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8-K
 filed this Form 8-K on 08/10/2010
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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

 

Date of Report (Date of Earliest Event Reported): May 31, 2010

 

MAGNA ENTERTAINMENT CORP.

(Exact Name of Registrant as Specified in its Charter)

 

Delaware

(State or Other Jurisdiction of Incorporation)

 

000-30578

 

98-0208374

(Commission File Number)

 

(I.R.S. Employer Identification No.)

 

337 Magna Drive, Aurora, Ontario, Canada

 

L4G 7K1

(Address of Principal Executive Offices)

 

(Zip Code)

 

(905) 726-2462

(Registrant’s Telephone Number, Including Area Code)

 

Not Applicable

(Former Name or Former Address, if changed since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 



 

Item 8.01       Other Events

 

On May 31, 2010, the Registrant and several other direct and indirect U.S. subsidiaries of the Registrant (collectively, the “U.S. Debtors”), filed their financial statements included in the Monthly Operating Report for the period from April 5, 2010 to April 30, 2010 with the United States Bankruptcy Court for the District of Delaware (“U.S. Bankruptcy Court”) (In re Magna Entertainment Corp., et al, Chapter 11, Case No. 09-10720). A copy of the monthly operating report is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference herein.

 

The Monthly Operating Report is limited in scope, covers a limited time period, and has been prepared solely for the purpose of the U.S. Debtors’ compliance with the monthly reporting requirements of the U.S. Bankruptcy Court. The Financial information in the Monthly Operating Report was not audited or reviewed by independent accountants, and has not been subject to all procedures that would typically be applied to financial information presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”), and therefore may exclude items required by GAAP, such as certain reclassifications, eliminations, accruals, and disclosure items. The Registrant cautions readers not to place undue reliance upon the Monthly Operating Report. There can be no assurance that such information is complete. The Monthly Operating Report may be subject to future adjustment and reconciliation. The Monthly Operating Report is in a format required by the U.S. Bankruptcy Code and should not be used for investment purposes. The information in the Monthly Operating Report should not be viewed as indicative of future results.

 

Item 9.01  Financial Statements and Exhibits

 

(c)

Exhibits

 

 

Exhibit 99.1

Monthly Operating Report for the period April 5, 2010 to April 30, 2010.

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

MAGNA ENTERTAINMENT CORP.

 

(Registrant)

 

 

 

 

August 10, 2010

by:

/s/William G. Ford

 

 

William G. Ford

 

 

Plan Administrator

 

2


Exhibit 99.1

 

UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

MONTHLY OPERATING REPORT

File with Court and submit copy to United States Trustee within 20 days after end of month

 

Submit copy of report to any official committee appointed in the case.

 

REQUIRED DOCUMENTS

 

Form No.

 

Document
Attached

 

Explanation
Attached

 

Affidavit/
Supplement
Attached

Schedule of Cash Receipts and Disbursements

 

MOR-1

 

Yes

 

 

 

 

Bank Reconciliation (or copies of debtor’s bank reconciliations)

 

MOR-1a

 

Yes

 

 

 

 

Schedule of Professional Fees Paid

 

MOR-1b

 

Yes

 

 

 

 

Copies of bank statements

 

 

 

No

 

 

 

 

Cash disbursements journals

 

 

 

No

 

 

 

 

Statement of Operations

 

MOR-2

 

Yes

 

 

 

 

Balance Sheet

 

MOR-3

 

Yes

 

 

 

 

Status of Post-petition Taxes

 

MOR-4

 

Yes

 

 

 

 

Copies of IRS Form 6123 or payment receipt

 

 

 

N/A

 

 

 

 

Copies of tax returns filed during reporting period

 

 

 

N/A

 

 

 

 

Summary of Unpaid Post-petition Debts

 

MOR-4

 

Yes

 

 

 

 

Listing of aged accounts payable

 

MOR-4

 

Yes

 

 

 

 

Accounts Receivable Reconciliation and Aging

 

MOR-5

 

Yes

 

 

 

 

Debtor Questionnaire

 

MOR-5

 

Yes

 

 

 

 

 

I declare under penalty of perjury (28 U.S.C. Section 1746) that this report and the attached documents are true and correct to the best of my knowledge and belief.

 

 

 

 

Signature of Debtor

 

Date

 

 

 

 

 

 

Signature of Joint Debtor

 

Date

 

 

 

/s/ William G. Ford

 

May 31, 2010

Signature of Authorized Individual*

 

Date

 

 

 

William G. Ford

 

Plan Administrator

Printed Name of Authorized Individual

 

Title of Authorized Individual

 


*Authorized individual must be an officer, director or shareholder if debtor is a corporation; a partner if debtor is a partnership; a manager or member if debtor is a limited liability company.

