10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended September 30, 2009

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                     to                    

Commission file number 033-80655

MOHEGAN TRIBAL GAMING AUTHORITY

(Exact name of registrant as specified in its charter)

Not Applicable	06-1436334
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
One Mohegan Sun Boulevard, Uncasville, CT	06382
(Address of principal executive offices)	(Zip Code)

(860) 862-8000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange On Which Registered
NONE	NONE

Securities registered pursuant to Section 12(g) of the Act:

Title of Class

NONE

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act:    Yes  ¨    No  x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act:    Yes  x    No  ¨

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:    Yes  x    No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K:  x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files):    Yes  ¨    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer  ¨    Accelerated filer  ¨    Non-accelerated filer  x    Smaller reporting company  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act):    Yes  ¨    No  x

MOHEGAN TRIBAL GAMING AUTHORITY

INDEX TO FORM 10-K

		Page Number
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		1
PART I
Item 1.	Business	2
Item 1A.	Risk Factors	35
Item 1B.	Unresolved Staff Comments	45
Item 2.	Properties	45
Item 3.	Legal Proceedings	46
Item 4.	Submission of Matters to a Vote of Security Holders	46
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	47
Item 6.	Selected Financial Data	47
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	48
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	88
Item 8.	Financial Statements and Supplementary Data	88
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	88
Item 9A(T).	Controls and Procedures	89
Item 9B.	Other Information	90
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	91
Item 11.	Executive Compensation	94
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	102
Item 13.	Certain Relationships and Related Transactions, and Director Independence	102
Item 14.	Principal Accounting Fees and Services	105
PART IV
Item 15.	Exhibits, Financial Statement Schedules	107
Signatures		108
Supplemental Information		108
Index to Consolidated Financial Statements		F-1
Schedule II—Valuation and Qualifying Accounts and Reserves		S-1

References in this Form 10-K to the “Authority” and the “Mohegan Tribe or Tribe” are to the Mohegan Tribal Gaming Authority and the Mohegan Tribe of Indians of Connecticut, respectively. The terms “we,” “us” and “our” refer to the Authority.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Form 10-K contains statements about future events, including, without limitation, information relating to business development activities, as well as capital spending, financing sources, the effects of regulation (including gaming and tax regulation) and increased competition. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements sometimes can be identified by our use of forward-looking words such as “may,” “will,” “anticipate,” “estimate,” “expect,” or “intend” and similar expressions. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated future results and, accordingly, such results may differ materially from those expressed in any forward-looking statements made by us or on our behalf. You should review carefully all of the information in this Form 10-K, including the consolidated financial statements.

In addition to the risk factors described under “Part I. Item 1A. Risk Factors,” the following important factors, among others, could affect our future financial condition or results of operations, causing actual results to differ materially from those expressed in the forward-looking statements:

• the financial performance of Mohegan Sun and Mohegan Sun at Pocono Downs and the Pennsylvania off-track wagering facilities;

• the local, regional, national or global economic climate, including the economic recession, which has affected our revenues and earnings;

• increased competition, including the legalization or expansion of gaming in New England, New York, New Jersey or Pennsylvania;

• our suspension of the hotel, retail and new parking garage elements of Project Horizon;

• our leverage and ability to meet our debt service obligations and maintain compliance with financial debt covenants;

• the continued availability of financing;

• our dependence on existing management;

• our ability to integrate new amenities from our Project Horizon expansion into Mohegan Sun’s current operations and manage the expanded resort;

• our ability to integrate and operate new amenities from our Project Sunrise expansion at Mohegan Sun at Pocono Downs;

• changes in federal or state tax laws or the administration of such laws;

• changes in gaming laws or regulations, including the limitation, denial or suspension of licenses required under gaming laws and regulations;

• changes in applicable laws pertaining to the service of alcohol, smoking or other amenities offered at Mohegan Sun and Mohegan Sun at Pocono Downs;

• our ability to implement successfully our diversification strategy; and

• an act of terrorism on the United States.

These factors and the other risk factors discussed in this Form 10-K are not necessarily all of the important factors that could cause our actual results to differ materially from those expressed in any of the forward-looking statements. Other unknown or unpredictable factors also could have material adverse effects on our future results. The forward-looking statements included in this Form 10-K are made only as of the date of this Form 10-K. We do not have and do not undertake any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances, except as required by law. We cannot assure you that projected results or events will be achieved or will occur.

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PART I

Item 1. Business.

Overview

The Tribe and the Authority

The Mohegan Tribe is a federally-recognized Indian tribe with an approximately 507-acre reservation situated in southeastern Connecticut, adjacent to Uncasville, Connecticut. Under the Indian Gaming Regulatory Act of 1988, or the IGRA, federally-recognized Indian tribes are permitted to conduct full-scale casino gaming operations on tribal lands, subject to, among other things, the negotiation of a gaming compact with the state in which they operate. The Tribe and the State of Connecticut have entered into such a compact, the Mohegan Compact, which has been approved by the United States Secretary of the Interior. We were established as an instrumentality of the Tribe, with the exclusive power to conduct and regulate gaming activities on tribal lands and the non-exclusive authority to conduct such activities elsewhere. Our gaming operation at Mohegan Sun is one of only two legally authorized gaming operations in New England offering traditional slot machines and table games. Through our subsidiary, Downs Racing, L.P., or Downs Racing, we also own and operate Mohegan Sun at Pocono Downs, a gaming and entertainment facility offering slot machines and harness racing situated on a 400-acre site in Plains Township, Pennsylvania, and several off-track wagering facilities, or OTW, located elsewhere in Pennsylvania, collectively the Pocono Downs entities. We are governed by a nine-member Management Board, whose members also comprise the Mohegan Tribal Council, the governing body of the Tribe. Any change in the composition of the Mohegan Tribal Council results in a corresponding change in our Management Board.

Our mailing address is One Mohegan Sun Boulevard, Uncasville, CT 06382 and our telephone number is (860) 862-8000. Our website is located at www.mtga.com. Through our website, we make available, free of charge, our annual reports on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) under the Securities Exchange Act of 1934. These reports are available as soon as reasonably practicable after we electronically file these materials with, or furnish them to, the Securities and Exchange Commission.

Mohegan Sun

In October 1996, we opened a gaming and entertainment complex known as Mohegan Sun. Mohegan Sun is located on a 185-acre site on the Tribe’s reservation overlooking the Thames River with direct access from Interstate 395 and Connecticut Route 2A. Mohegan Sun is approximately 125 miles from New York City, New York and approximately 100 miles from Boston, Massachusetts. In fiscal 2002, we completed a major expansion of Mohegan Sun known as Project Sunburst, which included increased gaming, restaurant and retail space, an entertainment arena, an approximately 1,200-room luxury Sky Hotel Tower and approximately 100,000 square feet of convention space. In fiscal 2007 and 2008, we completed the Sunrise Square and Casino of the Wind components of Project Horizon, respectively.

Mohegan Sun operates in an approximately 3.1 million square-foot facility, which includes the following:

Casino of the Earth

As of September 30, 2009, Casino of the Earth had approximately 188,000 square feet of gaming space and offered:

• approximately 3,700 slot machines and 190 table games (including blackjack, roulette, craps and baccarat);

• food and beverage amenities, including Birches Bar & Grill, an approximately 200-seat full-service restaurant, three full-service themed fine dining restaurants, with a fourth area featuring cuisine from all three adjacent restaurant themes, a 630-seat buffet, a Hong Kong-style food outlet offering authentic

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Southeast Asian cuisine, an 87-seat Bobby Flay’s Bobby’s Burger Palace and multiple service bars, all operated by us, as well as Frank Pepe Pizzeria Napoletana, operated by a third-party, and the recently opened Fidelia’s Market, a 123-seat multi-station food court, operated by us and third parties, for a total seating of approximately 2,000;

• the Wolf Den, an approximately 10,000-square-foot, 400-seat lounge featuring live entertainment seven days a week;

• an approximately 9,000-square-foot simulcasting Racebook facility;

• four retail shops providing shopping opportunities ranging from Mohegan Sun logo souvenirs to cigars; and

• Sunrise Square, a 9,800-square-foot Asian-themed gaming area offering 46 table games.

Casino of the Sky

As of September 30, 2009, Casino of the Sky had approximately 119,000 square feet of gaming space and offered:

• approximately 2,300 slot machines and 110 table games (including blackjack, roulette and craps);

• food and beverage amenities, including a full-service restaurant, a 24-hour coffee shop, a 330-seat buffet and five lounges and bars, all operated by us, as well as five full-service restaurants, three quick-service restaurants and a multi-station food court, operated by third parties, for a total seating of approximately 2,600;

• Mohegan After Dark, consisting of Ultra 88, a nightclub Lucky’s Lounge and Dubliner, an Irish pub, all operated by a third-party;

• the Mohegan Sun Arena with seating for up to 10,000;

• The Shops at Mohegan Sun containing 32 retail shops, seven of which we own;

• an approximately 1,200-room luxury Sky Hotel Tower with a private high limit table games suite;

• an approximately 20,000-square-foot spa operated by a third-party;

• approximately 100,000 square feet of convention space; and

• a child care facility and an arcade-style entertainment area operated by a third-party.

Casino of the Wind

As of September 30, 2009, Casino of the Wind had approximately 45,000 square feet of gaming space and offered:

• approximately 700 slot machines, 30 table games (including blackjack, roulette and craps) and a 42-table themed poker room; and

• 20,000 square feet of dining and retail amenities, including a two-level, 16,000-square-foot Jimmy Buffett’s Margaritaville Restaurant, operated by a third-party, and Chief’s Deli, a casual dining restaurant operated by us.

