-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IctfjasUleCzVHIg+qL/mBOjfx8bNgQRH1cZpNXZvZ2Q4UDUjaViWT8i4BzfECJR xshAoRIJW1Fz6q/Waq3/0Q== 0001164833-11-000003.txt : 20110208 0001164833-11-000003.hdr.sgml : 20110208 20110208160652 ACCESSION NUMBER: 0001164833-11-000003 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20110208 DATE AS OF CHANGE: 20110208 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MI DEVELOPMENTS INC CENTRAL INDEX KEY: 0001252509 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-RACING, INCLUDING TRACK OPERATION [7948] IRS NUMBER: 000000000 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-79210 FILM NUMBER: 11582717 BUSINESS ADDRESS: STREET 1: 455 MAGNA DR STREET 2: AURORA ONTARIO CITY: CANADA STATE: A6 ZIP: L4G7A9 BUSINESS PHONE: 9057136322 MAIL ADDRESS: STREET 1: 455 MAGNA DR STREET 2: AURORA ONTARIO CITY: CANADA STATE: A6 ZIP: L4G7A9 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HOTCHKIS & WILEY CAPITAL MANAGEMENT LLC CENTRAL INDEX KEY: 0001164833 IRS NUMBER: 954871957 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 725 SOUTH FIGUERORA ST 39TH FLOOR CITY: LOS ANGELES STATE: CA ZIP: 90017 BUSINESS PHONE: 2134301000 MAIL ADDRESS: STREET 1: 725 SOUTH FIGUEROA ST 39TH FLOOR CITY: LOS ANGELES STATE: CA ZIP: 90017 SC 13D/A 1 mim13d06.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 (Amendment No. 6)* MI Developments Inc. - -------------------------------------------------------------------------------- (Name of Issuer) Class A Subordinate Voting Shares - -------------------------------------------------------------------------------- (Title of Class of Securities) 55304X104 - -------------------------------------------------------------------------------- (CUSIP Number) Anna Marie Lopez Hotchkis and Wiley Capital Management, LLC 725 South Figueroa Street, 39th floor Los Angeles, California 90017-5439 (213) 430-1896 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) January 31, 2011 - -------------------------------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Sections 240.13d-1(e), 13d-1(f) or 240.13d-1(g), check the following box [ ]. Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Section 240.13d-7 for other parties to whom copies are to be sent. * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). (Continued on following pages) 13D =================== CUSIP No. 55304X104 =================== - ------------==================================================================== NAMES OF REPORTING PERSONS 1 I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY) Hotchkis and Wiley Capital Management, LLC 95-4871957 - ------------==================================================================== CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions) (a) [ ] (b) [ ] 2 - ------------==================================================================== 3 SEC USE ONLY - ------------==================================================================== SOURCE OF FUNDS (See Instructions) 4 OO - ------------==================================================================== CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT 5 TO ITEMS 2(d) OR 2(e) [ ] - ------------==================================================================== CITIZENSHIP OR PLACE OF ORGANIZATION 6 Delaware - ------------==================================================================== SOLE VOTING POWER 7 NUMBER OF 3,232,400 ------------=========================================== SHARES SHARED VOTING POWER BENEFICIALLY 8 OWNED BY -0- ------------=========================================== EACH SOLE DISPOSITIVE POWER 9 REPORTING 4,907,400 PERSON WITH ------------=========================================== SHARED DISPOSITIVE POWER 10 -0- - ------------==================================================================== AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 11 4,907,400 shares (Ownership disclaimed pursuant to Section 13d-4 of the 1934 Act) - ------------==================================================================== CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES 12 CERTAIN SHARES (See Instructions) [ ] - ------------==================================================================== PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 13 10.6% - ------------==================================================================== TYPE OF REPORTING PERSON (See Instructions) 14 IA - ------------==================================================================== This Amendment No. 6 (this "Amendment") amends that certain Statement on Schedule 13D filed on April 17, 2008, as amended by that certain Amendment No. 1 filed on May 16, 2008, Amendment