1005276--12/26/2007--MOHEGAN_TRIBAL_GAMING

related topics

{competitive, industry, competition}

{debt, indebtedness, cash}

{regulation, change, law}

{condition, economic, financial}

{cost, contract, operation}

{cost, regulation, environmental}

{loan, real, estate}

{cost, operation, labor}

Risks Related to Our Business Our substantial indebtedness could affect adversely our financial condition An entity s ability to enforce their rights against us is limited by our sovereign immunity and that of the Tribe, MBC, Mohegan Ventures-NW, Mohegan Golf and, to the extent applicable, the Pocono Downs entities, WTG and MTGA Gaming. Any rights as a creditor are limited to our assets and those of our guarantor subsidiaries. We, the Tribe and our wholly owned subsidiaries may not be subject to the federal bankruptcy laws, which could impair the ability of our creditors to be repaid from the sale of our assets if we are unwilling or unable to meet our debt service obligations. Restrictions in the new bank credit facility and the indentures to which we are a party may impose limits on our ability to pursue our business strategies. A downturn in the regional economy could impact negatively our financial performance. The loss of a key management member could have a material adverse effect on us, Mohegan Sun and the Pocono Downs entities. We may be subject to material environmental liability as a result of possibly incomplete remediation of known environmental hazards and the existence of unknown environmental hazards. Risks Related to Mohegan Sun Mohegan Sun s failure to generate sufficient cash flows could prevent us from fulfilling our debt service obligations. If we are not able to compete successfully, we may not be able to generate sufficient cash flows to fund our operations or service our debt. We face intense competition in our target market from Foxwoods Resort Casino. In addition to Foxwoods, we also face competition from existing casino and other gaming operations elsewhere in our market areas. New market entrants in our market areas could adversely affect our operations and our ability to meet our financial obligations. Because the gaming industry in the State of Connecticut has experienced seasonal fluctuations in the past, we also may experience seasonal variations in our revenue and operating results that could affect adversely our cash flows. Negative conditions affecting the lodging industry may have an adverse affect on our revenue and cash flows. Our obligations under the relinquishment agreement could affect adversely our financial condition and prevent us from fulfilling our debt service obligations. Failure to complete Project Horizon s planned construction within its budget and on time with minimal disruption to existing operations could adversely affect the financial condition of the Authority. The risks associated with operating an expanded facility and managing its growth could have a material adverse effect on Mohegan Sun s future performance. Risks Related to the Indian Gaming Industry Gaming is a highly regulated industry and changes in the law could have a material adverse effect on the Tribe s and our ability to conduct gaming, and thus on our ability to meet our debt service obligations. A change in our current tax-exempt status, and that of our subsidiaries, could have a material adverse effect on our ability to meet our debt service obligations. Risks Related to Our Pocono Downs Operations If we are not able to develop Project Sunrise at Pocono Downs on time or on budget, we may not be able to achieve necessary returns from the Pocono Downs acquisition. The adoption of modifications relating to the Pennsylvania Gaming Act could result in changes to the rules and regulations under which gaming is conducted in the Commonwealth, which in turn could negatively impact our operations and expected profitability. Construction difficulties may delay our projected opening of Project Sunrise and could prevent us from achieving our operating projections. If Pocono Downs is not able to compete successfully with existing and potential competitors, we may not be able to generate sufficient cash flows to fulfill our debt service obligations relating to the acquisition and our development activities. Our operations of the Pocono Downs business subject us to regulation by the Pennsylvania Gaming Control Board and Pennsylvania s State Harness Racing Commission. Changes in or the issuance of additional regulations by the PGCB may adversely affect our operations at Pocono Downs. Assessments for regulatory costs may negatively impact our operating results.

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1005276--12/26/2007--MOHEGAN_TRIBAL_GAMING_AUTHORITY