohibiting consummation of such transactions
or causing any of the transactions contemplated hereunder to be rescinded
following completion thereof;

        (c)   Commission Approvals.    Purchaser and Seller shall have received
preliminary approval from the Commission of (i) the purchase of the Companies by
Purchaser and (ii) Seller's management of the racing operations of the Meadows
Facility under the Racing Services Agreement (collectively, the "Commission
Approval"), each in form and substance satisfactory to Seller and Purchaser in
their reasonable discretion; and

        (d)   No Proceeding or Litigation.    No Action shall have been
commenced or threatened by or before any Governmental Authority against either
Seller or Purchaser, seeking to restrain or materially and adversely alter the
transactions contemplated hereby which is reasonably likely to render it
impossible or unlawful to consummate such transactions.

            SECTION 8.02    Conditions to Obligations of Seller. The obligations
of Seller to consummate the transactions contemplated by this Agreement shall be
subject to the fulfillment or waiver, at or prior to the Closing, of each of the
following conditions:

        (a)   Representations and Warranties; Covenants.    (i) The
representations and warranties of Purchaser contained in this Agreement shall be
true and correct as of the date hereof, except as would not have a Purchaser
Material Adverse Effect, other than such representations and warranties as are
made as of another date, which shall be true and correct on and as of such date,
except as would not have a Purchaser Material Adverse Effect, (ii) the covenants
and agreements contained in this Agreement to be complied with by Purchaser on
or before the Closing shall have been complied with in all material respects,
and (iii) Seller shall have received a certificate of Purchaser to such effect
signed by a duly authorized officer thereof;

        (b)   Changes Since the Date of Signing.    (i) Seller shall have
received a certificate of Purchaser (1) indicating which, if any,
representations and warranties of Purchaser contained in this Agreement would
not be true and correct if made on the Closing Date, other than such
representations and warranties as are made as of another date, which would not
be true and correct on and as of such date and (2) describing the circumstances,
if any, which would cause such representations and warranties to not be so true
and correct if made on the Closing Date (or on such other date if made on
another date) as a result of events, occurrences or change of circumstances that
has occurred since the date of this Agreement (such circumstances, "Purchaser
Developments"), and (ii) if there are such Purchaser Developments that would
result in a Purchaser Material Adverse Effect, Seller shall have the right to
not proceed with the Closing; provided, that Purchaser Developments will not
constitute a breach of representation or warranty by Purchaser hereunder whether
or not Seller proceeds with the Closing and whether or not the Repayment
Date occurs;

        (c)   Resolutions.    Seller shall have received a true and complete
copy, certified by the Secretary or an Assistant Secretary of Purchaser
(or equivalent officer), of the resolutions, if any, duly and validly adopted by
the Board of Directors of Purchaser evidencing its authorization of the
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby;

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        (d)   Incumbency Certificate.    Seller shall have received a
certificate of the Secretary or an Assistant Secretary (or equivalent officer)
of Purchaser certifying the names and signatures of the officers of Purchaser
authorized to sign this Agreement and the other documents to be
delivered hereunder;

        (e)   XpressBet Amendments.    Each party to the XpressBet Amendments
(other than XpressBet, Inc.) shall have delivered to Seller an executed
counterpart of each of the XpressBet Amendments;

        (f)    Racing Services Agreement.    MECRacing, MECPenn, WTA and MLR
shall have delivered to Seller an executed counterpart of the Racing
Services Agreement;

        (g)   Legal Opinion.    Seller shall have received from Purchaser's
counsel a legal opinion, addressed to Seller and dated the Closing Date,
substantially in the form of Exhibit 8.02(g); and

        (h)   Note Documents.    Each party to the Note Documents (other than
Seller) shall have executed and delivered each of the Note Documents and each of
the conditions in Sections 4.1 and 4.2 of the Note Agreement shall have been
satisfied (or waived in writing by Seller).

            SECTION 8.03    Conditions to Obligations of Purchaser. The
obligations of Purchaser to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment or waiver, at or prior to the
Closing, of each of the following conditions:

        (a)   Representations and Warranties; Covenants.    (i) The
representations and warranties of Seller contained in this Agreement shall be
true and correct as of the date hereof, except as would not have a Material
Adverse Effect, other than such representations and warranties as are made as of
another date, which shall be true and correct on and as of such date, except as
would not have a Material Adverse Effect, (ii) the covenants and agreements
contained in this Agreement to be complied with by Seller on or before the
Closing shall have been complied with in all material respects, and
(iii) Purchaser shall have received a certificate of Seller to such effect
signed by a duly authorized officer thereof;

        (b)   Changes Since the Date of Signing.    (i) Purchaser shall have
received a certificate of Seller (1) indicating which, if any, representations
and warranties of Seller contained in this Agreement would not be true and
correct if made on the Closing Date other than such representations and
warranties as are made as of another date, which would not be true and correct
on and as of such date and (2) describing the circumstances, if any, which would
cause such representations and warranties to not be so true and correct if made
on the Closing Date (or on such other date if made on another date) as a result
of events, occurrences or change of circumstances that has occurred since the
date of this Agreement (such circumstances, the "Seller Developments"), and
(ii) if there are Seller Developments which would result in a Material Adverse
Effect, Purchaser shall have the right to not proceed with the Closing;
provided, that Seller Developments will not constitute a breach of
representation or warranty by Seller hereunder whether or not Purchaser proceeds
with the Closing and whether or not the Repayment Date occurs;

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        (c)   Resolutions.    Purchaser shall have received a true and complete
copy, certified by the Secretary or an Assistant Secretary (or equivalent
officer) of Seller, of the resolutions duly and validly adopted by the Board of
Directors of Seller evidencing its authorization of the execution and delivery
of this Agreement and the consummation of the transactions contemplated hereby;

        (d)   Incumbency Certificate.    Purchaser shall have received a
certificate of the Secretary or an Assistant Secretary (or equivalent officer)
of Seller certifying the names and signatures of the officers of Seller
authorized to sign this Agreement and the other documents to be
delivered hereunder;

        (e)   Resignations of Directors.    The members of the Board of
Directors of each Company and Subsidiary shall have resigned;

        (f)    [Reserved]

        (g)   XpressBet Amendments.    XpressBet, Inc. shall have delivered to
Purchaser an executed counterpart of each of the XpressBet Amendments;

        (h)   Racing Services Agreement.    MEC Pennsylvania Racing
Services, Inc. shall have delivered to Purchaser an executed counterpart of the
Racing Services Agreement;

        (i)    FIRPTA.    Seller shall have provided Purchaser with a
certificate pursuant to Treasury Regulations Sections 1.1445-2(b) that the
Seller is not a foreign person under the provisions of the Internal
Revenue Code;

        (j)    Legal Opinion.    Purchaser shall have received from one or more
of Seller's counsel (including internal counsel) one or more legal opinions,
each addressed to Purchaser and dated the Closing Date, substantially in the
forms attached hereto as Exhibit 8.03(j);

        (k)   Title Insurance.    For each parcel of owned Real Property, the
Title Company shall be irrevocably committed to issue an ALTA extended owner's
coverage title insurance policy (each, a "Title Policy") in the form of the
relevant Title Commitment insuring fee title in such Real Property, vested in
the applicable Company or Subsidiary, in such amount as shall be reasonably
requested by Purchaser, but not in excess of $53,000,000 for the Meadows
Facility Real Property, subject only to Permitted Exceptions and Insured
Exceptions and containing such affirmative coverages and endorsements described
in Section 5.11;

        (l)    Employees.    The Transferred Employees shall no longer be
employees of the Companies or the Subsidiaries;