No. 2 filed on March 6, 2009 and Amendment No. 3 filed on November 13, 2009, Amendment No. 4 filed on December 9, 2009 and Amendment No. 5 filed on December 27, 2010(collectively, the "Schedule 13D"), which relates to the Class A Subordinate Voting Shares (the "Class A Shares") of MI Developments Inc. (the "Company"). The Company's principal offices are located at 455 Magna Drive, Aurora, Ontario, Canada L4G 7A9. Item 3. Source And Amount Of Funds And Other Consideration - ------- -------------------------------------------------- HWCM purchased the Class A Shares on behalf of its clients in the ordinary course of business, using the investment capital of its clients. The Class A Shares were acquired at an average price of approximately $24.67 per share (including commissions). The amount of investment capital used to purchase the Class A Shares was approximately $121,072,329 (including commissions). Item 4. Purpose Of The Transaction - ------ -------------------------- Item 4 is supplemented and updated as follows: As disclosed by the Company in its Form 6-K filed with the Securities and Exchange Commission on February 1, 2011 (the "Company 6-K"), the Company, the Stronach Trust and 445327 Ontario Limited, an entity controlled by the Stronach Trust ("445"), executed an Arrangement Agreement dated January 31, 2011 (the "Arrangement Agreement"). Pursuant to the Arrangement Agreement and the Plan of Arrangement contemplated thereby and a form of which is attached thereto (the "Plan of Arrangement"), and as more fully described therein and in the Company 6-K, the Company proposes to effect a reorganization in connection with which: (i) the Company will cancel all 363,414 Class B Shares held by 445; (ii) the Company will transfer to a corporation controlled by 445 the Company's horseracing, gaming and certain real estate development and other assets and liabilities and US$20 million of working capital as of January 1, 2011; (iii) the Company will purchase all remaining Class B Shares for consideration consisting of 1.2 Class A Shares for each Class B Share; and (iv) upon the effective date under the Plan of Arrangement (the "Effective Date"), the Company and certain related parties and officers and directors of the Company will be released from all claims up to and including the Effective Date. On January 31, 2011, in connection with (a) the Support Agreement entered into by the Reporting Person with 445 on December 22, 2010 (the "Support Agreement") and (b) the Arrangement Agreement, THE REPORTING PERSON, on behalf of its clients who are holders of the Class A Shares reported herein, along with other shareholders who executed the Support Agreement, entered into an Agreement Regarding Arrangement (the "Agreement Regarding Arrangement") with the Company, the Stronach Trust and 445. The Agreement Regarding Arrangement addresses various matters related to the Reorganization, and includes, without limitation, (a) an agreement by each shareholder who executed the Support Agreement not to exercise any right of termination pursuant to Sections 5(a) or 5(b) of the Support Agreement provided that the executed versions of the definitive Arrangement Agreement, the Plan of Arrangement and certain other agreements referenced therein are substantially in the form of drafts previously reviewed by the Reporting Person, (b) an agreement by each shareholder who executed the Support Agreement not to enter into any additional agreement regarding the exercise of voting rights with any other shareholder of the Company until the date 180 days following the closing date of the Reorganization (other than in response to unanticipated matters arising after the closing date), (c) if any shareholder who executed the Support Agreement were to become a beneficial owner of at least 10% of any class of the Company's securities, an agreement by such shareholder not to dispose of any shares of the Company prior to the closing of the Reorganization and (d) the Company agreed to reimburse the shareholders who executed the Support Agreement for certain legal expenses. This summary of the Agreement Regarding Arrangement is qualified in its entirety by the full terms and conditions of the Agreement Regarding Arrangement attached hereto as Exhibit 4, which exhibit is incorporated by reference herein. Pursuant to a release executed on January 31, 2011 by the Reporting Person (the "Release"), the Reporting Person agreed to irrevocably and unconditionally release the Company, the Stronach Trust, 445 and Frank Stronach, as well as their affiliates, directors and officers, trustees, beneficiaries, shareholders and legal representatives, among others, from certain claims