CK Contract

EMPLOYMENT AGREEMENT

This Employment Agreement ("Agreement") is entered into as of June 18,2013, by andbetween THE NEW YORK RACING ASSOCIATION, INC., a New York not-for-profitcorporation ("Employer"), including its assigns and successors, and Christopher Kay("Employee").

1. Employment. Employer hereby employs Employee, and Employee hereby acceptsemployment by Employer, as Chief Executive Officer, to perform such duties associated with theposition and as directed by the Reorganization Board of The New York Racing Association, Inc.(the "Board"). In construing the provisions of this Agreement, the term "Employer" shall includeall of Employer's subsidiary, parent and affiliated corporations and entities (currently existing orhereinafter created), including any assigns or successors, and Employer hereby covenants andagrees to assign this agreement to any successor corporation of Employer. During the SpecifiedTerm, as that term is defined in this Agreement, Employee shall report directly to the Board.

2. Term. This Agreement is considered to have commenced on July 1,2013 (the"Commencement Date" or "Effective Date") and will continue through and including October17, 2015 (the "Specified Term"). Employer shall notify Employee of its intentions to renewEmployee's employment, upon such terms as the Parties may negotiate and agree in writing, nolater than thirty (30) days prior to the ending date of this Agreement. In the event that the Partiesare unable to reach agreement on the terms under which Employee's employment will continueafter the Specified Term, Employer and Employee agree that: (i) this Agreement will not berenewed; (ii) the Agreement terminates upon the conclusion of the Specified Term; and (iii)Employee shall be entitled to receive the Termination Benefits set forth in Paragraph 10(B) ofthis Agreement.

3. Compensation.

(A) Commencing on the Effective Date, Employee shall receive an annual salary of$300,000.00, payable in accordance with Employer's standard payroll practices.

(B) Employee's performance will be reviewed by the Board on the twelve monthanniversary of his employment, and an upward adjustment to his base salary may be made at thediscretion of the Board or its designee consistent with Employee's performance and thecompany's financial performance.

(C) Employee shall be entitled to receive, based upon the successful satisfaction andachievement of certain goals established by the Board, annual Management Incentivecompensation (the "Management Incentive Bonus"). Employee's target Management IncentiveBonus under this Agreement is $250,000 per year. Employer may at its discretion pay Employeea Management Incentive Bonus that is less than or greater than the target Management IncentiveBonus. Management Incentive goals will be established by the Board; a preliminary draft hasalready been provided to Employee. Employee's performance against these goals will bereviewed by the Board on the twelve month anniversary of his employment, at which time theManagement Incentive Bonus, if any, will be calculated and goals for the subsequent twelvemonth period will be established. The Management Incentive Bonus shall be paid to Employee

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within thirty (30) days of the twelve month anniversary ofthis Agreement and within thirty (30)days after subsequent one-year anniversary dates, as applicable.

(D) Employee shall also be entitled to receive reimbursement for actual andreasonable business and travel expenses incurred by Employee in the performance of his dutieshereunder, as provided to other executive officer level employees, payable in accordance withEmployer's practice, policies, and procedures, as amended from time to time. Employee shall bepermitted to travel business class on (i) all international air travel; and (ii) all air travel where thescheduled time from the flight's departure to landing is in excess of five (5) hours. A stipendwill be provided to Employee for living in Saratoga Springs, New York during the Saratoga racemeeting, consistent with that provided to other Officers of Employer.

4. Extent of Services. Employee agrees that the duties and services to be performed byEmployee shall be performed exclusively for Employer. Employee further agrees to performsuch duties in an efficient, trustworthy and businesslike manner. Employee agrees not to renderto others any service of any kind whether or not for compensation, or to engage in any otherbusiness activity whether or not for compensation, that is similar to or conflicts with theperformance of Employee's duties under this Agreement. Employer acknowledges thatEmployee has developed a concept for an on-line lottery game that potentially will at some timein the future be licensed to a third party in those markets where such games have been legalized(the "On-Line Lottery Game Concept") and that Executive's involvement with the On-LineLottery Game Concept shall not be in breach of this Agreement, provided that such involvementdoes not conflict with Employer's business or the performance of Employee's duties under thisAgreement.

