Schedule 13D/A

0000950123-10-116352.txt : 20101223 0000950123-10-116352.hdr.sgml : 20101223 20101223172227 ACCESSION NUMBER: 0000950123-10-116352 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20101223 DATE AS OF CHANGE: 20101223 GROUP MEMBERS: NORTH RUN ADVISORS, LLC GROUP MEMBERS: NORTH RUN CAPITAL, LP GROUP MEMBERS: NORTH RUN GP, LP GROUP MEMBERS: THOMAS B. ELLIS GROUP MEMBERS: TODD B. HAMMER 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: 101273065 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: NORTH RUN CAPITAL, L P CENTRAL INDEX KEY: 0001212897 IRS NUMBER: 364504416 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: ONE INTERNATIONAL PLACE STREET 2: SUITE 2401 CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6173106130 MAIL ADDRESS: STREET 1: ONE INTERNATIONAL PLACE STREET 2: SUITE 2401 CITY: BOSTON STATE: MA ZIP: 02110 FORMER COMPANY: FORMER CONFORMED NAME: NORTH RUN CAPITAL L P DATE OF NAME CHANGE: 20030106 SC 13D/A 1 c10226sc13dza.htm SCHEDULE 13D/A Schedule 13D/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934
(Amendment No. 3 )*

MI Developments Inc.

(Name of Issuer)

Class A Subordinate Voting Shares, no par value

(Title of Class of Securities)

55304X104

(CUSIP Number)

North Run Capital, LP
One International Place, Suite 2401
Boston, MA 02110
(617) 310-6130
Attention: General Counsel

(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)

- with copies to -

Eliot D. Raffkind
Akin, Gump, Strauss, Hauer & Feld, L.L.P.
1700 Pacific Avenue, Suite 4100
Dallas, Texas 75201-4618
(214) 969-2800

December 22, 2010

(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 §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 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).


CUSIP No.		55304X104


1	NAMES OF REPORTING PERSONS North Run Capital, LP


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) o
	(b) þ*

3	SEC USE ONLY



4	SOURCE OF FUNDS (SEE INSTRUCTIONS)

	AF

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION

	Delaware

		7	SOLE VOTING POWER

NUMBER OF			0

SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			2,365,800

EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			0

WITH		10	SHARED DISPOSITIVE POWER

			2,365,800

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,365,800

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	5.1%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	PN

* Filing describes relationship with other persons but Reporting Person does not affirm the existence of a group, in accordance with Schedule 13 Cover Page Instruction 2.

Page 2 of 9


CUSIP No.		55304X104


1	NAMES OF REPORTING PERSONS North Run GP, LP


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) o
	(b) þ*

3	SEC USE ONLY



4	SOURCE OF FUNDS (SEE INSTRUCTIONS)

	AF

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION

	Delaware

		7	SOLE VOTING POWER

NUMBER OF			0

SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			2,365,800

EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			0

WITH		10	SHARED DISPOSITIVE POWER

			2,365,800

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,365,800

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	5.1%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	PN

* Filing describes relationship with other persons but Reporting Person does not affirm the existence of a group, in accordance with Schedule 13 Cover Page Instruction 2.

Page 3 of 9


CUSIP No.		55304X104


1	NAMES OF REPORTING PERSONS North Run Advisors, LLC


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) o
	(b) þ*

3	SEC USE ONLY



4	SOURCE OF FUNDS (SEE INSTRUCTIONS)

	AF

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION

	Delaware

		7	SOLE VOTING POWER

NUMBER OF			0

SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			2,365,800

EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			0

WITH		10	SHARED DISPOSITIVE POWER

			2,365,800

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,365,800

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	5.1%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	OO

* Filing describes relationship with other persons but Reporting Person does not affirm the existence of a group, in accordance with Schedule 13 Cover Page Instruction 2.