which the releasing parties had or have up to and including the Effective Date. This summary of the Release is qualified in its entirety by the full terms and conditions of the Release attached hereto as Exhibit 5, which exhibit is incorporated by reference herein. The reference above to the Support Agreement is qualified in its entirety by the full terms and conditions of the Support Agreement attached as Exhibit 3 to the Schedule 13D filed by the Reporting Person on December 23, 2010, which exhibit is incorporated by reference herein. Although the Reporting Person has no specific plan or proposal to acquire or dispose of the Class A Shares, the Reporting Person at any time and from time to time may acquire additional Class A Shares or other securities of the Company or, subject to the terms of the Support Agreement, transfer or dispose of any or all of its Class A Shares depending upon an ongoing evaluation of the investment in the Class A Shares, prevailing market conditions, other investment opportunities, liquidity requirements of the Reporting Person and/or other investment considerations. The Reporting Person has not made a determination regarding a maximum or minimum number of Class A Shares or other securities of the Company which it may hold at any point in time. Also, consistent with their investment intent, the Reporting Person may engage in communications regarding the Company with, without limitation, one or more shareholders of the Company, one or more officers of the Company, one or more members of the board of directors of the Company and/or one or more potential participants in the transactions contemplated by the Support Agreement and/or the Arrangement Agreement. Such communications may concern, without limitation, the transactions contemplated by the Support Agreement and/or the Arrangement Agreement, the Company's operations, structure, potential reorganization plan(s) and financial relationships with Company affiliates, as well as any other potential strategies to maximize shareholder value. Except to the extent the foregoing may be deemed a plan or proposal, the Reporting Person does not have any plans or proposals which relate to, or could result in, any of the matters referred to in paragraphs (a) through (j), inclusive, of the instructions to Item 4 of Schedule 13D. The Reporting Person may, at any time and from time to time, review or reconsider its position and/or change its purpose and/or formulate plans or proposals with respect thereto. Item 5. Interest In Securities Of The Issuer - ------- ------------------------------------ (a) The percentage amount set forth in Row 13 for the cover page filed herewith is calculated based upon the 46,160,564 Class A Shares outstanding as of December 31, 2009, as reported by the Company in its Form 40-F for the fiscal year ended December 31, 2009 filed with the Securities and Exchange Commission on March 29, 2010. (b) The number of shares of Class A Shares as to which there is sole power to vote or direct the vote, shared power to vote or direct the vote, sole power to dispose or direct the disposition, or shared power to dispose or direct the disposition for the Filing Persons is set forth on the cover page in items 7 through 10. Note that certain of HWCM's clients have retained voting power over the Class A Shares that they beneficially own. Accordingly, HWCM has the power to dispose of more Class A Shares than it can vote. (c) Information concerning transactions relating to the shares offered through open market transactions by the Reporting Person during the past sixty days are listed below. Transaction date Shares purchased/(sold) Price per share 12/22/10* 170,400 $28.4311 12/23/10 110,300 $27.5446 12/27/10 25,000 $27.6161 12/28/10 70,000 $27.4026 12/29/10 84,800 $27.7155 1/5/11 5,800 $27.4712 1/6/11 77,100 $27.7480 1/14/11 200 $27.0200 *Purchase made after the announcement by the Company of a proposed transaction. (d) The securities as to which this Schedule is filed by HWCM, In its capacity as investment adviser, are held in HWCM clients' custodial accounts for the benefit of its clients. These clients have the right to receive, or the power to direct the receipt of, dividends from, or the proceeds from the sale of, such securities. No such client is known to have such right or power with respect to more than five percent of this class of securities. HWCM disclaims beneficial ownership of all securities owned for the benefit of its clients. (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer Item 6 is hereby amended and restated as follows: Except for the Support Agreement, the Agreement Regarding Arrangement, and otherwise as described