EXHIBIT 10.1

 

FOURTEENTH AMENDING AGREEMENT

 

THIS AGREEMENT is made as of May 23, 2008,

 

BETWEEN:

 

MAGNA ENTERTAINMENT CORP.

 

as Borrower (the “Borrower”)

 

- and -

 

THE GUARANTORS SET FORTH
ON THE SIGNATURE PAGES HEREOF

 

as Guarantors (collectively, the “Guarantors”)

 

- and -

 

BANK OF MONTREAL, ACTING THROUGH ITS
CHICAGO LENDING OFFICE

 

as Lender (the “Lender”)

 

- and -

 

BANK OF MONTREAL, ACTING THROUGH ITS
CHICAGO LENDING OFFICE

 

as Agent (the “Agent”)

 

RECITALS:

 

A.            The Lender has made a certain credit facility available to the
Borrower in accordance with the terms and conditions set out in an amended and
restated credit agreement (the “Loan Agreement”) dated as of July 22, 2005,
between the Borrower, the Guarantors, the Lender, the Agent and BMO Nesbitt
Burns Inc., a Division of Bank of Montreal, as arranger, and as amended from
time to time.

 

B.            The Borrower, the Lender and the Agent have agreed to further
amend the Loan Agreement by extending the Maturity Date on the terms and
conditions set out herein.

 

C.            The Guarantors have agreed to confirm the guarantees and security
granted by them in connection with the Loan Agreement.

 

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D.            Article 7 of the Loan Agreement sets out certain affirmative and
negative obligations which the Borrower has covenanted to be bound by and has
agreed to follow unless the Agent, on behalf of the Lender, waives in writing.

 

NOW THEREFORE in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration (the receipt and sufficiency
of which are hereby acknowledged) the parties agree as follows:

 

1.                                                                                     
Interpretation

 

Capitalized terms not defined in this Fourteenth Amending Agreement have the
meaning given to such terms in the Loan Agreement.

 

2.                                                                                     
Loan Agreement Amendment

 

The parties hereto agree to amend the Loan Agreement by:

 

a)     deleting the reference to “May 23rd, 2008” in Section 1.1.120 and
replacing it with “the earlier of (i) July 30, 2008 or (ii) fourteen (14) days
prior to the maturity date in respect of the US$110,000,000 credit agreement(the
“Bridge Loan Facility Agreement”) dated as of September 12, 2007 amongst the
Borrower, as borrower, MID Islandi SF, as lender and certain other parties
listed therein, as such agreement has been amended on the date hereof and as may
be amended from time to time “ such that such earlier date will be the
“Termination Date” for the purposes of the Loan Agreement;

 

b)    adding a new covenant to Section 7.1 (Positive Covenants) as follows:

 

7.1.20  Austrian Assets.  The Borrower shall take commercially reasonable steps
to cause the sale of the following assets located in Austria and owned directly
or indirectly by the Borrower,  Fontana Housing, Magna Racino, and Austrian Golf
Course (collectively, the “Austrian Assets”), each as more particularly
described in Schedule 7.1.20”;

 

c)   adding a new Schedule 7.1.20 (Austrian Assets) as per Annex A;

 

d)   adding a new section 2.3.4 (Repayment under Credit Facility) as follows:

 

“Notwithstanding the foregoing, section 2.3.2 and 2.3.3 shall not apply to the
Austrian Assets and all of the net cash proceeds from the direct or indirect
sale of any of the Austrian Assets including, without limitation, the shares of
the Subsidiaries that own the relevant Austrian Asset, and including any cash
received in respect of non-cash proceeds (including any cash payments received
by way of deferred payment of principal pursuant to a note or instalment
receivable or purchase price adjustment receivable or otherwise, but excluding
any interest payments) but only as and when received, in each

 

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case after giving effect to agents’ commissions and sale related expenses
(including, without limitation, agents’ fees and expenses)  shall be paid to the
Agent for the account of the Lenders for application against  the Obligations
outstanding under the Credit Facility. Any prepayment made hereunder shall
permanently reduce the Lender’s Commitment and the Aggregate Commitment.”

 

4.                                                                                     
Conditions Precedent to Loan Agreement Amendments

 

The obligation of the Lender to agree to the amendment herein, and to make
available any further advances, is subject to fulfillment of the following
conditions precedent on the date hereof:

 

(a)   the Lender shall be satisfied, in its sole discretion, with the First
Amending Agreement dated the date hereof in respect of the Bridge Loan Facility
Agreement;

 

(b)   the Lender shall be satisfied in its sole discretion, with the Third
Amending Agreement dated the date hereof in respect of the Remington Park
project financing facility and the Second Amending Agreement in respect of
Gulfstream Park project financing facility;

 

(c)   MID Islandi SF and the Borrower shall enter into an amendment of
the inter-creditor agreement amongst such parties, MI Developments Inc. and the
Lender which amends the prepayment provisions relating to the Austrian Assets as
reflected by the terms herein, and such amendment shall be on terms and
conditions satisfactory to the Lender;

 

(d)   the representations and warranties of the Borrower set out in section 6.1
of the Loan Agreement are true and correct on the date hereof provided if any
such representation and warranty is specifically given as of any particular date
or particular period of time, then such representation and warranty shall
continue to be given as at such date or such period of time;

 

(e)   no Default or Event of Default has occurred or is continuing or would
arise immediately after giving effect to or as a result of the amendment herein;

 

(f)    no Material Adverse Change since December 31st, 2007 shall have occurred;

 

(g)   payment in full of all reasonable invoiced fees, including for greater
certainty, an upfront fee of US$607,685.00 and all reimbursable out-of-pocket
expenses payable by the Borrower on or prior to the date hereof including
payment of all reasonable fees, disbursements and out-of-pocket expenses of
counsel to the Agent and the Lenders; and

 

(h)   such other documentation or information as the Lender shall have
reasonably requested.