Page 4 of 9


CUSIP No.		55304X104


1	NAMES OF REPORTING PERSONS Todd B. Hammer


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) o
	(b) þ*

3	SEC USE ONLY



4	SOURCE OF FUNDS (SEE INSTRUCTIONS)

	AF

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION

	United States

		7	SOLE VOTING POWER

NUMBER OF			0

SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			2,365,800

EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			0

WITH		10	SHARED DISPOSITIVE POWER

			2,365,800

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,365,800

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	5.1%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	IN

* Filing describes relationship with other persons but Reporting Person does not affirm the existence of a group, in accordance with Schedule 13 Cover Page Instruction 2.

Page 5 of 9


CUSIP No.		55304X104


1	NAMES OF REPORTING PERSONS Thomas B. Ellis


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) o
	(b) þ*

3	SEC USE ONLY



4	SOURCE OF FUNDS (SEE INSTRUCTIONS)

	AF

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION

	United States

		7	SOLE VOTING POWER

NUMBER OF			0

SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			2,365,800

EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			0

WITH		10	SHARED DISPOSITIVE POWER

			2,365,800

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,365,800

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	5.1%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	IN

* Filing describes relationship with other persons but Reporting Person does not affirm the existence of a group, in accordance with Schedule 13 Cover Page Instruction 2.

Page 6 of 9

This Amendment No. 3 to Schedule 13D (as amended, the “Schedule 13D”) is being filed on behalf of North Run Advisors, LLC, a Delaware limited liability company (“North Run”), North Run GP, LP, a Delaware limited partnership (the “GP”), North Run Capital, LP, a Delaware limited partnership (the “Investment Manager”), Todd B. Hammer and Thomas B. Ellis. Todd B. Hammer and Thomas B. Ellis are the principals and sole members of North Run. North Run is the general partner for both the GP and the Investment Manager. The GP is the general partner of North Run Capital Partners, LP, a Delaware limited partnership (the “Fund”), North Run Qualified Partners, LP, a Delaware limited partnership (the “QP Fund”), and North Run Master Fund, LP, a Cayman Island exempted limited partnership (the “Master Fund”). The Fund, the QP Fund and North Run Offshore Partners, Ltd., a Cayman Island exempted company (the “Offshore Fund”), are also general partners of the Master Fund. This Schedule 13D relates to Class A Subordinate Voting Shares (“Class A Shares”) of MI Developments Inc., an Ontario corporation (the “Issuer”), held by the Master Fund (the “Shares”).

Except as set forth below, all previously reported items remain unchanged.

Item 4. Purpose of the Transaction

The Shares were acquired and are held for investment purposes. The Shares were acquired in the ordinary course of business and not for the purpose of changing or influencing control of the Issuer.

The Reporting Persons will monitor and evaluate their investment in the Issuer on a continuing basis and may engage in discussions with management, the board of directors of the Issuer and other stockholders of the Issuer concerning the business, operations and future plans of the Issuer. Depending on various factors, including, without limitation (a) the Issuer’s business, operations, assets, financial condition and prospects; (b) market, general economic and other conditions; and (c) other investment opportunities available to the Reporting Persons, the Reporting Persons may take such actions with respect to this investment as they deem appropriate including, without limitation, (1) acquiring additional Shares or other securities of the Issuer, (2) making proposals to the Issuer regarding changes in the capitalization, ownership structure, operations or board representation, or (3) disposing of some or all of the Shares. Any such additional purchases or sales of the Shares may be in open market or privately negotiated transactions or otherwise.

Collectively with other large shareholders, together representing close to half of the outstanding Class A Shares as of March 4, 2009, the Reporting Persons retained counsel to explore the legal remedies available to shareholders of the Issuer in connection with related party transactions involving Magna Entertainment Corp., including whether claims should be asserted against directors of the Issuer. Such counsel has engaged in correspondence informing the Issuer’s board of directors of such initiative, and urging the Ontario Securities Commission to examine and pursue appropriate enforcement action, and the Reporting Persons expect correspondence and communications on this and related matters, including appropriate judicial and regulatory submissions, to continue from time to time. The parties to such representation have not agreed to act together for the purpose of acquiring, holding, voting or disposing of equity securities of the Issuer, and the Reporting Persons expressly disaffirm the existence of a “group” among the Reporting Persons and such shareholders within the meaning of Rule 13d-5 under the Act.