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        (m)  Gaming License.    No Governmental Authority shall have enacted,
issued, promulgated, enforced or entered any Governmental Order which is in
effect, no Action shall have been commenced by or before any Governmental
Authority (provided that if any such Action has been commenced by or before any
Governmental Authority, Purchaser shall have 10 days from receipt of written
notice from Seller of such Action to provide a written notice to Seller ("Action
Notice") that it considers such Action to be non-frivolous and that based on
such Action it will not close the transaction contemplated hereunder, and if
Purchaser does not provide an Action Notice with respect to such Action within
such 10 day period, the commencement or existence of such Action shall not be
the basis of a claim for a failure of a condition to the Purchaser's obligations
to consummate the transactions contemplated hereunder) and no Law shall have
been enacted or adopted and remain in effect which would have or has had, as
applicable, the effect of (i) having a material and adverse effect on the right
of Purchaser to own and control the Companies and the Subsidiaries following
completion of the transactions contemplated hereunder or (ii) having a material
adverse effect on the ability of WTA or MLR to obtain a Conditional Category 1
license or Category 1 license under the Gaming Act, or to own or operate a
temporary or permanent facility at the Meadows Facility containing at least
3,000 slot machines no later than March 31, 2007, in each case of clause (i)
or (ii) other than such Laws that would have such material and adverse effect
solely due to the bad acts or bad character issues of Purchaser or any of
its Affiliates;

        (n)   MEC Items.    Seller and Purchaser shall not have received
notification from the Gaming Board or its staff that the Gaming Application
filed with the Gaming Board by Purchaser for a Conditional Category 1 license
will be subject to being declared or deemed incomplete with respect to the MEC
Items and such matters have not been rectified to the satisfaction of the
Gaming Board.

        (o)   [Reserved]

        (p)   Excluded Subsidiaries.    Each of the Excluded Subsidiaries shall
have been sold or transferred to Seller or any Affiliate of Seller (other than
any Company or any Subsidiary). Seller agrees that neither the Companies nor the
Subsidiaries shall retain any Liabilities related to the Excluded Subsidiaries;

        (q)   Financial Statements.    Purchaser shall have received the 2005
Audited Financial Statements, the 2005 Quarterly Financial Statements
(accompanied by the SAS 100 review thereon by Seller's Accountants as required
by Section 5.16 hereof), and the 2006 Interim Financial Statements (accompanied
by the SAS 100 review thereon by Seller's Accountants as required by
Section 5.16 hereof); provided, that with respect to any period from the end of
the previous fiscal quarter to the Closing Date (it being understood that any
determination of Closing or Closing Date in this Agreement shall be determined
without giving effect to the closing condition relating to the foregoing
deliverables with respect to such interim periods and/or fiscal quarters set
forth in this Section 8.03(q)), and if any 2006 fiscal quarter has ended after
45 days prior to the Closing Date, the foregoing deliverables with respect to
such interim periods and/or fiscal quarters need not be provided on or prior to
the Closing Date, but shall be provided not later than 45 days after the end of
such period; and

        (r)   Note Document Conditions.    Each party to the Note Documents
(other than the Loan Parties, Parent Entites and OCM AcquisitionCo (each as
defined in the Note Agreement)) shall have executed and delivered each of the
Note Documents and each of the conditions in Sections 4.1 and 4.3 of the Note
Agreement shall have been satisfied (or waived in writing by Purchaser).

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ARTICLE IX

INDEMNIFICATION

            SECTION 9.01    Survival. Subject to the limitations and other
provisions of this Agreement, the representations, warranties, covenants and
agreements of the parties contained herein shall survive the Closing and shall
remain in full force and effect until the date that is 15 months from the
earlier of the Stock Transfer Trigger Date and the Seller Note Certificate Date;
provided, however, (w) that the covenants and agreements set forth in
Sections 5.03, 5.04, 5.05, 5.06, 5.08, 5.09, 5.12, 5.15, 5.16, 5.17 and 5.23 and
in Article VI, Article XI and this Article IX shall remain in full force and
effect for the applicable periods specified in the respective Sections or
Articles or, if no such period is specified, indefinitely; (x) that the
representations and warranties set forth in Section 3.18 (relating to Taxes) and
the agreements in Article VII shall remain in full force and effect as provided
in Section 7.08(c); (y) the representations and warranties set forth in
Section 3.12 (relating to environmental matters) shall survive for a period of
seven years from the Closing Date; and (z) the representations and warranties
set forth in the 1st, 3rd, and 4th sentences of Section 3.01, Section 3.02,
Section 3.03, all of Section 3.04(a) excluding the 1st sentence and the 1st and
2nd sentences of Section 4.01 (collectively, the "Fundamental Representations")
shall survive indefinitely. Whether or not Purchaser or Seller proceeds to the
Repayment Date after the delivery of the Seller Note Certificate (as defined in
the Note Agreement), (i) the Seller Note Developments and the Purchaser Note
Developments, as applicable, will not constitute a breach of representation or
warranty by Seller or Purchaser, respectively, hereunder and (ii) any breach of
any representation or warranty by Seller made under the Seller Note Certificate
will not constitute a breach of representation or warranty of Seller to the
extent (a) not within the knowledge of Seller (or not within what reasonably
should have been within the knowledge of Seller) with respect to facts and
circumstances relating to any period after the Closing Date; or (b) resulting
from (1) any actions taken or omitted to be taken by Seller, Purchaser or any of
their respective Affiliates in compliance with the terms of the Note Documents
or the Transaction Documents or (2) any actions taken or omitted to be taken by
or on behalf of any of the Companies (not within the sole or shared control of
the Operator under the Racing Services Agreement) after the Closing Date (other
than activities taken or omitted to be taken by Operator under the Racing
Services Agreement) or by or on behalf of Purchaser or any of its Affiliates
(other than the Companies).

            SECTION 9.02    Indemnification by Purchaser. (a) Purchaser agrees,
subject to the other terms and conditions of this Agreement, to indemnify Seller
and its Affiliates and the officers, directors, employees and agents of each of
the foregoing (all such Persons being included within the definition of "Seller"
only for purposes of this Section 9.02, Article VI and Article VII) against and
hold them harmless from all Losses arising out of (i) the breach of any
representation, warranty, covenant or agreement of Purchaser herein (other than
Article VI and Article VII, it being understood that the sole remedy for any
such breach thereof shall be pursuant to Article VI or Article VII respectively,
as applicable), (ii) subject to the terms of the Racing Services Agreement, the
conduct of the business of each Company and Subsidiary by Purchaser following
the Closing Date and (iii) any employee benefit plan (as defined in Section 3(3)
of ERISA) maintained, sponsored or contributed to by Purchaser or any current or
former ERISA Affiliate of Purchaser (other than the Companies and their
Subsidiaries), including without limitation any multiemployer plan (as defined
in Section 3(37) of ERISA). Anything in Section 9.01 to the contrary
notwithstanding, no claim may be asserted, nor, subject to the last sentence of
this Section 9.02(a), may any action be commenced, against Purchaser for breach
of any representation, warranty, covenant or agreement contained herein, unless
written notice of such claim or action is received by Purchaser describing in
reasonable detail the facts and circumstances with respect to the subject matter
of such claim or action on or prior to the date on which the representation,
warranty, covenant or agreement on which such claim or action is based ceases to
survive as set forth in Section 9.01 (the "Applicable Date"), irrespective of
whether the subject matter of such claim or action shall have occurred before or
after such date. If a claim or a potential claim arises, Purchaser and Seller
shall promptly work in good faith to determine the validity of such claim or
potential claim within a reasonable period of time and if such claim or
potential claim is not resolved to both parties' satisfaction within such
reasonable period of time, either party may commence legal proceedings to
resolve such claim or potential claim (but in no event (other than as described
in the next sentence) after the Applicable Date). If Seller becomes aware of any
such claim or potential claim within ninety days prior to the Applicable Date
and promptly gives such written notice thereof as aforesaid on or prior to the
Applicable Date, then upon the giving of such notice, Seller and its Affiliates,
or any of them, shall have the right to commence legal proceedings for a period
of up to ninety days subsequent to the date of such written notice for the
enforcement of their rights under Section 9.02 with respect to the matters
indicated in such notice.