5. Policies and Procedures. In addition to the terms contained herein, Employee agrees to bebound by Employer's written policies and procedures, as amended by Employer from time totime. In the event the terms of this Agreement conflict with Employer's written policies andprocedures, the terms of this Agreement shall take precedence.

6. Licensing Requirements. Employee acknowledges that Employer is engaged in abusiness that is, may be subject to, and/or exists because of privileged licenses issued bygovernmental authorities in New York and other jurisdictions in which Employer is engaged inthe gaming business. If requested to do so by Employer, Employee shall apply for and obtain anylicense, qualification, clearance or the like which shall be requested or required of Employee byany regulatory authority having jurisdiction over Employer. IfEmployee fails to satisfy suchrequirement, or if Employer is directed by any such authority to cease employment of Employee,or if Employer shall determine, in Employer's sole and exclusive judgment, that Employee was,is or might be involved in, or is about to be involved in, any activity, relationship(s) orcircumstances which could or does jeopardize Employer's business, reputation, or such licensesof Employer, or if any such license is threatened to be, or is, denied, curtailed, suspended orrevoked as a result of Employer's continued employment of Employee, this Agreement may beterminated by Employer and the parties' obligations and responsibilities shall be determined bythe provisions of Paragraph 10(A).

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7. Additional Consideration.

(A) Employee shall be entitled to participate in all benefit programs (e.g., healthcare,401(k), disability, etc.) afforded to other senior executive employees of Employer and Employeeshall be covered by the Employer's Directors and Officers Insurance Policy to the full extentpermitted by the Employer's policy, consistent with the Employer's Certificate ofIncorporationand Bylaws, and any amendments or successors thereto.

(B) Employee shall be entitled to four (4) weeks' paid vacation during each calendaryear of the Specified Term, except that his entitlement to paid vacation during the period fromthe Effective Date through and including December 31, 2013 shall be prorated based upon theEffective Date of this Agreement. Employee shall be permitted to carryover to a subsequentcalendar year up to ten (10) days of accrued and unused vacation; provided, however, thatEmployee may not have more than thirty (30) days of accrued vacation at any time during hisemployment under this Agreement. Employer shall pay Employee for any accrued and unusedvacation that Employee may have upon the separation of Employee's employment withEmployer.

(C) During the Specified Term, Employee shall receive an automobile allowance inan amount equal to $1,650.00 per month. Employee shall also receive a credit or debit card, orsome other portable means by which to effectuate financial transactions, to be used solely forEmployee's purchase of up to $400 per month of gasoline.

(D) In the event that (i) the Parties do not reach agreement on the terms under whichEmployee's employment will continue after the Specified Term (the "Non-Renewal"); or(ii) Employee's employment is terminated by Employer Without Cause, as defined in Paragraph10 below; or (iii) Employee's employment is terminated by Employee for Good Reason, asdefined in Paragraph 10 below, Employee shall be entitled to receive severance compensationfrom the date of the Non-Renewal or termination of employment in the following amount: (x) ifthe Non-Renewal or termination of employment occurs within the first 365 days of Employee'semployment with Employer, Employee shall receive salary continuation in an amount equal tonine (9) months of Employee's Annual Rate of Compensation at the time of separation; and (y) ifthe Non-Renewal or termination of employment occurs after the first 365 days of Employee'semployment with Employer, Employee shall receive salary continuation in an amount equal totwelve (12) months' of Employee's Annual Rate of Compensation at the time of separation;provided that, as used in this Agreement and in order to calculate Employee's entitlement toseverance pay, the term "Annual Rate of Compensation" shall refer to Employee's base salary atthe time of separation plus the full amount of Employee's target Management Incentive Bonus;provided further, however, that Employee shall not receive any severance compensation iftheNon-Renewal or termination of this Agreement is for Cause as defined and contained inParagraph 10 of this Agreement; and provided further, in order to be eligible for severancecompensation, Employee must sign (and not revoke) a waiver and release of any and all claimsagainst Employer (including its officers and directors). Employer shall pay to Employee theseverance compensation contemplated under this Agreement in substantially equal payments noless freq~ently than monthly.

