<PAGE>

                                                                   Exhibit 10.1
===============================================================================


                            ASSET PURCHASE AGREEMENT

                                   dated as of

                               November 13, 1998,

                                     between

                             Meditrust Corporation,

                          Meditrust Operating Company,

                         The Santa Anita Companies, Inc.

                  and Santa Anita Enterprises, Inc., as Sellers

                                       and

                   MI Developments of America, Inc., as Buyer

===============================================================================
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

                                   ARTICLE I

                                  DEFINITIONS

1.1  Definitions............................................................. 1

                                   ARTICLE II

       SALE OF ASSETS, ASSUMPTION OF LIABILITIES AND RELATED TRANSACTIONS

2.1  Purchase and Sale of Assets............................................   8
2.2  Assumption of Certain Liabilities......................................  10
2.3  Purchase Price and Allocation..........................................  11
2.4  Payment of Purchase Price; Closing Adjustment..........................  11
2.5  Review of Title Matters................................................  13
2.6  Interim Operations.....................................................  13


                                  ARTICLE III

                                    CLOSING

3.1  Closing Date...........................................................  13
3.2  Items to be Delivered at the Closing By Sellers........................  13
3.3  Items to be Delivered at the Closing by Buyer..........................  14


                                   ARTICLE IV

                   REPRESENTATIONS AND WARRANTIES OF SELLERS

 4.1  Organization and Related Matters......................................  15
 4.2  Stock.................................................................  15
 4.3  Financial Statements; Changes; Contingencies..........................  16
 4.4  Tax and Other Returns and Reports.....................................  17
 4.5  MaterialContracts.....................................................  17
 4.6  Condition of Property; Leases.........................................  18
 4.7  Intangible Property...................................................  20
 4.8  Authorization;No Conflicts............................................  20
 4.9  Legal Proceedings.....................................................  21
4.10  Minute Books..........................................................  21
4.11  Accounting Records; Internal Controls; Absence of Certain Payments....  21
4.12  Insurance.............................................................  21
4.13  Permits...............................................................  22
4.14  Compliance with Law...................................................  22

                                       i
<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)
                                                                            Page

4.15  Dividends and other Distributions.....................................  22
4.16  Employee Benefits.....................................................  22
4.17  Certain Interests.....................................................  26
4.18  Intercompany Transactions.............................................  26
4.19  Bank Accounts, Powers, etc............................................  26
4.20  No Brokers or Finders.................................................  26
4.21  Accuracy of Information...............................................  27
4.22  Environmental Compliance..............................................  27
4.23  Powers of Attorney....................................................  28
4.24  As-Is Qualification...................................................  28


                                    ARTICLE V

                     REPRESENTATIONS AND WARRANTIES OF BUYER


5.1  Organization and Related Matters.......................................  29
5.2  Authorization..........................................................  29
5.3  No Conflicts...........................................................  29
5.4  No Brokers or Finders..................................................  29
5.5  Governmental Filings...................................................  29


                                   ARTICLE VI

       COVENANTS WITH RESPECT TO CONDUCT OF THE BUSINESS PRIOR TO CLOSING


6.1  Access.................................................................  30
6.2  Material Adverse Changes; Reports; Financial Statements................  30
6.3  Conduct of Business....................................................  31
6.4  Notification of Certain Matters........................................  33
6.5  Permits and Approvals; Third Party Consents............................  33
6.6  Preservation of Business Prior to Closing Date.........................  34
6.7  Certain Filings........................................................  34


                                   ARTICLE VII

                         ADDITIONAL CONTINUING COVENANTS

 7.1  Noncompetition........................................................  34
 7.2  Nondisclosure of Proprietary Data.....................................  35
 7.3  Tax Cooperation.......................................................  35
 7.4  Employment Matters....................................................  36
 7.5  Proration Payments....................................................  36
 7.6  New Gaming Profit Sharing.............................................  37

                                       ii
<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)
                                                                            Page

 7.7  No Solicitation.......................................................  37
 7.8  Section 338(h)(10) Election...........................................  37
 7.9  Sales and Transfer Taxes..............................................  37
7.10  Waiver of Bulk Sales Notice...........................................  38
7.11  Elimination of Intercompany and Affiliate Liabilities.................  38
7.12  Pension Plan..........................................................  38
7.13  Corporate Name........................................................  38
7.14  Repair of Damage; Condemnation........................................  38


                                  ARTICLE VIII

                             CONDITIONS OF PURCHASE


8.1  GeneralConditions......................................................  39
8.2  Conditions to Obligations of Buyer.....................................  39
8.3  Conditions to Obligations of Sellers...................................  40


                                   ARTICLE IX

                      TERMINATION OF OBLIGATIONS; SURVIVAL


9.1  Termination of Agreement...............................................  40
9.2  Effect of Termination..................................................  41
9.3  Survival of Representations and Warranties.............................  41


                                    ARTICLE X

                                 INDEMNIFICATION


10.1  Obligations of Sellers................................................  42
10.2  Obligations of Buyer..................................................  42
10.3  Certain Tax Matters...................................................  43
10.4  Procedure.............................................................  44
10.5  Survival..............................................................  45
10.6  Notice by Sellers.....................................................  45
10.7  Not Exclusive Remedy..................................................  45


                                   ARTICLE XI

                                     GENERAL

 11.1  Amendments;Waivers...................................................  45
 11.2  Schedules; Exhibits; Integration.....................................  45
 11.3  BestEfforts;FurtherAssurances........................................  46

                                      iii
<PAGE>

                               TABLE OF CONTENTS
                                  (Continued)

                                                                            Page

 11.4  Governing Law........................................................  46
 11.5  No Assignment........................................................  46
 11.6  Headings.............................................................  46
 11.7  Counterparts.........................................................  46
 11.8  Publicity and Reports................................................  46
 11.9  Confidentiality......................................................  47
11.10  Parties in Interest..................................................  47
11.11  Performance by Subsidiaries..........................................  47
11.12  Notices..............................................................  47
11.13  Expenses.............................................................  48
11.14  Remedies; Waiver.....................................................  49
11.15  Attorney's Fees......................................................  49
11.16  Specific Performance.................................................  49
11.17  Severability.........................................................  49
11.18  Time of Essence......................................................  49


                                       iv
<PAGE>

                            ASSET PURCHASE AGREEMENT

     This Asset Purchase Agreement is entered into as of November 13, 1998,
between MI Developments of America, Inc., a Delaware corporation ("Buyer"),
Meditrust Corporation, a Delaware corporation ("MT"), Meditrust Operating
Company, a Delaware corporation ("MOC"), The Santa Anita Companies, Inc., a
Delaware corporation ("SAC"), and Santa Anita Enterprises, a California
corporation ("SAE," and together with MT, MOC and SAC, "Sellers").

                                 R E C I T A L S

     WHEREAS, Sellers own, lease or license all of the assets used in connection
with their horse racing business conducted at Santa Anita Racetrack.

     WHEREAS, Sellers desire to sell, and Buyer desires to purchase such assets
on the terms and conditions set forth in this Agreement.

                                A G R E E M E N T

     In consideration of the mutual promises contained herein and intending to
be legally bound, the parties agree as follows:

                                   ARTICLE I
                                   DEFINITIONS

     1.1 Definitions.
         ------------

     For all purposes of this Agreement, except as otherwise expressly provided,

     (a) the terms defined in this Article I have the meanings assigned to them
in this Article I and include the plural as well as the singular,

     (b) all accounting terms not otherwise defined herein have the meanings
assigned under generally accepted accounting principles in the United States,

     (c) all references in this Agreement to designated "Articles," "Sections"
and other subdivisions are to the designated Articles, Sections and other
subdivisions of the body of this Agreement,

     (d) pronouns of either gender or neuter shall include, as appropriate, the
other pronoun forms, and

     (e) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular Article,
Section or other subdivision.

     As used in this Agreement and the Exhibits and Schedules delivered pursuant
to this Agreement, the following definitions shall apply.
<PAGE>

          "Accounts Receivable" has the meaning specified in Section 2.1(b).

          "Action" means any action, complaint, investigation, petition, suit or
other proceeding, whether civil or criminal, in law or in equity, or before any
arbitrator or Governmental Entity.

          "Adjustment Period" has the meaning specified in Section 10.3(c).

          "Affiliate" means a Person that directly or indirectly, through one or
more intermediaries, controls, or is controlled by, or is under common control
with, a specified Person.

          "Aggregate Claims" has the meaning specified in Section 10.1(b).

          "Agreement" means this Agreement by and among Buyer and Sellers as
amended or supplemented together with all Exhibits and Schedules attached or
incorporated by reference.

          "Approval" means any approval, authorization, consent, qualification
or registration, or any waiver of any of the foregoing, required to be obtained
from, or any notice, statement or other communication required to be filed with
or delivered to, any Governmental Entity or any other Person.

          "Arbitrating Accountant" has the meaning specified in Section 2.4(d).

          "Associate" of a Person means

          (a) a corporation or organization (other than a party to this
Agreement) of which such person is a director, an officer or partner or is,
directly or indirectly, the beneficial owner of 10% or more of any class of
equity securities;

          (b) any trust or other estate in which such person has a substantial
beneficial interest or as to which such person serves as trustee or in a similar
capacity; and

          (c) any relative or spouse of such person or any relative of such
spouse.

          "Assumed Liabilities" has the meaning specified in Section 2.2(b).

          "Auditors" means PriceWaterhouseCoopers LLP, independent public
accountants to Sellers.

          "Bill of Sale" has the meaning specified in Section 3.2(a).

          "Business" means the horse racing operations of Sellers and the
Subsidiaries taken as a whole and any and all rights, documents and other
interests of Sellers and the Subsidiaries with respect to the development or the
proposed development of the Real Property and shall be deemed to include each or
any of the following incidents of such business: income, future cash flow,
operations, condition (financial or other), Purchased Assets, anticipated
revenues/income, prospects, Assumed Liabilities, and personnel and management.

                                       2
<PAGE>

          "Closing" means the consummation of the transaction contemplated by
this Agreement as set forth in Section 3.1.

          "Closing Account Amount" means (a) the sum of the book values of
inventory, prepaid expenses (including without limitation all expenses incurred
in connection with the 1998-1999 Santa Anita race meet) and cash and cash
equivalents as included in the Closing Balance Sheet, less (b) liabilities,
including, without limitation, deferred income and accrued vacation, reflected
on the Closing Balance Sheet (excluding any amounts for Excluded Liabilities,
which shall be transferred by LATC to Seller immediately prior to the Closing).

          "Closing Adjustment" has the meaning specified in Section 2.4.

          "Closing Balance Sheet" has the meaning specified in Section 2.4(b).

          "Closing Date" means the date of the Closing.

          "Closing Payment" has the meaning specified in Section 2.4(a).

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

          "Contract" means any agreement, arrangement, bond, commitment,
franchise, indemnity, indenture, instrument, lease, license or understanding,
whether or not in writing.

          "Deficiency Period" has the meaning specified in Section 10.3(c).

          "Deposit" means the $6.5 million being held pursuant to the letter
agreement, dated October 23, 1998, which amount shall be transferred to the
Title Company to be held under the terms hereof and the Joint Escrow
Instructions, and shall include any and all interest or other investment income
thereon.

          "Disclosure Schedule" means the Disclosure Schedule dated November 12,
1998 and delivered by Sellers to Buyer.  The Sections of the Disclosure Schedule
shall be numbered to correspond to the applicable Section of this Agreement and,
together with all matters under such heading, shall be deemed to qualify only
                                                                         ----
that section.

          "Disputed Items" has the meaning specified in Section 2.4(d).

          "Encumbrance" means any claim, charge, lease, covenant, easement,
encumbrance, security interest, lien, option, pledge, rights of others, or
restriction (whether on voting, sale, transfer, disposition or otherwise),
whether imposed by agreement, understanding, law, equity or otherwise, except
for any restrictions on transfer generally arising under any applicable federal
or state securities law.

          "Equity Securities" means any capital stock or other equity interest
or any securities convertible into or exchangeable for capital stock or any
other rights, warrants or options to acquire any of the foregoing securities.

                                       3
<PAGE>

          "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the related regulations and published interpretations.

          "ERISA Affiliate" means (i) any corporation which is a member of a
group of corporations of which any Seller is a member and which is a controlled
group of corporations within the meaning of Section 414(b) of the Code; (ii) any
trade or business (whether or not incorporated) which is a member of a group of
trades or businesses under common control within the meaning of Section 414(c)
of the Code of which any Seller is a member; and (iii) a member of an affiliated
service group within the meaning of Section 414(m) or (o) of the Code of which
any Seller, any corporation described in clause (i) above or any trade or
business described in clause (ii) above is a member.

          "ERISA Plan" means any plan or Contract referred to in Section 4.16
that is subject to any provision of ERISA.

          "Excess Amount" has the meaning specified in Section 10.3(c).

          "Exchange Act" means the United States Securities Exchange Act of
1934, as amended.

          "Excluded Assets" has the meaning specified in Section 2.1(a).

          "Excluded Liabilities" has the meaning specified in Section 2.2(a).

          "FIRPTA Certificate" has the meaning specified in Section 3.2(e).

          "GAAP" means generally accepted accounting principles in the United
States, as in effect from time to time, applied on a consistent basis.

          "Gaming Royalty" has the meaning specified in Section 7.6.

          "Governmental Entity" means any government or any agency, bureau,
board, commission, court, department, official, political subdivision, tribunal
or other instrumentality of any government, whether federal, state or local,
domestic or foreign.

          "Grant Deed" has the meaning specified in Section 3.2(b).

          "Hart-Scott-Rodino Act" means the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the related regulations and published
interpretations.

          "Hazardous Substance" means (but shall not be limited to) substances
that are defined or listed in, or otherwise classified pursuant to, any
applicable Laws as "hazardous substances," "hazardous materials," "hazardous
wastes" or "toxic substances," or any other formulation intended to define, list
or classify substances by reason of deleterious properties such as ignitibility,
corrosivity, reactivity, radioactivity, carcinogenicity, reproductive toxicity
or "EP toxicity," and petroleum and drilling fluids, produced waters and other
wastes associated with the exploration, development, or production of crude oil,
natural gas or geothermal energy.

                                       4
<PAGE>

          "Indemnifiable Claim" means any Loss for or against which any party is
entitled to indemnification under this Agreement; "Indemnified Party" means the
                                                   -----------------
party entitled to indemnity hereunder; and "Indemnifying Party" means the party
                                            ------------------
obligated to provide indemnification hereunder.

          "Intangible Property" means any trade secret, secret process or other
confidential information or know-how related to the Business and any and all
Marks, and in each case, any licenses with respect thereto.

          "Inventory" has the meaning specified in Section 2.1(a).

          "IRS" means the United States Internal Revenue Service or any
successor entity.

          "Joint Escrow Instructions" has the meaning specified in Section
8.2(h).

          "LATC" means Los Angeles Turf Club Incorporated, a California
corporation.

          "Law" means any constitutional provision, statute or other law, rule,
regulation, or interpretation of any Governmental Entity and any Order.

          "Lease" has the meaning set forth in Section 4.6.

          "Loss" means any action, cost, damage, disbursement, expense,
liability, loss, deficiency, diminution in value, obligation, penalty or
settlement of any kind or nature, whether foreseeable or unforeseeable,
including but not limited to, interest or other carrying costs, penalties,
legal, accounting and other professional fees and expenses incurred in the
investigation, collection, prosecution and defense of claims and amounts paid in
settlement, that may be imposed on or otherwise incurred or suffered by the
specified person.

          "Mark" means any brand name, copyright, patent, service mark,
trademark, trade name, and all registrations or applications for registration of
any of the foregoing, in each case related to the Business.

          "Material Adverse Effect" means (a) dimunition in value of the
Purchased Assets of $5 million or more from their value as of the date of this
Agreement or (b) the inability of Buyer to conduct the Business in substantially
the manner it has been conducted during the Period of Ownership.

          "Material Contract" means any executory Contract relating to the
Business as of or after November 12, 1998 which is deemed material by Section
4.5.

          "Order" means any decree, injunction, judgment, order, ruling,
assessment or writ.

          "PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.

          "Pension Plan" has the meaning set forth in Section 7.12.

                                       5
<PAGE>

          "Permit" means any license, permit, franchise, certificate of
authority, or order, or any waiver of the foregoing, required to be issued by
any Governmental Entity and related to the operation of the Business.