Mohegan Sun has parking spaces for approximately 13,000 guests and 3,900 employees. In addition, we operate a gasoline and convenience center, an approximately 3,600-square-foot, 20-pump facility located adjacent to Mohegan Sun.

Project Horizon

Project Horizon, Mohegan Sun’s second major expansion, was initially planned to include four major components: Sunrise Square, Casino of the Wind, Property Infrastructure, including a new parking garage, additional surface parking lots, site development and road improvements, and the Earth Expansion, including a new hotel and related retail areas, as well as improvements to the existing Winter Parking Garage and Winter

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Entrance. As of September 30, 2009, two of the components, Sunrise Square and Casino of the Wind, have been completed. Additionally, the Winter Parking Garage improvements, surface parking lots, site development and road improvements were completed as of September 30, 2009.

Sunrise Square was completed in August 2007 and includes 9,800 square feet of gaming space offering 46 table games, a 3,500-square-foot bus lobby and a 4,000-square-foot Hong Kong-style food outlet.

Casino of the Wind was completed in August 2008 and adds approximately 45,000 square feet of gaming space, approximately 700 slot machines, 30 table games and a 42-table themed poker room, as well as approximately 20,000 square feet of dining and retail amenities.

In September 2008, we announced the suspension of the hotel, retail and new parking garage elements of Project Horizon due to a slowdown in business volumes and uncertainties in the financial markets resulting from the national economic recession. The costs incurred for the suspended elements were related to excavation and foundation work for the planned podium and hotel tower, as well as professional fees for design and architectural work. We are currently evaluating our options with respect to the development of the suspended elements, including the new hotel; however, we can provide no assurance as to if or when the suspended elements will resume.

The Winter Entrance of the Earth Expansion, which connects the Winter Parking Garage to Casino of the Earth, opened in early July 2009. The renovated Winter Entrance incorporates new food and beverage facilities, including: Bobby Flay’s Bobby’s Burger Palace, Frank Pepe Pizzeria Napoletana and Fidelia’s Market, a quick-serve dining area featuring Jasper White’s Summer Shack Express, Woodland Wok and Chief’s Bagels, Subs & Sweets. Additionally, Bobby Flay’s Bar American and The Original SoupMan were opened in November 2009. Bobby Flay’s Bar Americain is located in the area previously occupied by Fidelia’s Restaurant. The Original SoupMan is located in Fidelia’s Market. Estimated remaining project costs relating to the Winter Entrance consist primarily of costs to complete the theming of the Winter Entrance.

Mohegan Basketball Club

In January 2003, we formed a wholly-owned subsidiary, Mohegan Basketball Club, LLC, or MBC, for the purpose of owning and operating a professional basketball team in the Women’s National Basketball Association, or WNBA. MBC entered into a membership agreement with the WNBA permitting it to operate the Connecticut Sun basketball team. The team plays its home games in the Mohegan Sun Arena.

Mohegan Golf

In November 2006, we formed a wholly-owned subsidiary, Mohegan Golf, LLC, or Mohegan Golf, to purchase and operate a golf course in southeastern Connecticut. In May 2007, Mohegan Golf acquired substantially all of the assets of Pautipaug Country Club Inc., or PCC, which included a golf course located in Sprague and Franklin, Connecticut. The golf course was renamed Mohegan Sun Country Club at Pautipaug and reopened under the ownership of Mohegan Golf in June 2007.

Pocono Downs

Through Downs Racing, we own and operate the slot machine and harness racing facility known as Mohegan Sun at Pocono Downs situated on a 400-acre site in Plains Township, Pennsylvania, and OTWs located in Carbondale, East Stroudsburg, Hazleton and Lehigh Valley, Pennsylvania. Harness racing has been conducted at Pocono Downs since 1965. The Lehigh Valley OTW is a 28,000-square-foot facility and is the largest OTW in the Commonwealth of Pennsylvania.

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Downs Racing completed the 2009 harness racing season at Pocono Downs in November 2009 and will continue its harness racing activities when the 2010 racing season begins in the spring of 2010. Year-round simulcast pari-mutuel racing activities also are conducted at Pocono Downs and the OTW facilities. Construction of a new paddock, adjacent to the racetrack, was completed in April 2009.

Downs Racing holds a Category One slot machine license issued by the Pennsylvania Gaming Control Board, or PGCB, for the operation of slot machines at Pocono Downs. This license permits Downs Racing to install and operate up to 3,000 slot machines at Pocono Downs. Under certain circumstances, Downs Racing may install and operate up to a total of 5,000 slot machines.

Pocono Downs became the first location to offer slot machine gaming in the Commonwealth of Pennsylvania when Phase I of its gaming and entertainment facility opened in November 2006. The total cost incurred for development of the Phase I facility was approximately $70.0 million.

Pocono Downs opened Project Sunrise on July 17, 2008. Pocono Downs offers approximately 2,500 slot machines and electronic table games and several dining options including: Ruth’s Chris Steakhouse, Rustic Kitchen Bistro and Bar, which features dining and a live cooking show, Bar Louie, a casual bar and restaurant, Timbers Buffet, a 300-seat Mohegan Indian cultural heritage themed buffet, and a food court, including: Johnny Rockets, Hot Dog Hall of Fame, Puck Express by Wolfgang Puck and Ben & Jerry’s Ice Cream. Pocono Downs also offers a wide array of retail amenities, including: Brookstone, Marshall Rousso women’s couture, Misura men’s fine apparel boutique, Crossing Vineyards Wine and Cheese Shop, and MOGO, the Pocono Downs logo store. Project Sunrise also added three bars/lounges: Sunburst Bar, featured in the center of the gaming floor, Breakers Night Club and Pearl Sushi Bar. In addition, the food court that previously operated in the Phase I facility has been renovated as a 275-seat banquet and meeting venue, which opened in October 2008. The renovated facility now serves as a multi-purpose venue. The final cost of Project Sunrise, including the Phase I renovation, is anticipated to be approximately $198.0 million, excluding capitalized interest.

In March 2009, we and a subsidiary of Penn National Gaming, Inc. entered into an amendment to the purchase agreement for Pocono Downs. Pursuant to the amendment, the parties agreed to accelerate the remaining $16.0 million refund payment due to us and discount the amount of such balance to approximately $13.1 million, which we received in March 2009. We incurred a non-cash loss in connection with this transaction totaling approximately $1.6 million.

Other Diversification Projects

The Tribe has determined that it is in its long-term best interest to pursue diversification of its business interests, both directly and through us. As a result, from time to time, we and the Tribe receive and evaluate various proposed business opportunities. These opportunities primarily include the proposed development and management of, investment in, or proposed ownership of additional gaming enterprises through direct investments, acquisitions, joint venture arrangements and loan transactions. In addition to the developments described below, we and the Tribe are currently exploring other opportunities; there is no assurance, however, that we or the Tribe will continue to pursue any of these opportunities or that any of them will be consummated.

Cowlitz Project

In July 2004, we formed Mohegan Ventures-Northwest, LLC, or Mohegan Ventures-NW, one of three current members in Salishan-Mohegan, LLC, or Salishan-Mohegan. Salishan-Mohegan was formed to participate in a proposed development and management of a casino to be located in Clark County, Washington, or the Cowlitz Project, and owned by the Cowlitz Indian Tribe, or the Cowlitz Tribe. Mohegan Ventures-NW holds a 49.15% membership interest, the Mohegan Tribe holds a 7.85% membership interest and Salishan Company, LLC, or Salishan Company, holds a 43% membership interest in Salishan-Mohegan. Mohegan Ventures-NW and the Mohegan Tribe each hold one of four seats on the Board of Managers of Salishan-Mohegan.

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In September 2004, Salishan-Mohegan entered into development and management agreements with the Cowlitz Tribe regarding the Cowlitz Project, which agreements have been amended from time to time. Under the terms of the development agreement, Salishan-Mohegan administers and oversees the planning, designing, development, construction and furnishing, and provides assistance with the securing of financing, of the Cowlitz Project. The development agreement provides for certain development fees of 3% of total Project Costs, as defined under the development agreement, which are to be distributed to Mohegan Ventures-NW pursuant to the Salishan-Mohegan operating agreement. As of April 2006, Salishan-Mohegan purchased the land to be used as the site for the proposed casino, which will be transferred to the Cowlitz Tribe or the United States under certain conditions in the development agreement. The management agreement is for a period of seven years commencing with the opening of the proposed casino, during which Salishan-Mohegan will manage, operate and maintain the proposed casino. The management agreement provides for a management fee of 24% of Net Revenues, as defined under the management agreement, which approximates net income from the Cowlitz Project. Pursuant to the operating agreement, management fees will be allocated to the members of Salishan-Mohegan based on their respective membership interest percentages. Development of the Cowlitz Project is subject to certain governmental and regulatory approvals, including, but not limited to, negotiation of a gaming compact with the State of Washington and acceptance by the United States Department of the Interior of land into trust on behalf of the Cowlitz Tribe. The development agreement provides for termination of Salishan-Mohegan’s exclusive development rights if the land is not taken into trust by a certain date. In July 2009, the development agreement was amended to extend that date from December 31, 2010 to December 31, 2015. The management agreement is subject to approval by the National Indian Gaming Commission, or the NIGC.