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(E) Employee represents and warrants that the consideration enumerated herein isreasonable, adequate and sufficient for Employee's agreement to the terms contained herein,including but not limited to the undertakings stated in Paragraphs 4,6 and 8.

8. Restrictive Covenants.

(A) Competition. Employee acknowledges that, in the course of performingEmployee's responsibilities hereunder, Employee will form business relationships and becomeacquainted with certain confidential and proprietary information as further defined in Paragraph8(b). Employee further acknowledges that such relationships and information are valuable toEmployer and that the restrictions on future employment, if any, are reasonably necessary inorder for Employer to remain competitive in the gaming industry. In consideration for theCompensation and Consideration hereunder, and in recognition of Employer's need forprotection from abuse of relationships formed or information obtained before and during theSpecified Term of the Employee's employment hereunder, Employee covenants and agrees that,except as otherwise provided herein, in the event Employee is not employed by Employer for theentire Specified Term, then for the twelve (12) month period immediately following separationfrom active employment, or for such shorter period remaining in the Specified Term shouldEmployee separate from active employment with less than twelve (12) months remaining in theSpecified Term (the "Restricted Period"), Employee shall not directly or indirectly be employedby, provide consultation or other services to, engage in, participate in or otherwise be connectedin any way with any firm, person, corporation, or other entity which is either directly, indirectlyor through an affiliated company, engaged in pari-mutuel wagering on thoroughbred horse racesin the State of New York, or in the simulcast of thoroughbred horse races for purposes ofconducting pari-mutuel wagering within the continental United States of America("Competitor"). Employer acknowledges "and agrees that Employee's involvement in the On­Line Lottery Game Concept shall not be a breach of this Paragraph 8, provided that suchinvolvement does not conflict with Employer's business or the performance of Employee'sduties under this Agreement.

(B) Confidentiality. Employee covenants and agrees that Employee shall not at anytime during the Specified Term or thereafter, without Employer's prior written consent, discloseto any other person or business entities any trade secret (see Exhibit "A" attached hereto) orproprietary or other confidential information concerning Employer, including without limitation,Employer's customers, marketing practices, procedures, management policies, labor agreements,or any other information regarding the Employer which is not already and generally known tothe public or to Competitors or available to interested persons. Employee further covenants andagrees that Employee shall not at any time during the Specified Term, or thereafter, without theEmployer's prior written consent, utilize any such trade secrets or proprietary or confidentialinformation in any way, other than in connection with employment hereunder.

(C) Employer's Property. Employee hereby confirms that such trade secrets,proprietary or confidential information and all information concerning the goods, services orfacilities of Employer constitute Employer's exclusive property. Employee agrees that upontermination of active employment under this Agreement, Employee shall promptly return to theEmployer all gas cards, notes, notebooks, memoranda, computer disks, computers, personalelectronic devices (cell phone, Blackberry, etc.) and any other similar repositories of information

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(regardless of whether Employee possessed such information prior to the date hereof) containingor relating in any way to the trade or business secrets or proprietary and confidential informationof the Employer. Such repositories of information also include but are not limited to any personalfiles or other personal data compilations in any form, which in any manner contain any tradesecrets or proprietary or confidential information of Employer.

(D) Notice to Employer. Employee agrees to notify Employer immediately of anycontacts made by Employer's Competitors, which concern or relate to an offer of futureemployment (or consulting services) to Employee.