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS

 

Amounts reported should be per the debtor’s books, not the bank statement.  The beginning cash should be the ending cash from the prior month or, if this is the first report, the amount should be the balance on the date the petition was filled.  The amounts reported in the “CURRENT MONTH - ACTUAL” column must equal the sum of the four bank account columns.  The amounts reported in the “PROJECTED” columns should be taken from the SMALL BUSINESS INITIAL REPORT (FORM IR-1).  Attach copies of the bank statements and the cash disbursements journal.  The total disbursements listed in the disbursements journal must equal the total disbursements reported on this page.  A bank reconciliation must be attached for each account.  [See MOR-1 (CONT)]

 

 

 

BANK ACCOUNTS

 

CURRENT MONTH

 

CUMULATIVE
FILING TO DATE

 

 

 

OPER.

 

PAYROLL

 

TAX

 

OTHER

 

ACTUAL

 

PROJECTED

 

ACTUAL

 

PROJECTED

 

CASH BEGINNING OF MONTH

 

1,204,679

 

 

 

 

 

52,652,244

 

53,856,923

 

 

 

801,229

 

 

 

RECEIPTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CASH SALES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ACCOUNTS RECEIVABLE

 

 

 

 

 

 

 

 

 

 

 

 

 

90,752

 

 

 

LOANS AND ADVANCES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SALE OF ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

88,320,438

 

 

 

OTHER (ATTACH LIST)

 

4,433,278

 

 

 

 

 

53

 

4,433,331

 

 

 

44,969,597

 

 

 

TRANSFERS (FROM DIP ACCTS)

 

3,500,000

 

 

 

 

 

6,617

 

3,506,617

 

 

 

71,053,974

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL RECEIPTS

 

7,933,278

 

 

 

 

 

6,670

 

7,939,948

 

 

 

204,434,761

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET PAYROLL

 

281,270

 

 

 

 

 

 

 

281,270

 

 

 

3,467,355

 

 

 

PAYROLL TAXES

 

280,977

 

 

 

 

 

 

 

280,977

 

 

 

2,291,681

 

 

 

SALES, USE & OTHER TAXES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INVENTORY PURCHASES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SECURED RENTAL/LEASES

 

17,265

 

 

 

 

 

 

 

17,265

 

 

 

86,431

 

 

 

INSURANCE

 

792,030

 

 

 

 

 

 

 

792,030

 

 

 

13,496,218

 

 

 

ADMINISTRATIVE

 

254,606

 

 

 

 

 

6,617

 

261,223

 

 

 

6,326,820

 

 

 

SELLING

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER (ATTACH LIST)

 

1,852,709

 

 

 

 

 

51,010,136

 

52,862,845

 

 

 

130,293,781

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OWNER DRAW*

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TRANSFERS (TO DIP ACCTS)

 

1,656,617

 

 

 

 

 

 

 

1,656,617

 

 

 

20,577,502

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PROFESSIONAL FEES

 

3,048,156

 

 

 

 

 

 

 

3,048,156

 

 

 

26,033,325

 

 

 

U.S. TRUSTEE QUARTERLY FEES

 

54,912

 

 

 

 

 

 

 

54,912

 

 

 

121,301

 

 

 

COURT COSTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL DISBURSEMENTS

 

8,238,542

 

 

 

 

 

51,016,753

 

59,255,295

 

 

 

202,694,414

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET CASH FLOW

 

(305,264

)

 

 

 

 

(51,010,083

)

(51,315,347

)

 

 

1,740,347

 

 

 

(RECEIPTS LESS DISBURSEMENTS)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CASH - END OF MONTH

 

899,415

 

 

 

 

 

1,642,161

 

2,541,576

 

 

 

2,541,576

 

 

 

 


* COMPENSATION TO SOLE PROPRIETORS FOR SERVICES RENDERED TO BANKRUPTCY ESTATE

 

THE FOLLOWING SECTION MUST BE COMPLETED

 

DISBURSEMENTS FOR CALCULATING U.S. TRUSTEE QUARTERLY FEES (FROM CURRENT MONTH ACTUAL COLUMN)

 

TOTAL DISBURSEMENTS (LESS TRANSFERS TO OTHER ACCOUNTS)

 

$

59,255,295

 

LESS: TRANSFERS TO DEBTOR IN POSSESSION ACCOUNTS

 

$

1,656,617

 

PLUS: ESTATE DISBURSEMENTS MADE BY OUTSIDE SOURCES (i.e. from escrow accounts)

 

$

 

 

TOTAL DISBURSEMENTS FOR CALCULATING U.S. TRUSTEE QUARTERLY FEES

 

$

57,598,678

 

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

BANK RECONCILIATIONS

Continuation Sheet for MOR-1

 

A bank reconciliation must be included for each bank account.  The debtor’s bank reconciliation may be substituted for this page.