In May 2008, the Bureau of Indian Affairs, or BIA, published a final rule relating to gaming on trust lands acquired after October 17, 1988. The new rule addresses, among other things, the process used by the BIA to determine what lands should be taken into trust for an initial reservation or restored lands for a tribe, such as the Cowlitz Tribe, seeking its initial or restored reservation. The new rule also expressly provides that a tribe may rely on earlier final agency decisions, including decisions of the NIGC, regarding lands to be taken into trust. In November 2005, the Cowlitz Tribe received an opinion from the NIGC determining that if the Secretary of the Interior takes the Cowlitz Project site into trust, the land will constitute restored lands of the Cowlitz Tribe. Based on this opinion by the NIGC, the additional analysis called for under the May 2008 rule is not expected to apply to the BIA’s decision in connection with the Cowlitz Tribe. In May 2008, the BIA published a Final Environmental Impact Statement, or Final EIS, for the Cowlitz Project site.

In February 2009, the U.S. Supreme Court issued a decision in a case involving the State of Rhode Island and the Narragansett Indian Tribe, which held that the Secretary of the Interior may exercise his authority to acquire trust title to land for an Indian tribe under the Indian Reorganization Act only if the tribe was “under federal jurisdiction” when the Indian Reorganization Act was enacted on June 18, 1934 (Carcieri v. Salazar, 555 U.S.              (2009) or the Carcieri decision). Since the trust land application for the Cowlitz Project requires action by the Secretary of the Interior under the Indian Reorganization Act, the Carcieri decision may delay action on that application until the BIA and the United States Department of the Interior determine whether the Cowlitz Tribe was under federal jurisdiction at that time, and an adverse decision may lead to a rejection of the trust land application. The Cowlitz Tribe did not receive federal recognition until 2000, so, based on the Carcieri decision, the tribe must establish that it was under federal jurisdiction in 1934 by separate means. In September 2009, following earlier congressional hearings on the Carcieri decision, the Chairman of the Senate Indian Affairs Committee introduced legislation to reverse the impact of the decision and reaffirm the authority of the Secretary of the Interior to take land into trust for Indian tribes regardless of when the tribe was recognized by the federal government. On December 17, 2009, the full Senate Indian Affairs Committee passed the bill. We believe that the Cowlitz Tribe, as a federally-recognized but landless tribe, will ultimately be able to establish its reservation and that casino gaming will be permitted on such lands; however, we can provide no assurance in this regard.

In light of the aforementioned and the inherent uncertainty in the development of the Cowlitz Project, we maintain a reserve for doubtful collection of the Salishan-Mohegan receivables, which is based on our estimate

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of the probability that the receivables will be collected. While certain events described above, including the publication of the Final EIS for the Cowlitz Project site, are generally positive steps in furtherance of the project, other events, including the Carcieri decision, may ultimately delay or prevent the completion of the project. However, considered collectively, these events have not materially changed our current interest in or assessment of the Cowlitz Project, nor do such events affect the extent to which we plan to continue our involvement in the Cowlitz Project.

Menominee Project

In October 2004, we entered into a management agreement with the Menominee Indian Tribe of Wisconsin, or the Menominee Tribe, and the Menominee Kenosha Gaming Authority, or MKGA. The terms of the management agreement grant us the exclusive right and obligation to manage, operate and maintain a proposed casino and destination resort to be located in Kenosha, Wisconsin, or the Menominee Project, for a period of seven years commencing with the opening of the proposed casino, in consideration of a management fee of 13.4% of Net Revenues, as defined under the management agreement, which approximates net income earned from the Menominee Project. The management agreement is subject to approval by the NIGC.

In March 2007, Wisconsin Tribal Gaming, LLC, or WTG, was formed to participate in the Menominee Project. WTG consists of two members, our wholly-owned subsidiary, Mohegan Ventures Wisconsin, LLC, or MVW, which holds an 85.4% membership interest in WTG, and a wholly-owned subsidiary of the Mohegan Tribe, Mohegan Ventures, LLC, or MV, which holds the remaining 14.6% membership interest. Following formation in March 2007, WTG purchased the development rights for the Menominee Project under a development agreement with the Menominee Tribe and MKGA, which was executed in October 2003, along with certain other assets, and assumed certain liabilities from Kenesah Gaming Development, LLC, for consideration of $6.4 million. The development agreement provides for certain development fees of 13.4% of Available Revenue Flow, as defined under the development agreement, which approximates net income from the Menominee Project over a period of seven years following the opening of the proposed casino, which are to be paid to WTG and distributed to us and the Mohegan Tribe, through MVW and MV, respectively. Development of the Menominee Project is subject to certain governmental and regulatory approvals, including, but not limited to, the United States Department of the Interior accepting land into trust for the Menominee Tribe’s project site in Kenosha, Wisconsin.

In January 2009, the BIA informed the Menominee Tribe of the decision by the United States Secretary of the Interior to decline to take the Menominee Project site in Kenosha into trust for the Menominee Tribe. The rejection of the application to take the Kenosha site into trust was based on a policy for reviewing trust land acquisitions for off-reservation gaming projects adopted by the BIA in January 2008 in a guidance memorandum and contradicted an earlier recommendation from the BIA’s Regional Director. In March 2009, the Menominee Tribe withdrew a related lawsuit against the federal government while reserving its right to re-file in the event the January 2008 guidance memorandum is not withdrawn and the decision on the Menominee Project site is not reconsidered and reversed by the Secretary of the Interior. The United States Supreme Court’s Carcieri decision, discussed above, is not expected to affect the Menominee Project. We believe the rejection of the land into trust application for the Kenosha site announced in January 2009 decreased the probability that the Menominee Tribe will obtain the necessary regulatory approvals in order to proceed with the Menominee Project, and officials appointed by the new presidential administration have not yet taken a position on reversal of the January 2008 guidance memorandum or the January 2009 rejection of the Kenosha application. As of September 30, 2008, we had fully reserved the WTG receivables pertaining to reimbursable development costs and expenses in connection with the Menominee Project and have written-off the remaining related development rights intangible asset. As of September 30, 2009, the WTG receivables remain fully reserved.

Pursuant to an option agreement, as amended, which was assigned to WTG upon its purchase of the development rights for the Menominee Project, for the purchase of Dairyland Greyhound Park in Kenosha, the proposed site for the Menominee Project, in November 2009, WTG consented to the cessation of operations at the Dairyland Greyhound Park and the option payments were accordingly adjusted, subject to various conditions. The current operators of the Dairyland Greyhound Park have announced that the facility will be closed in January 2010.

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Other Projects

In March 2008, we formed Mohegan Gaming & Hospitality, LLC, or MG&H, with the Tribe to evaluate and pursue new business opportunities. Our wholly-owned subsidiary, MTGA Gaming, LLC, or MTGA Gaming, holds a 49% membership interest in MG&H and the Tribe holds the remaining 51% membership interest. MG&H subsequently formed a wholly-owned subsidiary, Mohegan Resorts, LLC, or Mohegan Resorts. It is anticipated that certain of our and the Tribe’s future diversification efforts will be conducted, either directly or indirectly, through MG&H and/or Mohegan Resorts. Mohegan Resorts is currently evaluating potential gaming opportunities in the Commonwealth of Massachusetts, and a wholly-owned subsidiary of Mohegan Resorts has entered into a ground lease for approximately 152 acres of land located in Palmer, Massachusetts, which would serve as a potential site for future gaming development, if legalized in the Commonwealth of Massachusetts. A wholly-owned subsidiary of Mohegan Resorts also was a partner in an unsuccessful effort, ended in September 2008, to secure a gaming license for the development of a gaming facility in the State of Kansas.

Strategy

Our overall strategy is to profit from gaming in our core markets, as well as to diversify the Tribe’s business interests in the gaming industry outside of Mohegan Sun. Mohegan Sun’s success has resulted primarily from patronage from guests residing within 100 miles of Mohegan Sun, which represents our primary market. We also have enjoyed additional patronage from guests residing within a 100 to 200 mile radius of Mohegan Sun, which represents our secondary market. Based upon Mohegan Sun’s results and experiences, we believe gaming in these markets continues to be strong despite recent reductions in our profits resulting from the national economic recession. With the completion of Project Sunburst in 2002, we developed Mohegan Sun into a full-scale entertainment and destination resort, which has led to increases in the number of guests and lengthened the duration of their stays at our facility. We believe our addition of Casino of the Wind and Sunrise Square enables us to further strengthen our position in the Northeast gaming market by capitalizing on the demand for gaming and non-gaming amenities and enhancing our premier destination resort to mitigate impacts from future competition.

With the opening of the slot machine facility at Pocono Downs in November 2006, and with the completion of Project Sunrise in July 2008, we have taken significant steps in our diversification efforts with what we believe to be another first class gaming and entertainment property enabling us to diversify our revenue sources from a new gaming market outside of Mohegan Sun.

Market and Competition from Other Gaming Operations

Mohegan Sun and Foxwoods Resort Casino, or Foxwoods, are the only two legally authorized gaming operations offering both traditional slot machines and table games in New England. Foxwoods, operated by the Mashantucket Pequot Tribe, or the MPT, under procedures approved by the United States Department of the Interior, is located approximately 10 miles from Mohegan Sun.

Since the completion of Project Sunburst in 2002, we have broadened Mohegan Sun’s target market beyond day-trip customers to include guests making overnight stays at the resort. Consequently, Mohegan Sun also now competes directly for customers with resort casinos located in Atlantic City, New Jersey. Some of these casinos have greater resources, operating experience and name recognition than Mohegan Sun.