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        (b)   Payments by Purchaser pursuant to Section 9.02(a) shall be limited
to the amount of any liability or damage that remains after deducting therefrom
any Tax benefit to Seller and any insurance proceeds and any indemnity,
contribution or other similar payment recovered by Seller from any third party
with respect thereto (it being agreed that Seller will use its commercially
reasonable efforts to recover such proceeds and payments and that, promptly
after the realization of any insurance proceeds, indemnity, contribution or
other similar payment, Seller shall reimburse Purchaser for such reduction in
Losses for which Seller was indemnified prior to the realization of such
reduction of Losses). A Tax benefit to Seller for purposes of this Section 9.02
shall be reasonably determined by Seller's Accountants as the difference between
(i) the amount of federal, state and local Tax Liabilities of Seller and its
Affiliates for the year with respect to which the indemnity payment is made, and
(ii) the amount of federal, state and local Tax Liabilities of Seller and its
Affiliates for the year with respect to which the indemnity payment is made but
without the effect of event that gave rise to the indemnity payment. Seller
shall provide Purchaser with calculations and/or other information reasonably
supporting the determination of the amount of the Tax benefit.

        (c)   No claim may be made against Purchaser for indemnification
pursuant to Section 9.02(a)(i) (other than breaches and claims under
Section 2.03(c) and the Fundamental Representations) with respect to any
individual item of liability or damage arising out of a breach of a
representation or warranty of Purchaser or of a covenant or agreement to be
performed by Purchaser prior to the Closing Date, unless the aggregate of all
such Losses of Seller with respect to Sections 9.02(a)(i) (other than breaches
and claims under Section 2.03(c) and the Fundamental Representations) shall
exceed $1,000,000, and Purchaser shall be required to pay or be liable only for
amounts in excess of such aggregate amount. Seller shall not be indemnified
pursuant to Section 9.02(a)(i) with respect to any individual item of liability
or damage (other than breaches and claims under Section 2.03(c) and the
Fundamental Representations) if the aggregate of all liabilities and damages of
Seller for which Seller has received indemnification pursuant to
Sections 9.02(a)(i) shall have exceeded $20,000,000 (including any amounts paid
or payable by Purchaser or any of its Affiliates under the Note Documents to the
extent such amounts are liabilities and damages that would have been payable
under Section 9.02(a)(i) (other than breaches and claims under Section 2.03(c)
and the Fundamental Representations) but excluding any principal or interest
payment under the Seller Notes and any other amounts paid or payable by
Purchaser or any of its Affiliates under the Note Documents with respect to any
other liabilities and damages).

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        (d)   Except as set forth in this Agreement (including the Exhibits and
the Purchaser Disclosure Schedule), the other Transaction Documents and the Note
Documents, Purchaser is not making any representation, warranty, covenant or
agreement with respect to the matters contained herein. Anything herein to the
contrary notwithstanding and except as set forth in this Agreement and the Note
Documents, no breach of any representation, warranty, covenant or agreement
contained herein shall give rise to any right on the part of Seller, after the
consummation of the purchase and sale of the Shares contemplated by this
Agreement, to rescind this Agreement or any of the transactions
contemplated hereby.

            SECTION 9.03    Indemnification by Seller. (a) Seller agrees,
subject to the other terms and conditions of this Agreement, to indemnify
Purchaser and its Affiliates and the officers, directors, employees and agents
of each of the foregoing (all such Persons being included in the definition of
"Purchaser" only for purposes of this Section 9.03, Article VI and Article VII)
against and hold it harmless from all Losses arising out of the following:

        (i)    the breach of any representation, warranty, covenant or agreement
of Seller herein (other than Article VI and Article VII and Sections 3.16, 3.17
and 3.18, it being understood that the sole remedy for any such breach thereof
shall be pursuant to Article VI or Article VII respectively, as applicable);

        (ii)   any and all Liabilities related to, arising out of or associated
with the Excluded Items or the business or operations of XpressBet, Inc., or any
predecessor or successor (including the Companies and the Subsidiaries but only
to the extent that the business or operations of the Companies and the
Subsidiaries related to the account wagering business now conducted by
XpressBet, Inc.), prior to, on and after the Closing Date, including, without
limitation, any Liabilities related to, arising out of or associated with the
formalizing of the relationship between XpressBet, Inc., Seller, any Company and
its Subsidiaries;

        (iii)  any and all Liabilities related to, arising out of or associated
with the Excluded Subsidiaries or the Former Subsidiaries;

        (iv)  any Liability, obligation or responsibility under or related to
Environmental Laws, whether such Liability or obligation or responsibility is
known or unknown, contingent or accrued, arising from acts, omissions, conduct
or circumstances occurring between April 5, 2001 and the Closing Date;

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(v)any Liability, obligation or responsibility under or required by
Environmental Law, whether such Liability, obligation or responsibility is known
or unknown, contingent or accrued, arising from acts, omissions, conduct or
circumstances occurring prior to April 5, 2001 and the occurrence or existence
of which is a violation of Environmental Law existing as of the Closing Date;

(vi)those matters set forth in the following Sections of the Company Disclosure
Schedules: Schedule 3.05(c) (item (b) only), Schedule 3.10(a) (except for
items (g) and (h) under the headings "Litigation Not Covered by Insurance") and
Schedule 3.11(a) (under the heading "OSHA Citation");

(vii)any liability, obligation or responsibility under the Lease Agreement,
including without limitation, (A) base rent payable under the Lease or otherwise
to the landlord thereunder for any period on or prior to the Closing Date; and
(B) any penalties, damages or claims assessed by the landlord under the Lease in
connection with any default under the Lease or damage to the premises leased
under the Lease; and

(viii)any withdrawal liability that becomes due and payable to any Multiemployer
Plans listed in Schedule 3.16(a) during the period commencing on the Closing
Date and ending on the fifth anniversary of the Closing (the "Pension Survival
Period") by the Companies or any of their Subsidiaries; provided, however, that
if Operator (as defined in the Racing Services Agreement) terminates the Racing
Services Agreement pursuant to Sections 15.4.3, 15.4.6, 15.4.7 (to the extent
that the revocation, suspension, withdrawal or failure of renewal of any license
referenced in Section 15.4.7 is caused by act or omisssion of any Owner
(as defined in the Racing Services Agreement) or any of its Affiliates),
15.4.10, or 15.4.12 of the Racing Services Agreement, then the Pension Survival
Period shall terminate on the date of termination of Operator's services under
the Racing Services Agreement and this indemnity shall not apply to any
withdrawal liability that becomes due and payable to any Multiemployer Plans on
and after the date of such termination or as a result of the termination of, or
as a result of any actions or omissions of Owners (as defined in the Racing
Services Agreement) or any of their Affiliates that gave rise to the termination
of, the Operator's services under the Racing Services Agreement pursuant to the
aforementioned sections of the Racing Services Agreement.