 

 

 

Operating

 

Payroll

 

Tax

 

Other

 

BALANCE PER BOOKS

 

#

 

 

 

#

 

 

 

#

 

 

 

#

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BANK BALANCE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(+) DEPOSITS IN TRANSIT (ATTACH LIST)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(-) OUTSTANDING CHECKS (ATTACH LIST)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER (ATTACH EXPLANATION)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ADJUSTED BANK BALANCE*

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


*Adjusted bank balance must equal balance per books

 

DEPOSITS IN TRANSIT

 

Date

 

Amount

 

Date

 

Amount

 

Date

 

Amount

 

Date

 

Amount

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHECKS OUTSTANDING

 

Ck. #

 

Amount

 

Ck. #

 

Amount

 

Ck. #

 

Amount

 

Ck. #

 

Amount

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER (RECEIPTS)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign Exchange Revaluation

 

 

 

(21,606

)

 

 

 

 

 

 

 

 

 

 

 

 

Funding from various business units

 

 

 

4,122,060

 

 

 

 

 

 

 

 

 

 

 

 

 

ATM Revenue net of fees

 

 

 

6,238

 

 

 

 

 

 

 

 

 

 

 

 

 

Various cash receipts

 

 

 

22,059

 

 

 

 

 

 

 

 

 

 

 

 

 

Nevada Settlement

 

 

 

164,190

 

 

 

 

 

 

 

 

 

 

 

 

 

Return Aviva Cash Collateral

 

 

 

45,185

 

 

 

 

 

 

 

 

 

 

 

 

 

EAP International refund

 

 

 

25,638

 

 

 

 

 

 

 

 

 

 

 

 

 

Gulfstream Park reimbursement of Sunshine Millions horse transportation

 

 

 

52,500

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic COBRA Credit refund

 

 

 

17,014

 

 

 

 

 

 

 

 

 

 

 

 

 

Earned Interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

53

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER (DISBURSEMENTS)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

401K payments/advances

 

 

 

5,527

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee Travel Expenses

 

 

 

34,329

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment of DIP Loan interest, commitment fee and arrangement fee

 

 

 

1,159,486

 

 

 

 

 

 

 

 

 

 

 

 

 

BMO interest payment

 

 

 

257,610

 

 

 

 

 

 

 

 

 

 

 

 

 

Contributions to Forest City Joint Venture

 

 

 

76,457

 

 

 

 

 

 

 

 

 

 

 

 

 

Forest City shared costs

 

 

 

245,659

 

 

 

 

 

 

 

 

 

 

 

 

 

Directors’ Fees

 

 

 

73,641

 

 

 

 

 

 

 

 

 

 

 

 

 

Principal repayment on DIP Loan

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

33,000,000

 

Principal repayment on Remington Loan

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18,010,136

 

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

SCHEDULE OF PROFESSIONAL FEES AND EXPENSES PAID

This schedule is to include all retained professional payments from case inception to current month.

 

 

 

Period

 

Amount

 

 

 

Check

 

Amount Paid

 

Year-To-Date

 

Payee

 

Covered

 

Covered

 

Payor

 

Number

 

Date

 

Fees

 

Expenses

 

Fees

 

Expenses

 

FTI Consulting, Inc.

 

Apr 1-
Apr 30, 2010

 

$

188,158

 

Magna Entertainment Corp.

 

Wire Payment

 

04/06/2010

 

$

165,000

 

$

23,158

 

 

 

 

 

FTI Consulting, Inc.

 

Success Fee

 

$

1,000,000

 

Magna Entertainment Corp.

 

Wire Payment

 

04/30/2010

 

$

1,000,000

 

 

 

$

3,311,375

 

$

220,866

 

Kramer Levin Naftalis & Frankel LLP

 

Feb 1 –
Feb 28, 2010

 

$

152,103

 

Magna Entertainment Corp.

 

Wire Payment

 

04/30/2010

 

$

144,640

 

$

7,463

 

$

2,831,425

 

$

150,628

 

Richards Layton & Finger, P.A.

 

Jan 1 –
Feb 28, 2010

 

$

139,887

 

Magna Entertainment Corp.

 

Wire Payment

 

04/30/2010

 

$

128,463

 

$

11,424

 

$

609,612

 

$

60,705

 

Weil, Gotshal & Manges LLP

 

Dec 1-
Dec 31, 2009

 

$

433,271

 

Magna Entertainment Corp.

