Document:

Exhibit 10.3

SECOND AMENDING AGREEMENT IN
RESPECT OF THE THIRD

AMENDED AND RESTATED GULFSTREAM PARK LOAN AGREEMENT

THIS
AGREEMENT made as of the 12th day of September, 2007,

BETWEEN:

GULFSTREAM PARK RACING
ASSOCIATION,

INC.,

a corporation incorporated under the laws of

the State of Florida

(being hereinafter called the “Borrower”),

OF THE FIRST PART,

- and -

MID
ISLANDI SF.,

a partnership formed under the laws of

Iceland, acting through its Zug branch

(being hereinafter called
the “Lender”),

OF THE SECOND PART,

- and -

REMINGTON PARK, INC.,

a corporation incorporated under the laws of

the State of Oklahoma

(being hereinafter called the “Remington

Guarantor”),

OF THE THIRD PART,

- and -

GPRA THOROUGHBRED TRAINING CENTER,

INC.,

a corporation
incorporated under the laws of

the State of Delaware

(being hereinafter called
the “Palm Meadows

Guarantor”),

- and -

MAGNA ENTERTAINMENT CORP.,

a corporation incorporated under the laws of

the State of Delaware

(being hereinafter called “MEC”), (the

Remington Guarantor, the Palm Meadows

Guarantor and MEC being hereinafter

collectively called the “Original

Guarantors”),

OF THE FOURTH
PART,

- and -

GULFSTREAM COMMERCIAL

ENTERPRISES, INC.,

a corporation incorporated under the laws of

the State of Florida

(being hereinafter called the “Gulfstream

Commercial  Guarantor” (the Original

Guarantors and the Gulfstream Commercial

Guarantor being hereinafter called the

“Guarantors”),

OF THE FIFTH PART.

WHEREAS the Lender, as lender, the Borrower, as borrower, and the
Original Guarantors, as guarantors, are parties to a Third Amended and Restated
Gulfstream Park Loan Agreement made as of December 22, 2006 (such Third Amended and Restated Gulfstream Park Loan Agreement, as
amended by a First Amending Agreement in respect of the Third Amended and
Restated Gulfstream Park Loan Agreement dated as of August 3, 2007, as the
Third Amended and Restated Gulfstream Park Loan Agreement may be further
extended, modified, renewed or replaced from time to time, being referred to
herein the “Loan  Agreement”);

 2
 

AND WHEREAS on September 12, 2007, MEC’s board of directors approved and adopted a
plan (the “Borrower Restructuring Plan”) to restructure MEC and
its subsidiaries (including the Borrower) and to revise the business plan of
MEC and its subsidiaries (including the Borrower);

AND WHEREAS the Borrower Restructuring Plan
contemplates the sale of assets including, without limiting the generality of
the foregoing, certain of those Properties, owned by the Borrower, that
constitute collateral for the Loan;

AND WHEREAS the Lender has
agreed, among other things, to waive the Pre-Payment Make Whole amounts in
respect of any pre-payments of the Loan made on or prior to May 31, 2008, and to provide a bridge loan to
MEC in a maximum amount of up to Eighty Million Dollars ($80,000,000), provided
that, among other things:

(i)                                     the Loan
Agreement is amended:

(A)                              to require the
Borrower to repay, in addition to the amount of the blended monthly instalments of principal and interest that the Borrower is
required to pay in accordance with Section 3.1 of the Loan Agreement,  not less than One Hundred  Million Dollars ($100,000,000) of the Loan in
cash by May 31, 2008;

(B)                                to require the
Borrower, the Guarantors, and MEC to use all commercially reasonable efforts to implement the
Borrower Restructuring Plan (including the sale of assets by the time periods
listed therein) and to use the net proceeds from any asset and/or real property
sales in the manner set forth in the Loan Agreement;

(C)                                to require MEC
to deliver a full recourse guarantee and indemnity of MEC (the “MEC Full Recourse Guarantee and Indemnity”), in form and
substance satisfactory to the Lender, under which MEC unconditionally
guarantees the payment and performance of the Indebtedness outstanding from
time to time, as well as interest and other amounts owing hereunder or under
the other Loan Documents, the completion of the Reconstruction in accordance
with the Gulfstream Development Agreement, the Construction Contracts and the
Plans, the completion of the Tranche 2 Slots Facilities Initiative in
accordance with the Tranche 2 Slots Facilities Contracts, the completion of the
Tranche 3 Slots Facilities Initiative in accordance with the Tranche 3 Slots
Facilities Contracts and the performance of all other obligations of the
Borrower under the Loan and the Loan Documents, including the payment of cost
overruns pursuant to Section 7.1(l) of the Loan Agreement; and

 3
 

(D)                              to require MEC
to deliver, as security for the MEC Full Recourse Guarantee and Indemnity,
a perfected Encumbrance under the Uniform Commercial Code as enacted in the
State of Delaware, in and to all of MEC’s right, title and interest, whether
now existing or hereafter arising, created or acquired in, to and under the
Collateral (as defined therein) in favor of the Lender pursuant to a general
security agreement in form and substance satisfactory to the Lender (the “MEC General Security Agreement”), dated September 12, 2007,
from MEC to the Lender; (ii) MEC executes and delivers the MEC Full Recourse
Guarantee and Indemnity and the MEC General Security Agreement;

AND WHEREAS the Lender, the Borrower
and the Guarantors have agreed to amend the Loan Agreement  in certain
respects as set out herein;

AND WHEREAS all capitalized terms used herein and not defined herein
shall have the respective meanings given to such terms in the Loan Agreement;

NOW
THEREFORE, in consideration of the mutual covenants and
agreements set forth in this Agreement and the sum of Ten Dollars ($10.00) paid
by each of the parties hereto to the other and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged),
the parties hereto covenant and agree as follows:

1.                                      Definitions.  Unless otherwise defined herein, all
capitalized terms used in this agreement (this “Agreement”) shall have the respective meanings ascribed to
them in the Loan Agreement.

2.                                      Representations and Warranties.  The Borrower and the Guarantors jointly and
severally represent and warrant to and in favour of the Lender, with the intent
that the Lender shall be entitled to rely upon such representations and
warranties in entering into this Agreement and notwithstanding the completion
of the transactions contemplated herein, that: (i) all of the recitals to this
Agreement are true and complete in all material respects; and (ii) there are no
facts, conditions or circumstances that are known to the Borrower or any of the
Guarantors and that may reasonably be considered relevant to the Lender’s
decision to enter into this Agreement that have not been disclosed in writing
to the Lender.