        Seller and Purchaser agree that the following amounts will annually be
determined and, to the extent claimed by Purchaser and acknowledged by Seller,
shall be Agreed Upon Losses (as defined in the Holdback Agreement), and, to the
extent claimed by Purchaser (and to the extent such claim has not become an
Agreed Upon Loss or a Non-Loss (as defined in the Holdback Agreement)), shall be
Disputed Losses (as defined in the Holdback Agreement) on each January 31
occurring within five years of the Repayment Date and on the fifth anniversary
of the Repayment Date (each a "Local Tax Assessment Date") in an amount equal to
the lesser of (i) the Maximum Amount then in effect, and (ii) the Annual
Applicable Amount. The "Annual Applicable Amount" for any such date means 50% of
the Tax Adjusted ocal Share Assessment Losses (i) with respect to the first
January 31 occurring after the Repayment Date, for the period (if any) from the
Repayment Date to the December 31 immediately preceding such January 31,
(ii) with respect to any subsequent January 31 occurring prior to the fifth
anniversary of the Repayment Date, for the twelve-month period ending on the
immediately preceding December 31 (or, if shorter, for the period commencing on
the Repayment Date and ending on the immediately preceding December 31), and
(iii) with respect to the fifth anniversary of the Repayment Date, for the
period from the January 1 occurring the day after the most recent December 31
described in clause (ii) above to such fifth anniversary, as applicable. If
North Strabane Township were to change its fiscal year, then the references to
December 31 in the preceding sentence would be to the end of the new fiscal
year, and the references to January 31 would be to the month end next succeeding
the new fiscal year end.

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        The "Local Share Assessment Losses" for any period means the positive
amount, if any, calculated as follows: (i) the local share assessment for such
period paid by Purchaser or WTA to the Applicable Local Authorities pursuant to
Section 1403(C)(3) of the Gaming Act, minus (ii) two percent (2%) of the
aggregated daily gross terminal revenue from slot machines in operation at WTA's
gaming facility for such period as calculated by the Department of Revenue of
the Commonwealth of Pennsylvania minus (iii) the incremental portion, if any, of
such local share assessment for such period paid by Purchaser or WTA to the
Applicable Local Authorities pursuant to Section 1403(C)(3) of the Gaming Act
which results from a change in law or regulation, or interpretation thereof or
from any other change thereto, in each case that occurs after the end of the
first legislative session of the Pennsylvania state legislature following the
Closing Date (the "Local Applicable Date") minus (iv) any Refund received in
such period from any Applicable Local Authority; provided, however, that if
there is any change to Section 1403(C)(3) of the Gaming Act or interpretation
thereof prior to the Local Applicable Date, then for purposes of calculating the
Local Share Assessment Losses, the amount in clause (i) above shall be the
lesser of (a) the amount described in clause (i) above and (b) the minimum
annual dollar amount (which amount is currently $10,000,000) required under such
Section 1403(C)(3) after giving effect to any such change (prorated if such
period is less than a year), or, if there is no minimum annual amount after
giving effect to such change, then $10,000,000 (prorated if such period is less
than a year).

        The "Tax Adjusted Local Share Assessment Losses" for any period means
the Local Share Assessment Losses for such period net of any Tax Benefits the
Companies actually recognize in the taxable year in which or with which such
period ends ("Current Tax Year") that are directly attributable to any Local
Share Assessment Losses. For this purpose, the Companies shall be deemed to
recognize a Tax benefit ("Tax Benefit") with respect to a taxable year if, and
to the extent that, the Companies' cumulative liability for Taxes through the
end of such taxable year, calculated by excluding any Tax items attributable to
the Local Share Assessment Losses from all taxable years, exceeds the Companies'
cumulative liability for Taxes through the end of such taxable year, calculated
by taking into account any Tax items attributable to the Local Share Assessment
Losses for all taxable years (to the extent permitted by relevant Tax law and
treating such Tax items as the last items claimed for any taxable year). If the
relevant income Tax return for the Current Tax Year has not yet been filed when
making the cumulative liability for Taxes calculations described above, Taxes
for the Current Tax Year shall be reasonably estimated in those calculations. If
an estimate is made pursuant to the previous sentence, once the relevant income
Tax return is filed, the previously estimated calculation shall be finalized,
and an appropriate upward or downward adjustment to the Agreed Upon Losses shall
be made at the next Local Tax Assessment Date (the "True-Up") (or if the income
Tax return is filed after the final Local Tax Assessment Date and the estimate
is finalized after such date, Purchaser will pay to Seller or Seller will pay to
Purchaser, as appropriate, in cash an amount equal to the True Up; provided that
in the event Seller owes any True Up amount in cash pursuant to the foregoing
provision, Seller shall be required to pay Purchaser such amount in cash only to
the extent that it has previously received cash from Releases (as defined in the
Holdback Agreement) that it would not have received but for the under estimation
of taxes that resulted in such True Up amount). The last determination of Tax
Benefits shall be for the taxable year following the last taxable year in which
local share assessments attributable to the five year period following the
Repayment Date are deducted, and no further adjustments for Tax Benefits shall
be made in subsequent taxable years. In no event shall the cumulative Tax
Benefit adjustments exceed the cumulative Local Share Assessment Losses for the
five years following the Repayment Date to which the Tax Benefits are
attributable. The parties agree to act in good faith when making the Tax Benefit
calculations, to make such calculations treating the Companies as a single
taxpayer, and to not take into account any payments made by the Companies to, or
received by the Companies from, any Affiliate of Purchaser (other than the
Companies) unless such payments are de minimis. For purposes of this paragraph,
the term "Companies" shall also include MEC Pennsylvania Food Services, Inc.,
MEC Racing Management, and any other subsidiaries of any of the Companies.

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        In the event that Purchaser or any of its Affiliates receives a Refund
during or after the sixth year following the Repayment Date, and Seller has
borne a portion of the cost of the local share assessment for the year to which
the Refund is attributable because there were Local Share Assessment Losses for
such year (other than any such Refund that was deducted pursuant to clause (iv)
of the Local Share Assessment Losses calculation for any period within such five
years), Purchaser agrees to give written notice thereof to Seller within five
(5) Business Days of receipt of each Refund and an amount equal to the following
will be due from Purchaser to Seller: (a) 50% of the lesser of (i) such Refund
amount and (ii) the Local Share Assessment Losses for the year to which the
Refund is attributable, minus (b) any Tax liability to Purchaser related to the
portion of the Refund creditable or payable to Seller pursuant to clause (a)
(the "Seller Credit"). If receipt of such Refund occurs following the fifth
anniversary of the Repayment Date, Purchaser agrees to pay the Seller Credit to
Seller in cash within fifteen days of receipt of the Refund.

        Notwithstanding anything to the contrary contained in this Agreement or
any of the other Transaction Documents or any of the Note Documents, Seller's
indemnification obligations under this paragraph with respect to the Annual
Applicable Amount shall only reduce the Holdback Amount and under no
circumstances is Seller or any of its Affiliates required to pay Purchaser or
any of its Affiliates any cash or any other consideration (other than a
reduction in the Maximum Amount to the extent described above).

        "Applicable Local Authorities" means North Strabane Township and other
local authorities in Pennsylvania that are entitled to the local share
assessment paid by Purchaser or WTA pursuant to Section 1403(C)(3) of the Gaming
Act. The term shall also include the Department of Revenue and the Treasury
Department of the Commonwealth of Pennsylvania and the Pennsylvania Department
of Economic and Community Development in their capacities or on behalf of the
local authorities described in the preceding sentence.

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        "Refund" means any rebates, reimbursements, credits, refunds or other
relief from any Applicable Local Authority credited to or paid to Purchaser or
any of its Affiliates or any grant or funding paid to Purchaser or any of its
Affiliates from any Applicable Local Authority, in each instance, directly
related to a local share assessment previously paid by Purchaser or WTA with
respect to the five years following the Repayment Date pursuant to
Section 1403(C)(3) of the Gaming Act. To the extent the "Refund" for any period
exceeds the excess, if any, of clause (i) of the definition of Local Share
Assessment Losses for such period over the sum of clauses (ii) and (iii) of the
definition of Local Share Assessment Losses for such period, then such excess
shall be deemed to be a Refund received in the next period.

