1005276--12/29/2008--MOHEGAN_TRIBAL_GAMING

related topics

{competitive, industry, competition}

{debt, indebtedness, cash}

{regulation, change, law}

{condition, economic, financial}

{cost, contract, operation}

{loan, real, estate}

{cost, regulation, environmental}

{acquisition, growth, future}

Risks Related to Our Business Our substantial indebtedness could affect our financial condition adversely. Our failure to generate sufficient cash flows could prevent us from fulfilling our debt service obligations. Our diversification efforts may not be successful. An entity s ability to enforce its rights against us is limited by our sovereign immunity and that of the Tribe, MBC, Mohegan Ventures-NW, Mohegan Golf, MVW 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 contained in our bank credit facility and the indentures to which we are a party may impose limits on our ability to pursue our business strategies. A further downturn in the regional economy could impact our financial performance negatively. 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 a material environmental liability as a result of possible incomplete remediation of known environmental hazards and the existence of unknown environmental hazards. Risks Related to Mohegan Sun We face intense competition in our target market from Foxwoods Resort Casino. In addition to Foxwoods, we also face competition from existing casinos 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 adversely affect 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. Our construction, renovation and expansion projects may face significant inherent risks that could adversely affect our financial condition. We may suspend or elect not to proceed with our construction, renovation or expansion projects once they have been undertaken, resulting in charges that could adversely affect our financial condition. 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. The adoption of modifications 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. 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 PGCB 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--12/29/2008--MOHEGAN_TRIBAL_GAMING_AUTHORITY