          "Permitted Exceptions" means (a) Taxes (i) not yet delinquent or (ii)
the validity of which are being contested in good faith by appropriate actions
and which are described on Schedule 2.5 hereto and (b) those exceptions set
forth in the Title Commitment.

          "Person" means an association, a corporation, an individual, a
partnership, a trust or any other entity or organization, including a
Governmental Entity.

          "Preliminary Title Report" means an extended coverage preliminary
title report or title insurance commitment issued by the Title Company showing
all Encumbrances affecting all Real Property, together with legible copies of
all documents referred to in such preliminary title report.

          "Prepaid Expenses" has the meaning specified in Section 2.1(a).

          "Proration Date" means as of 12:01 a.m. on the earlier of the Closing
Date or December 26, 1998.

          "Purchase Price" has the meaning set forth in Section 2.3.

          "Purchased Assets" has the meaning set forth in Section 2.1(a).

          "Real Property" means all Purchased Assets consisting of real
property, appurtenances thereto, rights in connection therewith, and any
interest therein, including without limitation leasehold estates.

          "Review Period" has the meaning specified in Section 2.4(c).

          "SAC" means The Santa Anita Companies, Inc., a Delaware corporation.

          "SAE" means Santa Anita Enterprises, Inc., a California corporation.

          "SEC" means the United States Securities and Exchange Commission or
any successor entity.

          "Securities Act" means the United States Securities Act of 1933, as
amended.

          "Subsequent Contract" has the meaning specified in Section 6.5.

          "Subsidiary" means any Person in which MOC has a direct or indirect
equity or ownership interest in excess of 50% and which is involved directly or
indirectly through other Subsidiaries in the Business, which are SAC, SAE and
LATC.

          "Survey" means a current survey of the Real Property prepared by a
surveyor registered or licensed in the State of California, which survey shall
contain the legal description of such Real Property and a certification from the
surveyor to Buyer and the Title Company that

                                       6
<PAGE>

it was prepared in compliance with standards of the American Land Title
Association, and that the survey shows: (a) the location of the perimeter of the
Real Property by courses and distances; (b) all easements affecting the Real
Property whether benefiting or burdening the same, rights-of-way and existing
utility lines whether recorded or disclosed by a physical inspection of the Real
Property; (c) a calculation of the acreage of the Real Property; (d) any
established building lines or restrictions of record or other restrictions that
have been established by any applicable zoning or building code or ordinance;
(e) the lines of the public streets abutting the Real Property and the widths
thereof; (f) all encroachments onto the Real Property and all encroachments by
any buildings, structures or improvements located on the Real Property onto any
easements and onto property adjacent to the Real Property, and the extent in
feet and inches of any such encroachments; (g) all buildings, structures and
improvements, whether completed or partially constructed, and, if determinable,
the location of the improvements to be constructed on the Real Property and any
other physical matters on the ground which may affect the Real Property or title
thereto and the relationship of such buildings, structures, improvements and
other physical matters by distances to the perimeter of the Real Property,
established building lines, street lines, set-back restrictions and easements;
and (h) if the Real Property is described as being on a filed map, a legend
relating the survey to such map.

          "Tax" means any foreign, federal, state, county or local income, sales
and use, excise, franchise, real and personal property, transfer, gross receipt,
capital stock, production, business and occupation, disability, employment,
payroll, severance or withholding tax or charge imposed by any Governmental
Entity, any interest and penalties (civil or criminal) related thereto or to the
nonpayment thereof, and any Loss in connection with the determination,
settlement or litigation of any Tax liability.

          "Tax Item" has the meaning specified in Section 10.3(c).

          "Tax Return" means a report, return or other information required to
be supplied to a Governmental Entity with respect to Taxes including, where
permitted or required, combined or consolidated returns for any group of
entities that includes any Subsidiary.

          "Termination Date" means the specific date first set forth in Section
9.1.

          "Title Commitment" means the commitment of the Title Company, dated
November 2, 1998 (No. 9832484-8) to issue the Title Policy.

          "Title Company" means First American Title Insurance Company, or any
other title insurance company reasonably acceptable to Buyer.

          "Title Policy" means one or more ALTA extended coverage owner's title
insurance policies, effective as of the date of the Closing, insuring Buyer's
fee title in each parcel of Real Property set forth in Schedule 2.1(a) hereto,
in an amount not less than the portion of the Purchase Price allocated to each
such parcel of Real Property, subject only to the Permitted Exceptions, and
containing unmodified CLTA Form 100, 103.1 (modified for an owner), 103.7,
116.1, 116.7 and 123.1 Endorsements (or equivalents) and such other endorsements
as Buyer shall reasonably require.

                                       7
<PAGE>

          "Withholding Exemption Certificate" has the meaning specified in
Section 3.2(f).

                                   ARTICLE II
                    SALE OF ASSETS, ASSUMPTION OF LIABILITIES
                            AND RELATED TRANSACTIONS

     2.1 Purchase and Sale of Assets.
         ----------------------------

     (a) Purchased Assets. Subject to the terms and conditions of this
         ----------------
Agreement, on the Closing Date Sellers shall sell, convey, assign, transfer and
deliver to Buyer, and Buyer shall purchase, acquire and accept from Sellers, all
of the assets, properties, rights, privileges, claims and contracts of every
kind and nature, real and personal, tangible and intangible, absolute or
contingent, wherever located, owned by Sellers and used primarily in connection
with the Business (the "Purchased Assets"), except the assets specifically
identified in Section 2.1(b) (the "Excluded Assets"). The Purchased Assets shall
include, but shall not be limited to, the items set forth on Schedule 2.1(a),
attached hereto and incorporated herein by reference, except as changed by
assets acquired or disposed of in the ordinary course of business of the
Business after the date thereof, and also shall include the following:

          (i) The Real Property owned by Sellers (the legal description of which
     is set forth as Appendix A to the Schedules hereto.)

          (ii) All fixtures and improvements attached to the Real Property owned
     by Sellers and used in the Business or to any Real Property used in the
     Business in which Sellers have a leasehold interest.

          (iii) All machinery, apparatus, furniture and fixtures, materials,
     supplies, motor vehicles, computer systems and other equipment of every
     type owned or leased by Sellers and used in the Business as set forth in
     Schedule 2.1(a).

          (iv) All inventory of usable goods, including all merchandise, food,
     beverages, supplies and other tangible personal property held for sale or
     used in connection with the Business as of November 12, 1998 (the
     "Inventory"), together with any additions thereto and subject to any
     reductions therefrom received or incurred by Sellers operating the Business
     in the ordinary course after November 12, 1998 through the Closing Date.

          (v) All of Sellers' rights and interests arising under or in
     connection with any Contracts to which any Seller is a party and which
     relate to the Business or insurance policies pursuant to which the Business
     is a beneficiary and other documents relating to the Business.

          (vi) Sellers' prepaid expenses related to the Business as of November
     12, 1998 ("Prepaid Expenses"), together with any additions thereto and
     subject to any reductions therefrom made or accrued by Sellers in operating
     the Business in the ordinary course and in compliance with Section 6.3
     hereof after November 12, 1998 through the Closing Date.

                                       8
<PAGE>

          (vii) Management information services systems and software used in
     connection with the Business and para-mutuel wagering computer systems and
     software used in connection with the Business, to the extent owned or
     licensed by SAC, SAE or LATC.

          (viii) Cash and cash equivalents of LATC and SAE as of November 12,
     1998, together with any additions thereto and subject to any reductions
     therefrom made by LATC in operating the Business in the ordinary course and
     in compliance with Section 6.3 hereof after November 12, 1998 through the
     Closing Date.

          (ix) Sales data, customer lists and profiles, information relating to
     customers, suppliers' names, mailing lists, and advertising matter and all
     rights thereto relating to the Business.

          (x) All of Sellers' Intangible Property related to the Business, and
     corporate and trade names and Marks related to the Business, including all
     of Sellers' rights in the corporate name and Marks related to the Business
     in any location in the United States or in any foreign country; goodwill
     associated with the Business; all Sellers' books and records relating to
     the Business and employees; transferable Permits; and unemployment
     compensation, workers' compensation and other credits, reserves or deposits
     with applicable Governmental Entities relating to Sellers' employees
     involved in the Business.

          (xi) All of Sellers' or LATC's rights in and to all artwork and
     statutes relating to the Business or located in the executive offices of
     the Business, except for that specifically set forth in Appendix D to the
     Schedules.

          (xii) All of the capital stock of LATC owned by Sellers.

     (b)  Excluded Assets.  The assets that constitute Excluded Assets shall
          ---------------
include only:

          (i) The consideration delivered to Sellers pursuant to this Agreement.

          (ii) Sellers' certificates or articles of incorporation,
     non-transferable franchises, corporate seals, minute books, stock books and
     other corporate records having to do with the corporate organization and
     capitalization of Sellers and all income tax records and nontransferable
     Permits; provided, however, that copies of such corporate and tax records
     (other than those of MT and MOC) and nontransferable Permits (whether by
     their terms or operation of law) shall be provided to Buyer at the Closing.

          (iii) Sellers' books of account; provided, however, that copies of
     such books of account related to the Business shall be provided to Buyer at
     the Closing.

          (iv) Any shares of the capital stock of Sellers held as treasury
     shares or otherwise.

          (v) Any Tax refund not included as a Purchased Asset.

                                       9
<PAGE>

          (vi) All amounts due from any Seller or any Affiliate of any Seller,
     to the extent set forth on Schedule 2.2(b).

          (vii) Any goods or other assets on consignment or otherwise held for
     third parties.

          (viii) The real property owned by MT relating to the medical office
     building and the ownership interest of MT in the Fashion Park regional mall
     adjacent to the Business, and specifically described on Schedule 2.1(b)
     hereto and all of MT's interests in Anita Associates, a California limited
     partnership.

          (ix) The artwork owned by LATC and which is specifically described in
     Appendix D to the Schedules.

          (x) The accounts receivable (the "Accounts Receivable") of LATC as of
     the Proration Date, which Accounts Receivable shall be transferred by LATC
     to Sellers effective as of the Closing Date.

          (xi) Any of Sellers' assets not used in the operation of the Business.

          (xii) Rights under the life insurance policies set forth on Appendix E
     to the
Schedules.

     2.2 Assumption of Certain Liabilities.
         ----------------------------------

    (a)  Liabilities Not Assumed.  Except for the liabilities and obligations
         -----------------------
     specifically assumed pursuant to and identified in Section 2.2(b) below,
     Buyer shall not assume, shall not take subject to and shall not be liable
                 ---               ---                           ---
     for, any liabilities or obligations of any kind or nature, whether
     absolute, contingent, accrued, known or unknown, of Sellers or any
     Affiliate of Sellers, the ("Excluded Liabilities") including, but not
     limited to, the following:

          (i) Any liabilities described on Schedule 2.2(a), including, without
     limitation, the liabilities of LATC described on Schedule 2.2(a);

          (ii) Any liabilities or obligations incurred prior to the Closing,
     arising from or out of, or in connection with Sellers' operations, the
     condition of their assets or places of business, their ownership of the
     Purchased Assets, or the issuance, sale, repayment or repurchase of any of
     their securities.

          (iii) Any liabilities or obligations incurred, arising from or out of,
     in connection with or as a result of claims made by or against Sellers
     whether before or after the Closing Date that arise out of events or
     operation of the Business solely prior to the Closing Date.

          (iv) Any liabilities or obligations incurred, arising from or out of,
     in connection with or as a result of any alleged or actual defect in any
     product or service or in connection with any alleged or actual breach of
     warranty (whether express or implied) in relation to any product sold or
     service provided by Sellers prior to the Closing Date.

                                       10
<PAGE>

          (v) Subject to the provisions of Section 10.3, any liabilities or
     obligations (whether assessed or unassessed) of Sellers for any Taxes,
     including any Taxes arising by reason of the transactions contemplated
     herein, as of, or for any period ending on or prior to, the Closing Date.

          (vi) All fees and expenses of Sellers in connection with the
     transactions contemplated herein.

          (vii) All fees and expenses, if any, of Sellers in connection with the
     dissolution and liquidation of Sellers and withdrawal from the Business by
     Sellers.

          (viii) Any liabilities or obligations incurred for any period prior to
     the Closing to former or current officers, directors, employees or
     Affiliates of Sellers, including without limitation any liabilities or
     obligations of Sellers in connection with any employee benefit plans or
     collective bargaining, labor or employment agreement or other similar
     arrangement or obligations in respect of retiree health benefits.

          (ix) Any liabilities or obligations to stockholders or former
     stockholders of Sellers.

          (x) Any liabilities or obligations of Sellers incurred, arising from
     or out of, or in connection with this Agreement or the events or
     negotiations leading up to this Agreement.

     (b)  Assumed Liabilities.  Notwithstanding Section 2.2(a), on the Closing
          -------------------
Date Buyer shall assume the liabilities or obligations specifically identified
on Schedule 2.2(b) attached hereto and incorporated herein by this reference and
the liabilities and obligations arising from the operation of the Business after
the Closing Date (the "Assumed Liabilities").

     2.3  Purchase Price and Allocation.
          -----------------------------

     The total purchase price (the "Purchase Price") to be paid to Sellers by
Buyer at the Closing for the Purchased Assets shall be (i) the assumption of the
Assumed Liabilities, plus (ii) $126 million in cash, plus or minus the amount of
the Closing Adjustment described in Section 2.4 calculated as of the Proration
Date.

     The Purchase Price shall be allocated among the Purchased Assets and
Assumed Liabilities as set forth in Schedule 2.3 attached hereto and
incorporated herein by reference. Buyer and Sellers agree that their agreed upon
allocation shall be used, reported and implemented for all federal, state, local
and other tax purposes.

     2.4 Payment of Purchase Price; Closing Adjustment.
         ---------------------------------------------

     (a) On the Closing Date, Buyer shall pay to Sellers $126 million (the
"Closing Payment") as set forth in this Section 2.4(a). Buyer shall make the
Closing Payment by depositing immediately available funds with the Title Company
in an amount equal to the balance of the Closing Payment not previously
deposited with the Title Company. The Title

                                       11
<PAGE>

Company shall distribute the Closing Payment to Sellers net of prorations,
adjustments and expenses described in the Joint Escrow Instructions.

     (b) Within 45 days after the Closing Date, Ernst & Young LLP shall deliver
to Sellers and Buyer an audited balance sheet of the Business as of the
Proration Date (the "Closing Balance Sheet"), prepared in accordance with GAAP,
which sets forth the book values of the Purchased Assets and the Assumed
Liabilities, and a calculation of the Closing Adjustment to the Purchase Price.
The "Closing Adjustment" shall be equal to the amount by which the Closing
Account Amount of the Business as of the Proration Date is greater than or less
than zero. If the Closing Account Amount as of the Proration Date, is greater
than zero, then Buyer shall pay to Sellers the amount of such excess. If the
Closing Account Amount as of the Proration Date, is less than zero, then Sellers
shall pay to Buyer the amount of such deficit.

     (c) Buyer shall deliver a copy of the Closing Balance Sheet and related
calculation of the Closing Adjustment to Sellers within three days of receipt of
the same from Ernst & Young LLP. Sellers and Auditors shall be entitled to make
an independent review of the Closing Balance Sheet and related calculation and
shall, during the 15-day period after delivery of the Closing Balance Sheet and
related calculation of the Closing Adjustment (the "Review Period"), have access
to all work papers of Ernst & Young LLP used to prepare the Closing Balance
Sheet and to calculate the Closing Adjustment.

     (d) Before expiration of the Review Period, Sellers shall deliver to Buyer
its objection, if any, to the calculation of the Closing Adjustment, together
with details of the disputed items (the "Disputed Items") set forth in the
Closing Balance Sheet and the proposed adjustments to such items. If Sellers
fail to provide notice of objection prior to the end of the Review Period, then
the Closing Balance Sheet, and the calculation of the Closing Adjustment by
Ernst & Young LLP shall be final and binding on all the parties. If Sellers
notify Buyer prior to the end of the Review Period of Sellers disapproval of the
calculation of the Closing Adjustment or the Closing Balance Sheet prepared by
Ernst & Young LLP, then Buyer and Sellers shall attempt to reach agreement with
respect to the Disputed Items. In the event that Buyer and Sellers are unable to
reach agreement on the Disputed Items, then either shall be entitled to refer
the matter to a nationally recognized accounting firm independent of Sellers and
Buyer mutually agreed upon by Buyer and Sellers, provided, that if Buyer and
Sellers are unable to agree upon such accounting firm within a period of 15 days
from the receipt by Buyer of Sellers' objection, such accounting firm shall be
chosen at random by Buyer and Sellers from among the "Big Five" accounting firms
which are independent of Buyer and Sellers (the "Arbitrating Accountant"). The
Arbitrating Accountant shall determine the Disputed Items and calculate the
Closing Adjustment within 20 days after the Disputed Items are submitted to
them, and such determination shall be final and binding upon all the parties.
The fees and expenses of the Arbitrating Accountants shall be paid 50% by Buyer
and 50% by Sellers.

