Document:

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                                                                   Exhibit 10.11

              MAGNA ENTERTAINMENT CORP. LONG-TERM INCENTIVE PLAN

                                I. INTRODUCTION

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

1.2      Certain Definitions.
         -------------------

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

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

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

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

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

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

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

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

         "Company" has the meaning specified in Section 1.1.
          -------

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

         "Eligible Participants" shall mean the persons specified in Section
          ---------------------
1.4(a).
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         "Eligible Director" shall mean those Outside Directors specified in
          -----------------
Section 1.4(b).

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

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

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

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

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

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

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

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

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

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

         "Performance Measures" shall mean the criteria and objectives,
          --------------------
established by the Committee, which shall be satisfied or met (i) as a condition
to the exercisability of all or a portion of a Stock Option or SAR, (ii) as a
condition to the grant of a Stock Award or (iii) during the applicable
Restriction Period or Performance Period as a condition to the holder's receipt,
in

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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employment or other activities. All such interpretations, rules, regulations and
conditions shall be final, binding and conclusive.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

                II. STOCK OPTIONS AND STOCK APPRECIATION RIGHTS

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

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

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

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

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

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

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

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

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

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

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

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

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business day prior to the date of grant of such SAR on which a board lot of
shares of Common Stock traded on The Toronto Stock Exchange.

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

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

2.3      Termination of Employment or Service.
         ------------------------------------

         (a)   Disability. Unless otherwise specified in the Agreement relating
               ----------
to a Stock Option or SAR, as the case may be, if the employment with or service
to the Company of the holder of a Stock Option or SAR terminates by reason of
Disability, each Stock Option and SAR held by such holder shall be fully
exercisable and may thereafter be exercised by such holder (or such holder's
legal representative or similar person) until and including the earliest to
occur of (i) the date which is three (3) years (or such other period as set
forth in the Agreement relating to such Stock Option or SAR) after the effective
date of such holder's termination of employment or service and (ii) the
expiration date of the term of such Stock Option or SAR.

         (b)   Retirement. Unless otherwise specified in the Agreement relating
               ----------
to a Stock Option or SAR, as the case may be, if the employment with or service
to the Company of the holder of a Stock Option or SAR terminates by reason of
Retirement, each Stock Option and SAR held by such holder shall be fully
exercisable and may thereafter be exercised by such holder (or such holder's
legal representative or similar person) until and including the earliest to

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occur of (i) the date which is three (3) years (or such other period as set
forth in the Agreement relating to such Stock Option or SAR) after the effective
date of such holder's termination of employment or service and (ii) the
expiration date of the term of such Stock Option or SAR.

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

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

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

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                               III. STOCK AWARDS

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

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

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

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

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

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

                                       11
<PAGE>

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

         (e)   Awards to Certain Executive Officers. Notwithstanding any other
               ------------------------------------
provision of this Article III, and only to the extent necessary to ensure the
deductibility to the Company of an award, the number of shares of Common Stock
subject to a Stock Award granted to a "covered employee" within the meaning of
Section 162(m) of the Code in any calendar year shall not exceed 400,000,000.

3.3      Termination of Employment or Service.
         ------------------------------------

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

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

                         IV. PERFORMANCE SHARE AWARDS

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

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

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

         (b)   Vesting and Forfeiture. The Agreement relating to a Performance
               ----------------------
Share Award shall provide, in the manner determined by the Committee, in its
discretion, and subject to the provisions of this Plan, for the vesting of such
award, if specified Performance Measures are

                                       12
<PAGE>

satisfied or met during the specified Performance Period, and for the forfeiture
of all or a portion of such award, if specified Performance Measures are not
satisfied or met during the specified Performance Period.

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

4.3      Termination of Employment.
         -------------------------

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

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

                                  V. GENERAL

5.1      Effective Date and Term of Plan. This Plan was approved by the
         -------------------------------
directors of the Company on February __, 2000 and was approved by the unanimous
written resolution of all of the shareholders of the Company on February __,
2000, which date is the effective date of this Plan. This Plan shall terminate
when shares of Common Stock are no longer available for the grant, exercise or
settlement of awards, unless terminated earlier by the Board. Termination of
this Plan shall not affect the terms or conditions of any award granted prior to
termination.

5.2      Amendments. The Board may amend this Plan as it shall deem advisable,
         ----------
subject to any requirement of stockholder approval required by applicable law,
rule or regulation, including Section 162(m) and Section 422 of the Code;
provided, however, that no amendment shall be made without stockholder approval
if such amendment would (a) increase the maximum number

                                       13
<PAGE>

of shares of Common Stock available under this Plan (subject to Section 5.7) or
(b) effect any change applicable to Incentive Stock Options that is inconsistent
with Section 422 of the Code, unless the Board has determined in good faith that
such change is inconsistent with Section 422 of the Code and is necessary in
order to facilitate a transaction involving a Change of Control of the Company.
No amendment may impair the rights of a holder of an outstanding award without
the consent of such holder.