3.                                      Amendments.  The Loan
Agreement  is hereby amended as follows:

(a)                                  by adding in proper
alphabetical order the following definition of “Additional MEC Security” to Section 1.1 of the Loan
Agreement: ““Additional MEC Security”
has the meaning ascribed thereto in Section 5.1;”;

 4
 

(b)                                 by adding in proper
alphabetical order the following definition of “MEC Full Recourse Guarantee and Indemnity” to
Section 1.1 of the Loan Agreement: ““MEC Full Recourse Guarantee
and Indemnity” has the meaning ascribed thereto in Section 5.1;”;

(c)                                  by adding in proper
alphabetical order the following definition of “MEC General Security
Agreement” to Section 1.1 of the Loan Agreement: ““MEC General Security
Agreement” has the meaning ascribed thereto in Section 5.1;”;

(d)                                 by adding the
following new paragraph after the first paragraph in Section 3.1:

“As of the date, if any, on which, in addition to the amount of the
blended monthly instalments of principal and interest that the Borrower is
required to pay in accordance with this Section 3.1, One Hundred Million
Dollars ($100,000,000) of the Loan has been repaid in cash on or prior to May
31, 2008, the amount of the blended monthly instalments of principal and
interest referred to in the paragraph above will be revised based on the
remaining portion of the previously applicable 25-year amortization period.”

(e)                                  by adding the
following new paragraph at the end of Section 3.4(a):

“Notwithstanding the foregoing, the Lender shall not charge, and the
Borrower shall not be obligated to pay, a Pre-Payment Make-Whole Amount in
respect of any valid pre-payments made under this Agreement on or prior to May 31, 2008.”

(f)                                    by deleting the
word “and” immediately following the “;” at the end of Section 5.1(k) of the
Loan Agreement, and by deleting the “.” and the end of Section 5.1(l) of the
Loan Agreement and replacing it with”; and”;

(g)                                 by adding the
following as Sections 5.1(m) and 5.1(n) of the Loan Agreement:

“(m)                        in return
for: (i) the Lender agreeing to waive the Pre-Payment Make Whole amounts in
respect of any pre-payments of the Loan made on or prior to May 31, 2008; and
(ii) the Lender agreeing to provide a bridge loan to MEC in a maximum amount of
up to Eighty Million Dollars ($80,000,000), pursuant to, in accordance with,
and subject to the terms of that certain Bridge Loan Agreement 

 5
 

between, inter
alios, MEC and Lender dated as of September 12, 2007 as the same may
be amended, modified, restated, severed, consolidated, renewed, replaced, or
supplemented from time to time, the full recourse guarantee and
indemnity (the “MEC  Full Recourse  Guarantee
and Indemnity”) of MEC, in form and substance satisfactory to the
Lender, under which MEC unconditionally guarantees the payment and performance
of the Indebtedness outstanding from time to time, as well as interest and
other amounts owing hereunder or under the other Loan Documents, the completion
of the Reconstruction in accordance with the Gulfstream Development Agreement,
the Construction Contracts and the Plans, the completion of the Tranche 2 Slots
Facilities Initiative in accordance with the Tranche 2 Slots Facilities
Contracts, the completion of the Tranche 3 Slots Facilities Initiative in
accordance with the Tranche 3 Slots Facilities Contracts and the performance of
all other obligations of the Borrower under the Loan and the Loan Documents,
including the payment of cost overruns pursuant to Section 7.1(l); and

(n)                                 as
security for the MEC Full Recourse Guarantee and Indemnity, a perfected
Encumbrance under the Uniform Commercial Code as enacted in the State of
Delaware, in and to all of MEC’s right, title and interest, whether now
existing or hereafter arising, created or acquired in, to and under the
Collateral (as defined therein) in favor of the Lender, pursuant to a general
security agreement in form and substance satisfactory to the Lender (the “MEC General Security Agreement”), dated September 12, 2007,
from MEC to the Lender.”;

(h)                                 by deleting the last
paragraph of Section 5.1 of the Loan Agreement in its entirety (beginning with
the words “The security set out above” and ending with the words “provided on
August 3, 2007.”), and replacing it with the following:  “At all times after September 12, 2007, the
security set out above in this Section 5.1 (except the Gulfstream Note) is
herein called the “Security”; the
Security provided by the Borrower (except the Pledge of Gulfstream Commercial
Shares) is herein called the  “Original
Security”, the Security provided by the Remington Guarantor,
the Palm Meadows Guarantor and MEC (except the MEC Full Recourse Guarantee
and Indemnity and the MEC General Security Agreement) is herein called
the “Additional
Security”, the Pledge of Gulfstream Commercial Shares is
herein called the  “Additional
Borrower Security”, the Security provided by the Gulfstream

 6
 

Commercial Guarantor is herein called the  “Gulfstream Commercial Additional Security”,
and the MEC Full Recourse Guarantee
and Indemnity and the MEC General Security Agreement provided by MEC is
herein called the  “Additional
MEC Security”.   The Original Security (save and
except for the Tranche 2 Future Advance Agreements and Tranche 3 Future Advance
Agreements) was provided on or before the Tranche 1 First Advance Date, the
Additional Security from the Palm Meadows Guarantor was provided on July 22,
2005, the Additional Security
from the Remington Guarantor was provided upon the receipt of the Gulfstream
Loan OHRC Approval, the Tranche 2 Future Advance Agreements were provided in
connection with the Second Amended and Restated Gulfstream Loan Agreement, the
Tranche 3 Future Advance Agreements were provided on December 22, 2006, the Additional Borrower Security and the
Gulfstream Commercial Additional Security were provided on August 3,
2007, and the Additional MEC Security
was provided on September 12, 2007.”;

(i)                                     by deleting the
word “and” immediately following the “;” at the end of Section 7.1(cc) of the
Loan Agreement, and by deleting the “.” and the end of Section 7.1(dd) of the
Loan Agreement and replacing it with”; and”; and

(j)                                     by adding the
following as Sections 7.1 (ee) and (ff) of the Loan Agreement:

“(ee) the Borrower, the Guarantors, and MEC shall use all commercially
reasonable efforts to implement the Borrower Restructuring Plan (including the
sale of assets by the time periods listed therein) and to use the net proceeds
from any asset and/or real property sales in the manner set forth in this
Agreement, provided that nothing in this Subsection 7.1(ee) shall derogate from
the provisions of Section 8.1 of this Agreement or relieve the  Borrower, the Guarantors, and MEC from the
obligation to comply with same; and

(ff) the Borrower shall repay, in addition to the amount of the blended
monthly instalments of principal and interest that the Borrower is required to
pay in accordance with Section 3.1, not less than One Hundred  Million Dollars ($100,000,000) of the Loan in
cash by May 31, 2008. Provided that: (i) such pre-payments under this Agreement are first applied to Tranche 2, with
the balance of any such pre-payment, if any, thereafter remaining then applied
to Tranche 3, and the balance of any such pre-payment, if any, thereafter
remaining then applied to Tranche 1; 

 7
 

and (ii) no Event of Default exists under this Agreement and/or under the Remington Loan Agreement at
the time such pre-payments are received by Lender.”