 

Wire Payment

 

04/30/2010

 

$

420,307

 

$

12,964

 

$

5,974,143

 

$

170,412

 

Miller Buckfire & Co., LLC

 

Jan 1 –
Jan 31, 2010

 

$

120,760

 

Magna Entertainment Corp.

 

Wire Payment

 

04/30/2010

 

$

120,000

 

$

760

 

$

2,343,145

 

$

168,953

 

Osler, Hoskin & Harcourt LLP

 

Dec 1, 2009 –
Feb 28, 2010

 

$

39,189

 

Magna Entertainment Corp.

 

Wire Payment

 

04/16/2010

 

$

38,977

 

$

212

 

$

1,097,459

 

$

25,343

 

Alix Partners, LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

195,774

 

$

46,249

 

Blackstone Advisory Services L.P.

 

Dec 1, 2009 –
Jan 31, 2010

 

$

241,442

 

Magna Entertainment Corp.

 

Wire Payment

 

04/30/2010

 

$

240,000

 

$

1,442

 

$

1,553,199

 

$

44,968

 

Kurtzman Carson Consultants LLC

 

Jan 1 –
Jan 31, 2010

 

$

56,031

 

Magna Entertainment Corp.

 

114083

 

04/08/2010

 

$

32,744

 

$

23,287

 

 

 

 

 

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

SCHEDULE OF PROFESSIONAL FEES AND EXPENSES PAID

This schedule is to include all retained professional payments from case inception to current month.

 

 

 

Period

 

Amount

 

 

 

Check

 

Amount Paid

 

Year-To-Date

 

Payee

 

Covered

 

Covered

 

Payor

 

Number

 

Date

 

Fees

 

Expenses

 

Fees

 

Expenses

 

Kurtzman Carson Consultants LLC

 

Feb 1 –
Mar 31, 2010

 

$

640,140

 

Magna Entertainment Corp.

 

Wire Payment

 

04/30/2010

 

$

190,028

 

$

450,112

 

$

1,368,474

 

$

596,636

 

Fasken Martineau DuMoulin LLP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

161,442

 

$

2,180

 

The Garden City Group, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

16,103

 

$

144

 

Mayer Brown LLP

 

Feb 1 –
Feb 28, 2010

 

$

37,175

 

Magna Entertainment Corp.

 

114087

 

04/08/2010

 

$

37,175

 

 

 

$

269,454

 

$

5,341

 

Young Conaway Stargatt & Taylor, LLP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

67,323

 

$

7,944

 

Sidley Austin LLP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

4,076,966

 

$

239,609

 

Davies Ward Phillips & Vineberg LLP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

150,202

 

$

5,204

 

Shearman & Sterling LLP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

8,683

 

 

 

Illumina Partners Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

100,280

 

$

989

 

Drinker Biddle & Reath LLP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

16,198

 

$

712

 

Pachulski, Stang, Ziehl & Jones LLP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

112,700

 

$

22,485

 

 


 


 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

STATEMENT OF OPERATIONS

(Income Statement)

 

The Statement of Operations is to be prepared on an accrual basis.  The accrual basis of accounting recognizes revenue when it is realized and expenses when they are incurred, regardless of when cash is actually received or paid.

 

 

 

Month

 

Cumulative Filing
to Date

 

REVENUES

 

 

 

 

 

Gross Revenues

 

$

 

 

$

 

 

Less: Returns and Allowances

 

 

 

 

 

Net Revenue

 

$

 

 

$

 

 

COST OF GOODS SOLD

 

 

 

 

 

Beginning Inventory

 

 

 

 

 

Add: Purchases

 

 

 

 

 

Add: Cost of Labor

 

 

 

 

 

Add: Other Costs (attach schedule)

 

 

 

 

 

Less: Ending Inventory

 

 

 

 

 

Cost of Goods Sold

 

 

 

 

 

Gross Profit

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

Advertising

 

4,252

 

172,558

 

Auto and Truck Expense

 

 

 

 

 

Bad Debts

 

 

 

3,354

 

Contributions

 

 

 

 

 

Employee Benefits Programs

 

26,805

 

(249,263

)

Insider Compensation*

 

942,093

 

2,471,035

 

Insurance

 

855

 

1,886,106

 

Management Fees/Bonuses

 

(718,111

)

(12,255,773

)

Office Expense

 

2,114

 

33,861

 

Pension & Profit-Sharing Plans

 

 

 

 

 

Repairs and Maintenance

 

18,325

 

303,373

 