Under current law, outside of Atlantic City, New Jersey, full-scale commercial casino gaming in the Northeastern United States may be conducted only by federally-recognized Indian tribes operating under federal Indian gaming laws or on cruise ships in international waters. In recent years, there has been an increase in the number of Indian tribes seeking to engage in commercial casino gaming, including full-scale commercial casinos, in the Northeastern United States and in the number of individual groups seeking to obtain federal recognition as Indian tribes so that they may engage in commercial casino gaming in the Northeastern United States. Under federal law, after obtaining federal recognition and before gaming operations may commence, an Indian tribe must,

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among other things, have land taken into trust by the federal government, negotiate a gaming compact with the state in which they intend to engage in commercial casino gaming, adopt a tribal gaming ordinance and construct a facility. An Indian tribe also may need to negotiate a gaming management agreement and obtain funding to construct a facility. As described below, efforts continue by groups seeking federal recognition as Indian tribes and by recognized Indian tribes seeking to establish or expand their reservation lands with an interest in operating commercial casinos on those lands.

In February 2009, the U.S. Supreme Court issued its decision in the Carcieri case, as discussed above under “Cowlitz Project.” The result of action by Congress or the Obama administration on the Carcieri decision and other issues involving the establishment of initial reservations for newly-recognized Indian tribes, or the taking of off-reservation land into trust for gaming by Indian tribes, may have an impact on competition from both tribal and commercial casinos in the Northeast region.

As states have struggled with unprecedented budget deficits in 2008 and 2009, there have been various proposals and debates among state legislatures regarding authorization or expansion of state-licensed gaming throughout New England, the Northeast and Mid-Atlantic regions. States also are considering or instituting regulatory and promotional measures to retain or enhance revenues from gaming, such as expanded state lottery or video lottery games and expanded hours of operations, which affects competition for both Mohegan Sun and Pocono Downs. In addition, Congress has adopted and continues to consider legislation to limit or otherwise regulate on-line poker and other on-line gaming by U.S. residents. While one of those measures, the Unlawful Internet Gambling Enforcement Act of 2006, or the UIGEA, was signed into law in October 2006, the effective date for compliance by banks and financial institutions with the provisions prohibiting the processing of credit card and other electronic transactions by U.S. residents has been delayed until June 1, 2010. Congress is expected to consider new legislation to establish a licensing, taxing and enforcement framework for internet gaming prior to that date.

Under federal law, “cruises to nowhere,” offering casino gaming activities on board cruise boats once the boat is in international waters or approximately 12 nautical miles from a coast, are permitted unless prohibited by the state from which they operate. Since 1998, we have seen a small number of such cruise boats operating out of Lynn, Massachusetts, Portland, Maine, New York City and Freeport, New York. Due to the difference in the gaming experience and limited success of such ventures, we do not believe that such cruises pose significant competition to Mohegan Sun or Pocono Downs.

Based on internal analysis of the existing and potential gaming market in our market areas, we believe that competition from other commercial casino gaming operations will continue to increase in the future.

We are unable to predict whether any of the efforts by other federally-recognized Indian tribes or individual groups attempting to gain federal recognition as Indian tribes or legalization of commercial casino gaming by non-Indian tribes will lead to the establishment of additional commercial casino gaming operations in the Northeastern United States. If established, we are uncertain of the impact such commercial casino gaming operations will have on our operations and our ability to meet our financial obligations.

Mohegan Sun

The following is a summary of recent developments involving competition affecting Mohegan Sun:

Connecticut

Currently, only the Tribe and the MPT are authorized to conduct commercial casino gaming in the State of Connecticut. As required by their individual Memorandum of Understanding, or MOU, with the State of Connecticut, the Tribe and the MPT make monthly contribution payments to the state based on a portion of monthly revenues from their slot machines. Pursuant to the terms of an exclusivity clause in each MOU, the contribution payments to the state will terminate if there is any change in state law that permits operation of slot machines or other commercial casino games or if any other person lawfully operates slot machines or other commercial casino games within the State of Connecticut, except those consented to by the Tribe and the MPT.

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According to various reports, in the fall of 2009, the MPT defaulted on certain bond payment obligations and entered into a forbearance agreement with its lenders. The forbearance agreement reportedly expires in January 2010 and relates to the MPT’s $700 million bank credit facility, which matures in June 2010. It is uncertain whether any action related to the debt structure of Foxwoods will affect the competitive gaming market in Connecticut or the Northeast region or if any lenders, bondholders or creditors will seek to exert any influence over the operation or management of Foxwoods that could have an effect on competition in the Northeast region.

In October 2009, the U.S. Court of Appeals for the Second Circuit ruled against the Schaghticoke Tribal Nation, based in western Connecticut, in an appeal seeking to overturn adverse decisions regarding its federal recognition and the reinstatement of an earlier recognition decision. In December 2009, the Schaghticoke Tribal Nation requested a new hearing before the full Second Circuit Court of Appeals.

Leaders of the Eastern Pequot Tribe, based in southeastern Connecticut, have stated that they continue to consider further appeals to challenge the rejection of their petition for federal recognition.

Rhode Island

Commercial gaming facilities in the State of Rhode Island, through the state’s two pari-mutuel facilities, Twin River in Lincoln and Newport Grand in Newport, together currently offer more than 6,200 video lottery terminals, or VLTs, and have recently added virtual blackjack and virtual roulette.

The operator of Twin River filed a voluntary petition for Chapter 11 bankruptcy relief in June 2009, and has sought agreements with its creditors and the Governor of Rhode Island to relinquish control over the facility and cease greyhound racing at Twin River. In July 2009, the Governor vetoed a bill that required at least 200 days of live greyhound racing and permitted VLT gaming 24-hour per day, seven-day per week at Twin River. However, in November 2009, the state lottery authorized the expansion of 24-hour gaming per day, seven-day per week at Twin River. In December 2009, Twin River’s owner, which is still operating the facility as a debtor-in-possession, filed its proposed reorganization plan with the bankruptcy court. According to reports, the proposed reorganization plan contemplates transferring operation of Twin River to owners chosen by the current lenders, extinguishing $290 million of debt and ending greyhound racing at the facility.

The Narragansett Indian Tribe of Rhode Island, with a reservation in Charlestown, is the only federally-recognized Indian tribe in the State of Rhode Island, and the only tribe directly impacted by the U.S. Supreme Court’s Carcieri decision, discussed above. Under specific terms of the Narragansett Land Claims Settlement Act passed by Congress in 1983, the Narragansett Indian Tribe is prohibited from opening a gaming facility under the IGRA on its settlement lands, but any legislation adopted by Congress in response to the Carcieri decision could have an impact on the tribe’s ability to conduct gaming on lands outside of the tribe’s existing reservation.

New York

Mohegan Sun also currently faces competition from several commercial casinos and gaming facilities located on Indian tribal lands in the State of New York, and from racetracks in the state that operate, or are planning to operate, VLTs. The State of New York has six federally-recognized Indian tribes located in the central, northern and western regions of the state. Three of these tribes, the Oneida Nation of New York, the Seneca Nation and the St. Regis Mohawk Tribe of New York, currently engage in commercial casino gaming. In addition to these tribes, other Indian tribes have been pursuing potential casino projects which, if completed, will add significant gaming space as well as hotel capacity to the Northeastern United States gaming market. In addition, racetracks located in Yonkers, Batavia, Hamburg, Nichols, Vernon, Monticello, Saratoga Springs and Farmington currently operate an aggregate of approximately 13,000 VLTs.

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In October 2001, the New York State Legislature approved legislation that permitted as many as six gaming operations by Indian tribes in the State of New York, in addition to the Oneida Nation’s Turning Stone Casino and St. Regis Akwesasne Mohawk Casino. This legislation approved the use of traditional slot machines, rather than VLTs, where the possession and use of traditional slot machines is authorized pursuant to a tribal-state compact. Up to three of these additional gaming operations may be owned by the Seneca Nation, while the remaining three may be located in either Ulster County or Sullivan County in the Catskills region of the state. The Governor of New York reached tentative land claim settlements with various Indian tribes and supported legislation for as many as five tribal commercial casinos in the Catskills region between 2001 and 2005. However, a 2005 U.S. Supreme Court’s decision regarding tribal jurisdiction over Indian tribal lands not held in trust by the United States and subsequent federal court decisions led to the withdrawal of these settlement agreements. Several federally-recognized Indian tribes, including the Seneca Nation, St. Regis Mohawk Tribe and Stockbridge-Munsee Tribe of Wisconsin, have renewed plans to pursue tribal casinos in the Catskills region, with newly announced support from New York’s state officials and the state’s congressional delegation.

Summarized below is the status of current and potential gaming operations by federally-recognized Indian tribes in the State of New York:

• Oneida Nation—The Oneida Nation operates Turning Stone Casino Resort in Verona, approximately 270 miles from Mohegan Sun. Turning Stone Casino Resort reportedly offers approximately 2,400 VLTs, 80 table games, 20 poker tables and more than 800 hotel rooms. Turning Stone Casino Resort primarily attracts customers from the Syracuse region.

• St. Regis Mohawk Tribe—The St. Regis Mohawk Tribe operates Akwesasne Mohawk Casino in Akwesasne, approximately 400 miles from Mohegan Sun. Akwesasne Mohawk Casino reportedly offers approximately 1,600 slot machines and 20 table games. The St. Regis Mohawk Tribe has been pursuing an off-reservation casino in the Catskills region for several years. In January 2008, the BIA notified the St. Regis Mohawk Tribe of its rejection of the tribe’s application to take a 29-acre racino in Monticello, currently operated by Empire Resorts, Inc., into trust for a full-scale commercial casino. This decision followed the BIA’s rejection of 10 other land into trust applications and the issuance of new guidance regarding taking off-reservation land into trust for tribal gaming, which requires greater scrutiny of the perceived benefits to the tribe in such acquisitions the greater the distance between a proposed project and the tribe’s existing reservation.