4.                                      Opinions.  The Borrower shall, if
requested by the Lender in writing, deliver to the Lender, as soon as
reasonably practicable following such written request, an opinion of the Borrower’s and Guarantor’s Florida Agent addressed
to the Lender, the Lender’s Counsel and the Lender’s Florida Agent, in form,
scope and substance satisfactory to the Lender and its counsel, acting
reasonably, with respect to this Agreement, the MEC Guarantee and
Indemnity, the MEC Full
Recourse Guarantee and Indemnity, and
the MEC General Security Agreement.

5.                                      Default.  Any
default by the Borrower under this Agreement shall be deemed for all purposes
to be an Event of Default under the Loan Agreement.

6.                                      Ratification and Confirmation of Amended Loan Agreement.   The
Loan Agreement, as amended by
this Agreement, is hereby ratified and confirmed in all respects and time shall
remain of the essence. After the date
hereof, all references in each Loan Document to the Credit Agreement or Loan
Agreement shall be deemed to be a reference to the Loan Agreement as amended by
this Agreement.

7.                                      Ratification and Confirmation of MEC Guarantee and
Indemnity.   MEC
hereby acknowledges and agrees that the liability of MEC under the MEC Full Recourse Guarantee and Indemnity
is in addition to and independent of the liability of MEC under the MEC Guarantee and Indemnity, that the MEC Full Recourse Guarantee and Indemnity
and the MEC General Security Agreement are being delivered by MEC as additional
Security under the Loan Agreement, and that the MEC Guarantee and Indemnity and all Security delivered in
connection therewith remain in full force and effect.  The MEC
Guarantee and Indemnity and all Security delivered in connection
therewith are hereby ratified and confirmed in all respects and time shall
remain of the essence.

8.                                      Successors and Assigns.  This Agreement shall enure to the benefit of
and shall be binding on and enforceable by the parties hereto and their respective
successors and permitted assigns.

9.                                      Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida and the federal
laws of the United States of America applicable herein.

10.                                Time of the Essence.  Time shall be of the essence of this
Agreement.  If anything herein is to be
done on a day which is not a Business Day, the same shall be done on the next
succeeding Business Day.  Where in this
Agreement a number of days is prescribed, the number shall be computed by
excluding the first day and including the last day.

 8
 

11.           Headings, Extended Meanings.  The headings in this Agreement are inserted
for convenience of reference only and shall not constitute a part hereof and
are not to be considered in the interpretation hereof.  In this Agreement, words importing the
singular include the plural and vice versa;
words importing the masculine gender include the feminine and vice versa; and words importing persons
include firms or corporations and vice versa.

12.           Counterparts.  This Agreement may be executed in
counterparts and may be delivered by e-mail and/or facsimile transmission.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
have caused the same to be executed by their duly authorized representatives as
of the date first above written.

	
  

  	
  GULFSTREAM PARK RACING

  ASSOCIATION, INC.

  
	
   

  	
   

  
	
   

  	
  by

  	
         /s/ Blake
  S. Tohana

  
	
   

  	
   

  	
    Name: Blake S. Tohana

  
	
   

  	
   

  	
    Title:   Executive
  Vice-President and

                Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ William Ford

  
	
   

  	
   

  	
    Name: William G. Ford

  
	
   

  	
   

  	
    Title:   Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  We have authority to bind the Corporation.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  REMINGTON PARK, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
      /s/ Blake S. Tohana

  
	
   

  	
   

  	
    Name: Blake S. Tohana

  
	
   

  	
   

  	
    Title:   Executive
  Vice-President

                and
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
      /s/ William Ford

  
	
   

  	
   

  	
    Name: William G. Ford

  
	
   

  	
   

  	
    Title:   Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  We have authority to bind the Corporation.

  

 

 9
 

 

	
  

  	
  GPRA THOROUGHBRED

  TRAINING CENTER INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
      /s/ Blake Tohana

  
	
   

  	
   

  	
    Name: Blake S. Tohana

  
	
   

  	
   

  	
    Title:   Executive
  Vice-President

                and
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
      /s/ William Ford

  
	
   

  	
   

  	
    Name: William G. Ford

  
	
   

  	
   

  	
    Title:   Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  We have authority to bind the Corporation.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MAGNA ENTERTAINMENT CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
  /s/ Blake Tohana

  
	
   

  	
   

  	
    Name: Blake S. Tohana

  
	
   

  	
   

  	
    Title:   Executive
  Vice-President

                and
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
      /s/ William Ford

  
	
   

  	
   

  	
    Name: William G. Ford

  
	
   

  	
   

  	
    Title:   Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  We have authority to bind the Corporation.

  
	
   

  	
   

  	
   

  
	
   

  	
  GPRA COMMERCIAL ENTERPRISES,

  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
      /s/ Blake S. Tohana

  
	
   

  	
   

  	
    Name: Blake S. Tohana

  
	
   

  	
   

  	
    Title:   Executive
  Vice-President

                and
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
      /s/ William G. Ford

  
	
   

  	
   

  	
    Name: William G. Ford

  
	
   

  	
   

  	
    Title:   Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  We have authority to bind the Corporation.

  
					

 

 10
 

 

	
  

  	
  MID ISLANDI SF.,

    ACTING THROUGH ITS ZUG

  BRANCH

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
      /s/ Thomas Schultheiss

  
	
   

  	
   

  	
    Name: Thomas Schultheiss

  
	
   

  	
   

  	
    Title:   Branch Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
      /s/ Peter Nideroest

  
	
   

  	
   

  	
    Name: Peter Nideroest

  
	
   

  	
   

  	
    Title:   Branch Manager

  
	
   

  	
   

  	
   

  
	
   

  	
  We have authority to bind the Partnership

  

 

 11Exhibit 10.4

MEC LETTERHEAD

As of [September
•], 2007

Mr. Thomas Hodgson

Senior Partner
& Chairman

Greenbrook Capital
Partners Inc.