        Anything in Section 9.01 to the contrary notwithstanding, no claim may
be asserted nor, subject to the second to the last sentence of this
Section 9.03(a), may any action be commenced against Seller for breach of any
representation, warranty, covenant or agreement contained herein, unless written
notice of such claim or action is received by Seller describing in reasonable
detail the facts and circumstances with respect to the subject matter of such
claim or action on or prior to the Applicable Date, irrespective of whether the
subject matter of such claim or action shall have occurred before or after such
date. If a claim or a potential claim arises, Purchaser and Seller shall
promptly work in good faith to determine the validity of such claim or potential
claim within a reasonable period of time and if such claim or potential claim is
not resolved to both parties' satisfaction within such reasonable period of
time, either party may commence legal proceedings to resolve such claim or
potential claim (but in no event (other than as described in the next sentence)
after the Applicable Date). If Purchaser becomes aware of any such claim or
potential claim within ninety days prior to the Applicable Date and promptly
gives such written notice thereof as aforesaid on or prior to the Applicable
Date, then upon the giving of such notice, Purchaser and its Affiliates, or any
of them, shall have the right to commence legal proceedings for a period of up
to ninety days subsequent to the date of such written notice for the enforcement
of their rights under Section 9.03 with respect to the matters indicated in such
notice. To the extent that Seller's undertakings set forth in this Section 9.03
may be unenforceable, Seller shall contribute the maximum amount that it is
permitted to contribute under applicable law to the payment and satisfaction of
all Losses incurred by Purchaser, the Companies and the Subsidiaries.

        (b)   No claim may be made against Seller for indemnification pursuant
to Section 9.03(a)(i) (other than breaches and claims under the Fundamental
Representations and Section 3.12 (as to environmental matters)) with respect to
any individual item of liability or damage arising out of a breach of a
representation or warranty of Seller or of a covenant or agreement to be
performed by Seller prior to the Closing Date, unless the aggregate of all such
Losses of Purchaser with respect to Section 9.03(a)(i) (other than breaches and
claims under the Fundamental Representations and Section 3.12 (as to
environmental matters)) shall exceed $1,000,000, and Seller shall be required to
pay or be liable only for amounts in excess of such aggregate amount. Purchaser
shall not be indemnified pursuant to Section 9.03(a)(i) with respect to any
individual item of liability or damage (other than breaches and claims under the
Fundamental Representations and Section 3.12 (as to environmental matters)) if
the aggregate of all liabilities and damages of Purchaser for which Purchaser
has received indemnification pursuant to Section 9.03(a)(i) shall have exceeded
$20,000,000 (including any amounts paid or payable by Seller or any of its
Affiliates under the Note Documents and the Holdback Documents to the extent
such amounts are liabilities and damages that would have been payable under
Section 9.03(a)(i) (other than breaches and claims under Section 3.12 (as to
environmental matters) and the Fundamental Representations) but excluding any
amounts paid or payable by Seller or any of its Affiliates under the Note
Documents and the Holdback Documents with respect to any other liabilities
and damages).

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        (c)   Payments by Seller pursuant to this Section 9.03 and Sections 6.05
and 7.01 shall be limited to the amount of any liability or damage that remains
after deducting therefrom (i) any Tax benefit to Purchaser, (ii) any insurance
proceeds and any indemnity, contribution or other similar payment recovered by
Purchaser from any third party with respect thereto (it being agreed that
Purchaser will use its commercially reasonable efforts and will cause Companies
and Subsidiaries to use their respective commercially reasonable efforts, to
recover such proceeds and payments and that, promptly after the realization of
any insurance proceeds, indemnity, contribution or other similar payment,
Purchaser shall reimburse Seller for such reduction in Losses for which
Purchaser was indemnified prior to the realization of reduction of such Losses),
and (iii) any amount paid pursuant to Section 15.6.5 of the Racing Services
Agreement with respect to the subject matter in dispute to the extent taken into
account in determining the payment pursuant to such section. A Tax benefit to
Purchaser for purposes of this Section 9.03 will be reasonably determined by
Purchaser's Accountants as the difference between (i) the amount of federal,
state and local Tax Liabilities of Purchaser and its Affiliates (including the
Companies and the Subsidiaries) for the year with respect to which the indemnity
payment is made, and (ii) the amount of federal, state and local Tax Liabilities
of Purchaser and its Affiliates (including the Companies and the Subsidiaries)
for the year with respect to which the indemnity payment is made but without the
effect of event that gave rise to the indemnity payment. Purchaser shall provide
Seller with calculations and/or other information reasonably supporting the
determination of the Tax benefit.

        (d)   Except as set forth in this Agreement (including the Exhibits and
the Company Disclosure Schedule), the other Transaction Documents and the Note
Documents, Seller is not making any representation, warranty, covenant or
agreement with respect to the matters contained herein. Anything herein to the
contrary notwithstanding and except as set forth in this Agreement and the Note
Documents, no breach of any representation, warranty, covenant or agreement
contained herein shall give rise to any right on the part of Purchaser, after
the consummation of the purchase and sale of the Shares contemplated hereby, to
rescind this Agreement or any of the transactions contemplated hereby.

        (e)   Seller and its Affiliates shall have no liability under any
provision of this Agreement for any liabilities and damages to the extent that
such liabilities and damages relate to actions taken by Purchaser or its
Affiliates, including, without limitation, each Company and Subsidiary, after
the Closing Date.

        (f)    Seller and its Affiliates shall have no liability under any
provision of this Agreement for any liabilities and damages to the extent that
such liabilities and damages are obligations of MEC Pennsylvania Racing
Services, Inc. under the Racing Services Agreement to the extent
satisfied thereunder.

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        (g)   Notwithstanding anything herein or in the Racing Services
Agreement to the contrary, (i) prior to the Repayment Date, subject to the next
sentence, all of the indemnification obligations of Seller and its Affiliates
under this Agreement (including without limitation under Articles VI, VII and IX
hereof) and the Racing Services Agreement (including without limitation any
guaranty obligations of Seller thereunder) shall be deferred, and Purchaser and
its Affiliates shall not be able to set off their obligations to Seller and its
Affiliates against such indemnification obligations, until the Repayment Date
(and, subject to the next sentence, no such obligations of Seller or any of its
Affiliates shall be payable prior to the Repayment Date) and (ii) on the
Repayment Date, to the extent there are Losses agreed to or proven to be payable
on or prior to the Repayment Date (pursuant to a final, nonappealable
adjudication) under this Agreement or the Racing Services Agreement, as the case
may be, the obligations with respect to any such agreed to or proven Losses
shall be satisfied by a reduction of the Tranche B Note (and thereafter, the
Tranche A Note) on the Repayment Date in an amount equal to the aggregate amount
of such agreed to or proven Losses. Notwithstanding anything herein or in the
Racing Services Agreement to the contrary, upon the earlier of the date of the
Stock Transfer and the completion of all of Seller's rights and remedies under
the Note Agreement, neither Seller nor any of its Affiliates shall have any
indemnification obligations under this Agreement (including without limitation
under Articles VI, VII and IX hereof) or the Racing Services Agreement
(including without limitation any guaranty obligations of Seller thereunder)
other than for Losses, in each case, which have resulted in out-of-pocket
expenditures by Purchaser's equity holders as a result of Seller's breach of
representation, warranty or covenant under this Agreement or under the Racing
Services Agreement. Nothing in this Agreement or in any of the Transaction
Documents shall limit any rights or claims Seller or any of its Affiliates may
have under the Note Documents. Notwithstanding this Section 9.03(g), the
procedures set forth in Section 9.04 shall continue to apply to any claims that
arise prior to the Repayment Date.