• Seneca Nation—Under the compact between the Seneca Nation and the State of New York and the 2001 legislation, the Seneca Nation is permitted to operate three casinos in the western portion of the state. With the July 2007 opening of a temporary casino in Buffalo, joining the tribe’s two casinos in Niagara Falls and Salamanca, the Seneca Nation now operates all three casinos, with the closest facility more than 400 miles from Mohegan Sun. Construction of a permanent facility in Buffalo remains on hold according to reports.

• Cayuga Indian Nation of New York—The Cayuga Indian Nation’s bingo gaming halls in Union Springs and Seneca Falls, previously operated by the tribe as Class II facilities, remain closed while the tribe’s application with the BIA to take 125 acres into trust for gaming at those facilities remains pending. The tribe also has pursued gaming developments in the Catskills region at various times.

On December 15, 2009, the state-recognized Shinnecock Indian Nation, based in southeastern Long Island, received preliminary recognition from the BIA, following a 30-year administrative and judicial process in pursuit of federal recognition. A decision on final federal recognition is expected before June 2010, according to a court-sanctioned schedule. In September 2009, the Governor of New York announced support for the tribe’s federal recognition. The Shinnecock Indian Nation has an approximately 800-acre state reservation on the east side of Shinnecock Bay, near Southampton, Tuckahoe and Shinnecock Hills. In 2003, the Shinnecock Indian Nation halted construction of a gaming facility on land owned by the tribe and in recent years was a bidder for the Aqueduct Raceway in Queens. In 2006, the tribe’s federal lawsuit claiming approximately 3,600 acres in the Southampton region was dismissed, following precedent in other New York tribal cases. In December 2008,

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county legislators in Suffolk County proposed county legislation to form a task force to expedite the selection of a possible casino location for the tribe within 75 miles of the tribe’s reservation. According to reports, following the BIA’s December 2009 preliminary recognition decision, the tribe is considering a Class II gaming facility on the tribe’s land in southeastern Long Island. Other potential locations include Aqueduct Raceway in Queens, Belmont Park in Nassau County and a former Northrop Grumman site in Calverton in eastern Long Island, approximately 72 miles from Manhattan and the Catskills region. If the Shinnecock Indian Nation receives final recognition by the BIA, gaming on the tribe’s existing land or at any other location will likely require various additional regulatory approvals and/or legislation.

There are several pending federal recognition petitions from other New York Indian tribes, but we believe none are being actively considered by the BIA for federal recognition. It is not clear if or when federal recognition for these groups will be achieved.

In October 2006, Empire City at Yonkers Raceway, in Yonkers, opened with approximately 1,800 VLTs. In March 2007, Empire City opened its Gotham Palace facility, which added 3,700 additional VLTs, as well as a new restaurant, bar area and bandstand. Empire City has previously reported plans to increase its VLTs to 7,500 as permitted under state law. Given its geographic proximity to New York City, Empire City may have distinct advantages over Mohegan Sun in competition for day-trip and other customers from the New York metropolitan region.

During the 2009 regular session, the New York State Legislature failed to enact new legislation to expand hours and legalize electronic table games at racinos in the state. The state lottery has taken the legal position that electronic versions of roulette, baccarat, blackjack and craps are legal in the state and may be introduced as early as 2010.

According to reports, in February 2008, Empire Resorts, Inc., owner of the Monticello Raceway, entered into an agreement with Concord Associates, L.P., for the development of a resort, harness racetrack and VLT facility at the Concord Hotel property in Kiamesha Lake, to replace the current Monticello Raceway and Mighty M VLT facility. In April 2008, demolition of certain buildings at the Concord Hotel property commenced. In July 2008, the Governor signed a bill that included various incentives for the development of the Concord Hotel property into a $1 billion casino and resort, including a reduction in VLT revenue-sharing payments to the state to 25%, significantly lower than the current rate paid by Empire Resorts and other VLT operators in the state. Construction and development plans for the facility have been halted and the owners are reportedly considering using the site for a possible casino to be owned by the Seneca Nation. In August 2009, the Kien Huat Realty III Limited, part of the Malaysian-based gaming group Genting, reportedly invested $55 million for just under 50% of the voting power of Empire Resorts, Inc., and named the former Chief Executive Officer at Foxwoods and Seneca Gaming Corporation as one of the company’s representatives on the Board of Directors to serve as non-executive Chairman of the company. The company is reportedly continuing to pursue its earlier gaming project with the St. Regis Mohawk Tribe and land into trust application for the Monticello property.

In February 2008, the New York Racing Authority, or NYRA, and the State of New York reached a new agreement permitting NYRA to continue operating thoroughbred racing at the three NYRA racetracks for a new term of 25 years. In September 2008, NYRA was discharged from its Chapter 11 bankruptcy. In October 2008, VLT rights at NYRA’s Aqueduct Racetrack were initially awarded to Delaware North Companies and its partner, Saratoga Harness Racing, Inc. However, that award was rescinded and bidding reopened in 2009. In May 2009, seven developers submitted new bids to develop the Aqueduct Racetrack VLT facility. In addition, the Authority also submitted a proposal limited to management of the proposed VLT facility, but that proposal was not selected for further consideration. According to reports, the selection of a developer is imminent. The proposed VLT facility is expected to open within 14 months to two years following the selection of the developer. While the Shinnecock Tribe submitted a proposal in the first round of bidding, it did not re-submit a new proposal.

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Currently, there are no non-Indian casinos operating in the State of New York, and the establishment of non-Indian commercial casino operations would require the approval of two successive state legislatures, followed by the voters in a statewide referendum.

Massachusetts

In October 2007, the Governor of the Commonwealth of Massachusetts filed legislation calling for the award of licenses for three major gaming facilities to be built in the western, southeastern and metropolitan Boston areas of the state. A partnership with a federally-recognized, eligible Massachusetts Indian tribe was identified as one of the criteria to be used to assess proposals. Various groups have expressed interest in constructing and operating these facilities, including the Authority, which has proposed plans to develop a facility on leased land in Palmer in the western portion of the state. In March 2008, the Massachusetts House of Representatives defeated the Governor’s casino proposal bill by a vote of 108 to 46.

While hearings on the subject were held in 2009, no votes were taken, and the process is expected to continue into 2010 with new legislative leadership support.

In November 2008, voters in the state passed a ban on all greyhound racing in the state, effective January 1, 2010.

The Aquinnah Wampanoag Tribe of Gay Head, located on the island of Martha’s Vineyard, is one of two federally-recognized Indian tribes in the Commonwealth of Massachusetts. The Aquinnah Wampanoag Tribe is currently subject to certain restrictions with respect to gaming, including gaming on its existing reservation on Martha’s Vineyard.

The Mashpee Wampanoag Tribe, the other federally-recognized Indian tribe in the state, is proceeding with plans for a casino and hotel project on what would be a portion of the tribe’s initial reservation in Middleboro. In April 2009, the tribe announced that the proposed casino and hotel project will likely be smaller in scale and may take longer than originally anticipated as a result of current economic conditions and the U.S. Supreme Court’s Carcieri decision, discussed above. In November 2009, the tribe announced that it had terminated its agreement with Trading Cove Associates in connection with its proposed development and will instead be proceeding with the Kien Huat Realty III Limited, part of the Malaysian-based gaming group Genting, as developer.

A number of other petitions for federal recognition are pending in the state, but even if these petitions are ultimately successful, we believe final recognition would, at the earliest, be several years away.

New Jersey

Mohegan Sun primarily competes with casinos located in Atlantic City for overnight customers. The Atlantic City gaming market currently consists of 11 casino properties, with a total of approximately 17,000 hotel rooms and 1.4 million square feet of gaming space, including approximately 31,000 slot machines and 1,600 table games.

Several proposed developments and expansions of casino, hotel, retail and entertainment space also have commenced or have been completed in Atlantic City, while others have been suspended, delayed or cancelled in the past two years due to adverse economic conditions and various properties have reported debt issues or bankruptcy. A summary of recent projects and status changes within the Atlantic City gaming market include:

• The Borgata Hotel Casino & Spa, or the Borgata, a casino resort complex completed in 2003, has expanded in two phases since its opening. The first phase of the Borgata expansion was completed in June 2006 and featured several new restaurants, a food court, 500 slot machines, 45 table games, an 85-table poker room and a new nightclub. The second phase of the Borgata expansion was completed in June 2008 with the opening of a new 43-story hotel tower, the Water Club. The combined Borgata facility reportedly now features approximately 2,800 hotel rooms and suites, 161,000 square feet of gaming space, 4,100 slot machines and 200 table games.

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• In October 2007, MGM Mirage, Inc., announced a $5 billion plan to build a three-tower, 3,000-room casino resort, or the MGM Grand Atlantic City, in a joint venture with Boyd Gaming Corporation on a 72-acre site located next to the Borgata. The MGM Grand Atlantic City was scheduled to open in 2012 with the largest casino floor in Atlantic City, including approximately 5,000 slot machines, 200 table games and a poker room, however, it has been reported that development work has been suspended indefinitely.

• In March 2008, Harrah’s Entertainment, Inc., opened its new 44-story, 960-room Waterfront Tower, which represents the final phase of a $550 million expansion at Harrah’s Marina and increased Harrah’s Marina hotel room capacity to 2,590 guest rooms.

