Magna President/CEO Leaving Company; Stronach Named to Interim Post

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Magna Entertainment Corp. announced Tuesday that president and CEO Tom Hodgson will leave the company at the end of this month and that the board has initiated a search process for a successor.

"Tom Hodgson, our current president and CEO, joined MEC in early 2005 to develop and implement the company's recapitalization plan which was announced in July 2005," said Magna chairman Frank Stronach, who will serve as interim president and CEO. "Under his leadership, the recapitalization plan has progressed well. The board has decided that, going forward, MEC should seek a CEO with in-depth knowledge and experience in the horseracing and gaming industry who can lead the company in fully exploiting its opportunities in this sector."

The company announced that its capitalization plan "focused on debt reduction, principally through asset sales, and had a minimum target of $150 million. During Hodgson's tenure, the company has closed asset sales with gross proceeds of approximately $76 million and has entered into agreements for further sales expected to close in 2006 for aggregate proceeds well in excess of $200 million, according to the statement.

"Tom Hodgson has more than achieved our recapitalization plan goals, and we are grateful for his contributions to the company," Stronach's statement said. "Mr. Hodgson will leave his positions at the company and step down from the board at the end of March of this year but will make himself available on a consulting basis to assist in a transition and as needed to assist in closing pending transactions. The corporate governance, human resources, and compensation committee of MEC's Board of Directors will work with an executive search firm to identify and interview qualified candidates with a view to naming a successor for Mr. Hodgson as soon as possible."

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