     (e) The amount of the Closing Adjustment as finally determined shall be
paid by wire transfer or other immediately available funds, within five days
after final determination of the Closing Adjustment.

                                       12
<PAGE>

     2.5 Review of Title Matters.
         -----------------------

     (a) Buyer acknowledges that Sellers have delivered to Buyer from the Title
Company a Preliminary Title Report with respect to the Real Property.

     (b) As soon as possible but prior to November 18, 1998, Sellers shall cause
to be delivered to Buyer and to the Title Company a Survey with respect to each
parcel of Real Property, together with a certificate as to whether the Real
Property lies within a flood zone as determined by the U.S. Federal Emergency
Management Agency. The Survey shall be certified as true and correct by the
surveyor for the benefit of Buyer and the Title Company and shall be at Sellers'
expense.

     (c) Buyer shall notify Sellers of any title exceptions that are not
reflected in the Title Commitment, and that would have a Material Adverse Effect
(each, a "Disapproved Matter"). Sellers shall use reasonable commercial efforts
without the expenditure of funds to remove, or cause to be removed, all
Disapproved Matters or, in the alternative, obtain title insurance in a form
reasonably satisfactory to Buyer insuring against the effect of such Disapproved
Matters. As soon as practicable prior to the Closing, Sellers shall notify Buyer
in writing of any Disapproved Matters which Sellers are unwilling or unable to
cause to be removed or satisfactorily insured against and Buyer shall then,
within five days thereafter or, if earlier, prior to the Closing, elect, by
giving written notice to Sellers, (i) to terminate this Agreement and obtain a
refund of the Deposit, or (ii) to waive its disapproval of such exceptions.
Buyer's failure to give such notice shall be deemed an election to waive such
exceptions.

     2.6 Interim Operations.
         -------------------

     If the Closing Date occurs after the Proration Date, then between the
Proration Date and the Closing Date, Sellers shall operate the Business in the
ordinary course of business for the benefit of Buyer in accordance with the
requirements of Section 6.3, with all net income and operating cash flow
accruing for the benefit of Buyer.

                                  ARTICLE III
                                     CLOSING

     3.1 Closing Date.
         ------------

     Upon the terms and subject to the conditions set forth in this Agreement,
the Closing of the transaction shall take place at the offices of O'Melveny &
Myers LLP, 400 South Hope Street, Los Angeles, California, at 9:00 a.m., on
December 23, 1998, or if Sellers notify Buyer on or prior to December 1, 1998 of
Sellers' election to delay the Closing until January 7, 1999 or at such other
location or time as Sellers and Buyer may agree, but in no event later than
January 15, 1999. Time is of the essence of this Agreement.

     3.2 Items to be Delivered at the Closing By Sellers.
         -----------------------------------------------

     At the Closing, Sellers shall deliver or cause to be delivered to Buyer:

                                       13
<PAGE>

     (a) A Bill of Sale and Assignment, in substantially the form of Exhibit A
(the "Bill of Sale").

     (b) Grant deed, properly executed and acknowledged, conforming to and
conveying the agreed state of title for all Real Property and interests in Real
Property in accordance with Section 2.5 (the "Grant Deed").

     (c) Instruments of transfer in the form customarily used in commercial
transactions in the area in which the personal property is located sufficient to
transfer each personal property interest owned by Seller not otherwise
transferred by the Bill of Sale referred to in Section 3.2(a).

     (d) Such other instruments of transfer necessary or appropriate to transfer
to and vest in Buyer all of Sellers' right, title and interest in and to the
Purchased Assets.

     (e) All documentation required to exempt Sellers from the withholding
requirement of Section 1445 of the Code, consisting of (a) an affidavit from
Sellers to Buyer stating under penalty of perjury that none of the Sellers is a
foreign person and providing each Seller's U.S. taxpayer identification number,
or (b) a sworn affidavit of each Seller that it is not a "U.S. real property
holding corporation," as defined in Section 897 of the Code or (c) a "qualifying
statement" obtained by each Seller from the Internal Revenue Service (any of
which is hereafter referred to as a "FIRPTA Certificate").

     (f) All documentation required to exempt Sellers from the withholding
requirements of Section 18662 of the California Revenue and Taxation Code,
consisting of a completed and duly executed California Form 590-RE (the
"Withholding Exemption Certificate").

     (g) The opinions, certificates, consents and other documents referred to
herein as then deliverable by Sellers.

     (h) A list of all assets being sold to Buyer, accounts payable and of all
other liabilities being assumed by Buyer relating to the Business as of the
Proration Date.

     (i) A list of all Accounts Receivable and prepaid expenses as of the
Proration Date.

     (j) A list of the locations of all deposits of Purchased Assets held by
other Persons and not listed on Schedule 4.19.

     (k) The keys to all locks located on or in the Purchased Assets (and any
and all cards, devices or things necessary to access any Purchased Assets).

     (l) A list of non-union employees of the Business as of the Closing Date.

     3.3 Items to be Delivered at the Closing by Buyer.
         ---------------------------------------------

     At the Closing, Buyer shall deliver to Sellers:

                                       14
<PAGE>

     (a) The Purchase Price.

     (b) An Assumption Agreement, in substantially the form of Exhibit B.

     (c) Such instruments as may reasonably be requested by any creditor, lessor
or any other person whose consent is required to consummate the transactions
contemplated by this Agreement to evidence the assumption by Buyer of the
Assumed Liabilities.

     (d) The opinions, certificates, consents and other documents referred to
herein as then deliverable by Buyer.

                                   ARTICLE IV
                    REPRESENTATIONS AND WARRANTIES OF SELLERS

     All references in this Article IV referring to Sellers knowledge or to the
best of Sellers' knowledge or similar words or phrases shall be deemed to mean
the actual knowledge without further inquiry of any of the officers or employees
who are specifically identified on Schedule 4.1. References in this Article IV
to "Period of Ownership" shall mean the period of time beginning on November 5,
1997 and ending on the Closing Date. Except as otherwise indicated on the
Sellers' Disclosure Schedule dated November 12, 1998 previously delivered to
Buyer, each Seller represents, warrants and agrees as follows:

     4.1 Organization and Related Matters.
         --------------------------------

     Each Seller is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
organization. Each Seller has all necessary corporate power and authority to
execute, deliver and perform this Agreement. Schedule 4.1 lists all Subsidiaries
of SAC and correctly sets forth the capitalization of LATC and SAC's ownership
interest therein, any other interest of any other Person therein, the
jurisdiction in which SAC and each Subsidiary was organized, each jurisdiction
in which SAC and each Subsidiary is or is required to be qualified or licensed
to do business as a foreign Person and a brief summary of SAC's and each
Subsidiary's assets, liabilities and business. Each of the Subsidiaries,
including LATC, is duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation or organization. SAC and its
Subsidiaries have all necessary corporate power and authority to own their
respective properties and assets and to carry on their respective businesses as
now conducted and are duly qualified or licensed to do business as foreign
corporations in good standing in all jurisdictions listed on Schedule 4.1.
Schedule 4.1 correctly lists the current directors and executive officers of SAC
and of each Subsidiary. True, correct and complete copies of the respective
charter documents of SAC and the Subsidiaries as in effect have been delivered
to Buyer. None of Sellers nor any Subsidiary is (i) except for MT and MOC, a
registered or reporting company under the Exchange Act or (ii) a company
required to be registered under the Investment Company Act of 1940, as amended.

     4.2 Stock.
         -----

     Except as described in Schedule 4.1, SAC owns all of the outstanding Equity
Securities of each of the Subsidiaries, beneficially and of record. All of such
Equity Securities of the Subsidiaries are owned free and clear of any
Encumbrance. At the Closing, Buyer will

                                       15
<PAGE>

acquire good and marketable title to and complete ownership of all of the issued
and outstanding capital stock of LATC, free of any Encumbrance. There are no
outstanding Contracts or other rights to subscribe for or purchase, or Contracts
or other obligations to issue or grant any rights to acquire, any Equity
Securities of LATC, or to restructure or recapitalize LATC, in each case arising
during the Period of Ownership. The Equity Securities of LATC are duly
authorized, validly issued and outstanding and are fully paid and nonassessable.
To Sellers' knowledge, there are no preemptive rights in respect of any Equity
Securities of LATC.

     4.3 Financial Statements; Changes; Contingencies.
         --------------------------------------------

     (a) Unaudited Financial Statements. Sellers have delivered to Buyer
         ------------------------------
consolidated and combined balance sheets for the Business at December 31, 1997
and September 30, 1998, and the related consolidated and combined statements of
operations and cash flows and changes in stockholder's equity for the year ended
December 31, 1997 and the nine months ended September 30, 1998. All such interim
financial statements have been prepared in conformity with GAAP applied on a
consistent basis except for changes, if any, required by GAAP and disclosed
therein. The statements of operations and cash flows present fairly the results
of operations and cash flows of the Business for the respective periods covered,
and the balance sheets present fairly the financial condition of the Business as
of their respective dates. All such financial statements reflect all adjustments
(which consist only of normal recurring adjustments not material in amount and
include but are not limited to estimated provisions for year-end adjustments)
necessary for a fair presentation. At the dates of such balance sheets, the
Business did not have any material liability (actual, contingent or accrued)
that, in accordance with GAAP applied on a consistent basis, should have been
shown or reflected therein but were not.

     (b) No Material Adverse Changes. Since September 30, 1998, whether or not
         ---------------------------
in the ordinary course of business, there has not been, occurred or arisen:

          (i) any change in or event affecting the Business that, to Sellers'
     knowledge, has had or may reasonably be expected to have a material adverse
     effect on the Business as a whole, or

          (ii) any agreement, condition, action or omission which would be
     proscribed by (or require consent under) Section 6.3 had it existed,
     occurred or arisen after the date of this Agreement, or

          (iii) any strike or other labor dispute, or

          (iv) any casualty, loss, damage or destruction (whether or not covered
     by insurance) of any of the Purchased Assets in excess of $1,000,000 or
     that has involved or may involve a loss to the Business of more than
     $1,000,000.

     (c)  No Other Liabilities or Contingencies.  None of the Sellers nor any
          -------------------------------------
Subsidiary has any liabilities related to the Business of any nature, whether
accrued, absolute, contingent or otherwise, and whether due or to become due,
probable of assertion or not, except liabilities that (i) are reflected or
disclosed in the most recent of the financial statements referred

                                       16
<PAGE>

to in subsection (a) above, (ii) were incurred after September 30, 1998 in the
ordinary course of business and in the aggregate do not exceed $100,000 or (iii)
are set forth in Schedule 4.3 hereto.

     4.4 Tax and Other Returns and Reports.
         ---------------------------------

     Each of SAC and LATC has timely filed or will file (or, where permitted or
required, its respective direct or indirect parents have timely filed or will
file) all required Tax Returns and have paid all Taxes due for all periods
ending after November 5, 1997. To Seller's knowledge, adequate provision has
been made in the books and records of each Seller and each Subsidiary, and in
the financial statements referred to in Section 4.3 above or delivered to Buyer,
for all Taxes whether or not due and payable and whether or not disputed. To
Seller's knowledge, none of SAC or LATC nor any Subsidiary has elected to be
treated as a consenting corporation under Section 341(f) of the Code. Schedule
4.4 lists the date or dates through which the IRS and any other Governmental
Entity have examined the United States federal income tax returns and any other
Tax Returns of SAC and LATC. To Seller's knowledge, all required Tax Returns of
SAC or LATC, including amendments to date, have been prepared in good faith
without negligence or willful misrepresentation and are complete and accurate in
all material respects. To Seller's knowledge, except as set forth in Schedule
4.4, no Governmental Entity has, during the past three years, examined or is in
the process of examining any Tax Returns of SAC or LATC. To Sellers' knowledge,
except as set forth on Schedule 4.4, no Governmental Entity has proposed
(tentatively or definitively), asserted or assessed or, to the best knowledge of
Sellers, threatened to propose or assert, against LAC or LATC any deficiency,
assessment or claim for Taxes.

     4.5 Material Contracts.
         ------------------

     Schedule 4.5 lists each contract which relates to the Purchased Assets or
the Business to which any Seller or any Subsidiary is a party or to which any
Seller, any Subsidiary or any of their respective properties used in the
Business is subject or by which any thereof is bound that is deemed a Material
Contract under this Agreement. Unless otherwise so noted in Schedule 4.5, each
such Contract was entered into in the ordinary course of business. Each Contract
that relates to the Business and that (a) after September 30, 1998 obligates
Sellers to pay an amount of $100,000 or more, (b) has an unexpired term as of
September 30, 1998 in excess of one year, (c) contains a covenant not to compete
or otherwise significantly restricts business activities, (d) provides for the
extension of credit other than consistent with normal credit terms, (e) limits
the ability of Sellers or any Subsidiary to conduct the Business, including as
to manner or place, (f) provides for a guaranty or indemnity by Sellers or any
Subsidiary, (g) grants a power of attorney, agency or similar authority to
another person or entity, (h) contains a right of first refusal, (i) contains a
right or obligation relating to the Business other than in the ordinary course
of business to any Affiliate, officer or director or any Associate, of any
Seller or any Subsidiary to any Subsidiary, (j) constitutes a collective
bargaining agreement or provides for severance benefits to any officer, director
or employee, (k) represents a Contract upon which the Business is substantially
dependent or a Contract which is otherwise material to the Business, (l) relates
to the leasing of, or future commitments to lease, any portion of the Real
Property regardless of whether such Real Property is used in the Business or (m)
was not made in the ordinary course of business and requires aggregate
expenditures in excess of $100,000, shall be deemed to be a Material Contract.
True, correct and complete copies of the agreements



                                       17
<PAGE>

appearing on Schedule 4.5, including all amendments and supplements, have been
delivered to Buyer. Each Material Contract is valid and subsisting; each Seller
or the applicable Subsidiary that is a party to a Material Contract has duly
performed all its material obligations thereunder to the extent that such
obligations to perform have accrued; and no breach or default, alleged breach or
default, or event which would (with the passage of time, notice or both)
constitute a breach or default thereunder by any Seller or its Subsidiaries, as
the case may be (or, to the best knowledge of Sellers, any other party or
obligor with respect thereto), has occurred or as a result of this Agreement or
its performance will occur, except for such breaches and defaults which
individually or in the aggregate will not have a material adverse effect on the
Business, the Purchased Assets or the Assumed Liabilities. Except as set forth
in Schedule 4.5A, consummation of the transactions contemplated by this
Agreement will not (and will not give any Person a right to) terminate or modify
any rights of, or accelerate or augment any obligation of, Sellers or any
Subsidiary.

     4.6 Condition of Property; Leases.
         -----------------------------

     (a) As of the Closing, Sellers shall have good and marketable title to each
of the Purchased Assets (excluding the Real Property), free and clear of any
Encumbrances, except Permitted Encumbrances. Sellers have all rights, power and
authority to sell, convey, assign, transfer and deliver the Purchased Assets to
Buyer in accordance with the terms of this Agreement. At the Closing, Sellers
shall deliver the Purchased Assets to Buyer, free and clear of any Encumbrances
except for Permitted Exceptions. The Purchased Assets have been maintained
during the Period of Ownership in a manner consistent with past practices. The
machinery, apparatus, furniture and fixtures, materials, supplies, motor
vehicles, computer systems and other equipment of every type set forth in
Schedule 2.1(a) constitutes all of the machinery, apparatus, furniture and
fixtures, materials, supplies, motor vehicles, computer systems and other
equipment of every type owned or leased by Sellers or LATC and used in the
Business.

     (b) To Seller's knowledge, the Real Property listed on Schedule 2.1(a)
consists of substantially all of the real property and leasehold interests used
by Sellers in the conduct of the Business. Sellers have received no notice of
any proposed special assessments, nor any proposed material changes in property
tax or land use laws affecting the Real Property.

     (c) To Sellers' knowledge, there are no material physical, structural, or
mechanical defects in the Real Property, including, without limitation, the
plumbing, heating, air conditioning and electrical systems.