Rent and Lease Expense

 

47,985

 

400,288

 

Salaries/Commissions/Fees

 

391,771

 

3,601,478

 

Supplies

 

 

 

 

 

Taxes - Payroll

 

 

 

 

 

Taxes - Real Estate

 

 

 

 

 

Taxes - Other

 

 

 

 

 

Travel and Entertainment

 

16,245

 

645,788

 

Utilities

 

 

 

 

 

Other (attach schedule)

 

167,285

 

3,378,024

 

Total Operating Expenses Before Depreciation

 

899,619

 

390,829

 

Depreciation/Depletion/Amortization

 

1,470,303

 

12,446,146

 

Net Profit (Loss) Before Reorganization Items

 

(2,369,922

)

(12,836,975

)

OTHER INCOME AND EXPENSES

 

 

 

 

 

Other Income (attach schedule)

 

(5,096

)

(933,632

)

Interest Expense

 

2,674,730

 

36,370,861

 

Other Expense (attach schedule)

 

124,983

 

3,225,485

 

Net Profit (Loss) Before Reorganization Items

 

(5,164,539

)

(51,499,689

)

REORGANIZATION ITEMS

 

 

 

 

 

Professional Fees

 

12,984,642

 

35,530,294

 

U.S. Trustee Quarterly Fees

 

 

 

82,825

 

Interest Earned on Accumulated Cash from Chapter 11 (see continuation sheet)

 

 

 

 

 

Gain (Loss) from Sale of Remington Park

 

50,377

 

54,424,919

 

Other Reorganization Expenses (attach schedule)

 

70

 

142,782

 

Total Reorganization Expenses

 

12,934,335

 

(18,669,018

)

Income Taxes

 

 

 

4,621,440

 

Net Profit (Loss)

 

$

(18,098,874

)

$

(37,452,111

)

 


* “Insider” is defined in 11 U.S.C. Section 101(31).

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

STATEMENT OF OPERATIONS - continuation sheet

 

BREAKDOWN OF “OTHER” CATEGORY

 

Month

 

Cumulative Filing
to Date

 

 

 

 

 

 

 

Other Expenses

 

 

 

 

 

Write Off of Deferred costs

 

 

 

1,812,839

 

TVG Litigation costs

 

124,983

 

1,412,646

 

 

 

 

 

 

 

Other Operational Expenses

 

 

 

 

 

 

 

 

 

 

 

Other Income

 

 

 

 

 

ATM Revenues

 

6,253

 

324,629

 

Other Miscellanceous

 

(1,157

)

5,894

 

Millenium Holdback

 

 

 

158,918

 

Recovery of HRTV Contribution

 

 

 

404,191

 

Sponsorship Revenue

 

 

 

40,000

 

 

 

 

 

 

 

Other Operating Expenses

 

 

 

 

 

Memberships & Subscriptions

 

8,035

 

71,401

 

Audit Fees

 

 

 

(98,410

)

Tax Fees

 

46,321

 

813,567

 

Legal Expenses

 

2,192

 

421,008

 

Consulting Fees

 

22,042

 

304,476

 

Shareholder Info

 

1,245

 

118,103

 

Trademarks & Logos

 

308

 

12,863

 

Filing & Lobbying

 

14,838

 

171,674

 

MSI Intercompany Fees

 

14,951

 

588,988

 

Bank Service Charges

 

16,987

 

315,595

 

Recruiting

 

 

 

60,000

 

Foreign Exchange (Gain) / Loss

 

40,366

 

598,759

 

Other Reorganization Expenses

 

 

 

 

 

Air and Ground Travel

 

70

 

3,752

 

Meals

 

 

 

155

 

Office Expense

 

 

 

35

 

Insurance Service Fees

 

 

 

24,840

 

E&Y Bankruptcy Retention Fees

 

 

 

59,000

 

Property Appraisal & valuation Fees

 

 

 

55,000

 

 

Reorganization Items - Interest Earned on Accumulated Cash from Chapter 11:

 

Interest earned on cash accumulated during the chapter 11 case, which would not have been earned but for the bankruptcy proceeding, should be reported as a reorganization item.

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

BALANCE SHEET

 

The Balance Sheet is to be completed on an accrual basis only. Pre-petition liabilities must be classified separately from postpetition obligations.