20 Eglinton Ave. West, Suite 1400

Toronto, Ontario

P.O. Box 2003

M4R 1K8

Dear
Tom:

Consulting
Agreement with Magna Entertainment Corp. (“MEC”)

Further
to our discussions, MEC wishes to retain Greenbrook Capital Partners Inc. (together
with its employees, the “Consultant”) to provide consulting services to assist MEC
and its subsidiaries with the adoption and implementation of a restructuring
plan (the “Project”).  The overall
objective of the Project is to eliminate the MEC debt and underperforming /
loss operations.  The terms and
conditions of the consulting arrangement would be as follows:

1.                                       Consultant.  The Consultant will provide
its Senior Partner & Chairman, Mr. Thomas Hodgson (the “Designated
Consultant”), to carry out the Consultant’s obligations under this
agreement.  The Consultant’s use of any
other employee or consultant other than the Designated Consultant to perform
the consulting services in respect of the Project is subject to the prior
written authorization of MEC.  The Consultant acknowledges that due to the
nature of the Project, the Designated Consultant will be expected to engage in
extensive business travel.

2.                                       Fees.  MEC will pay the Consultant an
annual fee of US$500,000 per annum, exclusive of GST (“Base Fee”), payable in
monthly instalments.  Invoices should be
rendered on a monthly basis in arrears and include GST and provincial taxes
where applicable.

In addition to the Base Fee set out above, and
provided that the Consultant has complied with its obligations hereunder, the
Consultant will be entitled to receive performance fees, calculated and payable
as follows:

·                  following
the receipt by MEC of an aggregate minimum of US$250 million of 

proceeds (net of all
third-party commissions, selling expenses and other costs, “Proceeds”) from
asset sales and/or equity raises conducted in accordance with the Project, the
Consultant will be entitled to receive US$125,000 (being 0.05% of US$250
million), payable within 30 days of the date on which the Consultant has
delivered an invoice therefor following MEC’s receipt of such aggregate Proceeds;

·                  on
the next US$250 million of Proceeds (or part thereof) received by MEC from
asset sales and/or equity raises conducted in accordance with the Project, the
Consultant will be entitled to receive 0.1% of such incremental amount, payable
within 30 days of the date on which the Consultant has delivered an invoice
therefor following MEC’s receipt of such incremental Proceeds;

·                  on
any further incremental Proceeds above US$500 million received by MEC from
asset sales and/or equity raises conducted in accordance with the Project, the
Consultant will be entitled to receive 0.2% of such incremental amount (for
certainty, that amount above US$500 million), payable within 30 days of the
date on which the Consultant has delivered an invoice therefor following MEC’s
receipt of such further incremental Proceeds;

·                  provided,
however, that for the purposes of these calculations of the performance fees,
the Proceeds received by MEC from any equity issued to MI Developments Inc. or
Fair Enterprise Limited will be deemed to be reduced by 60%.

For greater certainty, provided that this agreement
is in effect at the time that MEC enters into any transaction that results in
MEC receiving the Proceeds referred to above, the Consultant will be entitled
to receive the relevant performance fees (with such performance fees being paid
at the time specified above) regardless of whether this agreement is in effect
at the time that MEC receives the Proceeds.

3.                                       Stock Options.  Subject
to the express approval of the Board of Directors of MEC and any regulatory
bodies having jurisdiction (including the consent of the Toronto Stock Exchange
to the listing of the underlying shares), and subject to the Designated Consultant
entering into a stock option agreement with MEC in the standard form
contemplated by the Corporation’s 2003 Incentive Stock Option Plan, MEC will
grant the Designated Consultant options to purchase 250,000 Class A Subordinate
Voting Shares of MEC (each an “MEC Share”) at an exercise price per MEC Share
which is equal to one hundred per cent (100%) of the last sale price of an MEC
Share on the Toronto Stock Exchange on the trading day prior to the date of MEC
Board approval of the stock option grant; provided, however, that the Designated
Consultant acknowledges and agrees that the timing and pricing of the grant of
its options will be subject to all applicable securities law restrictions.  Such options will be exercisable by the Designated
Consultant 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, MEC will place this
matter 

 2
 

before the MEC Board for
review pursuant to the terms of this paragraph 3.

4.                                       Expenses.  MEC will reimburse the
Consultant for all reasonable business expenses actually and properly incurred
in carrying out the Project to the extent specifically required by MEC under
this agreement and in accordance with MEC’s expense reimbursement
guidelines.  If the Consultant travels
outside of Canada on MEC business, it will be the Consultant’s responsibility
to maintain adequate medical coverage. 
The Consultant will supply original vouchers and receipts to support all
expenses, will itemize such expenses on a standard MEC expense report, and will
obtain advance approval from MEC’s Chief Financial Officer for any individual
expense in excess of US$2,500.

5.                                       Coordination of Services.  The
Consultant will carry out those services needed to complete the Project with
the assistance and under the direction of the MEC Board of Directors (the “Board”).  The Consultant will liaise with members of
MEC management and those other employees and consultants of MEC and will provide
written and verbal reports as requested by the Board from time to time.  For greater certainty, the Consultant
acknowledges and agrees that MEC will make its own determination of whether to
pursue or consummate any transaction that the Consultant may suggest or
recommend.

6.                                       Term.  This agreement will commence effective
[September] •, 2007 and terminate
on [December 12, 2008], unless terminated
earlier in accordance with this paragraph. 
This agreement may be immediately terminated by (i) mutual agreement of
the parties or (ii) MEC at any time in the event the Consultant is in material
breach of the provisions of this agreement, or the Designated Consultant dies
or becomes disabled to such an extent that he is unable to perform services for
the Consultant as provided for in this agreement in any material way.  In addition, MEC may terminate this agreement
at any time by giving the Consultant [thirty (30)]
days prior written notice.

7.                                       Independent Contractors.  The
Consultant is an independent contractor and in no way will the Consultant be
considered as an employee, agent or joint venturer of MEC.  Subject to coordination with the persons described
in paragraph 5, the Consultant will determine how, where and when it will carry
out its consulting services and other obligations under this agreement.  The Consultant will have no authority to
represent MEC except as a consultant nor to bind it in any way and agrees that it
will not hold itself out as having authority to act for MEC or its affiliates.

As an independent contractor, the Consultant
will not be entitled to any employment related benefits, including without
limitation, any payments under the Employment Standards Act, 2000
(Ontario).  Upon termination of this
agreement, MEC will only be responsible for paying those fees associated with
the Project up to and including the termination date.  With the exception of such amounts, the
Consultant will have no further claim or cause of action against MEC for any
cause, matter or thing relating to an alleged employment relationship between
the Consultant and MEC,

 3
 

including, without limitation, any claim for
reasonable notice of termination, pay in lieu of notice, termination, severance
or vacation pay, expenses, bonus or incentive plan payments, profit sharing,
stock options, overtime pay, or pension entitlements  other than the performance fees and stock
options specifically provided for in this agreement.