     (d) Except as disclosed to Buyer in writing, Sellers have not received any
notices or communications with respect to any condemnation, environmental,
zoning or other land-use regulation proceeding, either instituted or planned to
be instituted, which would affect the Real Property or the conduct of the
Business thereon in any material respect, nor do Sellers have any knowledge of
any assessments affecting the Real Property other than as set forth in the
Preliminary Title Report.

                                       18
<PAGE>

     (e) To Sellers' knowledge, Sellers have received no notice or communication
with respect to any violation of any covenants, conditions or restrictions
applicable to the Real Property.

     (f) None of Sellers is either a "foreign person" within the meaning of
Section 1445(f)(3) of the Code, nor a non-resident seller of a "California real
property interest" within the meaning of Sections 18805 or 26131 of the
California Revenue and Taxation Code.

     (g) Sellers have not received notice that any portion of the Real Property
is subject to a redevelopment plan or agreement or is to be included within any
redevelopment area. Sellers have not entered into a disposition and development
agreement, owner's participation agreement, or any similar agreement with any
governmental or quasi-governmental authority concerning the use and development
of any portion of the Real Property except as disclosed in the Preliminary Title
Report or otherwise disclosed in writing by Sellers to Buyer.

     (h) All material leasehold properties that constitute part of the Purchased
Assets held by Sellers or any Subsidiary as lessee are held under valid, binding
and enforceable leases in accordance with their terms (except for the effects on
enforceability arising from bankruptcy, insolvency and similar laws affecting
creditors' rights generally), subject only to such exceptions as are not,
individually or in the aggregate, material to the Business.

          (i) Sellers have heretofore delivered to Buyer a true, correct and
     complete copy of each lease that pertains to a leasehold interest
     comprising a portion of the Purchased Assets (each a "Lease"), together
     with all amendments, modifications, alterations, and other changes thereto.

          (ii) To Sellers' knowledge, the Leases constitute the entire agreement
     to which Sellers or any Subsidiary is a party with respect to the
     properties which are demised pursuant thereto.

          (iii) To Sellers' knowledge, the term and a description of each Lease
     is accurately set forth on Schedule 4.6. Seller has accepted possession of
     the property demised pursuant to each Lease and is in actual possession
     thereof and has not sublet, assigned or hypothecated its leasehold interest
     except as set forth on Schedule 4.6.

          (iv) To Seller's knowledge, as of the date hereof, all conditions
     precedent to the enforceability of each Lease have been satisfied and there
     exists no breach or default, nor state of facts which, with the passage of
     time, notice, or both, would result in a breach or default on the part of
     any Seller or the lessor thereunder.

          (v) To Seller's knowledge, all space and improvements leased by
     Sellers have been fully and satisfactorily completed and furnished in
     accordance with the provisions of each Lease.

          (vi) To Sellers' knowledge, Sellers have received no notice of
     non-compliance with any restriction encumbering any leased property, nor
     has any Seller received notice of any zoning violations affecting any
     leased property.

                                       19
<PAGE>

          (vii) To Seller's knowledge, there is no pending or threatened Action
     that would materially interfere with the quiet enjoyment of any such
     leasehold by Sellers or, after the Closing, by Buyer.

     (i) To Sellers' knowledge, all water, sewer, gas, electric, telephone, and
drainage facilities and all other utilities required by Law for the present use
and operation of the Real Property are installed across public property or valid
easements to the boundary lines of the Real Property, and are connected pursuant
to valid permits.

     4.7 Intangible Property.
         -------------------

     To Sellers' knowledge, Schedule 4.7 lists any and all Marks and other
material items of Intangible Property related to the Business in which any
Seller or its Subsidiaries have an interest and the nature of such interest.
Such assets include all Permits or other rights with respect to any of the
foregoing. Sellers and their Subsidiaries have complete rights to and ownership
of all Intangible Property required for use in connection with the Business.
Sellers and its Subsidiaries do not use any Intangible Property by consent of
any other person and are not required to and do not make any payments to others
with respect thereto. Except as prohibited by their terms or by Law, the
Intangible Property of Sellers and its Subsidiaries is fully assignable free and
clear of any Encumbrances. To Seller's knowledge, Sellers and their Subsidiaries
have in all material respects performed all obligations required to be performed
by them, and none of such entities is in default in any material respect under
any Contract relating to any of the foregoing. To Sellers' knowledge, none of
Sellers nor any Subsidiary has received any notice to the effect (or is
otherwise aware) that the Intangible Property or any use by Sellers or any
Subsidiary of any such property conflicts with or infringes (or allegedly
conflicts with or infringes) the rights of any Person.

     4.8 Authorization; No Conflicts.
         ---------------------------

     The execution, delivery and performance of this Agreement by Sellers have
been duly and validly authorized by the respective Boards of Directors of
Sellers and by all other necessary corporate action on the part of Sellers. This
Agreement constitutes the legally valid and binding obligation of Sellers,
enforceable against Sellers in accordance with its terms except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws and equitable principles relating to or
limiting creditors rights generally. The execution, delivery and performance of
this Agreement by Sellers will not violate, or constitute a breach or default
(whether upon lapse of time and/or the occurrence of any act or event or
otherwise) under, the charter documents or by-laws of any of such entities or
any Material Contract of any of such entities, result in the imposition of any
Encumbrance against any assets of Sellers or any of the Purchased Assets or
violate any Law, limited, in the case of Material Contracts, to such violations,
breaches or defaults as would have a material adverse effect on the Business.
Schedule 4.8 lists all Permits held by any of Sellers or any Subsidiary relating
to the operation of the Business.

                                       20
<PAGE>

     4.9 Legal Proceedings.
         -----------------

     To Seller's knowledge, there is no Order or Action relating to the Business
pending, or, to the best knowledge of Sellers, threatened, against or affecting
the Business or any of its properties or assets that individually or when
aggregated with one or more other Orders or Actions has or might reasonably be
expected to have a material adverse effect on the Business, the Purchased Assets
(or the use, operation or value thereof), the Assumed Liabilities or Sellers'
ability to perform this Agreement. Schedule 4.9 lists each Order and each Action
that involves a claim or potential claim of aggregate liability in excess of
$100,000 against, or that enjoins or seeks to enjoin any activity by Sellers or
any Affiliate in connection with the Business. There is no matter as to which
any Seller has received any notice, claim or assertion against or affecting any
director, officer, employee, agent or representative of Sellers or any
Subsidiary involved in the Business or any other Person in connection with which
any such Person has or may reasonably be expected to have any right to be
indemnified by Sellers or any Subsidiary as a result of the ownership or
operation of the Business.

     4.10 Minute Books.
          ------------

     The minute books of SAC and LATC accurately reflect all actions and
proceedings taken during the Period of Ownership by the respective shareholders,
boards of directors and committees of SAC and LATC, and such minute books
contain true and complete copies of the charter documents of SAC and LATC and
all related amendments. To Seller's knowledge, the stock record books of each
SAC and LATC reflect accurately all transactions in their respective capital
stock of all classes.

     4.11 Accounting Records; Internal Controls; Absence of Certain Payments.
          ------------------------------------------------------------------

     (a) Accounting Records. During the Period of Ownership, each Seller and its
         ------------------
Subsidiaries have maintained records relating to the Business that accurately
and validly reflect their respective transactions pertaining to the Business,
and accounting controls sufficient to insure that such transactions are (i)
executed in accordance with management's general or specific authorization and
(ii) recorded in conformity with GAAP so as to maintain accountability for
assets.

     (b) Data Processing; Access. Such records, to the extent they contain
         -----------------------
important information that is not easily and readily available elsewhere, have
been duplicated, and such duplicates are stored safely and securely pursuant to
procedures and techniques utilized by companies of comparable size in similar
lines of business.

     4.12 Insurance.
          ---------

     Sellers and the Subsidiaries are, and at all times during the Period of
Ownership have been, insured with reputable insurers against all risks normally
insured against by companies in similar lines of business, and all of the
insurance policies and bonds maintained by Sellers and its Subsidiaries relating
to the Business are in full force and effect. Schedule 4.12 lists all insurance
policies and bonds that are material to the Business. To Sellers' knowledge,
none of Sellers nor any Subsidiary is in default under any such policy or bond.
Each Seller and

                                       21
<PAGE>

its Subsidiaries have timely filed claims with their respective insurers with
respect to all matters and occurrences relating to the operation of the Business
for which they believe they have coverage. All insurance policies maintained by
Sellers and their respective Subsidiaries pertaining to the Business, are in
effect as of the Closing. There are no outstanding requirements or
recommendations which have been communicated to Sellers by any insurance company
that issued a policy with respect to any of the properties and assets, including
the Purchased Assets, of Sellers or any Subsidiary used in the Business by any
Board of Fire Underwriters or other body exercising similar functions or by any
Governmental Entity requiring or recommending any action which has not been
taken.

     4.13 Permits.
          -------

     Sellers have received no notice or communication regarding the suspension,
cancellation or termination of any of the Permits.

     4.14 Compliance with Law.
          -------------------

     To Sellers' knowledge, Sellers and their respective Subsidiaries involved
in the Business are organized and have conducted the Business in accordance with
applicable Laws, and the forms, procedures and practices of Sellers and its
Subsidiaries are in compliance with all such Laws, to the extent applicable, the
violation of which might have a material adverse effect on Sellers, the Business
or any of the Purchased Assets or the Assumed Liabilities.

     4.15 Dividends and other Distributions.
          ---------------------------------

     There has been no dividend or other distribution of assets, other than
cash, cash items, or intercompany receivables or payables, declared, issued or
paid subsequent to the date of the most recent financial statements described in
Section 4.3 by LATC.

     4.16 Employee Benefits.
          -----------------

     (a) Employee Benefit Plans, Collective Bargaining and Employment
Agreements, and Similar Arrangements.

          (1) Schedule 4.16 lists (by entity subject thereto or bound thereby)
     all employee benefit plans and collective bargaining, employment or
     severance agreements and other similar arrangements which cover employees
     employed in the Business and to which any Seller or any Subsidiary is or
     has been within the Period of Ownership a party or by which any of them is
     or within the Period of Ownership has been bound, legally or otherwise,
     including, without limitation, (a) any profit-sharing, deferred
     compensation, bonus, stock option, stock purchase, pension, retainer,
     consulting, retirement, severance, welfare or incentive plan, agreement or
     arrangement, (b) any plan, agreement or arrangement providing for "fringe
     benefits" or perquisites to employees, officers, directors or agents,
     including but not limited to benefits relating to company automobiles,
     clubs, vacation, child care, parenting, sabbatical, sick leave, medical,
     dental, hospitalization, life insurance and other types of insurance, (c)
     any employment agreement not terminable on 30 days (or less) written
     notice, or (d) any other "employee benefit plan" (within the meaning of
     Section 3(3) of ERISA), but only to the extent that

                                       22
<PAGE>

     such employee benefit plans, collective bargaining, labor and employment
     agreements or other similar arrangements are Assumed Liabilities under
     Section 2.2(b) and are not Excluded Liabilities under Section 2.2(a) (the
     "Employee Plans").

          (2) Sellers have delivered to Buyer true and complete copies of all
     documents and summary plan descriptions with respect the Employee Plans, or
     summary descriptions of any Employee Plans not otherwise in writing.

          (3) To the best of Sellers' knowledge, there are no negotiations,
     demands or proposals that are pending or have been made which concern
     matters within the Period of Ownership, now covered, or that would be
     covered, by the Employee Plans.

          (4) With respect to the Period of Ownership, Sellers and their
     respective Subsidiaries are in material compliance with the applicable
     provisions of ERISA (as amended through the date of this Agreement), the
     regulations and published authorities thereunder, and all other Laws
     applicable with respect to the Employee Plans. Within the Period of
     Ownership, Sellers and their respective Subsidiaries have performed all of
     their material obligations under the Employee Plans. To the best knowledge
     of Sellers, there are no Actions (other than routine claims for benefits)
     pending or threatened against the Employee Plans or the assets of the
     Employee Plans, or arising out of the Employee Plans, and, to the best
     knowledge of Sellers, within the Period of Ownership no facts exist which
     could give rise to any such Actions that might have a material adverse
     effect on the Employee Plans or the Business.

          (5) Except as specified in Schedule 4.16, each of the Employee Plans
     can be terminated by Buyer or the applicable Subsidiary within a period of
     30 days following the Closing Date, without payment of any additional
     compensation or amount or the additional vesting or acceleration of any
     such benefits.

     (b) Qualified Plans.
         ---------------

          (1) Schedule 4.16A lists all "employee pension benefit plans" (within
     the meaning of Section 3(2) of ERISA) in Schedule 4.16 which are also stock
     bonus, pension or profit-sharing plans within the meaning of Section 401(a)
     of the Code and which are not unfunded plans providing for deferred
     compensation (the "Employee Pension Plans").

          (2) Each Employee Pension Plan has been duly authorized by the
     appropriate board of directors of Sellers and each participating
     Subsidiary. With respect to the Period of Ownership, each Employee Pension
     Plan is qualified in form and operation under Section 401(a) of the Code
     and each trust under each Employee Pension Plan is exempt from tax under
     Section 501(a) of the Code. To Sellers' knowledge and with respect to the
     Period of Ownership, no event has occurred that will or could give rise to
     disqualification or loss of tax-exempt status of any Employee Pension Plan
     or trust under such sections. To Sellers' knowledge, no event has occurred
     during the Period of Ownership that will or could subject any Employee
     Pension Plans to tax under Section 511 of the Code. To Sellers' knowledge,
     no prohibited transaction (within the

                                       23
<PAGE>

     meaning of Section 4975 of the Code) or party-in- interest transaction
     (within the meaning of Section 406 of ERISA) has occurred during the Period
     of Ownership with respect to any Employee Pension Plan. For purposes of the
     preceding two sentences, Sellers have knowledge if they have knowledge of
     the event or transaction even if they do not have knowledge of the
     consequences of the event or transaction under the Code or ERISA.

          (3) Sellers have delivered to Buyer for each Employee Pension Plan
     copies of the following documents: (i) the Form 5500 filed in each of the
     most recent plan year, including but not limited to all schedules thereto
     and financial statements with attached opinions of independent accountants,
     (ii) the most recent determination letter from the IRS, (iii) the
     consolidated statement of assets and liabilities of such plan as of its
     most recent valuation date, and (iv) the statement of changes in fund
     balance and in financial position or the statement of changes in net assets
     available for benefits under such Employee Pension Plan for the most
     recently ended plan year. To the best knowledge of Sellers, the financial
     statements so delivered fairly present the financial condition and the
     results or operations of each of such plans as of such dates, in accordance
     with GAAP.

     (c) Title IV Plans.
         --------------

          (1) Schedule 4.16B lists all plans in Schedules 4.16 and 4.16A which
     are also subject to Title IV of ERISA, other than any Multiemployer Plan (a
     "Defined Benefit Pension Plan").

          (2) With respect to each Defined Benefit Pension Plan solely with
     respect to the Period of Ownership, (i) neither Sellers nor any Subsidiary
     nor any ERISA Affiliate has withdrawn from such Defined Benefit Pension
     Plan during a plan year in which it was a "substantial employer" (as
     defined in Section 4001(a)(2) of ERISA), (ii) neither Sellers nor any
     Subsidiary nor any ERISA Affiliate has filed a notice of intent to
     terminate any Defined Benefit Pension Plan or adopted any amendment to
     treat any Defined Benefit Pension Plan as terminated, (iii) the PBGC has
     not instituted proceedings to terminate any such plan, (iv) no other event
     or condition has occurred which might constitute grounds under Section 4042
     of ERISA for the termination of, or the appointment of a trustee to
     administer, any Defined Benefit Pension Plan, (v) no accumulated funding
     deficiency, whether or not waived, exists with respect to any Defined
     Benefit Pension Plan, no condition has occurred or exists which by the
     passage of time would be expected to result in an accumulated funding
     deficiency as of the last day of the current plan year of any Defined
     Benefit Pension Plan, and neither Sellers nor any Subsidiary nor any ERISA
     Affiliate has failed to make full payment when due of all amounts which
     under the provisions of any Defined Benefit Pension Plan are required to be
     made as contributions thereto, (vi) all required premium payments to the
     PBGC have been paid when due, (vii) no reportable event, as described in
     Section 4043 of ERISA, has occurred with respect to any Defined Benefit
     Pension Plan, (viii) no excise taxes are payable under the Code and (ix) no
     amendment with respect to which security is required under Section 307 of
     ERISA has been made or is reasonably expected to be made.