• In February 2009, Trump Entertainment Resorts, Inc., owner of the Trump Marina, Taj Mahal and Trump Plaza properties, filed for bankruptcy under Chapter 11 for a third time. In December 2009, financier Carl Icahn announced his purchase of most of the company’s bank debt. A court decision on a bondholder reorganization plan remains pending.

• In May 2008, Tropicana Entertainment, LLC, the parent company of the Tropicana Casino and Resort, filed for bankruptcy, and in June 2009, the court approved its sale to a group led by investor, Carl Icahn, pending regulatory approvals.

• In November 2009, Resorts Atlantic City, Atlantic City’s first casino, reportedly received approval for the transfer of ownership of the facility to a lender group led by Credit Suisse Group A.G. in exchange for the cancellation of approximately $360 million of debt. Resorts International Hotel, Inc., will continue to operate the property.

There are no federally-recognized Indian tribes in the State of New Jersey; however, at least one state tribe, the Unalachtigo Band of the Nanticoke Lenni Lenape Nation, is reportedly seeking federal recognition and possible casino gaming. In addition, the New Jersey State Legislature has considered adding slot machines or VLTs at state racetracks.

Maine

Currently, no full-scale casino gaming operations are allowed in the State of Maine. There are four federally-recognized Indian tribes in the state, one of which, the Penobscot Tribe, operates a high stakes bingo facility in Old Town in the east central region of the state. The Penobscot Tribe and the Passamaquoddy Tribe also are attempting to gain approval for full-scale casino operations at various locations throughout the state, however, to date, such efforts have been unsuccessful. In November 2007, voters in the state rejected a proposal by the Passamaquoddy Tribe to build a racetrack, high stakes bingo parlor, hotel and casino on 700 acres in Calais, along the St. Croix River bordering New Brunswick, Canada. The proposed facility reportedly would have offered 1,500 slot machines. In the 2008 legislative session, the state legislature approved a bill allowing 100 slot machines on the Penobscot Tribe’s reservation, but that bill was vetoed by the Governor. In November 2008, voters in the state rejected a proposed non-tribal development of a $184 million casino with 1,500 slot machines, a 300-room hotel and conference center in the town of Oxford in Oxford County. None of the other federally-recognized Indian tribes in the state have negotiated a tribal-state compact or taken any other significant steps towards developing casino operations.

Penn National Gaming, Inc., operates Hollywood Slots Hotel and Raceway, a racino located in Bangor, with 1,000 slot machines and a six-story hotel.

New Hampshire

Currently, gaming is not allowed in the State of New Hampshire, however, in July 2009, the Governor issued an executive order establishing a new gambling study commission, which subsequently began hearing recommendations from consultants, including a recommendation for up to two full-scale casinos in the state. In

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recent years, a number of legislative initiatives seeking to expand legalized gambling activities in the state, particularly at racetracks, have been defeated. There is no federally-recognized Indian tribe in the state and no announced petition for recognition pending.

Vermont

Currently, gaming is not allowed in the State of Vermont nor are there any significant initiatives underway to legalize commercial casino gaming in the state. There is no federally-recognized Indian tribe in the state. In June 2007, the BIA issued a final determination rejecting a petition for federal recognition from the St. Francis/Sokoki Band of Abenakis in Swanton. In October 2007, the BIA dismissed, as untimely, the tribe’s request for reconsideration of that final determination.

Delaware

In May 2009, the state legislature enacted a new law, signed by the Governor, to legalize single-game sports betting and live table games in the State of Delaware. In September 2009, following a decision by the U.S. District Court of Appeals for the Third Circuit that the plan violated a 1992 federal law, a U.S. District Court judge issued a permanent injunction to prohibit the planned September 2009 commencement of single-game sports betting in the state. Under earlier rulings, only multi-game betting is allowed in the state.

Pocono Downs

The following is a summary of recent developments involving competition affecting Pocono Downs:

In July 2004, the Governor of the Commonwealth of Pennsylvania signed the Pennsylvania Race Horse Development and Gaming Act, or the Pennsylvania Gaming Act, permitting up to 61,000 slot machines at 14 locations throughout the state. The Pennsylvania Gaming Act authorized slot machines at seven harness and thoroughbred racetracks and five stand-alone slot facilities. Each facility may initially install and operate up to 3,000 slot machines and can be expanded to up to 5,000 slot machines after six months of operation and upon gaining the approval of the PGCB. In addition, the legislation authorized two resort facilities with up to 500 slot machines. The Pennsylvania Gaming Act also includes prohibitions against locating facilities in close proximity to other operations, including, among other things, a prohibition against locating another harness or thoroughbred facility with slots or a stand-alone slot facility within 20 linear miles of Pocono Downs, and a prohibition against locating a resort facility within 15 linear miles of Pocono Downs. In 2009, with the support of the Governor, state legislators have debated proposals to amend the Pennsylvania Gaming Act to allow the operation of table games at slot facilities, including Pocono Downs. In December 2009, the state House and Senate each passed versions of a bill to authorize table games. According to various reports, the Governor has requested that a bill be signed into law no later than January 8, 2010 in order to avoid certain state job lay-offs. In connection with this proposed legislation, we have announced plans to add table games, as well as a potential hotel at Pocono Downs, if suitable legislation is adopted. The legislature also is considering adding additional Category Three resort facilities with up to 500 or more slot machines and authorizing bars and restaurants in the state to operate some form of gaming. Any of these proposals, if adopted, could impact Pocono Downs.

Category One slot machine licenses have been awarded to owners of the six existing racetracks in the Commonwealth of Pennsylvania: three thoroughbred racetracks, Philadelphia Park in Bensalem (approximately 115 miles southeast of Pocono Downs); Penn National Race Course in Grantville (approximately 85 miles southwest of Pocono Downs); Presque Isle Downs in Summit Township, near Erie (approximately 325 miles from Pocono Downs); and two harness racetracks, the Meadows in Meadow Lands, near Pittsburgh (approximately 300 miles from Pocono Downs), and Harrah’s Chester Casino and Racetrack in Chester (approximately 115 miles from Pocono Downs). In addition, Indianapolis-based Centaur, LLC, which had been awarded a harness racing license and had begun construction of Valley View Downs in Lawrence County, near Pittsburgh (approximately 300 miles from Pocono Downs), reportedly lost its financing in 2008. In October 2009, Centaur, LLC’s two affiliates in the Commonwealth of Pennsylvania filed for Chapter 11 bankruptcy relief.

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The PGCB has awarded conditional Category Two slot machine licenses to the owners of five stand-alone slot facilities, two of which are located in Philadelphia, with a third located in Pittsburgh. The remaining two facilities selected, which are located closer to Pocono Downs and are more likely to have an impact on our Pocono Downs operations, are as follows:

• Mount Airy, LLC was approved for a conditional Category Two slot machine license to operate a slot machine parlor at the former Mount Airy Lodge in Mount Pocono, which is approximately 40 miles from Pocono Downs. In October 2007, Mount Airy, LLC opened its $412 million Mount Airy Resort and Casino, or Mount Airy, which currently operates approximately 2,500 slot machines. In November 2007, a 188-room hotel, which includes a spa, salon and fitness center, was opened at Mount Airy. Mount Airy also operates five restaurants, three lounges and an 18-hole golf course.

• Sands Bethworks Gaming, a partnership between BethWorks and Las Vegas Sands, Inc., was approved for a conditional Category Two slot machine license to operate a gaming facility in Bethlehem, which is approximately 70 miles from Pocono Downs. In May 2009, Sands Bethworks Gaming opened its Sands Casino Resort Bethlehem, or Sands Bethlehem, which currently operates approximately 3,250 slot machines. Sands Bethlehem also currently operates five restaurants, a multi-station food court and three lounges. Sands Bethworks Gaming’s published expansion plans include a 302-room hotel, 200,000 square feet of retail space and 48,000 square feet of meeting, convention and special event space.

In addition to existing slot operations in the Commonwealth of Pennsylvania, Pocono Downs also faces competition from the VLT facility at the Monticello Raceway in Monticello, New York. The Catskills are approximately 90 miles from Pocono Downs. Additionally, Pocono Downs faces competition from Tioga Downs Racetrack in Nichols, New York, approximately 100 miles from Pocono Downs, which features a racetrack and gaming floor with 750 VLTs. Pocono Downs also faces potential competition from any full-scale casino gaming operation that is ultimately developed by an Indian tribe in the Catskills region. Also, in November 2008, voters in the State of Maryland passed a referendum authorizing state-licensed slot operations with up to 15,000 slot machines at up to five locations and the State of Maryland has begun the process of licensing sites for these facilities. In November 2009, voters in the State of Ohio passed a similar referendum authorizing up to four gaming facilities in that state. Since Pocono Downs is located more than 150 miles and 300 miles from any likely gaming facility in the State of Maryland or the State of Ohio, respectively, such gaming facilities would be less likely to have a direct impact on our Pocono Downs operations. The expansion of gaming in nearby states may affect overall gaming in Pennsylvania, the OTW facilities and other gaming facilities with which Pocono Downs competes for patrons.

Mohegan Tribe of Indians of Connecticut

General

The Tribe has lived in a cohesive community for hundreds of years in what is today southeastern Connecticut, and became a federally-recognized Indian tribe in 1994. The Tribe currently has approximately 1,800 members including 1,100 adult voting members. The Tribe historically has cooperated with the United States and is proud of the fact that members of the Tribe have fought on the side of the United States in every war from the Revolutionary War to the wars in Iraq and Afghanistan. The Tribe believes that this philosophy of cooperation exemplifies its approach to developing Mohegan Sun and pursuing diversification of its business interests.