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

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

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

                                       14
<PAGE>

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

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

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

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

5.10     Designation of Beneficiary. If permitted by the Company, a holder of an
         --------------------------
award may file with the Committee a written designation of one or more persons
as such holder's beneficiary or

                                       15
<PAGE>

beneficiaries (both primary and contingent) in the event of the holder's death.
To the extent an outstanding Stock Option or SAR granted hereunder is
exercisable, such beneficiary or beneficiaries shall be entitled to exercise
such Stock Option or SAR.

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

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

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

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

                                       16<PAGE>

                                                                   EXHIBIT 10.12

PRIVATE & CONFIDENTIAL

November 26, 1999

Mr. David Mitchell
8817 Bonta Court
Las Vegas, Nevada
89134

Dear David:

Re:    Employment with MI Entertainment Corp.
---------------------------------------------

In accordance with our recent discussions, this letter confirms that the terms
and conditions of your employment with MI Entertainment Corp. (the
"Corporation"), shall be as follows:

1.  Position: You are appointed Executive Vice-President and CFO of the
    Corporation reporting to the Chairman and carrying out your day-to-day
    duties from the Corporation's head office at Santa Anita Race Track.

2.  Remuneration: Your Base Salary shall be US $300,000 per annum (less
    statutorily required deductions), payable monthly in arrears and otherwise
    in accordance with the Corporation's standard payroll practices.

    Annual Bonus:    In addition to your Base Salary, you shall receive an
    Annual Bonus (inclusive of all entitlement to vacation pay, whether
    vacation is taken or not in any period and less the required withholding
    taxes and other statutory deductions) in an amount equal to the greater of
    US $150,000 or one-half of one percent (0.5%) of the net profits before
    income tax of the Corporation for each such full fiscal year completed
    during your employment.

    "Net profits before income tax of the Corporation" for the purposes of this
    Agreement shall be determined and paid in accordance with the stated
    policies prescribed by the Corporation from time to time, in its sole
    discretion.

3.  Signing Bonus: In addition, you shall receive a one-time lump-sum signing
    bonus of US $100,000 (less statutorily required deductions and inclusive of
    all entitlement to vacation pay) after completion of your eighth week of
    employment.
<PAGE>

                                      -2-

4.   Benefits:  During your employment by the Corporation, you will be entitled
     to:

     (a)  participate in all group insurance and benefit programs generally
          applicable to salaried employees of the Corporation from time to time,
          with the exception of the Magna Employee Equity Participation and
          Profit Sharing Plan or any equivalent or related plans in effect from
          time to time;

     (b)  three (3) weeks vacation in respect of each completed twelve (12)
          month period, to be taken at such time or times as are mutually
          convenient to you and the Corporation, but not payment in lieu
          thereof;

     (c)  receive an automobile allowance of US $875 per month for the purchase
          or lease of a domestic vehicle, provided that you shall be responsible
          for all automobile operating costs including, without limitation,
          fuel, repairs, maintenance, insurance premiums and insurance
          deductibles;

     (d)  reimbursement for all reasonable and documented business expenses
          incurred on behalf of the Corporation in carrying out your duties, in
          accordance with the Corporation's policies from time to time, but
          excluding automobile operating costs; and

     (e)  reimbursement of your reasonable travel expenses to and from Las Vegas
          until the earlier of your family's relocation to California and
          December 31, 2000.

5.   Stock Options: Subject to the express approval of the Board of Directors of
     the Corporation and any regulatory bodies having jurisdiction (including
     the consent of NASDAQ to the listing of the underlying shares), and subject
     to you entering into a Stock Option Agreement with the Corporation in the
     standard form contemplated by the Corporation Incentive Stock Option Plan,
     the Corporation shall grant you options to purchase 25,000 Class A
     Subordinate Voting shares of the Corporation at an exercise price per share
     which is equal to 100% of the last sale price of such shares on NASDAQ on
     the trading day prior to the date of the Corporation's Board approval. Such
     options shall be exercisable by you only in accordance with the terms and
     conditions set forth in the Stock Option Agreement referred to above. Upon
     receipt of an executed copy of this Agreement, we will place this matter
     before the Board of Directors of the Corporation at the earliest
     opportunity.

6.   Termination: Your employment and this Agreement, including all benefits
     provided for under this agreement, will terminate without notice or payment
     in lieu thereof, on: (a) the acceptance by the Corporation of your
     voluntary resignation, (b) at the Corporation's option, your disability for
     an aggregate of six (6) months or more in any twenty-four (24) month
     period, subject to any statutory requirement to accommodate such
     disability, (c) your death; or (d) your dismissal for just cause or by
     reason of your breach of the terms of this Agreement.