herein, there are no contracts, arrangements, understandings or relationships (legal or otherwise) among the persons named in Item 2 hereof and between such persons and any person with respect to any securities of the Issuer, including, but not limited to, transfer or voting of any other securities, finder's fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, divisions of profits or loss, or the giving or withholding of proxies. Item 7. Material to be Filed as Exhibits. Item 7 is hereby amended by the addition of the following: Exhibit 4. Agreement Regarding Arrangement Exhibit 5. Release SIGNATURES ---------- After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Date: February 7, 2011 Hotchkis and Wiley Capital Management, LLC By: /s/ Anna Marie Lopez Name: Anna Marie Lopez Title: Chief Operating Officer EX-4 2 mimexh4.txt EXHIBIT 99.4 EXHBIT 4 AGREEMENT REGARDING ARRANGEMENT Reference is made to (a) the support agreement (the "Support Agreement") entered into among certain shareholders (each an "Initiating Shareholder", and collectively the "Initiating Shareholders") of MI Developments Inc. ("MID") and 445327 Ontario Limited ("445") between December 20, 2010 and December 22, 2010 pursuant to which such parties agreed to cause their Class A Shares and Class B Shares to be voted in favour of the Arrangement Resolution, subject to the terms and conditions of such agreement and (b) the arrangement agreement (the "Arrangement Agreement") dated the date hereof among MID, 445 and the Stronach Trust. Capitalized terms used but not otherwise defined herein shall have the meanings set out in the Arrangement Agreement. FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which are acknowledged, each of the Initiating Shareholders, MID, 445 and the Stronach Trust agree as follows: 1. Each Initiating Shareholder (in respect of itself only and based solely on its own review and not on any representations or advice from any other Initiating Shareholder) acknowledges and agrees that it has reviewed drafts of the definitive documents for the Arrangement dated January 29, 2011 (the "Draft Documents") (being the Arrangement Agreement, the Plan of Arrangement in the form attached to the Arrangement Agreement, the Transfer Agreement in the form attached to the Arrangement Agreement and this Agreement) and that it shall not exercise any right of termination pursuant to sections 5(a) or 5(b) of the Support Agreement provided that the executed versions of such definitive documents are substantially in the form of the Draft Documents. 2. On the Effective Date and conditional on the closing of the Arrangement, MID shall reimburse the Initiating Shareholders (which for greater certainty excludes 445, whose fees shall be reimbursed in accordance with section 6.3 of the Arrangement Agreement) for or, as applicable, pay on their behalf: (a) their reasonable legal and advisory fees incurred and to be incurred in connection with the Arrangement (to the extent that such fees have not already been paid by MID pursuant to the letter agreement dated January 28, 2011), excluding, for greater certainty, fees in connection with any enforcement proceedings taken pursuant to section 7, and (b) their reasonable legal and advisory fees paid to Voorheis & Co. LLP ("Voorheis") and Thornton Grout Finnigan LLP prior to the date of the Support Agreement in connection with their investment in MID up to an aggregate maximum of US$1,000,000 for all Initiating Shareholders for all such fees. The Initiating Shareholders, through Voorheis or a Designated Person (as defined below), shall provide MID with the amount of and payment instructions for the fees to be reimbursed pursuant to this section 2, together with copies of the applicable invoices, at least three Business Days prior to the expected Effective Date (and MID shall provide Voorheis or the Designated Person, as applicable, with at least seven Business Days notice of the expected Effective Date). The payment of the amount of fees to be reimbursed pursuant to this section 2 by MID in accordance with the payment instructions provided by Voorheis or the Designated Person, as applicable, shall satisfy and fully discharge MID's reimbursement obligations pursuant to this section 2. 