                                       24
<PAGE>

          (3) costs of any Defined Benefit Pension Plan have been provided for
     on the basis of consistent methods in accordance with sound actuarial
     assumptions and practices. Since the last valuation date for each Defined
     Benefit Pension Plan, there has been no amendment or change to such plan
     that would increase the amount of benefits thereunder.

          (4) In addition to the documents listed in sub-section (b)(3) above,
     Sellers have delivered to Buyer for each Defined Benefit Pension Plan
     copies of the following documents: (i) the Form PBGC-1 filed in each of the
     most recent plan year, and (ii) the actuarial report as of the last
     valuation date. To the best knowledge of Sellers, each such actuarial
     report fairly presents the financial condition and the results of
     operations of each such plan as of such date, in accordance with GAAP.

     (d) Multiemployer Plans.
         -------------------

          (1) Schedule 4.16C lists all plans in Schedules 4.16 and 4.16A that
     are also multiemployer plans within the meaning of Section 3(37) of ERISA
     (the "Multiemployer Plans").

          (2) With respect to each such Multiemployer Plan in which any Seller,
     any Subsidiary or any ERISA Affiliate participates or has participated with
     respect to employees employed in the Business during the Period of
     Ownership, (i) neither Sellers nor any Subsidiary nor any ERISA Affiliate
     has withdrawn, partially withdrawn, or received any notice of any claim or
     demand for withdrawal liability or partial withdrawal liability, (ii)
     neither Sellers nor any Subsidiary nor any ERISA Affiliate has received any
     notice that any such plan is in reorganization, that increased
     contributions may be required to avoid a reduction in plan benefits or the
     imposition of any excise tax, or that any plan is or may become insolvent,
     (iii) neither Sellers, nor any Subsidiary nor any ERISA Affiliate has
     failed to make any required contributions, (iv) to the best of Sellers'
     knowledge, no such plan is a party to any pending merger or asset or
     liability transfer, (v) to Sellers' knowledge, there are no PBGC
     proceedings against or affecting any such plan and (vi) neither Sellers nor
     any Subsidiary nor any ERISA Affiliate has (or may have as a result of the
     transactions contemplated hereby) any withdrawal liability by reason of a
     sale of assets pursuant to section 4204 of ERISA.

     (e) Health Plans. To Sellers' knowledge and during the Period of Ownership,
         ------------
all group health plans covering employees involved in the Business of Sellers,
any Subsidiary and any ERISA Affiliate have been operated in compliance with the
group health plan continuation coverage requirements of Section 162(k) and
Section 4980B of the Code to the extent such requirements are applicable.

     (f) Fines and Penalties. To Sellers' knowledge and during the Period of
         -------------------
Ownership, there has been no act or omission by any Seller or any Subsidiary or
any ERISA Affiliate that has given rise to or may give rise to fines, penalties,
taxes, or related charges under Section 502(c) or (i) or Section 4071 of ERISA
or Chapter 43 of the Code.

                                       25
<PAGE>

     4.17 Certain Interests.
          -----------------

     No Affiliate of Sellers nor any officer or director of any thereof, nor
Associate of any such individual, has any material interest in any of the
Purchased Assets, the Assumed Liabilities or any property used in or pertaining
to the Business; no such Person is indebted in an amount in excess of $10,000 or
otherwise obligated to Sellers or any Subsidiary; and no Seller is indebted or
otherwise obligated to any such Person, except for amounts due under normal
arrangements applicable to all employees generally as to salary or reimbursement
of ordinary business expenses not unusual in amount or significance. The
consummation of the transactions contemplated by this Agreement will not (either
alone, or upon the occurrence of any act or event, or with the lapse of time, or
both) result in any benefit or payment (severance or other) due to any employee
involved in the Business arising or becoming due from Sellers or any Subsidiary
or the successor or assign of any thereof to any Person.

     4.18 Intercompany Transactions.
          -------------------------

     Except for payments made by LATC, as lessee, to Meditrust, as lessor,
pursuant to that certain lease covering the Real Property (the "Permitted Lease
Payments") and for the transfer by LATC of the Munnings Art Collection as
described in Appendix D to the Schedules (the "Munnings Transfer") and
intercompany payables and receivables reflected on the LATC balance sheet, dated
September 30, 1998 (the "Intercompany Amounts" and together with the Permitted
Lease Payments and the Munnings Transfer, the "Permitted Intercompany
Transactions"), neither SAC nor any of its Subsidiaries has engaged in any
transaction with any Affiliate of Sellers since December 31, 1997 or (if prior
to such date) that remains executory. Except for the Permitted Intercompany
Transactions, neither SAC nor any of its Subsidiaries has any liabilities or
obligations to any Affiliate of Sellers and none of such Affiliates has any
obligations to SAC or any of its Subsidiaries. The consummation of the
transactions contemplated by this Agreement will not (either alone, or upon the
occurrence of any act or event, or with the lapse of time, or both) result in
any payment arising or becoming due from Sellers (other than MT and MOC) or any
Subsidiary or the successor or assign of any thereof to any Affiliate of
Sellers.

     4.19 Bank Accounts, Powers, etc.
          --------------------------

     Schedule 4.19 ("Bank List") lists each bank, trust company, savings
institution, brokerage firm, mutual fund or other financial institution of which
any of SAC, SAE or LATC has an account or safe deposit box used in connection
with the operation of the Business and the names and identification of all
Persons authorized to draw thereon or to have access thereto, and lists the
names of each Person holding powers of attorney or agency authority from Sellers
or any Subsidiary and a summary of the terms thereof.

     4.20 No Brokers or Finders.
          ---------------------

     Neither Seller nor any Affiliate thereof has engaged any agent, broker,
finder, or investment or commercial banker in connection with the negotiation,
execution or performance of this Agreement who is or will be entitled to any
brokerage or finder's or similar fee or other

                                       26
<PAGE>

commission as a result of this Agreement, except for NationsBanc Montgomery
Securities LLC, as to which Sellers shall have full responsibility and Buyer
shall have no liability.

     4.21 Accuracy of Information.
          -----------------------

     All information prepared or dated on or after November 5, 1997 furnished by
or on behalf of Sellers to Buyer, its agents or representatives in connection
with Sellers, any Subsidiary, the Business, the Purchased Assets, the Excluded
Assets, the Assumed Liabilities and the Excluded Liabilities, this Agreement and
the transactions contemplated by this Agreement is, to Sellers' knowledge, true
and complete in all material respects and does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make any
statement therein not misleading. None of the information supplied or to be
supplied by or on behalf of Sellers prepared or dated on or after November 5,
1997 (a) to any Person for inclusion, or included, in any document or
application filed with any Governmental Entity having jurisdiction over or in
connection with the transactions contemplated by this Agreement or (b) to Buyer,
its agents or representatives in connection with these transactions or this
Agreement, did contain, or at the respective times such information is delivered
or becomes effective, will contain any untrue statement of a material fact, or
omitted or will omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. If Sellers become aware that any of
such information at any time subsequent to its delivery and prior to Closing
becomes untrue or misleading in any material respect, Sellers will promptly
notify Buyer in writing of such fact and of the reasons for such change. All
documents required to be filed by Sellers or any Subsidiary or Affiliate with
any Governmental Entity in connection with this Agreement or the transactions
contemplated by this Agreement will comply in all material respects with the
provisions of applicable Law.

     4.22 Environmental Compliance.
          ------------------------

     Except as set forth in Section 4.22 of the Disclosure Schedule during the
Period of Ownership, (i) Sellers have not received any notice or communication
indicating that any Seller with reference to the Business and the Purchased
Assets nor any Subsidiary has generated, used, transported, treated, stored,
released or disposed of, or has suffered or permitted anyone else to generate,
use, transport, treat, store, release or dispose of any Hazardous Substance in
violation of any Law; (ii) except as disclosed in environmental reports
delivered to Buyer by Sellers, Sellers have not received any notice or
communication indicating that there has been any generation, use,
transportation, treatment, storage, release or disposal of any Hazardous
Substance in connection with the conduct of the Business or the use of any
property or facility of Sellers or any Subsidiary included in the Purchased
Assets or to the knowledge of Sellers any nearby or adjacent properties which
has created or might reasonably be expected to create any liability under any
Law or which would require reporting to or notification of any Governmental
Entity; and (iii) with respect to the Business and the Purchased Assets, neither
Sellers nor any Subsidiary are subject to or have received notice of any written
order, consent decree, settlement agreement, investigation, notice, claim,
action, suit, proceeding, demand or other order or directive with or from any
Person relating to (a) a violation of Law relating to the generation, use,
transportation, treatment, storage, release or disposal of Hazardous Substances
or (b) any

                                       27
<PAGE>

actual or alleged damage, injury, threat or harm to health, safety, natural
resources or the environment.

     4.23 Powers of Attorney.
          ------------------

     During the Period of Ownership and to Sellers' knowledge, Sellers and the
Subsidiaries have not given any power of attorney (irrevocable or otherwise) to
any person or entity for any purpose relating to the Business, Purchased Assets
or Assumed Liabilities, other than powers of attorney given to regulatory
authorities in connection with routine qualifications to do business.

     4.24 As-Is Qualification
          -------------------

     Buyer hereby agrees and acknowledges that (i) except for the
representations and warranties set forth in Article IV, it is buying the
Purchased Assets on an "AS-IS" basis; (ii) it has made or will have made its own
investigations and inspections of the Purchased Assets, including, without
limitation, the physical aspects of the Purchased Assets and the Purchased
Assets' compliance with all laws applicable to the Purchased Assets' current or
intended use or development; (iii) in connection with its investigations and
inspections of the Purchased Assets it has contracted or had the opportunity to
contract with certain advisors and consultants, including, but not limited to,
environmental consultants, engineers and geologists, to conduct such
environmental, hazardous material, geological, soils, hydrology, seismic,
endangered species, archeological, physical, structural, mechanical and other
inspections of the Purchased Assets as Buyer deemed to be necessary, including
without limitation whether the Real Property is located in a "flood zone" as set
forth on the Special Flood Zone Area Maps maintained by the United States
Department of Housing and Urban Development and whether the Real Property is
situated in a Special Study Zone as designated under the Alquist-Priolo Special
Studies Zone Act with respect to areas of geologic instability; (iv) it has
approved the reports of such advisors and consultants; (v) except for the
representations and warranties set forth in Article IV, it is relying solely on
such reports and its own investigations as to the Purchased Assets, their
condition and other characteristics and compliance with laws; (vi) except for
the representations and warranties set forth in Article IV, Buyer is not making
the purchase of the Purchased Assets in reliance upon any statements or
representations, express or implied, made by Sellers or their agents or brokers,
as to the condition of or characteristics of the Purchased Assets, their fitness
for use for any particular purpose, or the Purchased Assets' compliance with any
zoning or other rules, regulations, laws or statutes applicable to the Purchased
Assets, or the uses permitted on or the development requirements for or any
other matters relating to the Property. Except as set forth in Article IV,
Sellers have no liability nor responsibility to Buyer in connection with the
matters set forth in this Section 4.24, including, without limitation, any
liability under any laws, rules, regulations or ordinances regulating the
environment, hazardous materials, or human health and safety, or any latent or
patent defects.

                                       28
<PAGE>

                                   ARTICLE V
                     REPRESENTATIONS AND WARRANTIES OF BUYER

     Except as otherwise indicated on the Buyer's Disclosure Schedule dated
November 12, 1998 previously delivered to Sellers, Buyer represents, warrants
and agrees as follows:

     5.1 Organization and Related Matters.
         --------------------------------

     Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware. Buyer has all necessary
corporate power and authority to carry on its business as now being conducted.
Buyer has the necessary corporate power and authority to execute, deliver and
perform this Agreement.

     5.2 Authorization.
         -------------

     The execution, delivery and performance of this Agreement by Buyer has been
duly and validly authorized by the Board of Directors of Buyer and by all other
necessary corporate action on the part of Buyer. This Agreement constitutes the
legal, valid and binding obligation of Buyer, enforceable against Buyer in
accordance with its terms except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws and
equitable principles relating to or limiting creditors' rights generally.

     5.3 No Conflicts.
         ------------

     The execution, delivery and performance of this Agreement by Buyer will not
violate the provisions of, or constitute a breach or default whether upon lapse
of time and/or the occurrence of any act or event or otherwise under (a) the
charter documents or bylaws of Buyer, (b) any Law to which Buyer is subject or
(c) any Contract to which Buyer is a party that is material to the financial
condition, results of operations or conduct of the business of Buyer, provided
that the appropriate regulatory approvals are received as contemplated by
Section 8.1.

     5.4 No Brokers or Finders.
         ---------------------

     Neither Buyer nor any Affiliate thereof has engaged any agent, broker,
finder, or investment or commercial banker in connection with the negotiation,
execution or performance of this Agreement who is or will be entitled to any
brokerage or finder's or similar fee or other commission as a result of this
Agreement.

     5.5 Governmental Filings. All documents required to be filed by Buyer or
         --------------------
any Affiliate with any Governmental Entity in connection with this Agreement or
the transactions contemplated by this Agreement will comply in all material
respects with the provisions of applicable law.

                                       29
<PAGE>

                                   ARTICLE VI
                    COVENANTS WITH RESPECT TO CONDUCT OF THE
                            BUSINESS PRIOR TO CLOSING

     Sellers hereby covenant and agree with Buyer that from November 13, 1998
until the Closing, and except as otherwise contemplated by this Agreement or
consented to or approved by Buyer in writing, as follows:

     6.1 Access.
         ------

     Sellers will (and will cause the Subsidiaries to) authorize and permit
Buyer and its representatives (which term shall be deemed to include its
independent accountants and counsel) to have reasonable access during normal
business hours, upon reasonable notice and in such manner as will not
unreasonably interfere with the conduct of their respective businesses, to all
of their respective properties, books, records, operating instructions and
procedures, Tax Returns and all other information with respect to the Business
as Buyer may from time to time reasonably request, and to make copies of such
books, records and other documents (at Buyer's expense) and to discuss the
Business with such third Persons (in a manner that will not unreasonably
interfere with the conduct of their business activities or the relationship
between such third persons and Sellers), including, without limitation,
directors, officers, employees, accountants, counsel, suppliers, customers, and
creditors, as Buyer considers reasonably necessary or appropriate for the
purposes of familiarizing itself with the Business, the Purchased Assets or the
Assumed Liabilities, obtaining any necessary Approvals of or Permits for the
transactions contemplated by this Agreement and conducting an evaluation of the
organization and the Business. Without limiting the generality of the foregoing,
Buyer shall be entitled to conduct or cause to be conducted on the Real Property
such soils and geological tests and environmental inspections, audits and tests
(including the taking of soils and ground water samples) and such structural and
other physical inspections as Buyer shall deem necessary or useful in connection
with its acquisition of the Real Property. After making such tests and
inspections, Buyer agrees to promptly restore the Real Property to its condition
prior to such tests and inspections, and to indemnify Sellers against any Losses
relating to Buyer's conduct of such tests and inspections, including, without
limitation, Sellers' reasonable attorneys' fees and expenses.

     6.2 Material Adverse Changes; Reports; Financial Statements.
         -------------------------------------------------------

     (a) Sellers will promptly notify Buyer of any event of which Sellers obtain
knowledge which has had or might reasonably be expected to have a material
adverse effect on the Business or which if known as of the date hereof would
have been required to be disclosed to Buyer. Buyer will promptly notify Sellers
of any event of which Buyer obtains knowledge which has had or might reasonably
be expected to have a material adverse effect on the Business.

     (b) Seller will furnish to Buyer (i) as soon as available, and in any event
within 10 days after it is prepared by Sellers or any of the Subsidiaries, all
financial statements relating to the Business prepared from and after the date
hereof for submission to their respective boards of directors and other
operating or financial reports relating to the Business (including any
projections and budgets) prepared for management of the Business, together with
any working papers related thereto, (ii) as soon as available, copies of all
reports, renewals, filings,

                                       30
<PAGE>

certificates, statements and other documents relating to the Business and filed
with any Governmental Entity, (iii) to the extent regularly prepared, monthly
and quarterly unaudited consolidated and combined balance sheets, statements of
operations and cash flows and changes in stockholder's equity of the Business,
and (iv) to the extent regularly prepared, such other reports as Buyer may
reasonably request relating to the Business. Each of the financial statements
delivered pursuant to this Section 6.2(b) shall be prepared in accordance with
GAAP, consistently applied (except as disclosed therein), except that such
financial statements may omit footnote disclosures required by GAAP and year-end
adjustments. Each of the financial statements delivered pursuant to this Section
6.2(b) shall be accompanied by a certificate of the respective chief financial
officers of Sellers and, as to the Subsidiaries, of Subsidiaries to the effect
that such financial statements present fairly the financial condition and
changes in equity and results of operations and cash flow of Sellers and its
Subsidiaries with respect to the operations of the Business for the periods
covered and reflect all adjustments (which consist only of normal recurring
adjustments not material in amount) necessary for a fair presentation.

