Monticello, NY – The company that owns and operates Monticello Gaming and Raceway Friday announced its net revenues fell $1.3 million, or eight percent, in the first quarter of 2009 as compared to the same period in 20008.

But, in a first quarter filing, it said it may not be able to meet its financial obligations.

Empire Resorts’ credit facility with the Bank of Scotland requires repayment of approximately $7.15 million on May 29, 2009.

The holders of its Senior Convertible Notes ($65 million principal balance due) have the right to demand repayment of the principal amount due on July 31, 2009. “We do not presently have a source of repayment for this credit facility or for these notes and our operations will not provide sufficient cash flow to repay these obligations,” the company said.

On April 21, 2009, the company received a letter from Bank of Scotland in which Bank of Scotland stated that it had received information that one or more defaults or events of default exist within the credit agreement with Bank of Scotland and that although the parties will engage in good faith discussions to address the situations that resulted in such defaults or events of default, Bank of Scotland reserves its rights and remedies under the credit agreement.

On April 15, 2009, the company received a letter from Plainfield, a holder of $22.5 million in principal amount of the company’s senior secured convertible notes, pursuant to which Plainfield stated that, among other things, it is a member of an ad hoc group of holders of the company’s senior secured convertible notes and that each of the members of the ad hoc group intends to exercise its put right in accordance with the terms of the indenture.

Revenue from racing operations at Monticello Gaming and Raceway was unchanged; revenue from video gaming operations fell by about $1 million, or seven percent, and food, beverage and other revenue decreased by approximately $68,000, or seven percent.

The company said their video gaming operations continue to be adversely affected by the competing VGM facility at Yonkers Raceway and slot machine facilities in Pennsylvania.

Monticello’s daily visits decreased about 11 percent and the daily win per unit fell from $91.51 for the three months ended March 31, 2008 to $85.41 for the three months ended March 31, 2009, or seven percent.

That happend as casinos nearby in Pennsylvania reported double-digit increases in revenues for the same period.

Racing costs decreased by approximately $122,000, or seven percent, to about $1.6 million for the three months ended March 31, 2009. “We have been able to reduce some operating expenses at our facility while our revenues derived from sources other than live racing at our facility remained comparable to the corresponding quarter in the prior year,” the company said it its first quarter report.

(Source: MidHudsonNews)