(E) The covenants contained in this Paragraph 8 shall survive the termination of thisAgreement.

9. Representations. Employee hereby represents, warrants and agrees with Employer that:

(A) The covenants and agreements contained in Paragraphs 4 and 8 above arereasonable in their geographic scope, duration and content; the Employer's agreement to employthe Employee and a portion of the compensation and consideration to be paid to Employee underParagraphs 3 and 7 hereof, are in partial consideration for such covenants; Employee shall notraise any issue of the reasonableness of the geographic scope, duration or content of suchcovenants in any proceeding to enforce such covenants; and such covenants shall survive thetermination of this Agreement, in accordance with such terms;

(B) The enforcement of any remedy under this Agreement will not prevent Employeefrom earning a livelihood, because Employee's past work history and abilities are such thatEmployee can reasonably expect to find work in other areas and lines of business;

(C) The covenants and undertakings stated in Paragraphs 4,6 and 8 above areessential for the Employer's reasonable protection; and

(D) Employer has reasonably relied on these representations, warranties andagreements by Employee.

Additionally, Employee agrees that in the event of Employee's breach of any covenantsset forth in Paragraphs 4 and 8 above, the Employer shall be entitled to seek to enforce suchcovenants through any equitable remedy, including specific performance or injunction, withoutwaiving any claim for damages. In any such event, the Employee waives any claim that theEmployer has an adequate remedy at law.

10. Termination.

(A) This Agreement may be terminated by Employer at any time during the SpecifiedTerm hereof for Cause. Upon any such termination, Employer shall have no further liability orobligations whatsoever to Employee hereunder except as provided under subparagraphsIO(A)(i)(a) and IO(A)(i)(b). "Cause" shall be defined as:

(i) Employee's death or Disability, where "Disability" is defined asincapacity for health reasons certified to by a licensed physician which precludes Employee from

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performing the essential functions ofEmployee's duties hereunder for a substantiallyconsecutive period of six (6) months or more;

(a) In the event of Employee's death during the term of thisAgreement, Employee's beneficiary (as designated by Employee on Employer's benefit records)shall be entitled to receive a death benefit in conformance with Employer's then existing normaldeath benefit plan for executive employees, as from time-to-time amended.

(b) In the event that this Agreement is terminated by Employer due toEmployee's Disability, as provided under subparagraph 10(A)(i), Employer shall pay toEmployee or his beneficiary a disability benefit in conformance with the Employer's thenexisting normal disability benefit plan for executive employees, as from time-to-time amended.

(ii) Employee's failure to abide by Employer's written policies andprocedures, willful misconduct, willful insubordination, willful inattention to Employer'sbusiness, breach of fiduciary duty, a material breach of the terms and requirements of thisAgreement, or conviction of or plea of nolo contendere to any felony or any other crimeinvolving moral turpitude; provided, however, that Cause shall not exist for Employee's materialbreach of the terms and requirements of this Agreement unless and until the following haveoccurred: (x) Employer has provided Employee with written notice that specifies in reasonabledetail the provision of this Agreement that allegedly has been breached and the conduct ofEmployee that has caused such alleged breach; (y) Employee has had thirty (30) calendar daysfrom receipt of the written notice to cure the alleged breach of this Agreement; and (z) Employeehas failed to cure such breach; or

(iii) Employee's failure or inability to satisfy the requirements stated inParagraph 6 above.

