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Magna Sells Shares in The Meadows

AURORA, Ontario – (PRESS RELASE) -- Magna Entertainment Corp. ("MEC") (NASDAQ: MECA) today announced that it has entered into a share purchase agreement with PA Meadows, LLC, a company jointly owned by William Paulos and William Wortman, controlling shareholders of Millennium Gaming, Inc., and a fund managed by Oaktree Capital Management, LLC ("Oaktree" and together, with PA Meadows, LLC, "Millennium-Oaktree"), providing for the acquisition by Millennium-Oaktree of all of the outstanding shares of Washington Trotting Association, Inc. ("WTA"), Mountain Laurel Racing, Inc. ("MLR") and MEC Pennsylvania Racing, Inc. ("PAR"), each wholly owned subsidiaries of MEC. WTA, MLR and PAR are the entities through which MEC currently owns and operates The Meadows, a standardbred racetrack in Washington County, Pennsylvania.

The sale is scheduled to close following receipt of approval from the Pennsylvania Harness Racing Commission, receipt by the The Meadows of a Conditional Category 1 slot license pursuant to the Pennsylvania Race Horse Development and Gaming Act, and certain other customary closing conditions. Under the terms of the share purchase agreement, Millennium-Oaktree will pay MEC $225 million and MEC will continue to manage racing operations at The Meadows on behalf of Millennium-Oaktree pursuant to a minimum 5-year racing services agreement.

Tom Hodgson, President and Chief Executive Officer of MEC commented: "We are extremely pleased to establish a relationship with Millennium and Oaktree, and we look forward to the possibility of working with them on other projects in the future. The sale of The Meadows will allow MEC to significantly reduce our outstanding debt and strengthen our balance sheet, and will position us to further focus on our premier racing assets, and other gaming opportunities. At the same time, we will remain heavily involved with The Meadows and will develop our relationship with Millennium and Oaktree as we continue to manage The Meadows' horse racing side of the business."

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