3. MID agrees with the Initiating Shareholders (a) that it will comply with its obligations under sections 2.1, 2.2, 2.8, 4.3(a) and 4.3(c) of the Arrangement Agreement, (b) not to extend the Outside Date or the time for the performance of any of the obligations or other acts of the parties to the Arrangement Agreement without the prior approval of the Initiating Shareholders, (c) not to amend the Arrangement Agreement, the Plan of Arrangement, the Transfer Agreement or the Releases, or waive compliance with any of the agreements of the parties to the Arrangement Agreement or with any conditions to its own obligations, in each case in a manner that is adverse to the Initiating Shareholders in a material respect, without the prior approval of the Initiating Shareholders, and (d) not to terminate the Arrangement Agreement pursuant to section 6.1(a) of the Arrangement Agreement without the prior approval of the Initiating Shareholders. MID shall permit Blake, Cassels & Graydon LLP to review and comment on the Circular, all documents sent with the Circular, all documents filed with the Court in connection with the Interim Order and the Final Order and any amendments thereto, recognizing that whether or not such comments are ultimately included will be determined by MID, acting reasonably. 4. Each of 445 and the Stronach Trust agrees with the Initiating Shareholders that it will comply with its obligations under sections 2.1, 2.8, 4.3(a) and 4.3(c) of the Arrangement Agreement, as applicable, other than as may be consented to by the Initiating Shareholders. 5. The parties acknowledge and agree that an award of money damages would be inadequate for any breach of section 3 or 4 of this Agreement by MID, 445 or the Stronach Trust, as applicable, and any such breach would cause the Initiating Shareholders irreparable harm. Accordingly, the parties agree that, in the event of any breach or threatened breach of sections 3 or 4 of this Agreement by MID, 445 or the Stronach Trust, as applicable, the Initiating Holders will be entitled, without the requirement of posting a bond or other security, to remedies of injunctive relief and specific performance. Such remedies shall be the exclusive remedies for any breach of sections 3 or 4 of this Agreement or the Arrangement Agreement by MID, 445 or the Stronach Trust, as applicable. Notwithstanding the foregoing, this section 5 shall not preclude the Initiating Shareholders from bringing any action in the name and on behalf of MID under section 246 of the Business Corporations Act (Ontario) or any successor provision to enforce the Arrangement Agreement. 6. In taking any actions to provide their consent under section 3 or 4 of this Agreement, the Initiating Shareholders shall act solely through a person designated by Initiating Shareholders holding more than 50% of the aggregate Class A Shares held by the Initiating Shareholders (the "Designated Person"). In respect of any consent of the Initiating Shareholders requested pursuant to section 3 or 4, the Designated Person shall not provide such consent without obtaining the approval or consent of Initiating Shareholders holding more than 50% of the aggregate Class A Shares held by the Initiating Shareholders, and MID, 445 and the Stronach Trust shall be permitted to rely on any consent provided by the Designated Person and shall not be obligated to deal with a multiplicity of Initiating Shareholders. Any consent provided by the Designated Person shall be binding upon all Initiating Shareholders as if made by each of them directly. If a Designated Person does not respond to a request for approval or consent on behalf of the Initiating Shareholders within seven days of the request, the approval or consent of the Initiating Shareholders for the applicable matter shall be deemed to have been given. 7. No Initiating Shareholder may seek to enforce section 3 or 4 of this Agreement unless such enforcement has been approved by Initiating Shareholders holding more than 50% of the aggregate Class A Shares held by the Initiating Shareholders. 8. Notwithstanding Section 3(b) of Schedule B to the Support Agreement, 445's voting of its Class B Shares of MID on the resolution for the election of the persons nominated by the Initiating Shareholders to be directors of MID shall be governed by this Agreement and not by Section 3(b) of Schedule B to the Support Agreement. 445 may vote its Class B Shares of MID on the resolution for the election of the persons nominated by the Initiating Shareholders to become directors of MID at the Effective Time (which shall be a separate resolution from the resolution to approve the Plan of Arrangement) and 445 shall not, directly or indirectly, nominate or vote for the election of any other persons to become directors of MID at the Effective Time. 9. MID represents and warrants to and in favour of each of the Initiating Shareholders as follows and acknowledges that each of the Initiating Shareholders is relying on such representations and warranties in entering into this Agreement: (a) MID has tiled with all applicable Governmental Entities true and complete