8.                                       Licenses and Taxes, etc.  As
an independent contractor, the Consultant will obtain all necessary licenses
for the operation of its consulting business, including a GST registration
number and workers’ compensation number. 
The Consultant will also be responsible for all applicable remittances
including, but not limited to, federal and provincial taxes on its business
income, employment insurance, Canada Pension Plan, workers’ compensation or
income tax source deductions for it and its employees.  MEC will not be responsible for any of the
foregoing.

9.                                       Compliance with Privacy Laws:  The Consultant, including specifically its Senior Partner
& Chairman, agrees to comply with the Canadian Personal Information and Protection of Electronic Documents
Act (“PIPEDA”) and such other Legislation and Regulations pertaining
to privacy of personal information (“Privacy Laws”) with respect to the receipt
and use of personal information relating to MEC’s customers and employees.  The Consultant further acknowledges that
Privacy Law requirements include the need to:

(a)                                  properly secure such information;

(b)                                 use such information only for the purpose it
was made available;

(c)                                  co-operate with access requests; and

(d)                                 either return or destroy such information
once it is no longer needed for the Project.

10.                                 Conflict of Interest.  The
Consultant may perform other services for third parties during the term of this
agreement, provided that such activity does not interfere with the efficient
and timely performance of the Project and is not otherwise in competition with,
or being performed on behalf of (directly or indirectly) any person, firm or
corporation operating a similar or competing business to that of MEC and its
affiliates.

11.                                 Competition.  In the course of providing
services to MEC, the Consultant will maintain close working relationships with
customers, clients, suppliers, agents and employees of MEC and its affiliates.  Due to the sensitive nature of the Consultant’s
work and the special access the Consultant will have to MEC and its affiliates’
confidential information, the Consultant will be in a position to irreparably
harm MEC should the Consultant enter into competition with MEC or its
affiliates (directly or indirectly) or otherwise make use of the specialized
knowledge, contacts and connections obtained while working on the Project.  Accordingly, during the term of this
agreement and for six (6) months
following its expiry or termination it is 

 4
 

understood that the
Consultant will not engage in, directly or indirectly, or perform services for
any businesses competitive with or affiliated with a business competitive with
MEC and its affiliates without MEC’s prior written consent.

The Consultant and the Designated Consultant
each agrees that the covenants and restrictions contained in the preceding
paragraph are reasonable and valid in terms of time, scope of activities and
geographic limitations and understands that they are vital consideration for
the purposes of MEC entering into this agreement.

12.                                 Confidentiality.  The
Consultant and its employees will treat as confidential and will not disclose
directly or indirectly at any time during or subsequent to the conclusion of
the Project any secret or confidential business, financial or other information
belonging or relating to MEC or its affiliates or their customers and
suppliers.  If requested by MEC, the
Consultant will execute a separate Confidentiality Agreement.

13.                                 Indemnity.  MEC will indemnify the
Consultant for any costs, expenses or damages arising from actions undertaken
by the Consultant in good faith in connection with the Project and in
accordance with this agreement pursuant to the terms and conditions of the
indemnity agreement to be entered into by MEC and the Consultant concurrent
herewith in the form attached hereto as Exhibit A.  The Consultant will indemnify MEC for any
costs, expenses or damages arising from the Consultant’s failure to comply in
all material respects with the provisions of paragraphs 7, 8, 9, 10, 11 and 12 of
this agreement.

14.                                 Assignment.  The Consultant will not
assign, transfer, subcontract its rights, obligations or interest in this
agreement to any party without the prior written consent of MEC.

15.                                 Severability.  In
the event that any covenant, provision or restriction contained in this
Agreement is found to be void or unenforceable (in whole or in part) by a court
of competent jurisdiction, it will not affect or impair the validity of any
other covenant, provisions or restrictions contained herein, nor will it affect
the validity or enforceability of such provisions in any other jurisdiction or
in regard to other circumstances.  Any
covenants, provisions or restrictions found to be void or unenforceable are declared
to be separate and distinct, and the remaining covenants, provisions and
restrictions will remain in full force and effect.

16.                                 Miscellaneous.  This
agreement will be governed by the laws of the Province of Ontario including all
federal laws applicable therein.  The
provisions of paragraphs 2, 3, 4, 7, 8, 9, 11, 13, 14, 15 and 16 of this
agreement will survive the termination of the agreement.

 5
 

If
the terms of the consulting agreement set out in this letter are acceptable to
the Consultant, please sign and date three (3) copies of this letter and return
two copies to me.

	
  Yours very truly,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Frank
  Stronach

  	
   

  	
  /s/ Jerry Campbell

  	
   

  
	
  Frank Stronach

  	
   

  	
  Jerry Campbell

  
	
  Chairman

  	
   

  	
  Lead Director

  

 

The
undersigned agrees to the terms and conditions contained in this letter on the
    day of [September], 2007,
effective as of the date specified above.

	
  

  	
  Greenbrook Capital Partners
  Inc.

  
	
   

  	
   

  
	
   

  	
  /s/ Thomas
  Hodgson

  	
   

  
	
   

  	
  Thomas Hodgson

  
	
   

  	
  Senior Partner
  & Chairman

  

 6
 

EXHIBIT A

FORM OF INDEMNITY AGREEMENT

This Indemnity Agreement (“Agreement”)
is made as of                  
by and between Magna Entertainment Corp., a Delaware corporation (the “Company”),
and
                 
(the “Indemnitee”), a consultant to the Company.

RECITALS

WHEREAS, the Indemnitee has agreed to serve as a
consultant to the Company and in such capacity will render valuable services to
the Company; and

WHEREAS, the Company has investigated the
availability and sufficiency of liability insurance and Delaware statutory
indemnification provisions to provide its directors and officers of, and
consultants to, the Company or its subsidiaries with adequate protection and
has concluded that such insurance and statutory provisions may provide
inadequate and unacceptable protection to certain individuals requested to
serve as its directors, officers or consultants; and

WHEREAS, in order to induce and encourage highly
experienced and capable persons such as the Indemnitee to serve as officers or
directors of, or consultants to, the Company or a subsidiary of the Company,
the Board of Directors has determined, after due consideration and
investigation of the terms and provisions of this Agreement and the various
other options available to the Company and the Indemnitee in lieu hereof, that
this Agreement is not only reasonable and prudent but also necessary to promote
and ensure the best interests of the Company and its stockholders; and

WHEREAS, in recognition of the services of the
Indemnitee, and in order to provide the Indemnitee with specific contractual
assurances that indemnification protection will be available to the Indemnitee,
the Company wishes to provide in this Agreement for indemnification of and
advancing of expenses to the Indemnitee as set forth in this Agreement.