On December 22, 2010, the Master Fund, along with other Class A shareholders, collectively representing over 50% of the Issuer’s Class A Shares, entered into a Support Agreement with the Issuer’s controlling shareholder, a company controlled by the Stronach Trust (affiliated with Frank Stronach, the Issuer’s Chairman and CEO). Under the Support Agreement, each such Class A shareholder agrees with the controlling shareholder to, among other things, support and vote in favor of a proposal to reorganize the Issuer. A copy of the Support Agreement is attached as Exhibit 2. The proposed reorganization would eliminate the Issuer’s dual class share structure by (1) cancelling the Class B Voting Shares (the “Class B Shares”) held by the controlling shareholder in exchange for the transfer of the Issuer’s horseracing, gaming and certain real estate assets (together with related assets and liabilities) to the controlling shareholder, and (2) converting the remaining Class B Shares (at 1.2:1 ratio) and Class A Shares (at 1:1 ratio) into common stock. The Issuer would retain its income-producing real estate property business and would be restricted from engaging in or having an interest in any business relating to horse racing or gaming. A new board of directors would be elected by shareholders other than the controlling shareholder at a meeting to approve the reorganization transaction, with nominees to be proposed by the supporting shareholders. The Support Agreement limits the transfer of shares during the pendency of the agreement and terminates if specified deadlines for the reorganization transaction are not met or upon a vote of stockholders with respect to the transaction, among other circumstances.

Except as otherwise provided in the Support Agreement, the Reporting Persons will make their own voting and investment decisions with respect to the Shares, independent of the decision-making by other shareholders of the Issuer. In addition, the Reporting Persons have no voting or dispositive power with respect to the shares beneficially owned by the controlling shareholder and its affiliates (383,414 Class B Shares and 50,000 Class A Shares based on their most recent public filings) nor the shares beneficially owned by the other Class A shareholders who have entered into the Support Agreement (approximately 20,736,444 Class A Shares based on publicly available information), and the Reporting Persons disclaim beneficial ownership over any securities held by such entities.

Except to the extent the foregoing may be deemed a plan or proposal, the Reporting Persons do not have any plans or proposals described in clauses (a) — (j) of the instructions to Item 4 of Schedule 13D. The Reporting Persons may from time to time review or reconsider their plans and proposals with respect to the Shares.

Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of Issuer

The Support Agreement, attached as Exhibit 2, is an agreement between each of the Class A shareholders party thereto and the Issuer’s controlling shareholder to support and vote in favor of a proposal to reorganize the Issuer. The proposed reorganization would eliminate the Issuer’s dual class share structure by (1) cancelling the Class B shares held by the controlling shareholder in return for the transfer of the Issuer’s horseracing, gaming and certain real estate assets (together with related assets and liabilities) to the controlling shareholder, and (2) converting the remaining Class B Shares (at 1.2:1 ratio) and Class A Shares (at 1:1 ratio) into common stock. The Support Agreement limits the transfer of shares during the pendency of the agreement and terminates if specified deadlines for the reorganization transaction are not met or upon a vote of stockholders with respect to the transaction, among other circumstances.