Although the Tribe is a sovereign entity, it has sought to work with, and to gain the support of, local communities in establishing Mohegan Sun. For example, the Tribe settled its claim to extensive tracts of land that had been guaranteed by various treaties in consideration for certain arrangements in the Mohegan Compact. As a result, local residents and businesses whose property values had been clouded by this dispute were able to gain clear title to their property. In addition, the Tribe has been sensitive to the concerns of the local community in developing Mohegan Sun. This philosophy of cooperation has enabled the Tribe to build a solid alliance among local, state and federal officials to achieve its goal of economic development through the success of Mohegan Sun and other projects.

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Governance of the Tribe

The Tribe’s Constitution provides for the governance of the Tribe by a Tribal Council consisting of nine members, and a Council of Elders consisting of seven members. The registered voters of the Tribe elect all members of the Tribal Council and the Council of Elders. As the result of an amendment to the Tribe’s Constitution in September 2003, the members of both the Council of Elders and the Tribal Council are elected on a staggered term basis and members of each Council are currently-elected for four-year terms. The terms of three members of the Council of Elders expire in October 2010, and the terms for the remaining four members will expire in October 2012. The terms for four members of the Tribal Council expire in October 2011 and the terms for the remaining five members will expire in October 2013. Members of the Tribal Council must be at least 21 years of age when elected, and members of the Council of Elders must be at least 55 years of age when elected. The members of the Tribal Council also serve as members and officers on our Management Board.

The Tribe’s Constitution vests all legislative and executive powers of the Tribe in the Tribal Council, with the exception of the enrollment of Tribal members and cultural duties, which are vested in the Council of Elders. The powers of the Tribal Council include the power to establish an executive branch departmental structure with agencies and subdivisions and to delegate appropriate powers to such agencies and sub-divisions.

The Tribe may amend the provisions of its Constitution that established us and the Gaming Disputes Court, which is described below. Such an amendment requires the approval of two-thirds of the members of the Tribal Council and must be ratified by registered voters of the Tribe by a two-thirds majority of all votes cast, with at least 40% of the registered voters of the Tribe voting. In addition, the Tribe’s Constitution currently prohibits the Tribe from enacting any law that would impair the obligations of contracts entered into in furtherance of the development, construction, operation and promotion of gaming on Tribal lands. An amendment to this provision requires the affirmative vote of 75% of all registered voters of the Tribe. Prior to the enactment of any such amendment by the Tribal Council, any non-Tribal party would have the opportunity to seek a ruling from the Appellate Branch of the Gaming Disputes Court that the proposed amendment would constitute an impermissible impairment of contract.

The Council of Elders acts in the capacity of an appellate court of final review and may hear appeals of any case or controversy arising under the Tribe’s Constitution, except those matters related to Mohegan Sun, which are required to be submitted to the Gaming Disputes Court.

Gaming Disputes Court

Under the Constitution and laws of the Tribe, the Gaming Disputes Court is vested with exclusive jurisdiction over all disputes related to gaming and associated facilities on Tribal lands, including appeals from certain final administrative agency decisions. The Gaming Disputes Court is composed of a Trial Branch and an Appellate Branch. Cases tried in the Trial Branch are heard by a single judge, whose decision can be appealed to the Appellate Branch. Appeals are decided by a panel of three judges, consisting of the Chief Judge and two judges selected in rotation, and the judge whose decision is on appeal may not serve on the appellate panel. Decisions of the Appellate Branch are final, and no further appeal is available.

The Gaming Disputes Court has jurisdiction over all disputes or controversies related to gaming between any person or entity and us or the Tribe. The Gaming Disputes Court also has jurisdiction over certain appeals arising out of tribal agency regulatory powers, including licensing actions. The Tribe has adopted the substantive law of the State of Connecticut as the applicable law of the Gaming Disputes Court to the extent that such law is not in conflict with Mohegan Tribal Law. Also, the Tribe has adopted all of Connecticut’s rules of civil and appellate procedure and professional and judicial conduct to govern the Gaming Disputes Court.

Judges of the Gaming Disputes Court are chosen by the Tribal Council from a publicly available list of eligible retired federal judges and Connecticut Attorney Trial Referees, who are appointed by the Chief Justice of the Connecticut Supreme Court, each of whom must remain licensed to practice law in the State of Connecticut.

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Judges are selected sequentially as cases are filed with the clerk of the Gaming Disputes Court. The Chief Judge of the Gaming Disputes Court, who serves as the Gaming Disputes Court’s administrative superintendent, is chosen by the Tribal Council from the list of eligible judges and serves a five-year term. The remaining judges may serve an unlimited term on the bench. Judges of the Gaming Disputes Court are subject to discipline and removal for cause pursuant to the rules of the Gaming Disputes Court. The Chief Judge is vested with the sole authority to revise the rules of the Gaming Disputes Court. Judges are compensated by the Tribe at an agreed rate of pay commensurate with their duties and responsibilities. Such rate cannot be diminished during a judge’s tenure.

Below is a description of certain information regarding judges currently serving on the Gaming Disputes Court:

Paul M. Guernsey, Chief Judge. Age: 59. Judge Guernsey has served on the Gaming Disputes Court since 1996. He was appointed Acting Chief Judge in November 1999 and appointed as Chief Judge in January 2000. Judge Guernsey also has served as Fact Finder for the New London Judicial District from 1990 to 1992 and as State of Connecticut Attorney Trial Referee, Judicial District of New London, since 1992.

F. Owen Eagan, Judge. Age: 79. Judge Eagan was appointed to the Gaming Disputes Court in 1996. He served as U.S. Magistrate Judge from 1975 to 1996 and was formerly Assistant U.S. Attorney for the District of Connecticut and U.S. Attorney for the District of Connecticut. He is currently an adjunct law faculty member at Western New England College School of Law, a position he has held since 1978.

Frank A. Manfredi, Judge. Age: 58. Judge Manfredi was appointed to the Gaming Disputes Court in 2001. He has been a partner at Cotter, Greenfield, Manfredi & Lanes, P.C., since 1983. Judge Manfredi also has served as State of Connecticut Attorney Trial Referee since 1993, State of Connecticut Attorney Fact Finder since 1992 and Town Attorney for the Town of Preston since 1988.

Thomas B. Wilson, Judge. Age: 69. Judge Wilson was appointed to the Gaming Disputes Court in 1996. Judge Wilson served as a partner and director at Suisman, Shapiro, Wool, Brennan & Gray, P.C., from 1967 to 2003. Judge Wilson also has served as State Attorney Trial Referee since 1988 and as Town Attorney for the Town of Ledyard from 1971 to 1979, 1983 to 1991 and 1995 to the present.

Workers’ Compensation Department

Effective September 1, 2004, the Tribal Council established a Workers’ Compensation Department that oversees a self-administered workers’ compensation program for employees of the Tribe and us, but does not include employees of any of the Pocono Downs entities. Prior to the formation of this department, we participated in the State of Connecticut workers’ compensation program. Duties of the Workers’ Compensation Department, including judgment on claims, are performed by two commissioners retained by the Tribe.

Below is a description of certain information regarding the commissioners serving in the Workers’ Compensation Department:

Giancarlo Rossi, Chief Commissioner. Age: 60. Mr. Rossi was appointed Chief Commissioner of the Tribe’s Workers’ Compensation Department in September 2004. Mr. Rossi is a practicing attorney with over 20 years of workers’ compensation experience in Connecticut.

Louis M. Pacelli, Commissioner. Age: 55. Mr. Pacelli was appointed Commissioner of the Tribe’s Workers’ Compensation Department in September 2004. Mr. Pacelli is a partner in the law firm of Grillo and Pacelli, LLC in East Haven, Connecticut and has practiced general law, including workers’ compensation matters, for over 20 years in Connecticut.

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Mohegan Tribal Gaming Authority

We were established by the Tribe in July 1995 with the exclusive power to conduct and regulate gaming activities on tribal lands for the Tribe and the non-exclusive authority to conduct such activities elsewhere. We are governed by a nine-member Management Board, whose members also comprise the Mohegan Tribal Council, the governing body of the Tribe. Any change in the composition of the Mohegan Tribal Council results in a corresponding change in our Management Board. See “—Mohegan Tribe of Indians of Connecticut” and “Part III. Item 10. Directors and Executive Officers of the Registrant.”

We have three major functions. The first major function is to direct the operation, management and promotion of gaming enterprises on tribal lands and all related activities. The second major function is to regulate gaming activities on tribal lands. Our Management Board has appointed an independent Director of Regulation to be responsible for the regulation of gaming activities at Mohegan Sun. The Director of Regulation serves at the will of the Management Board and ensures the integrity of the gaming operation through the promulgation and enforcement of appropriate regulations. The Director of Regulation and his staff also are responsible for performing background investigations and licensing of non-gaming employees, as well as vendors seeking to provide non-gaming products or services within the casino. Pursuant to the Mohegan Compact, the State of Connecticut is responsible for performing background investigations and licensing of gaming employees, as well as gaming vendors seeking to provide gaming products or services within the casino. The third major function is to identify and evaluate various diversification opportunities in conjunction with the Tribe. These opportunities primarily include the development and/or management, ownership or investments in, other gaming enterprises through direct investment, acquisition, joint venture arrangements and loan transactions.