AGREEMENT

NOW, THEREFORE, in consideration of the
mutual covenants contained herein and for other valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Indemnitee do hereby agree as follows:

1.             Definitions. Whenever used
in this Agreement the following words, unless the context clearly indicates
otherwise, shall have the following meanings:

(a) “Proceeding” includes any threatened,
pending or completed claim, action, suit, proceeding, formal or informal, or
alternative dispute resolution mechanism, or any hearing, inquiry or
investigation that the Indemnitee believes might lead to the institution of any
claim, action, suit, proceeding or alternative dispute resolution mechanism,
whether brought before or 

 7
 

after the date of this
Agreement, whether brought in the right of the Company or otherwise and whether
of a civil, criminal, administrative, investigative or other nature.

(b) “Expenses” include, without limitation,
attorneys’ fees, disbursements and retainers, accounting and witness fees,
travel and deposition costs, expenses of investigations, judicial or
administrative Proceedings and appeals, amounts paid in settlement by or on
behalf of the Indemnitee, and any expenses of establishing the existence of
and/or enforcing a right to indemnification, pursuant to this Agreement or
otherwise, including reasonable compensation for time spent by the Indemnitee
in connection with the investigation, defense or appeal of a Proceeding or
action for indemnification for which he or she is not otherwise compensated by
the Company, a subsidiary of the Company, or any third party.  The term “Expenses” does not include
Liabilities.

(c) “Independent Legal Counsel” shall refer to
an attorney or firm of attorneys with recognized expertise in matters of
Delaware corporations law and who shall not have otherwise performed services
for the Company or the Indemnitee within the five years immediately preceding
such counsel’s selection pursuant to Section 5 of this Agreement.

(d) “Liabilities” include, without limitation,
judgments, fines, penalties, excise taxes and other liabilities levied or
assessed against the Indemnitee in connection with any Proceeding.  The term “Liabilities” does not include
Expenses.

(e) “D&O Insurance” means directors’ and
officers’ liability insurance.

2.             Agreement
to Serve.

The Indemnitee agrees to
serve as a consultant to the Company at the will of the Company pursuant to the
terms and conditions of the Indemnitee’s consulting agreement with the Company
executed concurrent herewith.  The
indemnification provisions provided under this Agreement shall continue for
Indemnitee even though Indemnitee may have ceased to be a consultant to the
Company at the time of any Proceeding.

3.             Indemnification
in Third Party Actions.

The Company shall indemnify
the Indemnitee (including the Indemnitee’s spouse, heirs, estate, executor or
personal or legal representatives), and each person who controls the Indemnitee
or who may be liable within the meaning of Section 15 of the Securities Act of
1933, as amended (the “Securities Act”),
or Section 20 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),  if the Indemnitee is a party
to or threatened to be made a party to or is otherwise involved in any
Proceeding (other than a Proceeding by or in the right of the Company), by
reason of (or arising in part out of) any event or occurrence related to the
fact that the Indemnitee is or was a consultant to the Company, or is or was
serving at the request of the Company as a director, officer, employee,
controlling person, agent or fiduciary of another corporation, limited
liability company, partnership, joint venture, trust, or other enterprise, or
by reason of any actions alleged to have been taken or omitted in such
capacity, against all Expenses and Liabilities actually and reasonably incurred
by the Indemnitee in connection with the defense, settlement, or other
disposition of such a 

 8
 

Proceeding, to the fullest
extent permitted by Delaware law; provided that any settlement of a Proceeding
be approved in writing by the Company. 
For purposes of this Agreement, if the Indemnitee serves as a director,
officer, employee, controlling person, agent or fiduciary of any corporation,
limited liability company, partnership, joint venture, trust or other
enterprise that is owned or controlled, wholly or in part, directly or
indirectly, by the Company, the Indemnitee shall be conclusively presumed to
serve in that capacity at the request of the Company.

4.             Indemnification
in Proceedings by or in the Right of the Company.

The Company shall indemnify
the Indemnitee (including the Indemnitee’s spouse, heirs, estate, executor or
personal or legal representatives), and each person who controls the Indemnitee
or who may be liable within the meaning of Section 15 of the Securities Act, or
Section 20 of the Exchange Act, if the Indemnitee is a party to or threatened
to be made a party to or is otherwise involved in any Proceeding by or in the
right of the Company by reason of (or arising in part out of) any event or
occurrence related to the fact that the Indemnitee is or was a consultant to
the Company, or is or was serving at the request of the Company as a director,
officer, employee, controlling person, agent or fiduciary of another
corporation, limited liability company, partnership, joint venture, trust or
other enterprise, or by reason of any actions alleged to have been taken or
omitted in such capacity, against all Expenses and Liabilities actually and
reasonably incurred by the Indemnitee in connection with the defense,
settlement or other disposition of such a Proceeding, to the fullest extent
permitted by Delaware law.

5.             Conclusive
Presumption regarding Standards of Conduct.

(a)
The Indemnitee shall be conclusively presumed to have met the relevant
standards of conduct, if any, as defined by Delaware law, for indemnification
pursuant to this Agreement, unless a final determination is made by a court of
competent jurisdiction that the Indemnitee has not met such standards.  For purposes of this Agreement, the
termination of any claim, action, suit, or proceeding, by judgment, order,
settlement (whether with or without court approval), or conviction, or upon a
plea of nolo contendere, or its equivalent, shall not, of itself, create a
presumption that the Indemnitee did not meet any particular standard of conduct
or that a court has determined that indemnification is not permitted by
applicable law.