Item 7. Material to be Filed as Exhibits


Exhibit 1		Joint Filing Agreement, dated December 23, 2010

Exhibit 2		Support Agreement, dated on or about December 22, 2010, between the controlling shareholder and the Class A shareholders of MI Developments Inc. named therein

Signature

After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: December 23, 2010


NORTH RUN CAPITAL, LP
By:	North Run Advisors, LLC, its general partner

By:	/s/ Thomas B. Ellis
	Name:	Thomas B. Ellis
	Title:	Member

and
By:	/s/ Todd B. Hammer
	Name:	Todd B. Hammer
	Title:	Member

NORTH RUN GP, LP
By:	North Run Advisors, LLC, its general partner

By:	/s/ Thomas B. Ellis
	Name:	Thomas B. Ellis
	Title:	Member

and
By:	/s/ Todd B. Hammer
	Name:	Todd B. Hammer
	Title:	Member


NORTH RUN ADVISORS, LLC
By:	/s/ Thomas B. Ellis
	Name:	Thomas B. Ellis
	Title:	Member

and
By:	/s/ Todd B. Hammer
	Name:	Todd B. Hammer
	Title:	Member



	/s/ Thomas B. Ellis
	Thomas B. Ellis



	/s/ Todd B. Hammer
	Todd B. Hammer

EX-1 2 c10226exv1.htm EXHIBIT 1 Exhibit 1

EXHIBIT 1

JOINT FILING AGREEMENT

In accordance with Rule 13d-1(k) under the Securities Exchange Act of 1934, as amended, the undersigned agree to the joint filing on behalf of each of them of a Statement on Schedule 13D (including any and all amendments thereto) with respect to the to Class A Subordinate Voting Shares, no par value, of MI Developments Inc., and further agree that this Joint Filing Agreement shall be included as an Exhibit to such joint filings.

The undersigned further agree that each party hereto is responsible for the timely filing of such Statement on Schedule 13D and any amendments thereto, and for the accuracy and completeness of the information concerning such party contained therein; provided, however, that no party is responsible for the accuracy or completeness of the information concerning any other party, unless such party knows or has reason to believe that such information is inaccurate.

This Joint Filing Agreement may be signed in counterparts with the same effect as if the signature on each counterpart were upon the same instrument.

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of December 23, 2010.


NORTH RUN CAPITAL, LP
By:	North Run Advisors, LLC, its general partner

By:	/s/ Thomas B. Ellis
	Name:	Thomas B. Ellis
	Title:	Member

and
By:	/s/ Todd B. Hammer
	Name:	Todd B. Hammer
	Title:	Member

NORTH RUN GP, LP
By:	North Run Advisors, LLC, its general partner

By:	/s/ Thomas B. Ellis
	Name:	Thomas B. Ellis
	Title:	Member

and
By:	/s/ Todd B. Hammer
	Name:	Todd B. Hammer
	Title:	Member


NORTH RUN ADVISORS, LLC
By:	/s/ Thomas B. Ellis
	Name:	Thomas B. Ellis
	Title:	Member

and
By:	/s/ Todd B. Hammer
	Name:	Todd B. Hammer
	Title:	Member



	/s/ Thomas B. Ellis
	Thomas B. Ellis



	/s/ Todd B. Hammer
	Todd B. Hammer

EX-2 3 c10226exv2.htm EXHIBIT 2 Exhibit 2

EXHIBIT 2

SUPPORT AGREEMENT

FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which are acknowledged, the shareholders (each a “Shareholder”, and collectively the “Initiating Shareholders”) of MI Developments Inc. (the “Company”) listed in the attached Schedule A, and such other direct or indirect shareholders of the Company who may execute a counterpart of this Agreement, agree as follows with respect to a plan of arrangement or other form of transaction (the “Transaction”) substantially on the terms and subject to the conditions set out in the attached Schedule B. For this purpose, each of the Initiating Shareholders further agrees as follows with respect to itself:

1.		Certain Initiating Shareholders will propose, with the support of 445327 Ontario Limited (“445”), the Transaction to the board of directors (the “Board”) of the Company and request that the Board take all action required to implement the Transaction as soon as reasonably practicable in accordance with all applicable legal and regulatory requirements.

2.		Each Shareholder agrees to vote (or cause to be voted) all Class A Subordinate Voting Shares and Class B Shares of the Company (the “Shares”) owned or controlled by that Shareholder in favour of the Transaction.