copies of all documents that MID is required by applicable Securities Laws to file therewith. Such documents, taken as a whole, do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Each such document at the time filed complied in all material respects with the requirements of applicable Securities Laws. (b) Since September 30, 2010, there have been no amendments to the Magna Leases (excluding any Magna Leases identified in the disclosure letter dated the date hereof) outside of the ordinary course of business that would result in a material adverse change to the income or value of the Real Estate Business. "Magna Leases" means the real property leases between MID or any of its Subsidiaries, on the one hand, and Magna International Inc. or any of its Subsidiaries, on the other hand. (c) Since December 22, 2010, MID and its Subsidiaries have not entered into any transaction or series of related transactions with 445, the Trust, the directors or officers of MID or of any of its Subsidiaries, or any of their Affiliates or immediate family members, with a value in excess of $2 million, other than (1) as publicly disclosed prior to the date hereof or as disclosed in the disclosure letter dated the date hereof, (ii) pursuant to the Pre-Arrangement Reorganization or the Arrangement Agreement, (iii) transactions solely between MID and any of its Subsidiaries or solely between Subsidiaries of MID, or (iv) transactions in respect of the Racing and Gaming Business or the Development Properties (for greater certainty, any funding by MID or its Subsidiaries (other than Raceco and its Subsidiaries or the Development Property Companies) of the Racing and Gaming Business or the Development Properties shall be subject to section 4.1 of the Arrangement Agreement). 10. MID shall give prompt notice to Blake, Cassels & Graydon LLP of the occurrence of any event which would cause any representation or warranty in section 9 of this Agreement to be untrue or inaccurate in any material respect at the Effective Time. If any of the representations and warranties in section 9 of this Agreement shall not be true and correct in all material respects at the Effective Time with the same force and effect as if such representations and warranties were made at and as of such time, or a certificate dated the Effective Date to that effect shall not have been delivered by MID, the Designated Person may elect to require MID, 445 and the Trust to not close the Arrangement and to terminate the Arrangement Agreement. No such election may be made if (a) Initiating Shareholders holding 10% or more of the aggregate Class A Shares held by the Initiating Shareholders had knowledge of the applicable breach or inaccuracy of the representation or warranty on the date hereof, (b) the Initiating Shareholders had previously consented (in the manner contemplated by section 6) to the matter giving rise to such breach or inaccuracy or (c) in the case of a breach or inaccuracy of the representation and warranty in section 9(c) of this Agreement, such breach has been cured by 445 or the Trust. In making the election pursuant to this section 10, the Initiating Shareholders shall act solely through the Designated Person. The Designated Person shall not make such election without first obtaining the written approval of (a) Initiating Shareholders holding in excess of 50% of the Class A Shares held by the Initiating Shareholders and (b) holders of Class A Shares holding more than 33-1/3% of the outstanding Class A Shares immediately prior to making such election, and MID shall be permitted to rely on any election provided by the Designated Person and shall not be obligated to deal with a multiplicity of Initiating Shareholders. Any election made by the Designated Person with such prior written approval shall be binding upon all Initiating Shareholders as if made by each of them directly. The election contemplated by this section shall be the Initiating Shareholders' sole remedy arising under this Agreement for any breach or inaccuracy of the representations and warranties in section 9 of this Agreement. 11. As soon as reasonably available, MID shall provide to Blake, Cassels & Graydon LLP statements disclosing (a) the cash position of MID, (b) indebtedness of MID for borrowed money and (c) the rental revenue from the Real Estate Business, in each case as at and for the year ended December 31, 2010, the three- months ended March 31, 2011 and for each calendar month thereafter until the Effective Date. Such statements shall be reviewed by the auditors of MID prior to delivery to Blake, Cassels & Graydon LLP. 12. MID shall provide Blake, Cassels & Graydon LLP with a copy of (a) all notices provided or received by it pursuant to the Arrangement Agreement, (b) all amendments to the Arrangement Agreement and (c) all waivers provided or received by it pursuant to the Arrangement Agreement. 