(b)
Notwithstanding the foregoing provisions of Section 5(a) of this Agreement, in
the event of any Proceeding (other than a Proceeding by or in the right of the
Company) in which the claimant alleges or has alleged specific material acts by
the Indemnitee of actual fraud, personal dishonesty, misappropriation, or
breach of the duty of loyalty, in each case for the direct or indirect personal
benefit of the Indemnitee, then the Company may rebut the presumption that the
Indemnitee has met the relevant standards of conduct for indemnification under
this Agreement by obtaining, at its expense, a written opinion of Independent
Legal Counsel, to the effect that, assuming the truth of the facts alleged by
the claimant, the Indemnitee, and all other persons being indemnified by the
Company who are similarly situated in the context of the Proceeding and who
have had a similar involvement in the alleged acts have not met such
standards.  Receipt by the Company of
such an opinion shall, accordingly and notwithstanding the absence of a final
determination by a court of competent jurisdiction as contemplated by Section
5(a) of this Agreement, permit the Company to make a determination 

 9
 

that the Indemnitee has not
met the relevant standards of conduct, provided that any such determination is
also made with respect to all other persons who, the opinion states, did not
meet such standards.  Neither the receipt
of a written opinion from Independent Legal Counsel nor the making by the Company
of a determination pursuant to this Section 5(b) shall create a presumption
that the Indemnitee did not meet any particular standards of conduct or that
the Indemnitee is not entitled to indemnification under this Agreement or
otherwise.  Nothing herein, however,
shall prevent the Company from presenting such opinion as evidence or the
Independent Legal Counsel as a witness in any court case.

6.             Indemnification
of Expenses of Successful Party.  Notwithstanding any other provision of this
Agreement (except for, and subject to, Section 10(c)), to the extent that the
Indemnitee has been successful in defense of any Proceeding or in defense of
any claim, issue or matter therein, on the merits or otherwise, including the
dismissal of a Proceeding without prejudice or the settlement of a Proceeding
(with the consent of the Company, which consent shall not be unreasonably
withheld) without an admission of liability, the Indemnitee shall be
indemnified against Expenses actually and reasonably incurred in connection
therewith.

7.             Indemnification
for Expenses of a Witness.  Notwithstanding any other provision of this
Agreement, to the extent that Indemnitee is, by reason of the fact that
Indemnitee was a consultant to the Company, or was serving at the request of
the Company as a director, officer, employee, controlling person, agent or
fiduciary of another corporation, limited liability company, partnership, joint
venture, trust or other enterprise, a witness in any Proceeding, the Indemnitee
shall be indemnified against Expenses actually and reasonably incurred in
connection therewith.

8.             Advances
of Expenses.  If requested
by Indemnitee, the Company shall, in accordance with this Agreement and within
five (5) business days of a written request by Indemnitee, advance to
Indemnitee the Expenses that are reasonably anticipated to be incurred by
Indemnitee and reimburse Indemnitee for the Expenses that are actually incurred
by Indemnitee in connection with any Proceeding; provided that the Indemnitee
shall undertake in writing to repay any advances if it is conclusively
determined by a court of competent jurisdiction that the Indemnitee is not
entitled to indemnification under this Agreement or otherwise.  The Indemnitee’s obligation to reimburse the
Company for advanced Expenses shall be unsecured and no interest shall be
charged thereon.

9.             Partial
Indemnification.  If the
Indemnitee is entitled under any provision of this Agreement to indemnification
by the Company for a portion of the Expenses or Liabilities actually and
reasonably incurred by the Indemnitee in the investigation, defense, appeal, or
settlement of any Proceeding but not, however, for the total amount of the
Indemnitee’s Expenses or Liabilities, the Company shall nevertheless indemnify
the Indemnitee for the portion of Expenses and Liabilities to which the
Indemnitee is entitled.

 10
 

10.          Indemnification
Procedure; Determination of Right to Indemnification.

(a)
Promptly after receipt by the Indemnitee of notice of the commencement of any
Proceeding, the Indemnitee shall, if a claim in respect thereof is to be made
against the Company under this Agreement, notify the Company of the
commencement thereof in writing.  The
omission to so notify the Company will not relieve it from any liability which
it may have to the Indemnitee under this Agreement except to the extent such
failure materially prejudices the Company.

(b)
If a claim for indemnification or advances under this Agreement is not paid by
the Company within 30 days of receipt of written notice, the rights provided by
this Agreement shall be enforceable by the Indemnitee in any court of competent
jurisdiction.  The burden of proving by
clear and convincing evidence that indemnification or advances are not
appropriate shall be on the Company. 
Neither the failure of the Independent Legal Counsel to have made a
determination prior to the commencement of such action that indemnification or
advances are proper in the circumstances because the Indemnitee has met the
applicable standard of conduct, nor an actual determination by the Independent
Legal Counsel that the Indemnitee has not met the applicable standard of
conduct, shall be a defense to the action or create a presumption that the
Indemnitee has not met the applicable standard of conduct.

 (c) The Indemnitee’s Expenses incurred in
connection with any proceeding concerning his or her right to indemnification
or advances in whole or in part pursuant to this Agreement or otherwise shall
also be indemnified by the Company regardless of the outcome of such a
proceeding, unless a court of competent jurisdiction determines that each of
the material assertions made by the Indemnitee in the proceeding was not made
in good faith or was frivolous.

(d)
With respect to any Proceeding for which indemnification is requested, the
Company will be entitled to participate therein at its own expense and, except
as otherwise provided below, to the extent that it may wish, the Company may
assume the defense thereof, with counsel reasonably satisfactory to the
Indemnitee.  After notice from the
Company to the Indemnitee of its election to assume the defense of a
Proceeding, the Company will not be liable to the Indemnitee under this
Agreement for any Expenses subsequently incurred by the Indemnitee in
connection with the defense thereof, other than as provided below.  The Company shall not settle any Proceeding in
any manner that would impose any penalty or limitation on the Indemnitee
without the Indemnitee’s written consent, which consent shall not be
unreasonably withheld.  The Indemnitee
shall have the right to employ his or her own counsel in any Proceeding, but
the fees and expenses of such counsel incurred after notice from the Company of
its assumption of the defense of the Proceeding shall be at the expense of the
Indemnitee, unless (i) the employment of counsel by the Indemnitee has been
authorized by the Company in writing, (ii) the Indemnitee shall have reasonably
requested separate counsel in the conduct of the defense of a Proceeding, or
(iii) the Company shall not in fact have employed counsel to assume the defense
of a Proceeding, in each of which cases the fees and expenses of the Indemnitee’s
counsel shall be advanced by the Company. 
The Company shall not be entitled to assume the defense of any
Proceeding brought by or on behalf of the Company or as 

 11
 

to which the Indemnitee has
concluded that there may be a conflict of interest between the Company on the
one hand and the Indemnitee on the other hand.

