Hotchkis & Wiley Capital Management LLC – ‘SC 13D/A’ on 2/8/11 re: Granite Real Estate Inc. – EX-4

On:  Tuesday, 2/8/11, at 4:06pm ET   ·   Accession #:  1164833-11-3   ·   File #:  5-79210

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Amendment to General Statement of Beneficial Ownership   —   Schedule 13D
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SC 13D/A    Amendment to General Statement of Beneficial           4     31K 
                          Ownership                                              
 2: EX-4        Instrument Defining the Rights of Security Holders     7±    30K 
 3: EX-5        Opinion re: Legality                                   3±    11K 

EX-4   —   Instrument Defining the Rights of Security Holders

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.                                                     

</PAGE>                                                                         

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.                           

</PAGE>                                                                         

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).                                      

</PAGE>                                                                         

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.                              

</PAGE>                                                                         

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]                  

</PAGE>                                                                         

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)      

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘SC 13D/A’ Filing		Date		Other Filings
		3/31/11		13F-HR,  6-K
Filed on:		2/8/11
		1/29/11
		1/28/11
		12/31/10		13F-HR,  6-K
		12/22/10		6-K
		12/20/10
		9/30/10		13F-HR,  6-K
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