Magna Entertainment Corp. announced Tuesday that PA Meadows, LLC, a company owned by Cannery Casino Resorts, LLC, made payment to MEC of $175 million in cash and delivered a $25 million holdback agreement, in full satisfaction of the notes issued to MEC on July 26, 2006 representing the purchase price for The Meadows, a Standardbred racetrack located in Washington County, Pennsylvania that has been approved for a Conditional Category 1 gaming license.CCR is owned by Millennium Gaming, Inc. (which is jointly owned by William Paulos and William Wortman) and an entity managed by Oaktree Capital Management.
The $25 million holdback is payable to MEC over a five-year period, subject to offset for certain indemnification obligations. Payments under the holdback will be deferred until the opening of a permanent casino at The Meadows.
Pursuant to a racing services agreement entered into on July 26, 2006, MEC will continue to manage racing operations at The Meadows, on behalf of PAM, for at least five years.Blake Tohana, executive vice president and chief financial officer of MEC, commented: "We are extremely pleased that The Meadows sale transaction has now closed. The collection of our $175 million note has enabled MEC to significantly reduce its outstanding debt and strengthen its balance sheet. The completion of this sale brings MEC's total consideration generated from asset sales over the past 14 months to approximately $368 million. We remain focused on pursuing further asset sales and debt reduction opportunities."