        (h)   Notwithstanding anything herein or in the Racing Services
Agreement to the contrary, (i) prior to the earlier of the Repayment Date and
the Stock Transfer Trigger Date, all of the indemnification obligations of
Purchaser and its Affiliates under this Agreement (including without limitation
under Articles VI, VII and IX hereof) and the Racing Services Agreement shall be
deferred, and Seller and its Affiliates shall not be able to set off their
obligations to Purchaser and its Affiliates against such indemnification
obligations, until the earlier of the Repayment Date and the Stock Transfer
Trigger Date (and no such obligation of Purchaser or any of its Affiliates shall
be payable prior to the earlier of the Repayment Date and the Stock Transfer
Trigger Date) and (ii) on the earlier of the Repayment Date or the Stock
Transfer Trigger Date, to the extent that there are Losses agreed to or proven
to be payable on or prior to the Repayment Date or Stock Transfer Trigger Date,
as applicable, under this Agreement or the Racing Services Agreement, as the
case may be, the obligations shall be paid in cash. Nothing in this Agreement or
in any of the Transaction Documents shall limit any rights or claims Purchaser
or any of its Affiliates may have under the Note Documents.

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SECTION 9.04 Indemnification Procedures, Etc. (a) Each of Purchaser and Seller
(for purposes of this Section 9.04(a), an "Indemnified Party") agrees to give
the indemnifying party under Section 6.05, 7.01, 9.02 or 9.03, as applicable
(for purposes of this Section 9.04(a), an "Indemnifying Party") prompt written
notice (a "Claim Notice") of any claim, assertion, event or proceeding by or in
respect of a third party of which it has knowledge concerning any liability or
damage as to which it may request indemnification under Section 6.05, 7.01, 9.02
or 9.03, as applicable, provided, however, that no delay on the part of the
Indemnified Party in notifying any Indemnifying Party shall relieve the
Indemnifying Party from any liability hereunder unless (and then solely to the
extent) the Indemnifying Party thereby is materially prejudiced by the delay.
The Indemnifying Party shall have the right to assume, through counsel of its
own choosing, the defense or settlement of any such claim or proceeding at its
own expense. If the Indemnifying Party elects to assume the defense of any such
claim or proceeding, the Indemnified Party may participate in such defense, but
in such case the expenses of the Indemnified Party shall be paid by it;
provided, however, that if there exists or is reasonably likely to exist a
conflict of interest (including, without limitation, if there may be one or more
legal or equitable defenses available to the Indemnified Party which are
different from or in addition to those of the Indemnifying Party and
representation by the same counsel would be inappropriate due to the actual or
potential differences between the parties) that would make it inappropriate in
the reasonable judgment of the Indemnified Party for the same counsel to
represent both the Indemnified Party and the Indemnifying Party, then the
Indemnified Party shall be entitled to retain its own counsel, in each
jurisdiction for which the Indemnified Party determines counsel is required, at
the expense of the Indemnifying Party. With reasonable notice, the Indemnified
Party shall provide the Indemnifying Party with reasonable access to its records
and personnel relating to any such claim, assertion, event or proceeding during
normal business hours and shall otherwise cooperate with the Indemnifying Party
in the defense or settlement thereof, and the Indemnifying Party shall reimburse
the Indemnified Party for all its reasonable out-of-pocket expenses in
connection therewith. If the Indemnifying Party elects to assume the defense of
any such claim or proceeding, the Indemnified Party shall not pay, or permit to
be paid, any part of any claim or demand arising from such asserted liability
unless the Indemnifying Party consents in writing to such payment or unless the
Indemnifying Party, subject to the penultimate sentence of this Section 9.04(a),
withdraws from the defense of such asserted liability or unless a final judgment
from which no appeal may be taken by or on behalf of the Indemnifying Party is
entered against the Indemnified Party for such liability. If the Indemnifying
Party shall fail to defend, or if after commencing or undertaking any such
defense, fails to prosecute or withdraws from such defense, the Indemnified
Party shall have the right to undertake the defense or settlement thereof, at
the expense of the Indemnifying Party. If the Indemnified Party assumes the
defense of any such claim or proceeding pursuant to this Section 9.04(a)
and proposes to settle such claim or proceeding prior to a final judgment
thereon or to forego any appeal with respect thereto, then the Indemnified Party
shall give the Indemnifying Party prompt written notice thereof and the
Indemnifying Party shall have the right to participate in the settlement or
assume or reassume the defense of such claim or proceeding. Neither the
Indemnified Party nor the Indemnifying Party shall settle any claim or
proceeding without the written approval of the Indemnifying Party (in the case
of a settlement by the Indemnified Party) or of the Indemnified Party (in the
case of a settlement by the Indemnifying Party), which approval shall not be
unreasonably withheld.

        (b)   Neither Seller nor Purchaser shall have any liability to Purchaser
or Seller (as defined in Section 9.03(a) and Section 9.02(a), respectively), as
the case may be, under Article VI, Article VII or this Article IX
for consequential or punitive damages, except that this Section 9.04(b) shall
not limit an Indemnified Party's right to recover fees or expenses of counsel or
reimbursement or indemnity for claims by third parties to the extent otherwise
provided for in Article VI, Article VII or this Article IX and paid or payable
by an Indemnified Party.

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        (c)   Each of Seller and Purchaser hereby acknowledges and agrees that,
from and after the Closing, other than the claims, remedies and other rights of
Seller, Purchaser and their respective Affiliates under the Note Documents, the
sole and exclusive remedy of Seller or Purchaser (as defined in Section 9.02(a)
and Section 9.03(a), respectively), as the case may be, against Purchaser or
Seller, as the case may be, with respect to any and all claims relating to the
subject matter of this Agreement shall be pursuant to the indemnification
provisions set forth in this Article IX and in Article VI and Article VII,
except for any claims arising out of fraud and where a party is entitled to seek
injunctive relief because there is no adequate remedy at law. In furtherance of
the foregoing, each of Purchaser and Seller hereby waives, on behalf of itself
and any other Purchaser or Seller (as defined in Section 9.02(a) and 9.03(a),
respectively), as the case may be, to the fullest extent permitted under
applicable law, any and all rights, claims and causes of action such Purchaser
and Seller (or, after the Closing, any Company or Subsidiary), as the case may
be, may have against Seller or Purchaser, as the case may be, (other than
pursuant to this Article IX, Article VI, or Article VII, as applicable) relating
to the subject matter of this Agreement arising under or based upon any law,
rule, regulation, order, judgment or decree applicable to it or by which any of
the properties of it or any of its subsidiaries is bound or affected, subject to
the exception set forth in the immediately preceding sentence and subject to the
claims, remedies and other rights of Seller, Purchaser and their respective
Affiliates under the Note Documents. Nothing in the forgoing provisions of this
Section 9.04(c) shall limit any rights or claims any party hereto, any Company,
any Subsidiary or MEC Pennsylvania Racing Services, Inc. or any of their
respective Affiliates may have under the Racing Services Agreement, the Note
Documents, the Holdback Documents, the Equity Commitment Agreement or any
agreements related thereto (including any agreements guarantying the obligations
under or otherwise lending credit support to the Holdback Documents or Equity
Commitment Agreement).

        (d)   Each of Purchaser and Seller agrees that, in the event an
Indemnifying Party elects to assume the defense of any claim or proceeding, it
will refrain from making any public announcements in respect of such claim or
otherwise communicating with the news media.