3.		Each Shareholder confirms that it owns or controls the class and number of Shares set out below its signature on the counterpart executed by it and has the authority to vote or direct the voting of such Shares as contemplated by this Agreement.

4.		For so long as this Agreement remains in effect, as to each Shareholder, each Shareholder shall not sell or otherwise transfer any Shares or take any other action that would prevent it from carrying out its obligations under this Agreement except that the Shareholder may sell or otherwise transfer all or part of the Shares to a person, corporation or entity that agrees to be bound by the terms hereof and executes a counterpart to this Agreement.

5.		Each Shareholder has the right to terminate its obligations under this Agreement by giving notice to the Company if:

(a)

the terms of the Transaction are changed from those set out in Schedule B in a manner that is adverse to that Shareholder or to all Initiating Shareholders in a material respect;

	(b)		the Shareholder, acting reasonably, determines that the definitive documents do not reflect the terms contemplated in Schedule B in a manner that is materially adverse to the Shareholder;

	(c)		the execution of definitive documentation relating to the transaction has not occurred by January 31, 2011 or the transaction has not been implemented by June 30, 2011;

	(d)		the meeting of shareholders of the Company to approve the Transaction has occurred;

	(e)		this Agreement has not been signed (by joinder or counterpart) on or before January 31, 2011 by holders of Class B Shares which constitutes a “majority of the minority” of such shares for purposes of National Instrument 61-101 (excluding in such calculation Shares held by the Magna Deferred Profit Sharing Plan (Canada)); or

	(f)		less than 30% of all outstanding Class A Subordinate Voting Shares remain subject to this Agreement.

445 agrees to promptly notify each Shareholder if it becomes aware of the occurrence of any of the foregoing events except for the event referred to in (d) above.

6.		Each Shareholder confirms that it has been a long-time investor in the Company and has sufficient knowledge of and access to information concerning the Company and its Shares to decide to enter into this Agreement. Each Shareholder further confirms that any factors peculiar to that Shareholder, including non-financial factors, that were considered relevant by that Shareholder in assessing the terms of the Transaction did not have the effect of reducing the consideration that otherwise would have been considered acceptable by that Shareholder. Nothing in this paragraph shall be construed as meaning or implying that the Shareholder possesses any undisclosed information relating to the Company.

7.		Each Shareholder confirms that the following statement is X or is not _____ (check as applicable) accurate in respect of the Shareholder:

		The Shareholder is not (i) an “interested party” (as defined in National Instrument 61-101 — Protection of Minority Security Holders in Special Transactions (“NI 61-101”)) in respect of the Transaction, (ii) a “related party” (as defined in NI 61-101) of an “interested party” in respect of the Transaction or (ii) acting “jointly or in concert”, as determined in accordance with section

- 2 -

91 of the Securities Act (Ontario), with an “interested party” in respect of the Transaction or with a “related party” of an “interested party” in respect of the Transaction.

8.		Each Shareholder agrees to execute and deliver a proxy to the Company in respect of the meeting of shareholders to be called to approve the Transaction as contemplated by this Agreement.

9.		445 agrees to vote (or cause to be voted) all Shares owned or controlled by 445 in favour of the Transaction and agrees to execute and deliver a proxy to the Company in respect of the meeting of shareholders to be called to approve the Transaction as contemplated by this Agreement.

10.		This Agreement is an agreement between each Shareholder and 445, and no Shareholder has an agreement with any other Shareholder and no Shareholder may enforce this Agreement against any other Shareholder. Only 445 may enforce this Agreement against a Shareholder. There are no third party beneficiaries of this Agreement, except the Initiating Shareholders. Each 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 Securities Exchange Act) with any other 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 Subordinate Voting Shares held by all Initiating Shareholders.

(Remainder of page intentionally left blank. Signature page follows.)

- 3 -

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 listed in Schedule A.

DATED the 21 day of December, 2010.