13. Each Initiating Shareholder covenants in favour of 445 that it will not at any time on or after the date of this Agreement and before 180 days after the Effective Time enter into any agreement or arrangement (other than this Agreement) with any other shareholder of MID relating in any way to the manner in which it will exercise or not exercise its voting rights respecting shares of MID (otherwise than in favour of the Plan of Arrangement) unless such agreement or arrangement is entered into in response to an event, action or matter that arises after the Effective Time and was not contemplated or anticipated by the Initiating Shareholders before the Effective Time. 14. If any Initiating Shareholder, alone or together with one or more persons with whom such Initiating Shareholder does not deal at arm's length for the purposes of the Income Tax Act (Canada), is, or prior to the Effective Time becomes, the beneficial owner of 10% or more of the issued and outstanding Class A Shares or 10% or more of the issued and outstanding Class B Shares, then such Initiating Shareholder shall not dispose of any of its shares of MID before the Effective Time to a person who is not related to such Initiating Shareholder for the purposes of the Income Tax Act (Canada) or to a partnership. 15. MacKenzie Financial Corporation ("MFC"), being one of the Initiating Shareholders, shall cause those of its funds on behalf of which MFC signed the Support Agreement which are corporations not to acquire any additional Class A Shares and Class B Shares before the Effective Date either directly or indirectly by way of options, swaps, future or forward contracts, hedging contracts or similar transactions. 16. This Agreement is an agreement between each Initiating Shareholder and MID, 445 and the Stronach Trust, and no Initiating Shareholder has an agreement with any other Initiating Shareholder and no Initiating Shareholder may enforce this Agreement against any other Initiating Shareholder. Only MID, 445 or the Stronach Trust may enforce this Agreement against an Initiating Shareholder. Each Initiating Shareholder confirms that in negotiating and executing this Agreement it did not intend and did not become a "group" (as defined in Rule 13d of the United States Securities Exchange Act of 1934) with any other Initiating Shareholder with respect to the matters contemplated herein. This Agreement may not be amended without the written consent of holders of a majority of the Class A Shares held by all Initiating Shareholders. This Agreement is not intended to confer on any person other than the parties any rights or remedies. 17. Each Initiating Shareholder and 445 confirms and agrees that the Support Agreement remains in full force and effect, subject to this Agreement. 18. This Agreement shall be governed by the laws of the Province of Ontario and shall take effect upon the execution and delivery of this Agreement or a counterpart hereof by each of the Initiating Shareholders. For purposes of the enforcement of this Agreement and the Arrangement Agreement, the parties hereby irrevocably attorn to the exclusive jurisdiction of the courts of the Province of Ontario. [THE REMAINDER OF THIS PAGE HAS BEEN LEFT INTENTIONALLY BLANK] Dated the 31st day of January, 2011. MI DEVELOPMENTS INC. By: /s/ Don Cameron Name: Don Cameron Title: Chief Operating Officer /s/ Rocco Liscio Name: Rocco Liscio Title: Executive Vice-President and Chief Financial Officer 445327 ONTARIO LIMITED By: /s/ Belinda Stronach Name: Belinda Stronach Title: President THE STRONACH TRUST By: /s/ Frank Stronach Name: Frank Stronach Title: Trustee By: /s/ Belinda Stronach Name: Belinda Stronach Title: Trustee Hotchkis and Wiley Capital Management, LLC (Print Name of Initiating Shareholder) /s/ Anna Marie Lopez (Signature of Initiating Shareholder or Autorized Signatory) Anna Marie Lopez, Chief Operating Officer (Print Name and Title) EX-5 3 mimexh5.txt EXHIBIT 99.5 EXHIBIT 5 RELEASE Reference is hereby made to the Arrangement Agreement (the "Agreement") made the 31st day of January, 2011 by and between MI Developments Inc. ("MID"), 4455327 Ontario Limited ("445") and The Stronach Trust (the "Trust"). Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Agreement. Whereas certain shareholders of MID have expressed disagreement in the past with respect to the management of MID and the conduct of its directors and officers and have asserted wrongdoing by MID and its directors and officers including assertions of intentional wrongdoing including fraud and those shareholders have asserted that MID can or ought to bring a civil action against its current and former directors and officers in respect of the asserted wrongdoing; And whereas MID and its directors and officers have always maintained that their actions and conduct have been permissible, appropriate and in accordance with any and all duties owed by them And whereas there have been court and other proceedings which have been commenced in which the propriety of the conduct of MID, current and former directors and officers have been put into issue; And whereas by the Agreement if closed, it is intended and agreed that any and all claims that have been or could have been brought by the shareholders as against MID and/or its current and former officers and directors and/or its controlling shareholders including, without limitation, those that are or could have been asserted in Action No. CV-10-403595 in the Ontario Superior Court of Justice, as well as those that could have been asserted in the name of MID are to be dismissed on a without costs basis and without any admission of liability; Hotchkis and Wiley Cap Mgt on behalf of itself and on behalf of its affiliates, successors, assigns, directors, officers, trustees and/or legal representatives (collectively in such capacity the "Releasor"), for good and valuable consideration, the receipt and sufficiency of which is hereby irrevocably acknowledged, hereby agrees: (i) to irrevocably and unconditionally release and forever discharge MID, 445, Frank Stronach and the Trust as well as each of their affiliates, successors, assigns, current directors and officers, former directors and officers, current trustees, former trustees, beneficiaries, shareholders and legal representatives (collectively in such capacity the "Releasees"), of and from all manner of actions, causes of action, suits, penalties, demands, debts, accounts, covenants, contracts, damages and all other claims whatsoever of any nature, character and description, whether contractual, legal or otherwise, whether known or unknown, which the Releasor ever had or now has up to and including the Effective Date, even if discovered after the execution of this Release against any of the Releasees including without limiting the generality of the foregoing, any allegations that any current or former director, current or former officer, current or former trustee, shareholder or beneficiary of MID, 445 and/or the Trust breached any duties, whether contractual, statutory or otherwise, owed to any party by virtue of being a director, officer, trustee, shareholder or beneficiary of MID, 445 and/or the Trust at any time whatsoever up to and including the Effective Date including any claims that are or could have been advanced in Action No. CV-10-403595 in the Ontario Superior Court of Justice (all collectively hereinafter referred to as the "Claim" or "Claims" as the context requires); and (ii) not to make any Claim of any nature whatsoever or take any proceeding, and hereby renounce thereto, against any other person, firm or corporation who might advance a Claim for contribution or indemnity from the Releasees released hereunder. The Releasor hereby represents and warrants that it has not commenced, and hereby irrevocably and unconditionally covenants and agrees that it will not commence or pursue any other Claims which it is releasing herein. The Releasor hereby represents and warrants that it has not assigned to any other person or entity any of the Claims which it is releasing herein. Nothing in this Release shall be construed as an admission of liability by the Releasees and any such liability is denied. This Release is binding upon the Releasor and enures to the benefit of the Releasees and their respective affiliates, successors, assigns, current directors and officers, former directors and officers, current trustees, former trustees, beneficiaries, legal representatives and permitted assigns. This Release will be governed by, interpreted and enforced in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. This Release may be signed in counterparts and will be valid and binding even though the parties sign separate copies of it. This Release may be executed by facsimile and if so executed, shall be legal, valid and binding on any party executing in such a manner. In witness whereof, this Release has been executed as of the 31st day of January, 2011 and will take effect as of the Effective Date. Hotchkis and Wiley Capital Management, LLC Per: /s/ Anna Marie Lopez Name: Anna Marie Lopez Title: Chief Operating Officer -----END PRIVACY-ENHANCED MESSAGE-----