Attractions Hippiques granted creditor protection

Montreal, June 26, 2008 - Attractions Hippiques has obtained court approved protection under the Companies' Creditors Arrangement Act in order to protect itself from its creditors. RSM Richter Inc. was appointed by the court to supervise the company’s ongoing operations for an undefined period of time.  Attractions Hippiques is seeking the time it needs to restructure its operations in light of the impasse that Loto-Québec and the Quebec government have forced it into and to protect itself from lawsuits such as the recent demand by the Association du trot et amble du Québec (ATAQ) or other claims by some of its creditors.

Attractions Hippiques recently issued a legal demand to Loto-Québec asking the government agency to provide compensation and rectify the situation immediately. .

The absence of a Ludoplex gaming hall at the new racetrack that was to be built north of Montreal has deprived Attractions Hippiques of $20 million in annual revenues from the 22% commission on the 1,300 video lottery terminals that would have been managed and operated there by Loto-Québec.  The financial losses caused by the poor performance of video lottery terminals (VLTs) operated by Loto-Quebec at the Trois-Rivières and Quebec City Ludoplexes have also affected Attractions Hippique’s finances.  These VLTs have generated a scant 35% of the forecasted revenues. In fact, 60% of the revenues stemming from Loto-Québec’s VLTs was supposed to pay the purses  in the horse races, as stipulated in the agreement.  Given the absence of these funds, Attractions Hippiques cannot fulfill its obligations.

Attractions Hippiques will be presenting “live” racing programs for an indefinite period at the Sulkys in Trois-Rivières, Quebec City and Gatineau (Aylmer). Only the program at the Montreal race track is suspended at this time. Presentation of simulcast races will continue as normal at the racetracks in Montreal, Trois-Rivières, Quebec City and Gatineau, as well as in its network of Hippo Clubs. 

Attractions Hippiques demands that Loto-Québec respect its commitments so that horse racing activities in Quebec can return to normal as soon as possible.  The success of this industry depends on the construction of a race track and a Ludoplex north of Montreal, as stipulated in the call for tenders won by Attractions Hippiques in October 2005, as well as urgent and essential changes to ensure that the Ludoplexes in Trois-Rivières and Quebec City are profitable.

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Information:

Benoit Gingues, CA
RSM Richter Inc.
 (514) 934-3514
Bgingues@rsmrichter.com

 Yves Vincent, FCA
 RSM Richter Inc.
 (514)934-3454
 Yvincent@rsmrichter.com