     6.3 Conduct of Business.
         -------------------

     None of Sellers nor any Subsidiary in connection with the operation of the
Business will without the prior consent in writing of Buyer (which consent shall
not be unreasonably withheld or delayed):

     (a) conduct the Business except in the ordinary course consistent with past
practices; or

     (b) amend, terminate, renew or renegotiate any Material Contract or default
(or take or omit to take any action that with or without the giving of notice or
passage of time or both, would constitute a default) in any of its obligations
under any Material Contract or enter into any new Material Contract, any Lease,
or any prospective lease for all or any portion of the Real Property; or

     (c) terminate or fail to renew any existing insurance coverage; or

     (d) terminate, amend or fail to renew or preserve any Permits; or

     (e) in the case of SAC, SAE or LATC except as otherwise permitted herein,
incur or agree to incur any obligation or liability (absolute or contingent)
that individually calls for payment by SAC, SAE or LATC in connection with the
Business of more than $75,000 in any specific case or $250,000 in the aggregate;
or

     (f) in the case of SAC, SAE or LATC, make any loan, guaranty or other
extension of credit, or enter into any commitment to make any loan, guaranty or
other extension of credit, to or for the benefit of any Affiliate, director,
officer, employee, stockholder or any of their respective Associates or
Affiliates; or

     (g) in the case of SAC, SAE or LATC, grant any general or uniform increase
in the rates of pay or benefits to officers, directors or employees (or a class
thereof) or any increase in salary or benefits of any officer, director,
employee or agent or pay any bonus to any person, except for normal increases to
non-management personnel in accordance with past

                                       31
<PAGE>

practices and increases required under the terms of agreements existing on
November 12, 1998 and listed in the Disclosure Schedule, or enter into any new
employment, collective bargaining or severance agreement; or

     (h) sell, transfer, mortgage, encumber or otherwise dispose of any assets
or any liabilities relating to the Business, including the Purchased Assets and
Assumed Liabilities, except (i) for dispositions of property not greater than
$100,000 in the aggregate, or (ii) in the ordinary course of business or (iii)
as contemplated by this Agreement; provided, that prior to the Closing,
Meditrust shall be permitted to secure up to $80 million of financing with a
trust deed, assignment of rents and leases and fixture filing on the Real
Property, which financing shall be repaid in full out of the Purchase Price at
the Closing, and the trust deed shall be released at the Closing; or

     (i) in the case of SAC, SAE or LATC, issue, sell, redeem or acquire for
value, or agree to do so, any debt obligations or Equity Securities of Sellers
or any of the Subsidiaries; or

     (j) in the case of SAC, SAE or LATC, declare, issue, make or pay any
dividend or other distribution, other than in cash, cash items or intercompany
payables or receivables to its shareholders, or split, combine, dividend,
distribute or reclassify any shares of its Equity Securities; or

     (k) in the case of SAC, SAE or LATC, change or amend any of its charter
documents or bylaws; or

     (l) in the case of SAC, SAE or LATC, make any capital expenditures or
commitments with respect thereto aggregating more than $50,000; or

     (m) in the case of SAC, SAE or LATC, make special or extraordinary payments
to any Person, except for cash settlements of outstanding litigation matters
involving LATC which are identified on Schedule 2.2(a) as liabilities not
assumed by Buyer; or

     (n) in the case of SAC, SAE or LATC, make any material investment, by
purchase, contribution to capital, property transfer, or otherwise, in any other
Person; or

     (o) in the case of SAC, SAE or LATC, dispose of or permit to lapse any
Intangible Property or any rights to its use; or

     (p) in the case of SAC, SAE or LATC, compromise or otherwise settle any
claims, or adjust any assertion or claim of a deficiency in Taxes, or file any
appeal from an asserted deficiency, except in a form previously approved by
Buyer in writing, or file or amend any Tax Return, in any matters that involves
or may involve any of the Assumed Liabilities or Purchased Assets, before
furnishing a copy to Buyer and affording Buyer an opportunity to consult with
respect thereto; or

     (q) in the case of SAC, SAE or LATC, make any Tax election, change any
method or period of accounting or change any significant accounting policy,
practice or

                                       32
<PAGE>

procedure, or introduce any new method of management or operation in respect of
the Business; or

     (r) in the case of SAC, SAE or LATC, fail to maintain or repair any
Purchased Asset consistent with past practices; or

     (s) take any action, or make any commitment, which relates to the
development, zoning, rezoning or leasing or prospective leasing of any of the
Real Property; or

     (t) from and after November 12, 1998, make any payments from LATC to any
Affiliate, except for payments required to be made by LATC under the Lease
between LATC and MT with respect to the Real Property through the Closing Date
or, if earlier, the Proration Date; or

     (u) in the case of SAC, SAE or LATC, enter into any new banking
relationships or commit to any new lines of credit or other financing
facilities; provided, that LATC shall be permitted to obtain prior to the
Closing a line of credit to fund its operations through the Closing Date which
line of credit shall be on terms reasonably acceptable to Buyer;

     (v) agree to or make any commitment to take any action that is or would be
prohibited by this Section 6.3.

     6.4 Notification of Certain Matters.
         -------------------------------

     Sellers shall give prompt notice to Buyer, and Buyer shall give prompt
notice to Sellers, of (i) the occurrence, or failure to occur, of any event that
would be likely to cause any of its representations or warranties contained in
this Agreement to be untrue or inaccurate in any material respect at any time
from the date of this Agreement to the Closing Date and (ii) any failure on its
part to comply with or satisfy, in any material respect, any covenant, condition
or agreement to be complied with or satisfied by it under this Agreement.

     6.5 Permits and Approvals; Third Party Consents.
         -------------------------------------------

     (a) Sellers and Buyer each agree to cooperate and use their best efforts to
obtain (and will immediately prepare all registrations, filings and
applications, requests and notices preliminary to obtaining all) Approvals and
Permits that may be necessary or that may be reasonably requested by Buyer to
consummate the transactions contemplated by this Agreement.

     (b) To the extent that the Approval of a third party with respect to any
Contract is required in connection with the transactions contemplated by this
Agreement, Sellers shall cooperate with Buyer in obtaining such Approval prior
to the Closing Date.

     (c) From November 12, 1998 to the Closing Date, SAC and SAE agree to
include in each Contract relating to the Business entered into subsequent to
November 12, 1998 ("Subsequent Contract") a provision permitting the assignment
of any such Subsequent Contract to Buyer and providing that upon such
assignment, Buyer shall succeed to all of SAC's and SAE's rights, title and
interests thereunder subject only to Buyer's express assumption of all

                                       33
<PAGE>

SAC's and SAE's duties, powers and obligations under such Subsequent Contract,
or containing provisions that do not otherwise prohibit assignment to Buyer.

     6.6 Preservation of Business Prior to Closing Date.
         ----------------------------------------------

     During the period beginning on November 12, 1998 and ending on the Closing
Date, (a) Sellers will use their best efforts to preserve the Business and to
preserve the goodwill of customers, suppliers and others having business
relations with Sellers and its Subsidiaries and (b) Sellers will not take any
actions which interfere with Buyer's efforts to keep available to Buyer, the
services of the officers and employees of Sellers and its Subsidiaries involved
in the operations of the Business that Buyer may wish to retain. Nothing in this
Section shall obligate Buyer or any Subsidiary after the Closing to retain or
offer employment to any officer or employee of Sellers or any Subsidiary;
provided, that Buyer agrees to indemnify and hold Sellers harmless with respect
to any liability of Sellers for failing to comply with any of the notification
requirements of the Worker Adjustment and Retraining Notification Act which
results from the discharge or termination of employment by Buyer or LATC after
the Closing Date.

     6.7 Certain Filings.
         ---------------

     Sellers and Buyer will make any and all filings required to be made on
their respective parts under the Hart-Scott-Rodino Act and the California Horse
Racing Law. Buyer and Sellers agree to make any filings required under the
Hart-Scott-Rodino Act on or before November 20, 1998. Sellers and Buyer shall
furnish each other such necessary information and reasonable assistance as the
other may reasonably request in connection with its preparation of necessary
filings or submissions under the provisions of such laws. Sellers and Buyer will
supply each other with copies of all correspondence, filings or communications,
including file memoranda evidencing telephonic conferences, with representatives
of any Governmental Entity or member of its staff, with respect to the
transactions contemplated by this Agreement and any related or contemplated
transactions.

                                  ARTICLE VII
                         ADDITIONAL CONTINUING COVENANTS

     7.1 Noncompetition.
         --------------

     (a) Restrictions on Competitive Activities. Sellers agree that, after the
         --------------------------------------
Closing, Buyer shall be entitled to the goodwill and going concern value of the
Business and to protect and preserve the same to the maximum extent permitted by
law. For these and other reasons and as an inducement to Buyer to enter into
this Agreement, Sellers agree that for a period of five years after the Closing
Date Sellers will not, directly or indirectly, for their own benefit or as agent
for another, carry on or participate in the ownership, management or control of,
or be employed by, or consult for or otherwise render services to, any other
present or future business enterprise that competes with Buyer in the horse
racing business in the Counties of Los Angeles, San Bernardino, San Diego,
Orange and Riverside in the State of California in which Sellers or its
Subsidiaries are now substantially engaged.

     (b) Exceptions. Nothing contained herein shall limit the right of Sellers
         ----------
as an investor to hold and make investments in securities of any corporation or
limited partnership that

                                       34
<PAGE>

is registered on a national securities exchange or admitted to trading
privileges thereon or actively traded in a generally recognized over-the-counter
market, provided Sellers' equity interest therein does not exceed 10% of the
outstanding shares or interests in such corporation or partnership.

     (c) Special Remedies and Enforcement. Sellers recognize and agree that a
         --------------------------------
breach by Sellers of any of the covenants set forth in this Section 7.1 could
cause irreparable harm to Buyer, that Buyer's remedies at law in the event of
such breach would be inadequate, and that, accordingly, in the event of such
breach a restraining order or injunction or both may be issued against Sellers,
in addition to any other rights and remedies which are available to Buyer. If
this Section 7.1 is more restrictive than permitted by the Laws of any
jurisdiction in which Buyer seeks enforcement hereof, this Section 7.1 shall be
limited to the extent required to permit enforcement under such Laws. In
particular, the parties intend that the covenants contained in the preceding
portions of this Section 7.1 shall be construed as a series of separate
covenants, one for each county specified. Except for geographic coverage, each
such separate covenant shall be deemed identical in terms. If, in any judicial
proceeding, a court shall refuse to enforce any of the separate covenants deemed
included in this paragraph, then such unenforceable covenant shall be deemed
eliminated from these provisions for the purpose of those proceedings to the
extent necessary to permit the remaining separate covenants to be enforced.

     7.2 Nondisclosure of Proprietary Data.
         ---------------------------------

     After the Closing, none of Sellers nor any of its representatives shall, at
any time, make use of, divulge or otherwise disclose, directly or indirectly,
any trade secret or other proprietary data (including, but not limited to, any
customer list, record or financial information) concerning the Business or the
business or policies of Sellers related to the Business that Sellers or any
representative of Sellers may have learned as an owner or a shareholder,
employee, officer or director of the Business. In addition, none of Sellers nor
any of their representatives shall make use of, divulge or otherwise disclose,
directly or indirectly, to persons other than Buyer, any confidential
information concerning the Business that may have been learned in any such
capacity. Notwithstanding the restrictions of this Section 7.2, Sellers shall
not be precluded from disclosing any such confidential or proprietary
information (i) which is required to be disclosed by law, court order,
governmental order or decree; provided, that Sellers have provided notice to
Buyer of such disclosure and given Buyer the opportunity to seek a protective
order with respect to the information proposed to be disclosed; or (ii) to an
insurance carrier or lender, subject to appropriate confidentiality
restrictions.

     7.3 Tax Cooperation.
         ---------------

          After the Closing, Sellers shall, and shall cause its Affiliates to,
cooperate fully with Buyer in the preparation of all Tax Returns relating to
periods ending on or prior to the Closing Date and shall provide, or cause to be
provided at Sellers' sole cost and expense, to Buyer any records and other
information requested by such parties in connection therewith as well as access
to, and the cooperation of, the Auditors of Sellers and its Affiliates.  After
the Closing, Sellers shall, and shall cause its Affiliates to, cooperate fully
with Buyer in connection with any Tax investigation, audit or other proceeding
relating to the Business.  After the Closing, Buyer shall, and shall cause its
Affiliates to, cooperate fully with Sellers in the preparation of all

                                       35
<PAGE>

Tax Returns required to be filed by Sellers relating the Business and to periods
ending on or prior to the Closing Date and shall provide, or cause to be
provided at Buyer's sole cost and expense, to Sellers any records and other
information requested by such parties in connection therewith as well as access
to, and the cooperation of, Buyer's auditors. Any information obtained pursuant
to this Section 7.3 or pursuant to any other Section hereof providing for the
sharing of information or the review of any Tax Return or other Schedule
relating to Taxes shall be subject to Section 11.9.

     7.4 Employment Matters.
         ------------------

     (a) Non-Represented Employees. As of the Closing Date, Buyer may, at its
         -------------------------
option, offer employment to any employee of Sellers involved in the Business
that is not represented by a collective bargaining organization on such terms
and conditions as may be mutually agreed upon by Buyer and such employees.
Sellers shall not take any action, directly or indirectly, to prevent or
discourage any such employee involved in horse racing activities from being
employed by Buyer as of the Closing Date and shall not solicit, invite, induce
or entice any such employee to remain in the employ of Sellers or otherwise
attempt to retain the services of any such employee, except with the prior
written consent of Buyer. Sellers agree to consult with Buyer on all material
oral or written communications or meetings primarily regarding future employment
with such employees and/or the represented employees described below.

     (b) Union Contracts. LATC is a party to the collective bargaining
         ---------------
agreements relating to the Business listed in Schedule 4.16 hereto (the "Union
Contracts"). Promptly after the execution of this Agreement, LATC shall advise
each such union of the matters contemplated hereunder and shall use its best
efforts to secure such union's written agreement that Buyer shall be LATC's
successor to the Union Contracts. Upon consummation of the Closing, Buyer agrees
to assume and fully discharge the obligations of Sellers and to be bound by all
terms and conditions of the Union Contracts on and after the Closing Date.

     (c) Proration of Employee Benefits. All obligations for compensation,
         ------------------------------
wages, bonuses, severance pay, vacation time, pay in lieu of vacation, sickness
and accident benefits, leaves of absence, and similar employee benefits provided
by Sellers shall be prorated between Sellers and Buyer as of the Closing Date
or, if earlier, the Proration Date for all employees of Sellers or LATC who
become employees of Buyer as of the Closing Date. Sellers and LATC shall cause
all such benefits to be paid or accrued as of the Closing Date or, if earlier,
the Proration Date, and such amounts shall be included as liabilities in
calculating the Closing Adjustment.

     (d) No Third Party Beneficiaries. Notwithstanding any possible inferences
         ----------------------------
to the contrary, neither Sellers nor Buyer intend for this Section 7.4 to create
any rights or obligations except as between Sellers and Buyer, and no past,
present or future employees of Sellers, Subsidiaries or Buyer shall be treated
as third-party beneficiaries of this Section 7.4.

                                       36
<PAGE>

     7.5 Proration Payments.
         ------------------

     If any provision hereof requires the proration between Buyer and Sellers of
obligations to third parties, including employees or former employees, each
party hereto agrees to pay promptly upon demand by the other party (accompanied
by a reasonably itemized statement of the claim and basis therefor and
supporting documentation from such other party) its proportionate share of the
obligations that it has assumed hereunder. If the parties are unable to agree on
an amount due hereunder the parties shall select an Arbitrating Accountant to
resolve the dispute, which resolution shall be binding on the parties.

