Exhibit 10.3


 


THIRD AMENDING AGREEMENT IN RESPECT OF THE THIRD AMENDED AND

RESTATED GULFSTREAM PARK LOAN AGREEMENT


 


THIS  AGREEMENT made as of the 23rd
day of May, 2008,


 


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 -


 


GPRA 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, and as amended by a Second Amending Agreement (the “Second Amending Agreement”) in respect of the Third Amended
and Restated Gulfstream Park Loan Agreement dated as of September 11,
2007, and 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 “Gulfstream Park
Loan  Agreement”);


 


AND WHEREAS on September 11,
2007, MEC’s Board of Directors approved and adopted a plan (the “MEC Debt Elimination Plan”) (referenced in the Second Amending Agreement as the “Borrower Restructuring Plan”) to restructure MEC’s balance sheet through the sale of certain
assets and entering into strategic partnerships or joint ventures to allow MEC
to substantially eliminate its debt by December 31, 2008, and to pursue a
business plan focused on achieving sustainable profitability;


 


AND WHEREAS the MEC Debt Elimination Plan contemplated 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 sale of assets under the MEC Debt Elimination Plan has taken longer than originally
contemplated;


 


2

















 


AND WHEREAS on March 31, 2008, the Board of Directors of MI
Developments Inc. (“MID”), an
affiliate of the Lender and the controlling shareholder of MEC, received a
reorganization proposal on behalf of various shareholders of MID that would,
among other things, alter the relationship between MID and MEC;


 


AND WHEREAS the Lender has agreed, inter alia, to
amend the Gulfstream
Park Loan Agreement to: (i) revise certain representations
and covenants relating to implementation of the MEC Debt Elimination Plan; (ii) to
extend from May 31, 2008 to August 31, 2008 the deadline for
repayment of $100 million required under Section 7.1 of the Gulfstream
Park Loan Agreement; (iii) to extend from May 31, 2008 to August 31,
2008 the date prior to which 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 the Gulfstream Park Loan Agreement, all on
the terms and conditions 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 Gulfstream Park 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 Gulfstream Park 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; (ii) except as specifically qualified in the Disclosure
Schedule, all of the representations and warranties of the Borrower in Article 6
of the Gulfstream Park Loan Agreement are true and correct on the date hereof
as if made on and as of the date hereof; 
and (iii) 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 Gulfstream Park Loan Agreement  is hereby amended as follows:


 


(a)               by
adding, in proper alphabetical order, the following definition of “MEC Debt Elimination Plan” to Section 1.1 of the Gulfstream
Park Loan Agreement:


 


3

















 


““MEC Debt Elimination Plan”
means the plan approved and adopted by MEC’s Board of Directors as of September 11,
2007 to restructure MEC’s balance sheet through the sale of certain assets and entering into
strategic partnerships or joint ventures to allow MEC to substantially
eliminate its debt by December 31, 2008, and to pursue a business plan
focused on achieving sustainable profitability,
including any amendments, revisions or modifications thereto approved by MEC’s
Board of Directors in its sole and absolute discretion (and provided forthwith
in writing to the MID Board of Directors);”;


 


(b)              by
adding, in proper alphabetical order, the following definition of “Reorganization Proposal” to Section 1.1 of the Gulfstream
Park Loan Agreement:


 


““Reorganization Proposal”
means that certain proposal received by MID’s Board of Directors on March 31,
2008 on behalf of various shareholders of MID, as may be amended from time to
time;”;


 


(c)               by
adding, in proper alphabetical order, the following definition of “Reorganization Proposal Approval” to Section 1.1 of the
Gulfstream Park Loan Agreement:


 


““Reorganization Proposal
Approval” means: (i) the approval of the Reorganization
Proposal by the shareholders of MID pursuant to applicable statutory and
regulatory requirements governing such approvals at a special meeting of
shareholders called to consider the Reorganization Proposal, together with (ii) the
final, unappealable approval by a court of competent jurisdiction of a plan of
arrangement implementing the Reorganization Proposal;”;


 


(d)              by
adding, in proper alphabetical order, the following definition of “Reorganization Proposal Termination Notice” to Section 1.1
of the Gulfstream Park Loan Agreement:


 


““Reorganization Proposal
Termination Notice” has the meaning ascribed thereto in Section 3.4;”;


 


(e)               by
adding in proper alphabetical order, the following definition of “Supporting Shareholders” to Section 1.1 of the
Gulfstream Park Loan Agreement:


 


““Supporting Shareholders”
means the shareholders on whose behalf the Reorganization Proposal was
submitted to MID’s Board of Directors on March 31, 2008;”;


 


(f)                 by
adding in proper alphabetical order the following definition of “Pre-Payment Make-Whole Amount Forgiveness Date” to Section 1.1
of the Gulfstream Park Loan Agreement:


 


4

















 


““Pre-Payment Make-Whole
Amount Forgiveness Date” has the meaning ascribed thereto in Section 3.4(a);”;


 


(g)              by
deleting the paragraph at the end of Section 3.1 of the Gulfstream Park
Loan Agreement, beginning with the words “As of the date” and ending with the
words “amortization period.”, and replacing it with the following:


 


“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 the Pre-Payment Make-Whole Amount Forgiveness Date, 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, provided that no Event of
Default exists under this Agreement and/or under the Remington Park Loan
Agreement at such time.”;


 


(h)              by
deleting the paragraph at the end of Section 3.4(a) of the Gulfstream
Park Loan Agreement, beginning with the words “Notwithstanding the foregoing”
and ending with the words “prior to May 31, 2008.”, and replacing it with
the following:


 


“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 August 31,
2008 (subject to acceleration as provided herein, the “Pre-Payment
Make-Whole Amount Forgiveness Date”), provided that no Event of
Default exists under this Agreement and/or under the Remington Park Loan
Agreement at the time of such pre-payment, and provided further that in the
event that MID gives written notice (a “Reorganization Proposal
Termination Notice”) to the Lender advising that the Reorganization
Proposal will not proceed to a vote of MID shareholders at a special meeting
(as a result of the Supporting Shareholders abandoning the Reorganization
Proposal, the MID Board of Directors failing to call such a meeting, or for any
other reason), that the Reorganization Proposal has not received the requisite
approvals at a special meeting called to consider the Reorganization Proposal,
or that a court of competent jurisdiction has not approved a plan of
arrangement implementing the Reorganization Proposal, then the Lender shall
give written notice to the Borrower that the Lender has received a
Reorganization Proposal Termination Notice, and the Pre-Payment Make-Whole
Amount Forgiveness Date shall be the earlier of: (i) August 31, 2008;
and (ii) the date which is one month after the Lender gives the Borrower
written notice that it has received the Reorganization Proposal Termination
Notice.”;


 


5

















 


(i)                  by deleting Subsections 7.1 (ee) and (ff) of the Gulfstream Park
Loan Agreement in their entirety, and replacing them with the following:


 


“(ee) the Borrower, the Guarantors, and MEC
shall use all commercially reasonable efforts to implement the MEC Debt
Elimination Plan 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 the
Pre-Payment Make-Whole Amount Forgiveness Date, with such pre-payments first applied to Tranche 2, then
applied to Tranche 3, and then applied to Tranche 1.”


 


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


 


5.                                       Ratification and Confirmation of Amended
Gulfstream Park Loan Agreement.   The Gulfstream Park 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
Gulfstream Park Loan Agreement shall be deemed to be a reference to the
Gulfstream Park Loan Agreement as amended by this Agreement.


 


6.                                       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.


 


7.                                       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.


 


8.                                       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.


 


9.                                       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.


 


6

















 


10.                                 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 G. 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 G. Ford

  
	
   

  	
   

  	
   

  	
   Name:

  	
  William G. Ford

  
	
   

  	
   

  	
   

  	
   Title:

  	
  Secretary

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  We have authority to bind the
  Corporation.

  
						



 


7

















 


	
   

  	
   

  	
  GPRA THOROUGHBRED 

  TRAINING CENTER 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.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  MAGNA ENTERTAINMENT CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  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.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  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.

  
							



 


8

















 


	
   

  	
   

  	
  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

  



 


9