11.          Limitations
on Indemnification.  No
payments pursuant to this Agreement shall be made by the Company:

(a)
To indemnify or advance funds to the Indemnitee for Expenses with respect to
Proceedings initiated or brought voluntarily by the Indemnitee and not by way
of defense, except (i) with respect to Proceedings brought to establish or
enforce a right to indemnification under this Agreement or any other statute or
law or otherwise as required under applicable law, (ii) with respect to
Proceedings (or parts thereof) authorized by the Board, or (iii) as otherwise
required under applicable law, regardless of whether the Indemnitee ultimately
is determined to be entitled to such indemnification or advancement of
Expenses;

(b)
To indemnify the Indemnitee for any Expenses or Liabilities sustained in any
Proceeding for which payment is actually made to the Indemnitee under a valid
and collectible insurance policy, except in respect of any excess beyond the
amount of payment under such insurance;

(c)
If a court of competent jurisdiction finally determines that any
indemnification or advances under this Agreement is not permitted by applicable
law;

(d)
To indemnify the Indemnitee for any Expenses or Liabilities sustained in any
Proceeding for an accounting of profits made from the purchase and sale by the
Indemnitee of securities of the Company pursuant to Section 16(b) of the
Securities Exchange Act of 1934 and amendments thereto or similar provisions of
any state statutory law or common law; or

(e)
To indemnify the Indemnitee for any Expenses or Liabilities resulting from the
Indemnitee’s conduct which is finally adjudged to have been willful misconduct,
knowingly fraudulent or deliberately dishonest.

12.          Liability
Insurance.

(a)
The Company hereby covenants and agrees that, as long as the Indemnitee shall
continue to serve as a consultant to the Company and thereafter as long as the
Indemnitee may be subject to any possible Proceeding, the Company, subject to
subsection (c) below, shall promptly obtain and maintain in full force and
effect D&O Insurance in reasonable amounts from established and reputable
insurers.

(b)
In all D&O Insurance policies, the Indemnitee shall be named as an insured
in such a manner as to provide the Indemnitee the same rights and benefits as
are accorded to the most favorably insured of the Company’s officers or
directors.

(c)
Notwithstanding the foregoing, the Company shall have no obligation to obtain
or maintain D&O Insurance if the Company determines in good faith that such
insurance is not reasonably available, the premium costs for such insurance are
disproportionate to the amount of coverage provided, the coverage provided by
such insurance is so limited by exclusions that 

 12
 

it provides an insufficient
benefit, or the Indemnitee is covered by similar insurance maintained by a
subsidiary of the Company.

13. Indemnification Hereunder Not Exclusive.  The indemnification provided by this
Agreement shall not be deemed exclusive of any other rights to which the
Indemnitee may be entitled under the certificate of incorporation, bylaws, any
agreement, vote of shareholders or disinterested directors, provision of
applicable law, or otherwise, both as to action in the Indemnitee’s official
capacity and as to action in another capacity on behalf of the Company or any
subsidiary of the Company while holding such office.

14. Contribution. 
Subject to Section 9, if the indemnification
provided for hereunder for any reason is held by a court of competent
jurisdiction to be unavailable to the Indemnitee in respect of any Expenses or
Liabilities referred to therein, then the Company, in lieu of indemnifying the
Indemnitee thereunder, shall contribute to the amount paid or payable by the
Indemnitee as a result of such Expenses or Liabilities (i) in such proportion
as is appropriate to reflect the relative benefits received by the Company and
the Indemnitee, or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company and the Indemnitee in connection with the action
or inaction that resulted in such Expenses or Liabilities, as well as any other
relevant equitable considerations.

15. Successors and Assigns.  This Agreement shall be binding upon, and
shall inure to the benefit of the Indemnitee and his or her heirs, executors,
administrators, and assigns, and the Company and its successors and
assigns.  The Company shall require and
cause any successor (whether direct or indirect, by purchase, merger,
consolidation, or otherwise) to all, substantially all, or a substantial part,
of the Company’s business or assets or both, by written agreement in form and
substance satisfactory to Indemnitee, expressly to assume and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform if no such succession had taken place.

16. Severability.  Each and every paragraph, sentence, term and
provision of this Agreement is separate and distinct so that if any paragraph,
sentence, term, or provision hereof shall be held to be invalid or
unenforceable for any reason, such invalidity or unenforceability shall not
affect the validity or enforceability of any other paragraph, sentence, term or
provision hereof.  To the extent
required, any paragraph, sentence, term, or provision of this Agreement may be
modified by a court of competent jurisdiction to preserve its validity and to
provide the Indemnitee with the broadest possible indemnification permitted
under Delaware law.

17. Scope.  The Company intends to indemnify the
Indemnitee hereunder to the fullest extent permitted by Delaware law.  In the event of any change after the date of
this Agreement in any applicable law, statute or rule that expands the right of
the Company to indemnify a director, officer, employee, controlling person,
agent or fiduciary, it is the intent of the parties hereto that the Indemnitee
shall enjoy by this Agreement the greater benefits afforded by such
change.  Upon any change in any
applicable law, statute or rule that narrows the right of the Company to
indemnify a director, officer, employee, controlling person, agent or
fiduciary, such change, to the extent not otherwise required by such law,
statute or rule to be applied to this Agreement, shall have no effect 

 13
 

on this Agreement or the
parties’ rights and obligations hereunder except as set forth in Section 11(a)
hereof

18. Savings Clause.  If this Agreement or any paragraph, sentence,
term, or provision hereof is invalidated on any ground by any court of
competent jurisdiction, the Company shall nevertheless indemnify the Indemnitee
as to any Expenses, judgments, fines, penalties, or excise taxes incurred with
respect to any Proceeding to the full extent permitted by any applicable
paragraph, sentence, term, or provision of this Agreement that has not been
invalidated or by any other applicable provision of Delaware law.

19. Governing Law.  This Agreement shall be construed as a whole
and in accordance with its fair meaning. 
Headings are for convenience only and shall not be used in construing
meaning.  This Agreement shall be
governed and interpreted in accordance with the laws of the State of Delaware,
without regard to conflicts of laws principles.

20. Amendments.  No amendment, waiver, modification,
termination, or cancellation of this Agreement shall be effective unless in
writing signed by the party against whom enforcement is sought.  The indemnification rights afforded to the
Indemnitee hereby are contract rights and may not be diminished, eliminated, or
otherwise affected by amendments to the certificate of incorporation, bylaws or
by other agreements, including D&O Insurance policies.

21. Counterparts.  This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each
party and delivered to the other.

22. Notices.  Any notice required to be given under this
Agreement to the Company shall be directed to the Company at its principal
executive offices, 337 Magna Drive, Aurora, Ontario, Canada L4G 7K1, Attention:
Legal Department, and to the Indemnitee at the address indicated below or to
such other address as either shall designate in writing.

[signature page follows]

 14
 

IN WITNESS WHEREOF, the parties have executed
this Indemnity Agreement as of the date first written above.

	
  

  	
  INDEMNITEE:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MAGNA
  ENTERTAINMENT CORP.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

 15

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