     7.6 New Gaming Profit Sharing.
         -------------------------

     In the event that video, mechanical, or electro-mechanical slot machines or
similar gaming devices ("Gaming Devices") are installed on the Real Property at
any time during the five-year period after the Closing Date, then Buyer agrees
to pay to Sellers an amount equal to 20% of the "pre-tax net profits" of Buyer
relating to such Gaming Devices for the ten-year period after Gaming Devices are
first introduced on the Real Property. "Pre-tax net profits" from Gaming Devices
(the "Gaming Royalties") shall be calculated and paid on a quarterly basis and
shall be determined in accordance with GAAP, including an allocation of the
overhead and related costs associated with generating the Gaming Devices
revenue. Accompanying each payment of Gaming Royalties shall be a report setting
forth in reasonable detail the calculation of the Gaming Royalties then due.
Sellers shall have the right to examine the books, records and accounts of Buyer
as are reasonably necessary to verify the calculation of Gaming Royalties;
provided, that such right shall not be exercised more than twice during any
12-month period. Such inspections shall be subject Sellers or their agents
signing a non-disclosure agreement, and may be conducted upon reasonable notice,
during normal business hours and in a manner that will not unreasonably
interfere with the conduct of the Business. If any audit reveals that Buyer has
underpaid Gaming Royalties hereunder, and the amount of Gaming Royalties which
Buyer has failed properly to pay exceeds by five percent (5%) or more the Gaming
Royalties actually paid to Sellers for the period under review, Buyer shall
reimburse Sellers for such underpayment and for the costs and expenses of any
independent certified public accountant engaged to conduct such review. In the
event of a dispute regarding the calculation of pre-tax net profits relating to
Gaming Devices, the dispute shall be finally and conclusively resolved by the
Arbitrating Accountant.

     7.7 No Solicitation.
         ---------------

     Sellers and their Subsidiaries shall not, directly or indirectly, through
any officer, director, agent or otherwise, solicit any offer or engage in any
negotiations, or provide non-public information to any person, other than Buyer
in connection with any transactions involving the sale of all or a substantial
part of the Business to any third party other than Buyer.

     7.8 Section 338(h)(10) Election.
         ---------------------------

     Buyer and Sellers agree that after the Closing Date each will make the
appropriate elections under Section 338(h)(10) of the Code to treat the sale of
the stock of LATC as an asset sale.

                                       37
<PAGE>

     7.9 Sales and Transfer Taxes.
         ------------------------

     Sellers shall pay all real and personal property transfer taxes, if any,
and all sales, use and other similar taxes, if any, imposed on or in connection
with the purchase, sale or transfer of the Purchased Assets to, and the
assumption of the Assumed Liabilities by, Buyer pursuant to this Agreement;
provided, that Sellers shall not be responsible for any real property taxes
relating to the reassessment of the Real Property with respect to periods after
the Closing as a result of the transactions contemplated hereby.

     7.10 Waiver of Bulk Sales Notice.
          ---------------------------

     Buyer and Sellers waive compliance with any applicable bulk sales laws,
subject to the provisions of Section 10.1.

     7.11 Elimination of Intercompany and Affiliate Liabilities.
          -----------------------------------------------------

     Prior to the Closing Date, Sellers shall cause to be repaid (i) any and all
loans or other extensions of credit made or guaranteed by Sellers or any
Subsidiary to or for the benefit of any director, officer, shareholder, or
employee involved in the Business, or any of their Affiliates or Associates and
(ii) any and all loans, guarantees or other extensions of credit of any amount
made to or for the benefit of Sellers or any of the Subsidiaries by any of such
persons. Buyer shall not have any continuing commitment, obligation or liability
of any kind with respect to the persons referred to in subsections (i) and (ii)
above as a result of this Agreement. Sellers agree to indemnify Buyer for any
Losses of Buyer with respect to any such commitment, obligation or liability not
assumed by Buyer.

     7.12 Pension Plan.
          ------------

     Prior to the Closing Date, Sellers shall cause The Santa Anita Companies,
Inc. Retirement Income Plan (the "Pension Plan") and the Santa Anita Companies,
Inc. 401(k) Plan (the "401(k) Plan") to be amended to provide that LATC is the
sponsor of such plans. The parties acknowledge that LATC will be the sponsor of
the Pension Plan and the 401(k) Plan following the Closing Date.

     7.13 Corporate Name.
          --------------

     Within one business day after the Closing Date, Sellers shall take all
action necessary and file all documents or instruments necessary with any
Governmental Entity or other Person to change the name of SAC and SAE to other
names. Such new names shall not conflict with or otherwise interfere with
Buyer's ability to use such names after the Closing.

     7.14 Repair of Damage; Condemnation.
          ------------------------------

     (a) In the event that prior to the Closing there is any "Non-Material" (as
defined in subsection (c) hereof) damage to the Purchased Assets, or any part
thereof, Buyer shall accept such Purchased Assets in their then current
condition (provided Buyer shall be entitled to any insurance proceeds).

                                       38
<PAGE>

     (b) In the event that prior to the Closing, any Non-Material portion of the
Purchased Assets is subject to a taking, Buyer shall accept the Purchased Assets
in their then-current condition and proceed with the Closing, in which case
Buyer shall be entitled to an assignment of all of Sellers' rights to any award
in connection with such taking. In the event of any such Non-Material taking,
Sellers shall not compromise, settle or adjust any claims to such award without
Buyer's prior written consent.

     (c) For the purpose of this Section 7.14, damage to the Purchased Assets or
a taking of a portion thereof shall be deemed to be "Non-Material" if the
reasonably estimated cost of restoration or repair of such damage or the amount
of the condemnation award with respect to such taking shall not exceed
$3,000,000.

     (d) Sellers agree to give Buyer prompt notice of any taking, damage or
destruction of the Purchased Assets.

                                  ARTICLE VIII
                             CONDITIONS OF PURCHASE

     8.1 General Conditions.
         ------------------

     The obligations of the parties to effect the Closing shall be subject to
the following conditions:

     (a) No Orders; Legal Proceedings. No Law or Order shall have been enacted,
         ----------------------------
entered, issued, promulgated or enforced by any Governmental Entity, nor shall
any Action have been instituted and remain pending and remain so by any
Governmental Entity on the scheduled Closing Date, that prohibits or restricts
or would (if successful) prohibit or restrict the sale of the Business or the
transfer of the Real Property. No Governmental Entity shall have notified any
party to this Agreement that consummation of the transactions contemplated by
this Agreement would constitute a violation of any Laws of any jurisdiction or
that it intends to commence proceedings to restrain or prohibit such
transactions or force divestiture or rescission, unless such Governmental Entity
shall have withdrawn such notice and abandoned any such proceedings prior to the
scheduled Closing.

     (b) Approvals. The applicable waiting period under the Hart-Scott-Rodino
         ---------
Act shall have expired or been terminated.

     8.2 Conditions to Obligations of Buyer.
         ----------------------------------

     The obligations of Buyer to effect the Closing shall be subject to the
following conditions except to the extent waived in writing by Buyer:

     (a) Representations and Warranties and Covenants of Sellers. The
         -------------------------------------------------------
representations and warranties of Sellers herein contained shall be true at the
Closing Date to the extent that there shall have been no Material Adverse
Effect, Sellers shall have performed all obligations and complied with all
covenants and conditions required by this Agreement to be performed or complied
with by them at or prior to the Closing Date, and Sellers shall have delivered
to Buyer certificates of Sellers in form and substance satisfactory to Buyer,
dated the

                                       39
<PAGE>

Closing Date and signed by the Chief Executive Officer and Chief Financial
Officer of Sellers to such effect.

     (b) No Material Adverse Effect. There shall not have occurred one or more
         --------------------------
events or other circumstances which have had a Material Adverse Effect
subsequent to September 30, 1998.

     (c) Opinion of Counsel. Buyer shall receive at the Closing from Arter &
         ------------------
Hadden LLP, counsel to Sellers, an opinion dated the Closing Date, in form and
substance substantially as set forth in Exhibit C.

     (d) Resignation of Directors and Certain Officers and Employees. The
         -----------------------------------------------------------
directors and officers of LATC listed in a letter to be delivered by Buyer to
Sellers not less than five days prior to the Closing Date, shall have submitted
their resignations in writing to LATC. Such resignations of officers and
directors (in such capacity) shall be effective as of the Closing.

     (e) Title. The Title Company shall have confirmed that it will issue the
         -----
Title Policy with respect to the Real Property, subject only to the Permitted
Exceptions.

     (f) Escrow Instructions. Sellers shall have entered into Joint Escrow
         -------------------
Instructions relating to the transfer of the Real Property substantially in the
form of Exhibit D hereto (the "Joint Escrow Instructions").

     8.3 Conditions to Obligations of Sellers.
         ------------------------------------

     The obligations of Sellers to effect the Closing shall be subject to the
following conditions, except to the extent waived in writing by Sellers:

     (a) Representations and Warranties and Covenants of Buyer. The
         -----------------------------------------------------
representations and warranties of Buyer herein contained shall be true in all
material respects at the Closing Date with the same effect as though made at
such time, Buyer shall have performed all obligations and complied with all
covenants and conditions required by this Agreement to be performed or complied
with by it at or prior to the Closing Date, and Buyer shall have delivered to
Sellers certificates of Buyer in form and substance satisfactory to Sellers,
dated the Closing Date and signed by the chief executive officer and chief
financial officer of Buyer, to such effect.

     (b) Opinion of Counsel. Seller shall receive at the Closing from O'Melveny
         ------------------
& Myers LLP, counsel to Buyer, an opinion dated the Closing Date, in form and
substance substantially as set forth in Exhibit E.

     (c) Escrow Instructions. Buyer shall have entered into the Joint Escrow
         -------------------
Instructions.

                                       40
<PAGE>

                                   ARTICLE IX
                      TERMINATION OF OBLIGATIONS; SURVIVAL

     9.1 Termination of Agreement.
         ------------------------

     Anything herein to the contrary notwithstanding, this Agreement and the
transactions contemplated by this Agreement shall terminate at the close of
business on January 15, 1998 unless extended by mutual consent in writing of
Buyer and Sellers and may otherwise be terminated at any time before the Closing
as follows and in no other manner:

     (a) Mutual Consent. By mutual consent in writing of Buyer and Sellers.
         --------------

     (b) Conditions to Buyer's Performance Not Met. By Buyer upon written notice
         -----------------------------------------
to Sellers that one or more of the conditions to the obligations of Buyer set
forth in Section 8.1 or 8.2 have not been satisfied.

     (c) Conditions to Sellers' Performance Not Met. By Sellers upon written
         ------------------------------------------
notice to Buyer that one or more of the conditions to the obligations of Sellers
set forth in Section 8.1 or 8.3 have not been satisfied.

     (d) Material Breach. By Buyer or Sellers if there has been a
         ---------------
misrepresentation or breach the result of which would be a material adverse
effect on the Business on the part of the other party in its representations,
warranties or covenants set forth herein; provided, however, that if such breach
or misrepresentation is susceptible to cure, Sellers or Buyer, as the case may
be, shall have 10 business days after receipt of notice from the other party of
its intention to terminate this Agreement pursuant to this Section 9.1(d) if
such misrepresentation or breach continues in which to cure such breach or
misrepresentation before the other party may so terminate this Agreement.

     (e) Destruction or Condemnation. By Buyer, if any of the Purchased Assets
         ---------------------------
are damaged, destroyed or taken, and if such damage, destruction or condemnation
is not "Non-Material" pursuant to Section 7.14.

     9.2 Effect of Termination.
         ---------------------

     In the event that this Agreement shall be terminated pursuant to Section
9.1, all further obligations of the parties under this Agreement shall terminate
without further liability of any party to another; provided that the obligations
of the parties contained in Section 11.9 [Confidentiality] and Section 11.14
[Expenses] shall survive any such termination. A termination under Section 9.1
shall not relieve any party of any liability for a breach of, or for any
misrepresentation under this Agreement, or be deemed to constitute a waiver of
any available remedy (including specific performance if available) for any such
breach or misrepresentation.

     9.3 Survival of Representations and Warranties.
         ------------------------------------------

     The representations and warranties contained in or made pursuant to this
Agreement shall expire on the first anniversary of the Closing, except that (i)
the representations

                                       41
<PAGE>

and warranties contained in Sections 4.1 [Organization and Related Matters], 4.2
[Stock], 4.8 [Authorization; No Conflicts], 4.20 [No Brokers or Finders], 4.22
[Environmental Compliance], 5.1 [Organization and Related Matters], 5.2
[Authorization], 5.4 [No Brokers or Finders], Section 7.9 [Sales and Transfer
Taxes], Section 7.10 [Waiver of Bulk Sales Notice], 7.14 [Repair of Damage;
Condemnation], and Section 4.4 [Taxes] shall survive the Closing and shall
remain in full force and effect through the expiration of the applicable statute
of limitations, and (ii) if a claim or notice is given under Article X
[Indemnification] with respect to any representation or warranty prior to the
applicable expiration date, such representation or warranty shall continue until
such claim is finally resolved.

                                   ARTICLE X
                                 INDEMNIFICATION

     10.1 Obligations of Sellers.
          ----------------------

     (a) Sellers agree to indemnify and hold harmless Buyer, and its directors,
officers, employees, affiliates, agents and assigns from and against any and all
Losses of Buyer, directly or indirectly, as a result of, or based upon or
arising from:

          (i) any material inaccuracy in or material breach or nonperformance of
     any of the representations, warranties, covenants or agreements made by
     Sellers in or pursuant to this Agreement; or

          (ii) any other matter as to which Sellers in other provisions of this
     Agreement has agreed to indemnify Buyer; or

          (iii) any liability or obligation of Sellers or any of its Affiliates
     not expressly assumed by Buyer pursuant to Section 2.2(b) hereof; or

          (iv) any third party claims in respect of the Purchased Assets,
     Assumed Liabilities or the Business (or regarding the conduct of the
     Business) from circumstances which arise prior to the Closing that are
     asserted after the Closing; or

          (v) non-compliance with any applicable bulk sales or fraudulent
     conveyance law in connection with or as a result of the sale and transfers
     contemplated by this Agreement; or

          (vi) any liabilities not assumed and set forth on Schedule 2.2(a).

     (b) Notwithstanding the provisions of Section 10.1(a) above, Buyer shall be
entitled to indemnity from Sellers for claims arising under Section 10.1(a)(i)
only after the aggregate claims thereunder would constitute a Material Adverse
Effect ("Aggregate Claims"). When the amount of the Aggregate Claims determined
exceeds $5,000,000, Sellers shall be obligated to indemnify Buyers for the full
amount of the Aggregate Claims and any other claims for indemnification under
Section 10.1(a)(i).

                                       42
<PAGE>

     10.2 Obligations of Buyer.
          --------------------

     (a) Buyer agrees to indemnify and hold harmless Sellers, and their
respective directors, officers, employees, affiliates, agents and assigns, from
and against any Losses of Sellers, directly or indirectly, as a result of, or
based upon or arising from:

          (i) any inaccuracy in or breach or nonperformance of any of the
     representations, warranties, covenants or agreements made by Buyer in or
     pursuant to this Agreement; or

          (ii) any other matter as to which Buyer in other provisions of this
     Agreement has agreed to indemnify Sellers; or

          (iii) any third party claims in respect of the Purchased Assets,
     Assumed Liabilities or the Business (or regarding the conduct of the
     Business) from circumstances which arise from and after the Closing.

     (b) Notwithstanding the provisions of this Section 10.2 to the contrary, in
the event that Buyer fails to consummate the transactions contemplated by this
Agreement, other than as a result of failure of Sellers to satisfy the
conditions to Closing set forth in Sections 8.1 and 8.2, then Sellers' sole and
exclusive recourse against Buyer shall be the retention of the Deposit described
in the Joint Escrow Instructions.