(B) This Agreement may also be terminated by Employer at any time during theSpecified Term hereof, Without Cause, upon: (i) ten (10) days' advance written notice toEmployee or (ii) in lieu of such notice, payment by Employer to Employee of an amount equal tothe salary that Employee would have received during the ten (10) day notice period. Upon suchtermination, Employer shall treat Employee as an inactive employee and, as its sole liability toEmployee arising from such termination, Employer shall provide Employee (or his beneficiary inthe event of Employee's death during the Specified Term) with the following severancecompensation and benefits ("Termination Benefits"):

(i) Severance compensation from the date of termination in the followingamount: (x) if the separation of employment occurs within the first 365 days of Employee'semployment with Employer, Employee shall receive salary continuation in an amount equal tonine (9) months of Employee's Annual Rate of Compensation at the time of separation; and (y) ifthe separation of employment occurs after the first 365 days of Employee's employment withEmployer, Employee shall receive salary continuation in an amount equal to twelve (12) monthsof Employee's Annual Rate of Compensation at the time of separation;

(ii) Employer shall continue to provide Employee's health benefits for thesame duration as the Employee's severance pay period at the same prevailing employee

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contribution rates then in effect and as adjusted in the ordinary course of business from time-to­time.

(iii) Employer shall not be required to continue to provide health benefits afterthe date of separation if the Employee becomes eligible to receive comparable health benefitsfrom any subsequent employer, and Employee shall have an affirmative duty to promptly notifyEmployer of his or her employment and eligibility for health benefits during the period of timeEmployee would otherwise be eligible for health benefits pursuant to the Termination Benefitsprovided hereunder.

(C) Employee shall have the right to terminate Employee's employment WithoutCause upon ten (10) days' advance written notice to Employer. Upon Employee providing suchnotice, Employer may elect to pay Employee an amount equal to the salary that Employee wouldhave received during the ten (10) day notice period. Upon any termination Without Cause byEmployee, Employer shall have no further liability or obligations whatsoever to Employeehereunder, except that Employee shall be entitled to receive all salary and vested benefits, asapplicable, through and including the date of termination. In the event that Employee exerciseshis right to terminate his employment Without Cause in accordance with this subparagraph10(C), Employee shall nevertheless be bound, to the fullest extent permitted, by any post­employment obligations and responsibilities, including but not limited to those enumerated inParagraph 8, imposed by and through this Agreement.

(D) This Agreement may be terminated by Employee at any time during the SpecifiedTerm hereof for Good Reason. Upon a termination by Employee for Good Reason, Employershall provide Employee with the Termination Benefits set forth in Paragraph 10(B). "GoodReason" shall be defined as follows: without Employee's written consent, (i) the materialdiminution of Employee's duties or responsibilities as the Chief Executive Officer; (ii) a changein Executive's title or reporting relationship to the Board; (iii) a reduction in Employee's basesalary; (iv) the relocation of Employee's primary office by more than fifty (50) miles; or (v) amaterial breach by Employer of this Agreement; provided, however, that Good Reason shall notexist for Employer's material breach of this Agreement unless and until the following haveoccurred: (x) Employee has provided Employer with written notice that specifies in reasonabledetail the provision of this Agreement that allegedly has been breached and the conduct ofEmployer that has caused such alleged breach; (y) Employer has had thirty (30) calendar daysfrom receipt of the written notice to cure the alleged breach of this Agreement; and (z) Employerhas failed to cure such breach.

(E) In the event of the Non-Renewal of this Agreement (as defined in Paragraph 7),Employer shall provide Employee with the Termination Benefits set forth in Paragraph 10(B).

(F) No termination of this Agreement shall extinguish such rights as Employee mayhave under applicable law or Employer's incorporation documents or bylaws to be indemnifiedin his capacity as an officer of Employer.

II. Change in Control Event. In the event Employee's employment is terminated within 365days after a Change in Control Event for any reason other than (A) by Employer for Cause or (B)by Employee without Good Reason, Employer shall provide Employee with (i) a lump sum

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payment equal to 100% of the severance compensation Employee would have been entitled tohad Employee been terminated by Employer Without Cause as set forth in Paragraph 10(B) (i) ofthis Agreement; and (ii) continued health benefits for the duration Employee would have beenentitled to such benefits had Employee been terminated by Employer Without Cause as set forthin Paragraph 10(B)(ii) of this Agreement. For purposes of this Agreement, a "Change in ControlEvent" means (x) the sale of all or substantially all the assets of Employer or, as applicable, theassets associated with the Aqueduct, Belmont and Saratoga Springs racetracks (the "NYRARacetracks"); or (y) the sale or transfer of more than 50% of the voting shares of Employer or, asapplicable, such amount of the voting shares of the entity that owns or operates the NYRARacetracks, to one or more parties who do not own such shares as of June 18, 2013.