 

ASSETS

 

BOOK VALUE AT END OF
CURRENT REPORTING MONTH

 

BOOK VALUE ON
PETITION DATE

 

CURRENT ASSETS

 

 

 

 

 

Unrestricted Cash and Equivalents

 

903,998

 

806,435

 

Restricted Cash and Cash Equivalents (see continuation sheet)

 

1,642,161

 

 

 

Accounts Receivable (Net)

 

580,986

 

539,865

 

Notes Receivable

 

 

 

 

 

Inventories

 

 

 

 

 

Prepaid Expenses

 

1,310,256

 

4,201,995

 

Professional Retainers

 

 

 

 

 

Other Current Assets (attach schedule)

 

 

 

 

 

TOTAL CURRENT ASSETS

 

$

4,437,401

 

$

5,548,295

 

PROPERTY AND EQUIPMENT

 

 

 

 

 

Real Property and Improvements

 

 

 

 

 

Machinery and Equipment

 

 

 

 

 

Furniture, Fixtures and Office Equipment

 

10,988,926

 

10,972,271

 

Leasehold Improvements

 

 

 

 

 

Vehicles

 

 

 

 

 

Less Accumulated Depreciation

 

(9,608,930

)

(9,299,978

)

TOTAL PROPERTY & EQUIPMENT

 

$

1,379,996

 

$

1,672,293

 

OTHER ASSETS

 

 

 

 

 

Loans to Insiders*

 

 

 

 

 

Other Assets (attach schedule)

 

1,034,828,013

 

1,023,855,318

 

TOTAL OTHER ASSETS

 

$

1,034,828,013

 

$

1,023,855,318

 

TOTAL ASSETS

 

$

1,040,645,410

 

$

1,031,075,906

 

 

LIABILITIES AND OWNER EQUITY
LIABILITIES NOT SUBJECT TO COMPROMISE

 

BOOK VALUE AT END OF
CURRENT REPORTING MONTH

 

BOOK VALUE ON
PETITION DATE

 

Accounts Payable

 

1,860,988

 

 

 

Taxes Payable (refer to FORM MOR-4)

 

 

 

 

 

Wages Payable

 

 

 

 

 

Notes Payable

 

 

 

 

 

Rent/Leases - Building/Equipment

 

 

 

 

 

Secured Debt/Adequate Protection Payments

 

 

 

 

 

Professional Fees

 

 

 

 

 

Amounts Due to Insiders*

 

 

 

 

 

Other Postpetition Liabilities (attach schedule)

 

20,934,867

 

6,269,666

 

TOTAL POSTPETITION LIABILITIES

 

$

22,795,855

 

$

6,269,666

 

LIABILITIES SUBJECT TO COMPROMISE (Pre-Petition)

 

 

 

 

 

Secured Debt

 

243,731,963

 

216,123,174

 

Priority Debt

 

 

 

 

 

Unsecured Debt

 

228,424,606

 

225,537,969

 

TOTAL PRE-PETITION LIABILITIES

 

472,156,569

 

441,661,143

 

 

 

 

 

 

 

TOTAL LIABILITIES

 

$

494,952,424

 

$

447,930,809

 

OWNER EQUITY

 

 

 

 

 

Capital Stock

 

701,630,421

 

701,630,421

 

Additional Paid-In Capital

 

4,149,000

 

4,149,000

 

Partners’ Capital Account

 

 

 

 

 

Owner’s Equity Account

 

 

 

 

 

Retained Earnings - Pre-Petition

 

(122,634,324

)

(122,634,324

)

Retained Earnings - Postpetition

 

(37,452,111

)

 

 

Adjustments to Owner Equity (attach schedule)

 

 

 

 

 

NET OWNER EQUITY

 

$

545,692,986

 

$

583,145,097

 

TOTAL LIABILITIES AND OWNERS EQUITY

 

$

1,040,645,410

 

$

1,031,075,906

 

 


* “Insider” is defined in 11 U.S.C. Section 101(31).

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

BALANCE SHEET - continuation sheet

 

ASSETS

 

BOOK VALUE AT END OF
CURRENT REPORTING MONTH

 

BOOK VALUE ON
PETITION DATE

 

Other Current Assets

 

 

 

 

 

 

 

 

 

 

 

Other Assets

 

 

 

 

 

Investments in subsidiaries

 

513,952,336

 

523,543,107

 

Income Taxes Receivable

 

11,164,208

 

13,110,591

 

Deferred taxes Receivable

 

89,794,850

 

89,781,850

 

Other Assets

 

10,107,230

 

8,178,857

 

Intercompany Receivable from MEC Holdings (USA) Inc.

 

(2,741,516

)

3,769,683

 

Intercompany Payable to MEC Holdings (Canada) Inc.

 

(448,118

)

(358,867

)

Intercompany Receivable from MEC Dixon Inc.

 

12,403,729

 

15,335,309

 

Intercompany Receivable from Magna Racino

 

509,170

 

484,635

 

Intercompany Receivable from Santa Anita Co. Inc.