        (e)   Purchaser and Seller hereby consent to the non-exclusive
jurisdiction of any court in which an Action by a third party is brought against
any Indemnified Party for purposes of any claim that an Indemnified Party may
have under this Agreement with respect to such Action or the matters alleged
therein and agree that process may be served on Purchaser and Seller with
respect to such a claim at the address specified in this Agreement. From and
after the Closing, neither the Companies nor the Subsidiaries shall have any
Liability to Seller or its Affiliates for any breaches of the representations,
warranties, agreements or covenants of Seller, the Companies or the Subsidiaries
set forth herein (other than such agreements and covenants of the Companies or
the Subsidiaries set forth herein to the extent such agreements and covenants
are to be performed after the Closing). From and after the Closing, neither
Seller nor its Affiliates shall seek indemnification or contribution from any
Company or Subsidiary (including any of its employees or agents) for any such
breaches (other than breaches of such agreements and covenants to be performed
after the Closing Date) or in respect of any other payments required to be made
by Seller or its Affiliates (other than the Companies or the Subsidiaries)
pursuant to this Agreement. Nothing in the foregoing provisions of this
Section 9.04(e) shall limit any rights or claims any party hereto, any Company,
any Subsidiary, MEC Pennsylvania Racing Services, Inc. or any of their
respective Affiliates may have under the Racing Services Agreement, the Note
Documents, the Holdback Documents, the Equity Commitment Agreement or any
agreements related thereto (including any agreements guarantying the obligations
under or otherwise lending credit support to the Holdback Documents or Equity
Commitment Agreement).

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        SECTION 9.05 Payments. Subject to Section 9.03(g), once a Loss is agreed
to by the Indemnifying Party or finally adjudicated to be payable pursuant to
Section 6.05, Section 7.01 or this Article IX, the Indemnifying Party shall
satisfy its obligations within fifteen (15) Business Days of such final,
nonappealable adjudication by wire transfer of immediately available funds;
provided, that during the term of any of the Holdback Documents, if the
Indemnifying Party is Seller and the Losses are covered under the Holdback
Documents, then such obligations shall be satisfied in accordance with the
provisions of the Holdback Documents. The parties hereto agree that should an
Indemnifying Party not make full payment of any such obligations (other than
such obligations described in the proviso set forth in the immediately preceding
sentence or in Section 9.03(g)) within such fifteen (15) Business Day period,
any amount payable shall accrue interest, compounded annually, calculated from
the date of agreement of the Indemnifying Party or final, nonappealable
adjudication through the date such payment has been made, on the basis of the
average of the daily rate of interest publicly announced by Citibank N.A. in
New York, New York from time to time as its base rate from the date of such
agreement or such adjudication to the date of such payment. The parties hereto
agree that any indemnification made pursuant to this Agreement (including
without limitation any indemnification covered by the Holdback Documents or any
indemnification resulting in the reduction of amounts owing under the Seller
Notes) shall be treated as an adjustment to the Purchase Price.

ARTICLE X

TERMINATION, AMENDMENT AND WAIVER

        SECTION 10.01 Termination. This Agreement may be terminated at any time
prior to the Closing:

(a)by the mutual written consent of Seller and Purchaser;

(b)by Seller if the condition set forth in Section 8.03(n) of this Agreement has
not been satisfied or waived by Purchaser by July 31, 2006;

(c)by Purchaser, upon a material breach of any representation, warranty,
covenant or agreement of Seller set forth in this Agreement such that the
conditions set forth in Section 8.03 would not be satisfied or if any
representation or warranty of Seller shall have become untrue such that
Purchaser would have the right not to proceed with the Closing pursuant to
Section 8.03(b) (a "Terminating Seller's Breach"); provided, however, that if
such Terminating Seller's Breach is curable by Seller through the exercise of
its reasonable efforts within 30 days from the date Seller becomes aware thereof
and is cured, Purchaser may not terminate this Agreement pursuant to this
Section 10.01(c) solely by reason of such Terminating Seller's Breach;

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        (d)   by Seller, upon a material breach of any representation, warranty,
covenant or agreement of Purchaser set forth in this Agreement such that the
conditions set forth in Section 8.02 would not be satisfied or if any
representation or warranty of Purchaser shall have become untrue such that
Seller would have the right not to proceed with the Closing pursuant to
Section 8.02(b) (a "Terminating Purchaser's Breach"); provided, however, that if
such Terminating Purchaser Breach is curable by Purchaser through the exercise
of its reasonable efforts within 30 days from the date Purchaser becomes aware
thereof and is cured, Seller may not terminate this Agreement pursuant to this
Section 10.01(d) solely by reason of such Terminating Purchaser's Breach;

        (e)   by Purchaser or Seller in the event that any Governmental
Authority shall have issued an order, decree or ruling or taken any other action
restraining or enjoining the transactions contemplated by this Agreement, and
such order, decree, ruling or other action shall have become final
and nonappealable;

        (f)    by Seller, upon receiving an Action Notice from the Purchaser;

        (g)   [reserved];

        (h)   by Seller upon failure to submit the Gaming Application to the
Gaming Board by December 20, 2005 in accordance with Section 5.04(c) or the
failure by Purchaser to satisfy and continue to satisfy the Gaming Application
Fee requirement in accordance with Section 5.04(d); provided, however that if
the failure to submit such Gaming Application is the result of the failure of
Seller to make reasonable efforts in accordance with Section 5.04(c), Seller may
not terminate pursuant to this Section 10.01(h);

        (i)    by Seller or Purchaser if the condition set forth in
Section 8.01(c) of this Agreement has not been satisfied or waived by both
Purchaser and Seller by July 31, 2006;

        (j)    [reserved];

        (k)   by Seller, at any time after the date which is 5 Business Days
prior to the date, if any, identified by the Gaming Board after which continued
pursuit by Seller of a Conditional Category 1 license with Purchaser pursuant to
the Gaming Application would jeopardize Seller's ability to obtain a Conditional
Category 1 license or a Category 1 license in its own name;

        (l)    by Seller or Purchaser if it reasonably determines that Closing
has become impossible due to events or circumstances that have occurred since
the date of this Agreement; provided however that the right to terminate this
Agreement under this Section 10.01(l) shall not be available to a party whose
failure to fulfill any obligation under this Agreement shall have been the cause
of, or shall have resulted in, the Closing becoming impossible; or

        (m)  by Seller or Purchaser if the Closing shall not have occurred prior
to July 31, 2006.

        Time shall be of the essence in this Agreement.

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        SECTION 10.02    Effect of Termination.    In the event of termination
of this Agreement in accordance with this Agreement, this Agreement shall
forthwith become void and there shall be no liability on the part of any party
hereto (a) except as set forth in Sections 5.04(e), 5.05 and 5.15 and the
second, third and fourth sentences of Section 5.04(d) and Article XI hereof and
(b) nothing herein shall relieve any party hereto from liability for any willful
breach of any provision hereof (including, without limitation, Section 5.10).

        SECTION 10.03    Waiver.    At any time prior to the Closing, each of
the parties hereto may (a) extend the time for the performance of any of the
obligations or other acts of the other party hereto, (b) waive any inaccuracies
in the representations and warranties contained herein or in any document
delivered pursuant hereto or (c) waive compliance with any of the agreements or
conditions contained herein. Any such extension or waiver shall be valid only if
set forth in an instrument in writing signed by the party to be bound by such
extension or waiver, as applicable. Any waiver of any term or condition shall
not be construed as a waiver of any subsequent breach or a subsequent waiver of
the same term or condition, or a waiver of any other term or condition, of this
Agreement. The failure of any party to assert any of its rights hereunder shall
not constitute a waiver of any of such rights.

ARTICLE XI

GENERAL PROVISIONS

        SECTION 11.01    Expenses; Pro-rations.