		North Run Master Fund, LP (Print Name of Shareholder)

		/s/ Todd B. Hammer (Signature of Shareholder or Authorized Signatory)

		Member, North Run Advisors, LLC (Print Name and Title)

		2,365,800 (Number of Class A Subordinate Voting Shares Held)


		(Number of Class B Shares Held)


		(Indicate if Shares are Owned or Controlled and if Controlled or not Owned Directly, print name(s) of Registered Shareholder(s))


	445327 ONTARIO LIMITED
	By:	/s/ Frank Stronach
		Name:
		Title:

SCHEDULE A

INITIATING SHAREHOLDERS

1.		Farallon Capital Partners, L.P.

2.		Farallon Capital Institutional Partners, L.P.

3.		Farallon Capital Institutional Partners II, L.P.

4.		Farallon Capital Offshore Investors II, L.P.

5.		Farallon Capital Offshore Investors III, Inc.

6.		Hotchkis and Wiley Capital Management, LLC

7.		Tyndall Capital Partners

8.		Franklin Templeton Investments Corp. as manager and trustee of Bissett Small Cap Fund

9.		Owl Creek Asset Management L.P.

10.		Mackenzie Financial Corporation

11.		The Mangrove Partners Fund, LP

12.		Donald Smith & Co., Inc.

13.		John Moran

14.		Inky Investments

15.		CFG Trust #1

16.		DLF Trust #1

17.		FCF Family Investments

18.		Octagon Insurance Group Ltd.

19.		Dennis S. Moran

20.		Michael Knapp

21.		Blake Ashdown IRA

22.		Berg & Berg Enterprises, LLC

23.		Carl E. Berg

24.		Brad Shingleton Trust

25.		Theresa Foote Pledge Account

26.		North Run Master Fund, LP

SCHEDULE B

TERM SHEET

Definitions:

	(a)		“MID” means MI Developments Inc. and its subsidiaries.

	(b)		“Group 1 Assets and Liabilities” means:

(1)

the subsidiaries and assets of MID which comprise the totality of the horseracing and gaming assets of MID, including:

	•		Santa Anita Park

	•		Golden Gate Field

	•		Maryland Jockey Club (Pimlico Race Course, Laurel Park, and the Bowie training facility)

	•		Gulfstream Park and associated retail development

	•		Portland Meadows

	•		Horseracing technology assets including XpressBet, AmTote, and HRTV LLC

	•		Joint Venture Interests in connection with the above assets.

	(2)		all properties owned by MID as described under “Real Estate Business — Development Properties” in note 6(a) of the notes to the interim consolidated financial statements of MID having a book value of $174.462 million for the three months ended September 30, 2010;

	(3)		the residential zoned property known as “French Creek”;

	(4)		cash such that the Group 1 Assets and Liabilities shall include on January 1, 2011 $20 million of adjusted working capital, provided that the maximum cash amount payable by MID to STco does not exceed $20 million (excluding

			restricted cash). For these purposes, adjusted working capital shall mean cash and cash equivalents, restricted cash, trade accounts receivable (net of doubtful accounts), operating inventories and prepaid expenses less all current liabilities (including accounts payable, long term liabilities due in the year, accrued salaries and wages, other accrued liabilities, income tax payables and deferred revenues). Attached as Exhibit A is a schedule of adjusted working capital as of October 31, 2010; and

	(5)		the liabilities consisting of all liabilities associated with or arising out of the properties described in paragraphs (1) and (2) above (the “Group 1 Liabilities”); provided that the Group 1 Liabilities shall not include liabilities between MID, on the one hand, and STco, on the other hand;

	(6)		To the extent any Group 1 Assets are sold or insurance proceeds are collected with respect thereto after the date hereof, any consideration received from such sale or insurance proceeds shall constitute Group 1 Assets;

	(7)		all trademarks, patents, goodwill and other intellectual and intangible property and books and records in respect of the assets described above.

	(c)		“ST Shareholder” means the corporation controlled by the Stronach Trust that owns Class B Shares of MID.

