Put your exit button in a different colour from the rest, red is the most obvious for exit. It's the sort of colour that you look at and think "I don't know what it does, but I probably don't want to find out because it could be something bad", meaning your friends are unlikely to try and press it during playing. Put it in the top-middle between Player 1 and Player 2, but make sure to have them far apart if you do that, so people don't accidentally hit exit instead of Player 1. It could happen.
A pause button is definitely a good idea. Whenever I play games with friends, there's always a time when somebody wants to pause.
If you don't want a shift button, just use a combo of two buttons instead.
Good luck with your cab.