        (a)   Except as otherwise expressly provided herein, all costs and
expenses, including, without limitation, fees and disbursements of counsel,
financial advisors and accountants, incurred in connection with this Agreement
and the transactions contemplated hereby shall be paid by the party incurring
such costs and expenses, whether or not the Closing shall have occurred. Seller
shall pay (i) the cost of the Title Commitments; (ii) the portion of the premium
attributable to the standard coverage portion of the Title Policies (excluding
the costs of any endorsements requested by Purchaser, except as are necessary to
cure any Title Objection or obtained in connection with an Insured Exception);
(iii) Seller's share of the pro-rations described in this Section 11.01;
and (iv) one-half of the HSR filing fee. Purchaser shall pay (i) the portion of
the premium attributable to any endorsements to the Title Policies (except as
set forth in the preceding sentence) and the portion of the premium attributable
to the "extended coverage" portion of the Title Policies; (ii) Purchaser's share
of the pro-rations described in this Section 11.01; and (iii) one-half of the
HSR filing fee.

        (b)   All non-delinquent real estate Taxes and assessments on the Real
Property will be prorated as of the Closing based on the actual current Tax
bill. If the Closing takes place before the real estate Taxes are fixed for the
Tax year in which the Closing occurs, the apportionment of real estate Taxes
will be made on the basis of the real estate Taxes for the immediately preceding
Tax year applied to the latest assessed valuation. All delinquent Taxes and all
delinquent assessments, if any, on the Real Property will be satisfied at the
Closing by Seller. All supplemental Taxes billed after the Closing for periods
prior to the Closing will be paid promptly by Seller. Any Tax refunds received
by Purchaser which are allocable to the period prior to the Closing (less
Purchaser's reasonable out-of-pocket costs in connection with any such refund
proceedings) will be paid by Purchaser to Seller.

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        (c)   With respect to rent and other amounts payable by Seller in
connection with any leases, all such rent and other amounts will be prorated as
of the Closing. Any delinquent rent or other payments payable by Seller in
connection with the leases will be satisfied at the Closing by Seller.

        (d)   With respect to rent and other amounts payable to Seller in
connection with any leases, all rents which are actually received by Seller as
of the Closing will be prorated. Delinquent rents and rents not paid by Closing
will not be prorated and Seller can continue to collect such rents, provided
that Purchaser shall not have the obligation to pursue any Action or other
proceedings in connection therewith. Rents allocable to the period prior to the
Closing will be the property of Seller and rents allocable to the period after
the Closing will be the property of Purchaser.

        (e)   All pro-rations will be made as of the date of the Closing based
on a 365-day year or the number of days in the month during which the Closing
occurs, as applicable.

        SECTION 11.02    Notices.    All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be given or made on
the date delivered by hand or by internationally recognized courier service such
as Federal Express or by other messenger (or if delivery is refused, upon
presentment), or upon receipt by facsimile transmission (without confirmation),
or upon delivery by registered or certified mail (postage prepaid, return
receipt requested) to the parties hereto at the following addresses (or at such
other address for a party as shall be specified in a notice given in accordance
with this Section 11.02):

(a)if to Seller:

Magna Entertainment Corp.
337 Magna Drive
Aurora, Ontario
L4G 7K1, Canada
Facsimile: 905-726-7177
Attn: CEO/General Counsel

with a copy to:

O'Melveny & Myers LLP
400 South Hope Street
15th Floor
Los Angeles, CA 90071
Facsimile: 213-430-6407
Attn: Joseph K. Kim, Esq.

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(b)if to Purchaser:

PA Meadows, LLC
211 North Rampart Blvd.
Las Vegas, Nevada 89115
Facsimile: 702-507-5992
Attn: William Paulos
William Wortman

with a copy to:

Munger, Tolles & Olson, LLP
355 S. Grand Avenue, 35th Floor
Los Angeles, CA 90071-1560
Facsimile: 213-687-3702
Attn: Sandra Seville-Jones, Esq.

and a copy to:

Santoro, Driggs, Walch, Kearney, Johnson & Thompson
400 South Fourth Street
Suite 300
Las Vegas, NV 89101
Facsimile: 702-791-1912
Attn: Michael Kearney

        SECTION 11.03    Public Announcements.    Unless otherwise required by
applicable law or stock exchange requirements, no party to this Agreement shall
make any public announcements in respect of this Agreement or the transactions
contemplated hereby or otherwise communicate with any news media without prior
consent of the other party, and the parties will cooperate as to the timing and
contents of any such announcement.

        SECTION 11.04    Headings.    The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

        SECTION 11.05    Severability.    If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in a mutually acceptable manner in
order that the transactions contemplated hereby be consummated as originally
contemplated to the greatest extent possible.

        SECTION 11.06    Entire Agreement.    This Agreement, the Note Documents
and the Transaction Documents constitute the entire agreement of the parties
hereto with respect to the subject matter hereof and supersedes all prior
agreements and undertakings, both written and oral, other than the
Confidentiality Agreement, between Seller and Purchaser (or Millennium
Management Group, LLC) with respect to the subject matter hereof and except as
otherwise expressly provided herein.

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        SECTION 11.07    Assignment.    This Agreement shall not be assigned by
operation of law or otherwise, except that prior to the Closing, Purchaser,
without the consent of Seller, but with at least 10 Business Days' prior written
notice to Seller, may transfer or cause to be transferred all of the equity
interests of Purchaser to a wholly owned direct or indirect subsidiary of
Cannery Casino Resorts, LLC, a Nevada limited liability company.

        SECTION 11.08    No Third-Party Beneficiaries.    Except as provided in
Article IX, this Agreement is for the sole benefit of the parties hereto and
their permitted assigns and nothing herein, express or implied, is intended to
or shall confer upon any other Person or entity any legal or equitable right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement.

        SECTION 11.09    Amendment.    This Agreement may not be amended or
modified except by an instrument in writing signed by Seller and Purchaser.

        SECTION 11.10    Governing Law; Jurisdiction; Service of
Process.    (a) This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York. Seller and Purchaser hereby agree and
consent to the exclusive jurisdiction of, and service of process and venue in,
the United States District Court for the Southern District of New York and the
courts of the State of New York located in the County of New York, State of
New York and waives any objection with respect thereto, for the purpose of any
action, suit or proceeding arising out of or relating to this Agreement.

        SECTION 11.11    WAIVER OF JURY TRIAL.    EACH OF PURCHASER AND SELLER
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING,
OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE ACTIONS OF PURCHASER OR SELLER IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF.

        SECTION 11.12    Counterparts.    This Agreement may be executed in one
or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.

        SECTION 11.13    Specific Performance.    The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or equity.

        SECTION 11.14    Prevailing Party.    The prevailing party or parties in
any arbitration, mediation, court action, or other adjudicative proceeding
arising out of or relating to this Agreement shall be reimbursed by the party or
parties who do not prevail for their reasonable attorneys, accountants and
experts fees and for the costs of such proceeding.

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        IN WITNESS WHEREOF, Seller and Purchaser have caused this Agreement to
be executed as of the date first written above by their respective officers
thereunto duly authorized.

    PA MEADOWS, LLC             By:  

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Name:
Title:                     MAGNA ENTERTAINMENT CORP.             By:  

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Name:
Title:                     By:  

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Name:
Title:

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QuickLinks

FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT
RECITALS
STOCK PURCHASE AGREEMENT
TABLE OF CONTENTS
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER
ARTICLE V
ADDITIONAL AGREEMENTS
ARTICLE VII TAX MATTERS
ARTICLE VIII CONDITIONS TO CLOSING
ARTICLE IX INDEMNIFICATION
ARTICLE X TERMINATION, AMENDMENT AND WAIVER
ARTICLE XI
GENERAL PROVISIONS