     10.3 Certain Tax Matters.
          -------------------

     (a) Sellers Indemnity. Sellers agree to indemnify, defend and hold harmless
         -----------------
Buyer against (i) any Tax payable by or on behalf of Sellers or any of its
Affiliates, to the extent such Taxes exceed the amount if any of Tax liability
expressly assumed by Buyer pursuant to Section 2.2(b), (ii) any deficiencies in
any Tax payable by or on behalf of Sellers or any of its Affiliates with respect
to any period ending (or treated by this Agreement as ending) on or prior to the
Closing Date, (iii) Taxes of any member of a consolidated or combined tax group
of which Sellers or any of its Affiliates are, or were at any time, a member,
for which Buyer is jointly or severally liable as a result of Sellers' or any
Subsidiary's inclusion in such group, (iv) any claim or demand for reimbursement
or indemnification resulting from any transfer by Sellers or any Subsidiary
prior to the Closing to any other person of any Tax benefits or credits
attributable to the Business, the Purchased Assets or the Assumed Liabilities,
or assumption of any Tax liability arising out of the transfer of the Purchased
Assets, including the stock of any of the Subsidiaries, or assumption of the
Assumed Liabilities, and (v) with respect to any Taxes payable by Buyer with
respect to the operation of the Business and the ownership of the Purchased
Assets (other than Buyer's income or franchise taxes) due for periods commencing
on or prior to and ending after the Closing Date (whether or not assessed prior
to the Closing Date), a pro- rata share of such Taxes, calculated as if the
period ended on the Closing Date.

     (b) Audit Matters. Sellers shall have the responsibility for, and the right
         -------------
to control, at Sellers' expense, the audit (and disposition thereof) of any Tax
Return relating to periods ending on or prior to the Closing Date and shall have
the right to participate in the disposition of the audit of any Tax Return
relating to the periods ending after the Closing Date if and to the extent that
such audit or disposition thereof could give rise to a claim for

                                       43
<PAGE>

indemnification hereunder. Buyer shall have the right directly or through its
designated representatives, to review in advance and comment upon all
submissions made in the course of audits or appeals thereof to any Governmental
Entity relating to periods ending (or treated by this Agreement as ending) on or
prior to the Closing Date and to approve the disposition of any audit adjustment
with respect to such periods if such disposition will or might reasonably be
expected to result in an increase in Taxes of Buyer for any period beginning at
or after the Closing.

     (c) Additional Matters. Notwithstanding any other provision of this
         -----------------
Agreement, the representations and indemnification in this Agreement by Sellers
of Buyer regarding Taxes of Sellers or any of their Subsidiaries or Affiliates
with respect to a particular year or other period ("Deficiency Period") shall
apply only to the extent attributable to the excess ("Excess Amount") of (i) the
Taxes for such Deficiency Period which result from the inclusion or
disallowance, as the case may be, of any item of income, gain, loss, deduction
or credit ("Tax Item") for such Deficiency Period, over (ii) the present value
of any reduction in Taxes for a year or other period preceding or subsequently
to the Deficiency Period ("Adjustment Period") attributable to an exclusion or
allowance, as the case may be, for the Adjustment Period of all or a portion of
a Tax Item corresponding to, or caused by, the adjustment with respect to the
Tax Item for the Deficiency Period. The following shall apply in determining the
Excess Amount.

          (i) The discount rate for determining the present value of any
     reduction in Taxes for an Adjustment Period shall be based on the U.S.
     Prime Rate as published in the Wall Street Journal on the last publication
     date during the Deficiency Period; and

          (ii) The reduction in Taxes for an Adjustment Period shall be based on
     the "Hypothetical Tax Rate." The Hypothetical Tax Rate shall be the
     percentage equal to the sum of "A" and "B," where: "A" equals the highest
     marginal federal income tax rate to which the taxable income of the Seller,
     Subsidiary or Affiliate in issue was subject for the Deficiency Period; and
     "B" equals the highest marginal state income or franchise tax rate to which
     the taxable income of such Seller, Subsidiary or Affiliate was subject for
     the Deficiency Period, as adjusted to take into account the effect of any
     federal income tax deduction for state income or franchise taxes.

     For example and for illustration purposes only, if (i) a Tax liability for
a Deficiency Period is attributable to the disallowance of a deduction under
Code Section 162, and (ii) all or any portion of such Tax Item is deductible for
one or more Adjustment Periods (regardless as to whether such Tax Item is
deductible under Code Section 162, 168 or other provision of the Code), then the
Tax representations and Tax indemnification set forth in this Agreement shall
apply only to the extent that the Taxes for the Deficiency Period attributable
to the disallowance of such Tax Item exceed the present value of the reduction
in Taxes (as determined above) for the Adjustment Period attributable to the
allowance of such Tax Item for such Adjustment Period.

                                       44
<PAGE>

     10.4 Procedure.
          ---------

     (a) Notice. Any party seeking indemnification (an "Indemnified Party") with
         ------
respect to any Loss shall give notice thereof to the party required to provide
indemnity hereunder (the "Indemnifying Party"). Notwithstanding the foregoing,
(i) no Indemnified Party shall have any obligation to give any notice of any
asserted liability by a third party unless such assertion is in writing, and
(ii) the rights of any Indemnified Party to be indemnified in respect of any
Loss resulting from the asserted liability shall not be adversely affected by
the Indemnified Party's failure to give or delay in giving notice unless (and
then only to the extent that) the Indemnifying Party is materially prejudiced
thereby.

     (b) Defense. If any claim, demand or liability is asserted by any third
         -------
party against any Indemnified Party, the Indemnifying Party shall upon the
written request of the Indemnified Party, defend any action or proceeding
brought against the Indemnified Party in respect of matters embraced by the
indemnity. If, after a request to defend any action or proceeding, the
Indemnifying Party neglects or refuses to defend the Indemnified Party, a
recovery against the latter suffered by it in good faith, is conclusive in its
favor against the Indemnifying Party, provided however that, if the Indemnifying
Party has not received reasonable notice of the action or proceeding against the
Indemnified Party, or is not allowed to control its defense, judgment against
the Indemnified Party is only presumptive evidence against the Indemnifying
Party. The parties shall cooperate in the defense of all third party claims
which may give rise to Indemnifiable Claims hereunder. In connection with the
defense of any claim, each party shall make available to the party controlling
such defense, any books, records or other documents within its control that are
necessary or appropriate for such defense.

     10.5 Survival.
          --------

     This Article X shall survive any termination of this Agreement.

     10.6 Notice by Sellers.
          -----------------

     Sellers agree to notify Buyer of any liabilities, claims or
misrepresentations, breaches or other matters covered by this Article X upon
discovery or receipt of notice thereof (other than from Buyer), whether before
or after Closing. Buyer agrees to notify Sellers of any liabilities, claims or
misrepresentations, breaches or other matters covered by this Article X upon
discovery or receipt of notice thereof (other than from Sellers), whether before
or after Closing.

     10.7 Not Exclusive Remedy.
          --------------------

     This Article X shall not be deemed to preclude or otherwise limit in any
way the exercise of any other rights or pursuit of other remedies for the breach
of this Agreement or with respect to any misrepresentation.

                                       45
<PAGE>

                                   ARTICLE XI
                                     GENERAL

     11.1 Amendments; Waivers.
          -------------------

     This Agreement and any schedule or exhibit attached hereto may be amended
only by agreement in writing of all parties. No waiver of any provision nor
consent to any exception to the terms of this Agreement shall be effective
unless in writing and signed by the party to be bound and then only to the
specific purpose, extent and instance so provided.

     11.2 Schedules; Exhibits; Integration.
          --------------------------------

     Each schedule and exhibit delivered pursuant to the terms of this Agreement
shall be in writing and shall constitute a part of this Agreement, although
schedules need not be attached to each copy of this Agreement. This Agreement,
together with such schedules and exhibits, constitutes the entire agreement
among the parties pertaining to the subject matter hereof and supersedes all
prior agreements and understandings of the parties in connection therewith.

     11.3 Best Efforts; Further Assurances.
          --------------------------------

     Each party will use its best efforts to cause all conditions to its
obligations hereunder to be timely satisfied and to perform and fulfill all
obligations on its part to be performed and fulfilled under this Agreement, to
the end that the transactions contemplated by this Agreement shall be effected
in accordance with its terms. The parties shall cooperate with each other in
such actions and in securing requisite Approvals. Each party shall execute and
deliver both before and after the Closing such further certificates, agreements
and other documents and take such other actions as the other party may
reasonably request to consummate or implement the transactions contemplated
hereby or to evidence such events or matters.

     11.4 Governing Law.
          -------------

     This Agreement and the legal relations between the parties shall be
governed by and construed in accordance with the laws of the State of California
applicable to contracts made and performed in such State and without regard to
conflicts of law doctrines except to the extent that certain matters are
preempted by federal law.

     11.5 No Assignment.
          -------------

     Neither this Agreement nor any rights or obligations hereunder are
assignable except that Buyer may assign its rights or a portion thereof
(including but not limited to its rights under Article X) to one or more
directly or indirectly wholly-owned subsidiaries of Buyer which are organized
under the laws of a state of the United States, however, notwithstanding any
such assignment hereunder Buyer shall continue to be responsible for payment of
the Purchase Price.

                                       46
<PAGE>

     11.6 Headings.
          --------

     The descriptive headings of the articles, sections and subsections of this
Agreement are for convenience only and do not constitute a part of this
Agreement.

     11.7 Counterparts.
          ------------

     This Agreement and any amendment hereto or any other agreement (or
document) delivered pursuant hereto may be executed in one or more counterparts
and by different parties in separate counterparts. All of such counterparts
shall constitute one and the same agreement (or other document) and shall become
effective (unless otherwise therein provided) when one or more counterparts have
been signed by each party and delivered to the other party.

     11.8 Publicity and Reports.
          ---------------------

     Sellers and Buyer shall coordinate all publicity relating to the
transactions contemplated by this Agreement, and no party shall issue any press
release, publicity statement or other public notice relating to this Agreement,
or the transactions contemplated by this Agreement, without obtaining the prior
consent of both Sellers and Buyer except to the extent that a particular action
is required by applicable Law.

     11.9 Confidentiality.
          ---------------

     All information disclosed by any party (or its representatives) whether
before or after the date hereof, in connection with the transactions
contemplated by, or the discussions and negotiations preceding, this Agreement
to any other party (or its representatives) shall be kept confidential by such
other party and its representatives and shall not be used by any such Persons
other than as contemplated by this Agreement, except to the extent that such
information (i) was known by the recipient when received, (ii) it is or
hereafter becomes lawfully obtainable from other sources, (iii) is necessary or
appropriate to disclose to a Governmental Entity having jurisdiction over the
parties, (iv) as may otherwise be required by law or (v) to the extent such duty
as to confidentiality is waived in writing by the other party. If this Agreement
is terminated, each party shall use all reasonable efforts to return upon
written request from the other party all documents (and reproductions thereof)
received by it or its representatives from such other party (and, in the case of
reproductions, all such reproductions made by the receiving party) that include
information not within the exceptions contained in the first sentence of this
Section 11.9, unless the recipients provide assurances reasonably satisfactory
to the requesting party that such documents have been destroyed.

     11.10 Parties in Interest.
           -------------------

     This Agreement shall be binding upon and inure to the benefit of each
party, and nothing in this Agreement, express or implied, is intended to confer
upon any other person any rights or remedies of any nature whatsoever under or
by reason of this Agreement. Nothing in this Agreement is intended to relieve or
discharge the obligation of any third person to any party to this Agreement.

                                       47
<PAGE>

     11.11 Performance by Subsidiaries.
           ---------------------------

     Each party agrees to cause its Subsidiaries to comply with any obligations
hereunder relating to such subsidiaries and to cause its subsidiaries to take
any other action which may be necessary or reasonably requested by the other
party in order to consummate the transactions contemplated by this Agreement.

     11.12 Notices.
           -------

     Any notice or other communication hereunder must be given in writing and
either (a) delivered in person, (b) transmitted by telex, telefax or
telecommunications mechanism or (c) mailed by certified or registered mail,
postage prepaid, as follows:

          If to Buyer, addressed to:

          MI Developments of America, Inc.
          337 Magna Drive
          Aurora, Ontario  L4G 7K1
          Canada
          Attention:  President

          With a copy to:

          O'Melveny & Myers LLP
          400 South Hope Street, 15th Floor
          Los Angeles, California 90071
          Attention: Frederick B. McLane, Esq.
          Facsimile: (213) 430-6407

          If to Sellers, addressed to:

          Meditrust Corporation
          197 First Avenue
          Needham Heights, MA  02194
          Attention:  Michael S. Benjamin
          Facsimile: (781) 433-1224

          With a copy to:

          Arter & Hadden LLP
          725 South Figueroa Street, Suite 3400
          Los Angeles, California 90017
          Attention: Bruce H. Newman, Esq.
          Facsimile: (213) 617-9255

or to such other address or to such other person as either party shall have last
designated by such notice to the other party.  Each such notice or other
communication shall be effective (i) if given

                                       48
<PAGE>

by telecommunication, when transmitted to the applicable number so specified in
(or pursuant to) this Section 11.12 and an appropriate answerback is received,
(ii) if given by mail, three days after such communication is deposited in the
mails with first class postage prepaid, addressed as aforesaid or (iii) if given
by any other means, when actually delivered at such address.

     11.13 Expenses.
           --------

     Each of Sellers and Buyer shall pay its own expenses incident to the
negotiation, preparation and performance of this Agreement and the transactions
contemplated hereby, including but not limited to the fees, expenses and
disbursements of its investment bankers, accountants and counsel and of securing
third party consents and approvals required to be obtained by it.

     Sellers shall pay (i) any documentary transfer tax, real property transfer
or gains tax, document recording fees and charges, and any income, franchise or
revenue tax or excise tax (and any surtax thereon) due in connection with the
consummation of the transactions contemplated by this Agreement, (ii) the cost
of a CLTA Title Policy for the Real Property, (iii) the cost of title
endorsements which are used for title curative purposes under Section 2.5, and
(iv) 50% percent of all other escrow and associated closing costs with respect
to transfers of the Real Property. Buyer shall pay (i) all document recording
fees and charges, (ii) the cost of any title endorsement other than an
endorsement for title curative purposes under Section 2.5, (iii) the incremental
cost of acquiring an ALTA Title Policy over an CLTA Title Policy and (iv) the
remaining 50% percent of the other escrow and closing costs referred to in
clause (iv) above.

     11.14 Remedies; Waiver.
           ----------------

     All rights and remedies existing under this Agreement and any related
agreements or documents are cumulative to, and not exclusive of, any rights or
remedies otherwise available under applicable Law. No failure on the part of any
party to exercise or delay in exercising any right hereunder shall be deemed a
waiver thereof, nor shall any single or partial exercise preclude any further or
other exercise of such or any other right.

     11.15 Attorney's Fees.
           ---------------

     In the event of any Action for the breach of this Agreement or
misrepresentation by any party, the prevailing party shall be entitled to
reasonable attorney's fees, costs and expenses incurred in such Action.

     Attorneys fees incurred in enforcing any judgment in respect of this
Agreement are recoverable as a separate item. The preceding sentence is intended
to be severable from the other provisions of this Agreement and to survive any
judgment and, to the maximum extent permitted by law, shall not be deemed merged
into any such judgment.

     11.16 Specific Performance.
           --------------------

     Sellers and Buyer each acknowledge that, in view of the uniqueness of the
Business and the Real Property and the transactions contemplated by this
Agreement, the other

                                       49
<PAGE>

party would not have an adequate remedy at law for money damages in the event
that this Agreement has not been performed in accordance with its terms. Each
party therefore agrees that the other party shall be entitled to specific
enforcement of the terms hereof in addition to any other remedy to which it may
be entitled, at law or in equity.

     11.17 Severability.
           ------------

     If any provision of this Agreement is determined to be invalid, illegal or
unenforceable by any Governmental Entity, the remaining provisions of this
Agreement shall remain in full force and effect provided that the economic and
legal substance of the transactions contemplated is not affected in any manner
materially adverse to any party. In the event of any such determination, the
parties agree to negotiate in good faith to modify this Agreement to fulfill as
closely as possible the original intents and purposes hereof. To the extent
permitted by Law, the parties hereby to the same extent waive any provision of
Law that renders any provision hereof prohibited or unenforceable in any
respect.

     11.18 Time of Essence
           ---------------

     Time is of the essence in the performance by Sellers and Buyer of their
respective obligations under this Agreement.

                                       50
<PAGE>

          IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by its duly authorized officers as of the day and year
first above written.

                              BUYER

                              MI DEVELOPMENTS OF AMERICA, INC.

                              By:____________________________________

                              Its:___________________________________

                              SELLERS

                              MEDITRUST CORPORATION



                              By:____________________________________

                              Its:___________________________________

                              MEDITRUST OPERATING COMPANY

                              By:____________________________________

                              Its:___________________________________


                              THE SANTA ANITA COMPANIES, INC.

                              By:____________________________________

                              Its:___________________________________



                                       51
<PAGE>

                              SANTA ANITA ENTERPRISES, INC.

                              By:____________________________________

                              Its:___________________________________

                                       52