 

70,619,407

 

72,999,028

 

Intercompany Payable to San Luis Rey Downs

 

(6,919,530

)

(7,106,529

)

Intercompany Payable to Pacific Racing

 

(1,074,398

)

(1,406,389

)

Intercompany Payable to Bay Meadows

 

(23,809,872

)

(23,818,104

)

Intercompany Receivable from Lone Star Park

 

6,383,824

 

1,909,994

 

Intercompany Receivable from Gulfstream Park

 

103,470,144

 

105,212,712

 

Intercompany Receivable from GPRA Training Center

 

79,897,420

 

79,655,973

 

Intercompany Receivable from GPRA Commercial Enterprises Inc.

 

32,916,832

 

17,930,982

 

Intercompany Payable to Sunshine Meadows Racing

 

(1,602,019

)

(458,456

)

Intercompany Receivable from MJC Laurel Park

 

37,205,248

 

34,313,644

 

Intercompany Receivable from MJC Pimlico

 

21,625,364

 

13,486,004

 

Intercompany Receivable from MJC Bowie

 

794,054

 

789,365

 

Intercompany Receivable from Remington Park

 

18,010,136

 

20,986,871

 

Intercompany Receivable from Thistledown

 

16,079,762

 

12,843,147

 

Intercompany Payable to MEC Racing Pennsylvania Inc.

 

(2,661,709

)

(2,814,367

)

Intercompany Receivable from Pennsylvania Racing Services Inc.

 

2,844,183

 

3,403,680

 

Intercompany Receivable from MEC Oregon Racing

 

14,132,295

 

13,004,877

 

Intercompany Receivable from Multnomah

 

800,822

 

800,822

 

Intercompany Receivable from MI Racing Inc.

 

18,513,468

 

18,541,298

 

Intercompany Receivable from DLR Inc.

 

1,001,180

 

1,001,081

 

Intercompany Receivable from OTL Inc.

 

115,662

 

115,552

 

Intercompany Payable to MGE

 

(21,245,061

)

(20,780,578

)

Intercompany Receivable from MI Developments

 

458,486

 

983,490

 

Intercompany Receivable from 1180482 Ontario Inc.

 

2,169

 

2,169

 

Intercompany Receivable from MEC Bedding

 

10,295,642

 

10,273,706

 

Intercompany Receivable from MEC Land Holdings

 

8,940,621

 

8,940,621

 

Intercompany Payable to Palm Meadows Residential

 

(1,920,119

)

(1,920,119

)

Intercompany Payable to XpressBet

 

(21,715,833

)

(22,065,651

)

Intercompany Receivable from HRTV

 

35,908,662

 

36,759,971

 

Intercompany Payable to Fontana Housing

 

(26,353,665

)

(27,682,115

)

Intercompany Receivable from SBI

 

230,300

 

230,300

 

Intercompany Receivable from MEC Maryland Investment Inc.

 

18,027,915

 

18,027,915

 

Intercompany Receivable from MEC NY Acquisitions, Inc.

 

6,230

 

9,330

 

Intercompany Receivable from Amtote

 

9,108,504

 

5,839,929

 

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

BALANCE SHEET - continuation sheet

 

LIABILITIES AND OWNER EQUITY

 

BOOK VALUE AT END OF
CURRENT REPORTING MONTH

 

BOOK VALUE ON
PETITION DATE

 

Other Postpetition Liabilities

 

 

 

 

 

Audit Accrual

 

 

471,172

 

Tax Accrual

 

346,667

 

269,166

 

Group RSP

 

26,800

 

38,183

 

Due to Magna International Inc.

 

938,162

 

1,109,176

 

Interest Accrual on Convertible Debentures

 

4,058,333

 

3,855,417

 

Interest Accrual on BMO Loan

 

 

 

Estimated IBNR

 

7,000

 

7,000

 

NTRA Dues

 

69,041

 

 

Severance Accrual

 

842,254

 

162,619

 

Legal Accrual

 

204,483

 

79,500

 

FSA Employee Deductions

 

769

 

275

 

ATM Settlement for the Tracks

 

 

7,344

 

Consulting Fees

 

4,952

 

9,814

 

Zurich Claim service fee

 

 

50,000

 

Directors Fees

 

10,000

 

210,000

 

Bankruptcy Professional Fees Accrual

 

13,426,406

 

 

Fex Straw Sale Proceeds

 

1,000,000

 

 

 

 

 

 

 

 

Adjustments to Owner Equity

 

 

 

 

 

 

 

 

 

 

 

Postpetition Contributions (Distributions) (Draws)

 

 

 

 

 

 

 

 

 

 

 

 

Restricted Cash is cash that is restricted for a specific use and not available to fund operations. Typically, restricted cash is segregated into a separate account, such as an escrow account.