12. Disputed Claim/Arbitration. Any dispute concerning, arising out of, or related to any ofthe provisions of this Agreement shall be resolved by arbitration administered by the AmericanArbitration Association under its National Rules for the Resolution of Employment Disputes.Any arbitration under this paragraph shall take place in New York State. Nothing herein shallpreclude or prohibit Employer or Employee from invoking any of the provisions of Paragraph10, or of either party seeking or obtaining injunctive or other equitable relief. In the event of apurported termination of Employee by Employer pursuant to Paragraph 10(A) which is disputedby Employee pursuant to Paragraph 10(C), if Employee prevails in the arbitration, Employeeshall not be entitled to reinstatement, but shall be entitled to the Termination Benefits.

13. Severability. If any provision hereof is deemed unenforceable, illegal, or invalid for anyreason whatsoever by a court of competent jurisdiction, such fact shall not affect the remainingprovisions hereof, however, any such ruling shall not affect Employer's right to seek damages orsuch additional relief as may be allowed by law in respect to any breach by Employee of theremaining enforceable provisions of this Agreement.

14. Attorneys' Fees. In the event that suit is brought to enforce or to recover damagessuffered as a result of breach of this Agreement, or there is an arbitration pursuant to Paragraph12, the prevailing party shall be entitled to recover its reasonable attorneys' fees and costs of suit.

15. No Waiver of Breach or Remedies. No failure or delay on the part of Employer orEmployee in exercising any right, power or remedy hereunder shall operate as a waiver thereofnor shall any single or partial exercise of any such right, power or remedy preclude any other orfurther exercise thereof or the exercise of any other right, power or remedy hereunder. Theremedies herein provided are cumulative and not exclusive of any remedies provided by law.

16. Amendment or Modification. No amendment, modification, termination or waiver of anyprovision of this Agreement shall be effective unless the same shall be in writing and signed bythe Employer's President and Employee, nor consent to any departure by the Employee from anyof the terms of this Agreement shall be effective unless the same is signed by the Employer'sPresident. Any such waiver or consent shall be effective only in the specific instance and for thespecific purpose for which given.

17. Governing Law. The laws of the State of New York shall govern the validity,construction and interpretation of this Agreement, and except for Disputed Claims, the courts of

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the State of New York shall have exclusive jurisdiction over any claim with respect to thisAgreement.

18. Number and Gender. Where the context of this Agreement requires the singular shallmean the plural and vice versa and references to males shall apply equally to females and viceversa.

19. Headings. The headings in this Agreement have been included solely for convenience ofreference and shall not be considered in the interpretation or construction of this Agreement.

20. Assignment. This Agreement is personal to Employee and may not be assigned.

21. Successors and Assigns. This Agreement shall be binding upon the successors andassigns of Employer.

22. Prior Agreements. This Agreement shall supersede and replace any and all otheremployment agreements, offers or discussions, whether oral or written, which may have beenmade or entered into by and between the parties.

IN WITNESS WHEREOF, Employer and Employee have entered into this Agreement inElmont, New York on June 18, 2013.

EM~E: EMPLOYER - THE NEW YORK RACING

~#~/F~ ::SO~INc.Christopher Kay ~ DavidSkort~~-----

Chairman of the Board

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EXHIBIT "An

Trade secret means information, including a fannula, pattern, compilation, program,device, method, technique or process, that derives economic value, prescnt or potential, from notbeing generally known to, and not being readily ascertainable by proper means by, other personswho can obtain any economic value from its disclosure or usc.

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