     Otherwise, you or the Corporation may, at any time, terminate your
     employment and this Agreement by providing the other party with twelve (12)
     months' prior written notice of intention to terminate. In addition the
     Corporation may elect to terminate your employment immediately by paying
     you a retiring allowance of US $300,000 (less statutorily required
     deductions) either in a lump sum within
<PAGE>

                                      -3-

     thirty (30) days of the date of termination or monthly in arrears in six
     (6) equal installments commencing thirty (30) days after the date of
     termination. If your employment is terminated pursuant to this paragraph,
     the Corporation shall maintain on your behalf the benefits referred to in
     paragraph 4(a) (except for Short Term and Long Term disability benefits)
     for a period of not less than the period required by applicable statute.
     Your Short Term and Long Term disability benefits shall be maintained for
     the period required by applicable statute.

     In the event that you breach the provisions of paragraph 7, the payment of
     any further installments of such retiring allowance will immediately cease.
     Further, the amount paid in each installment will be offset by any income
     earned, during the period you are entitled to receive installments, from
     alternate or self-employment.

     Upon termination of this Agreement, other than upon your resignation under
     paragraph 6(a) or for dismissal for cause or for breach under sub-paragraph
     (d), any stock options referenced in paragraph 5 which have vested, will
     continue to be exercisable in accordance with the said Stock Option
     Agreement.

     The termination provisions set forth above represent all severance pay
     entitlement, notice of termination or pay in lieu thereof, salary, bonuses,
     automobile allowances, vacation and/or vacation pay and other remuneration
     and benefits payable or otherwise provided to you in relation to your
     employment by the Corporation or any affiliates of Magna International Inc.
     (the "Magna Group").

7.   Other Conditions:  You hereby acknowledge as reasonable and agree that you
     shall abide by the following terms and conditions:

     i)   Technology, Know-How, Inventions, Patents: That all designs, devices,
          improvements, inventions and ideas made or conceived by you resulting
          from your access to the business of the Corporation shall be exclusive
          property of the Corporation and you and your estate agree to take all
          necessary steps to ensure that such property rights are protected.

     ii)  Confidentiality: You shall keep confidential at all times during or
          after your employment, any information (including proprietary or
          confidential information) about the business and affairs of, or
          belonging to, the Corporation, or any member of the Magna Group or
          their respective customers or suppliers, including information which,
          though technically not trade secrets, the dissemination or knowledge
          whereof might prove prejudicial to any of them.

    iii)  Non-Competition: During the term of your employment with the
          Corporation and for a period of six (6) months after the cessation of
          your employment, you shall not, directly or indirectly, in any
          capacity compete with the business of the Corporation or any other
          member of the Magna Group in respect of which you have had, access to
          proprietary or confidential information or solicit the employees
          thereof.

8.  Term: Subject to earlier termination in accordance with the terms of this
    Agreement, your employment with the Corporation shall commence on January 1,
    2000, or such earlier or later date as may be mutually agreed upon, (the
    "Start Date") and shall expire on December 31, 2004. This Agreement may be
    renewed for a subsequent term on such terms and conditions as may be
    mutually
<PAGE>

                                      -4-

    agreed upon in writing. Upon termination of this Agreement, paragraph 7
    shall continue in full force and effect. This Agreement shall be null and
    void and of no effect if you do not commence employment by January 1, 2000.

9.  Assignability: The Corporation may, in its sole discretion, assign this
    Agreement to an affiliated or other organization at any time. Upon any such
    assignment, the terms and conditions of this Agreement shall continue in
    full force and effect.

If the terms of employment as set out in this Agreement are acceptable to you,
please sign and date three copies of this Agreement in the places indicated and
return two fully signed copies to the attention of Keith Stein by December 21,
1999, after which, if not so signed and returned, this Agreement shall become
null and void and of no effect.  Upon execution by you, this Agreement: (i)
replaces any prior written or oral employment contract or other Agreement
concerning remuneration between you and the Corporation, or any member of the
Magna Group; (ii) will continue to apply to your employment in a similar or
other capacity with the Corporation, or any member of the Magna Group and, (iii)
will continue to be applicable in the event that your employment with the
Corporation continues beyond the expiry date of the term specified above without
this Agreement being formally extended or replaced.

Yours very truly,

MI ENTERTAINMENT CORP.

Per:
    ---------------------
    Frank Stronach

                                   **********

I hereby accept the terms and conditions set out above and acknowledge that this
Agreement contains all of the terms and conditions of my employment with the
Corporation and that no other terms, conditions or representations other than
those within this letter form part of this Agreement. I confirm that I am not
subject to any restrictions (contractual or otherwise) arising from my former
employment which would prevent or impair me in carrying out my duties and
functions with the Corporation. Furthermore, I confirm that during the term of
my employment I will not offer to the Corporation any confidential or
proprietary information that I have knowledge of with respect to my former
employers, nor will I provide such information to the Corporation should I be
requested to do so, until such time as such information is no longer
confidential, proprietary or comes into the public domain.

------------------                  ------------------------------
Date                                David Mitchell

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