 

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5.                                                                                     
Loan Agreement

 

Save as expressly amended by this Fourteenth Amending Agreement, all other terms
and conditions of the Loan Agreement and each of the Loan Documents remain in
full force and effect, unamended, and this Fourteenth Amending Agreement
constitutes a Loan Document for the purposes of the Loan Agreement.

 

6.                                                                                     
Confirmation of Guarantee and Security

 

Each of the Guarantors acknowledges and confirms that (i) the guarantee granted
by it pursuant to Article 10 of the Loan Agreement constitutes a continuing
guarantee of, among other things, all present and future obligations of the
Borrower to the Lender under the Loan Agreement and shall remain in full force
and effect; and  (ii) each of the other Loan Documents executed by it shall
remain in full force and effect.  In addition, (i) MEC Land Holdings
(California) Inc. acknowledges and confirms that the Golden Gate Mortgage
constitutes continuing security for the obligations secured thereby and shall
remain in full force and effect, and (ii) The Santa Anita Companies, Inc.
acknowledges and confirms that the Santa Anita Mortgage constitutes continuing
security for the obligations secured thereby and shall remain in full force and
effect.

 

7.                                                                                     
Counterparts

 

This Fourteenth Amending Agreement may be signed in any number of counterparts,
each of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same instrument.

 

IN WITNESS WHEREOF this Fourteenth Amending Agreement has been executed by the
parties hereto as of the date first written above.

 

[signature page to follow]

 

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MAGNA ENTERTAINMENT CORP., as
Borrower

 

 

 

 

 

 

 

By:

/s/Blake S. Tohana

 

 

Name: Blake S. Tohana

 

 

Title: Executive Vice-President and Chief

 

 

Financial Officer

 

 

 

 

 

 

 

By:

/s/William G. Ford

 

 

Name: William G. Ford

 

 

Title: Secretary

 

 

 

 

 

 

 

PACIFIC RACING ASSOCIATION, as
Guarantor, but only with respect to Article 10 of
the Loan Agreement and all other provisions
related thereto

 

 

 

 

 

 

 

By:

/s/Blake S. Tohana

 

 

Name: Blake S. Tohana

 

 

Title: Executive Vice-President and Chief

 

 

Financial Officer

 

 

 

 

 

 

 

By:

/s/William G. Ford

 

 

Name: William G. Ford

 

 

Title: Secretary

 

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MEC LAND HOLDINGS (CALIFORNIA)
INC., as Guarantor, but only with respect to
Article 10 of the Loan Agreement and all other
provisions related thereto

 

 

 

 

By:

/s/Blake S. Tohana

 

 

Name: Blake S. Tohana

 

 

Title: Executive Vice-President and Chief

 

 

Financial Officer

 

 

 

 

 

 

 

By:

/s/William G. Ford

 

 

Name: William G. Ford

 

 

Title: Secretary

 

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THE SANTA ANITA COMPANIES, INC., as
Guarantor, but only with respect to Article 10 of
the Loan Agreement and all other provisions
related thereto

 

 

 

 

 

 

By:

/s/Blake S. Tohana

 

 

Name: Blake S. Tohana

 

 

Title: Executive Vice-President and Chief

 

 

Financial Officer

 

 

 

 

 

 

 

By:

/s/William G. Ford

 

 

Name: William G. Ford

 

 

Title: Secretary

 

 

 

 

 

 

 

LOS ANGELES TURF CLUB,
INCORPORATED, as Guarantor, but only with
respect to Article 10 of the Loan Agreement and
all other provisions related thereto

 

 

 

 

 

 

 

By:

/s/Blake S. Tohana

 

 

Name: Blake S. Tohana

 

 

Title: Executive Vice-President and Chief

 

 

Financial Officer

 

 

 

 

 

 

 

By:

/s/William G. Ford

 

 

Name: William G. Ford

 

 

Title: Secretary

 

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BANK OF MONTREAL, acting through its
Chicago lending office, as Lender

 

 

 

 

 

 

 

By:

/s/David L. Mistic,

 

 

Vice-President

 

 

 

 

 

 

 

BANK OF MONTREAL, acting through its
Chicago lending office, as Agent

 

 

 

 

 

 

 

By:

/s/David L. Mistic,

 

 

Vice-President

 

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ANNEX A

 

SCHEDULE 7.1.20

 

AUSTRIAN ASSETS

 

1.  Magna Racino

 

Includes Magna Racino and excess land owned by MEC Grundstucksentwicklungs GmbH
(“MECG”, an Austrian subsidiary of the Borrower) located in Ebreichsdorf,
Austria which comprises a total area of approximately 668 acres.

 

2.  Austrian Golf Course

 

Includes land owned by MECG located in Ebreichsdorf, Austria which is leased to
the operator of the Ebreichsdorf Golf Club and comprises a total area of
approximately 220 acres.

 

3.  Fontana Housing

 

Includes certain land lots owned by Fontana Beteiligungs GmbH (“FBG”, an
Austrian subsidiary of the Borrower) located in Oberwaltersdorf, Austria which
comprises a total area of approximately 93 acres and includes lots EZ 168, 846,
1353, 1354, 1355, 1374, 1439, 1442, 1627 and part of lot EZ 1356.

 

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