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

STATUS OF POSTPETITION TAXES

 

The beginning tax liability should be the ending liability from the prior month or, if this is the first report, the amount should be zero.  Attach photocopies of IRS Form 6123 or payment receipt to verify payment or deposit of federal payroll taxes.

 

Attach photocopies of any tax returns filed during the reporting period.

 

Federal

 

Beginning Tax
Liability

 

Amount
Withheld or
Accrued

 

Amount Paid

 

Date Paid

 

Check No.
    T

 

Ending Tax
Liability

 

Withholding

 

 

 

 

 

 

 

 

 

 

 

 

 

FICA-Employee

 

 

 

 

 

 

 

 

 

 

 

 

 

FICA-Employer

 

 

 

 

 

 

 

 

 

 

 

 

 

Unemployment

 

 

 

 

 

 

 

 

 

 

 

 

 

Income

 

 

 

 

 

 

 

 

 

 

 

 

 

Other:

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Federal Taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

State and Local

 

 

 

 

 

 

 

 

 

 

 

 

 

Withholding

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

Excise

 

 

 

 

 

 

 

 

 

 

 

 

 

Unemployment

 

 

 

 

 

 

 

 

 

 

 

 

 

Real Property

 

 

 

 

 

 

 

 

 

 

 

 

 

Personal Property

 

 

 

 

 

 

 

 

 

 

 

 

 

Other:

 

 

 

 

 

 

 

 

 

 

 

 

 

Total State and Local

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUMMARY OF UNPAID POSTPETITION DEBTS

 

Attach aged listing of accounts payable.

 

Number of Days Past Due

 

 

 

Current

 

0-30

 

31-60

 

61-90

 

Over 90

 

Total

 

Accounts Payable

 

236,910

 

 

 

23,756

 

387,660

 

1,212,662

 

1,860,988

 

Wages Payable

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxes Payable

 

 

 

 

 

 

 

 

 

 

 

 

 

Rent/Leases-Building

 

 

 

 

 

 

 

 

 

 

 

 

 

Rent/Leases-Equipment

 

 

 

 

 

 

 

 

 

 

 

 

 

Secured Debt/Adequate Protection Payments

 

 

 

 

 

 

 

 

 

 

 

 

 

Professional Fees

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts Due to Insiders*

 

 

 

 

 

 

 

 

 

 

 

 

 

Other: Accrued Liabilities

 

20,934,867

 

 

 

 

 

 

 

 

 

20,934,867

 

Other:

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Postpetition Debts

 

21,171,777

 

 

 

23,756

 

387,660

 

1,212,662

 

22,795,855

 

 

Explain how and when the Debtor intends to pay any past-due postpetition debts.

 


* “Insider” is defined in 11 U.S.C. Section 101(31).

 



 

In re

Magna Entertainment Corp.

Case No.  09-10720

 

 

Reporting Period: April 5 – April 30, 2010

 

ACCOUNTS RECEIVABLE RECONCILIATION AND AGING

 

Accounts Receivable Reconciliation

 

 

 

Total Accounts Receivable at the beginning of the reporting period

 

597,175

 

+ Amounts billed during the period

 

49,208

 

- Amounts collected during the period

 

65,397

 

Total Accounts Receivable at the end of the reporting period

 

580,986

 

 

 

 

 

Accounts Receivable Aging

 

 

 

0 - 30 days old

 

49,208

 

31 - 60 days old

 

74,894

 

61 - 90 days old

 

113,163

 

91+ days old

 

343,721

 

Total Accounts Receivable

 

580,986

 

Amount considered uncollectible (Bad Debt)

 

 

 

Accounts Receivable (Net)

 

580,986

 

 

DEBTOR QUESTIONNAIRE

 

Must be completed each month

 

Yes

 

No

1.

 

Have any assets been sold or transferred outside the normal course of business this reporting period? If yes, provide an explanation below.

 

 

 

X

2.

 

Have any funds been disbursed from any account other than a debtor in possession account this reporting period? If yes, provide an explanation below.

 

 

 

X

3.

 

Have all postpetition tax returns been timely filed? If no, provide an explanation below.

 

X

 

 

4.

 

Are workers compensation, general liability and other necessary insurance coverages in effect? If no, provide an explanation below.

 

X

 

 

5.

 

Has any bank account been opened during the reporting period? If yes, provide documentation identifying the opened account(s). If an investment account has been opened provide the required documentation pursuant to the Delaware Local Rule 4001-3.