SIDLEY AUSTIN BROWN & WOOD LLP
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July 25, 2003
Magna Entertainment Corp.
337 Magna Drive
Aurora, Ontario L4G 7K1
Canada
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as special counsel to Magna Entertainment Corp., a Delaware
corporation (the "Company"), in connection with the Registration Statement on
Form S-3 (the "Registration Statement") filed by the Company on the date
hereof with the Securities and Exchange Commission, pursuant to the Securities
Act of 1933, for the registration of $150,000,000 in aggregate principal
amount of the Company's 8.55% Convertible Subordinated Notes due June 15, 2010
(the "Notes") and the shares of the Company's Class A Subordinate Voting Stock
issuable upon the conversion of the Notes (the "Conversion Shares"). The Notes
have been issued pursuant to an indenture dated as of June 2, 2003 (the
"Indenture"), between the Company and The Bank of New York, as trustee (the
"Trustee").
In rendering this opinion, we have examined and relied upon copies of the
Registration Statement, the Notes and the Indenture. We have also examined
such instruments, documents and records as we deemed relevant and necessary as
a basis for this opinion. In such examination, we have assumed the following:
(a) the authenticity of original documents and the genuineness of all
signatures; (b) the conformity to the originals of all documents submitted to
us as copies; and (c) the truth, accuracy and completeness of the information,
representations and warranties contained in the records, documents,
instruments and certificates we have reviewed.
Based upon the foregoing, we are of the opinion that:
1. The Notes have been duly and validly authorized, executed and
delivered by the Company and, assuming that (a) the Notes were issued and
authenticated in accordance with the terms of the Indenture and delivered
against payment therefor in accordance with the terms thereof and (b) the
Trustee duly authorized, executed and delivered the Indenture, the Notes
constitute valid and binding obligations of the Company, enforceable against
the Company in
accordance with their terms and entitled to the benefits of the
Indenture, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, moratorium, reorganization or similar laws affecting the rights of
creditors generally and subject to general principles of equity (regardless of
whether considered in a proceeding in equity or at law).
2. The Conversion Shares have been duly and validly authorized and, when
issued by the Company upon the conversion of the Notes in accordance with the
terms of the Notes and the Indenture, will be duly and validly issued, fully
paid and non-assessable.
We express no opinion with respect to any laws other than the laws of the
State of New York and the General Corporation Law of the State of Delaware.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name wherever appearing in the
Registration Statement, and in each prospectus contained therein.
Very truly yours,
/s/ Sidley Austin Brown & Wood LLP