	(d)		“Public Shareholders” means all shareholders of MID other than the ST Shareholder.

By way of a plan of arrangement under the Business Corporations Act (Ontario) or other form of transaction as may be agreed to by the parties, MID shall re-organize such that after the reorganization:

	(a)		The Group 1 Assets and Liabilities shall be transferred to a corporation owned by ST Shareholder (“STco”).

	(b)		If MID elects to sell any of the Magna corporate property in Aurora, Ontario on Magna Drive (South of Wellington) or in Oberwaltersdorf, Austria, STco shall have a right of first refusal to purchase from MID.

	(c)		Each Class A Share in MID shall be converted into 1 common share of MID, each Class B share in MID held by Public Shareholders shall be converted into 1.2 common shares in MID and each Class B share in MID held by ST Shareholder shall be cancelled for no further consideration other than the Group 1 Assets and Liabilities. Following closing of the transaction (the “Closing”), MID shall have one class of outstanding shares, being common shares.

	(d)		On the Closing, the adjustments specified in Section 3(d) below will be made to reflect an effective transfer date for the Group 1 Assets and Liabilities of January 1, 2011 (the “Interim Period”), provided that MID shall provide funding for the Group 1 Assets and Liabilities during the Interim Period. The Group 1 Assets will be operated as a separate business in the period between January 1, 2011 and the Closing.

Upon Closing:

	(a)		MID shall be restricted from engaging in or having an interest in, directly or indirectly, any business relating to horse racing or gaming.

	(b)		The board of directors of MID shall be elected by the Public Shareholders of MID at the shareholder meeting called to approve the Plan of Arrangement and the nominees proposed for election in the management information

			circular shall be designated by the supporting Class A Shareholders and STco shall not vote at the meeting to elect the board of directors of MID;

	(c)		MID shall reimburse the supporting Class A shareholders for all of their reasonable legal fees and advisory fees incurred and to be incurred in connection with the transaction and, in addition, MID shall reimburse supporting Class A shareholders for legal/advisory fees paid prior to the date hereof up to $1 million and MID shall reimburse ST Shareholder for all of its reasonable legal fees and advisory fees incurred in connection with the transaction up to $ 1 million; and

	(d)		If the funding requirements (including for greater certainty any funding permitted pursuant to paragraph 4(e) below) of the Group 1 Assets and Liabilities during the Interim Period exceed on average US$4,000,000 per month, ST Shareholder shall reimburse MID for such excess.

The principal closing conditions will include:

	(a)		receipt of all regulatory approvals, including all stock exchange approvals and any required securities regulatory approvals;

	(b)		receipt of all required MID shareholder approvals, including a majority of the minority of the Class A shareholders of MID and a majority of the minority of the Class B shareholders of MID;

	(c)		if the transaction proceeds by plan of arrangement, court approval of the plan of arrangement;

	(d)		no material adverse change in the affairs of MID;

	(e)		MID will continue to operate in the ordinary course and will not purchase any gaming or horseracing assets which are unrelated to existing Group 1 Assets. For greater certainty, it is understood that MID may purchase existing joint venture assets and make capital expenditures relating to Group 1 Assets and any such funding shall be included in the funding calculated pursuant to paragraph 3(d) above.

	(f)		reimbursements as contemplated in paragraphs 3(c) and (d) above.

	(g)		accuracy of all MID disclosure documents in all material respects; and

	(h)		the execution of definitive documentation relating to the transaction by January 31, 2011 and implementation of the transaction by June 30, 2011.

	(i)		The target closing date is April 1, 2011.

The supporting Class A shareholders agree to discontinue the currently contemplated litigation against MID, its shareholders and current and former officers and directors and provide appropriate releases to such parties, effective upon the implementation of the transaction.

Parties will work to complete transaction in a manner that is tax-efficient for ST Shareholder provided that structure is not materially disadvantageous to MID or Public Shareholders.