Government Regulation

General

Our operations at Mohegan Sun are subject to certain federal, state and tribal laws applicable to both commercial relationships with Indians generally and to Indian gaming and the management and financing of Indian casinos specifically. Our operations at Pocono Downs also are subject to Pennsylvania laws and regulations applicable to harness racing, simulcasting and slot machine gaming. The following description of the regulatory environment in which gaming takes place and in which we operate is only a summary and not a complete recitation of all applicable law. Moreover, since this regulatory environment is susceptible to changes in public policy considerations, it is impossible to predict how particular provisions will be interpreted, from time to time, or whether they will remain intact. Changes in such laws could have a material adverse impact on our operations. See “Risk Factors.”

Tribal Law and Legal Systems

Applicability of State and Federal Law

Federally-recognized Indian tribes are independent governments, subordinate to the United States, with sovereign powers, except as those powers may have been limited by treaty or by Congress. The power of Indian tribes to enact their own laws to regulate gaming derives from the exercise of this tribal sovereignty. Indian tribes maintain their own governmental systems and often their own judicial systems. Indian tribes have the right to tax persons and enterprises conducting business on tribal lands, and also have the right to require licenses and to impose other forms of regulations and regulatory fees on persons and businesses operating on their lands.

Absent the consent of the Tribe or action of Congress, the laws of the State of Connecticut do not apply to us or the Tribe. Pursuant to the federal law that settled the Tribe’s land claims in 1994, the United States and the Tribe consented to, among other things, the extension of Connecticut criminal law and Connecticut state traffic controls over Mohegan Sun.

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Waiver of Sovereign Immunity; Jurisdiction; Exhaustion of Tribal Remedies

Indian tribes enjoy sovereign immunity from unconsented suit similar to that of the states and the United States. In order to sue an Indian tribe (or an agency or instrumentality of an Indian tribe, such as us), the Tribe must have effectively waived its sovereign immunity with respect to the matter in dispute. Further, in most commercial disputes with Indian tribes, the jurisdiction of the federal courts, which are courts of limited jurisdiction, may be difficult or impossible to obtain. A commercial dispute is unlikely to present a federal question, and some courts have ruled that an Indian tribe as a party is not a citizen of any state for purposes of establishing diversity jurisdiction in the federal courts. State courts also may lack jurisdiction over suits brought by non-Indians against Indian tribes in Connecticut. The remedies available against an Indian tribe also depend, at least in part, upon the rules of comity requiring initial exhaustion of remedies in tribal tribunals and, as to some judicial remedies, the tribe’s consent to jurisdictional provisions contained in the disputed agreements. The U.S. Supreme Court has held that, where a tribal court exists, jurisdiction in that forum first must be exhausted before any dispute can be heard properly by federal courts which otherwise would have jurisdiction. Where a dispute as to the jurisdiction of the tribal forum exists, the tribal court first must rule as to the limits of its own jurisdiction.

In connection with some of our contractual arrangements, including substantially all of our outstanding indebtedness, we, the Tribe, MBC, Mohegan Ventures-NW, Mohegan Golf and to the extent applicable, the Pocono Downs entities, WTG, MTGA Gaming and certain other of our subsidiaries and entities have agreed to waive our and their respective sovereign immunity from unconsented suit to permit any court of competent jurisdiction to: (1) enforce and interpret the terms of our applicable outstanding indebtedness, and award and enforce the award of damages owing as a consequence of a breach thereof, whether such award is the product of litigation, administrative proceedings, or arbitration; (2) determine whether any consent or approval of the Tribe or us has been granted improperly or withheld unreasonably; (3) enforce any judgment prohibiting the Tribe or us from taking any action, or mandating or obligating the Tribe or us to take any action, including a judgment compelling the Tribe or us to submit to binding arbitration; and (4) adjudicate any claim under the Indian Civil Rights Act of 1968, 25 U.S.C. § 1302 (or any successor statute).

The Indian Gaming Regulatory Act of 1988

Regulatory Authority

The operation of casinos and of all gaming on Indian land is subject to IGRA, which is administered by the NIGC, an independent agency within the United States Department of the Interior, which exercises primary federal regulatory responsibility over Indian gaming. The NIGC has exclusive federal authority to issue regulations governing tribal gaming activities, approve tribal ordinances for regulating Class II and Class III Gaming (as described below), approve management agreements for gaming facilities, conduct investigations and generally monitor tribal gaming. Certain responsibilities under IGRA (such as the approval of gaming revenue allocation plans for tribal members and the review of application to take land into trust for gaming) are retained by the BIA. The BIA also has responsibility to review and approve certain agreements and land leases relating to Indian lands. The U.S. Department of Justice also retains responsibility for federal criminal law enforcement on the Mohegan reservation.

The NIGC is empowered to inspect and audit all Indian gaming facilities, to conduct background checks on all persons associated with Class II Gaming and management contractors involved in Class III Gaming, to hold hearings, issue subpoenas, take depositions, adopt regulations and assess fees and impose civil penalties for violations of IGRA. IGRA also prohibits illegal gaming on Indian land and theft from Indian gaming facilities. The NIGC has adopted rules implementing specific provisions of IGRA, which govern, among other things, the submission and approval of tribal gaming ordinances or resolutions and require an Indian tribe to have the sole proprietary interest in and responsibility for the conduct of any gaming. Tribes are required to issue gaming licenses only under articulated standards, to conduct or commission financial audits of their gaming enterprises, to perform or commission background investigations for primary management officials and key employees and

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to maintain their facilities in a manner that adequately protects the environment and the public health and safety. These rules also set out review and reporting procedures for tribal licensing of gaming operation employees and tribal gaming facilities.

Tribal Ordinances

Under IGRA, except to the extent otherwise provided in a tribal-state compact, Indian tribal governments have primary regulatory authority over Class III Gaming on land within a tribe’s jurisdiction. Therefore, our gaming operations, and persons engaged in gaming activities, are guided by and subject to the provisions of the Tribe’s ordinances and regulations regarding gaming, in addition to the provisions of the Mohegan Compact.

IGRA requires that the NIGC review tribal gaming ordinances and authorizes the NIGC to approve such ordinances only if they meet specific requirements relating to: (1) the ownership, security, personnel background, record keeping and auditing of a tribe’s gaming enterprises; (2) the use of the revenues from such gaming; and (3) the protection of the environment and the public health and safety. The Tribe adopted its gaming ordinance in July 1994, and the NIGC approved the gaming ordinance in November 1994.

Classes of Gaming

IGRA classifies games that may be conducted on Indian lands into three categories. “Class I Gaming” includes social games solely for prizes of minimal value or traditional forms of Indian gaming engaged in by individuals as part of, or in connection with, tribal ceremonies or celebrations. “Class II Gaming” includes bingo, pull-tabs, lotto, punch boards, tip jars, certain non-banked card games (if such games are played legally elsewhere in the state), instant bingo and other games similar to bingo, if those games are played at the same location where bingo is played. “Class III Gaming” includes all other forms of gaming, such as slot machines, video casino games (e.g., video blackjack and video poker), so-called “table games” (e.g., blackjack, craps and roulette) and other commercial gaming (e.g., sports betting and pari-mutuel wagering).

Class I Gaming on Indian lands is within the exclusive jurisdiction of the Indian tribes and is not subject to IGRA. Class II Gaming is permitted on Indian lands if: (1) the state in which the Indian lands lie permits such gaming for any purpose by any person, organization or entity; (2) the gaming is not otherwise specifically prohibited on Indian lands by federal law; (3) the gaming is conducted in accordance with a tribal ordinance or resolution which has been approved by the NIGC; (4) an Indian tribe has sole proprietary interest and responsibility for the conduct of gaming; (5) the primary management officials and key employees are tribally licensed; and (6) several other requirements are met. Class III Gaming is permitted on Indian lands if the conditions applicable to Class II Gaming are met, and in addition, the gaming is conducted in conformance with the terms of a tribal-state compact (a written agreement between the tribal government and the government of the state within whose boundaries the tribe’s lands lie).

With the growth of the Internet and other modern advances, computers and other technology aids are increasingly used to conduct specific kinds of gaming, such as poker or wagering on horse racing. Congress has adopted and continues to consider legislation to limit or otherwise regulate on-line gaming by U.S. residents. While the Unlawful Internet Gambling Enforcement Act of 2006, or the UIGEA, was signed into law on October 13, 2006, the effective date for compliance by banks and financial institutions with provisions prohibiting the processing of credit card and other electronic transactions by U.S. residents was delayed until December 1, 2009. In November 2009, just prior to that deadline, the U.S. Treasury Department and Federal Reserve Board delayed the effective date by six months, to June 1, 2010. Congress is expected to consider new legislation to establish a licensing, taxing and enforcement framework for internet gaming prior to that extended effective date.

Tribal-State Compacts

IGRA requires states to negotiate in good faith with Indian tribes that seek to enter into tribal-state compacts for the conduct of Class III Gaming. Such tribal-state compacts may include provisions for the allocation of criminal and civil jurisdiction between the state and the Indian tribe necessary for the enforcement of such laws and

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regulations, taxation by the Indian tribe of gaming activities in amounts comparable to those amounts assessed by the state for comparable activities, remedies for breach of compacts, standards for the operation of gaming and maintenance of the gaming facility, including licensing and any other subjects that are directly related to the operation of gaming activities. While the terms of tribal-state compacts vary from state to state, compacts within one state tend to be substantially similar. Tribal-state compacts usually specify the types of permitted games, establish technical standards for gaming, set maximum and minimum machine payout percentages, entitle the state to inspect casinos, require background investigations and licensing of casino employees and may require the tribe to pay a portion of the state’s expenses for establishing and maintaining regulatory agencies. Some tribal-state compacts are for set terms, while others are for an indefinite duration.

IGRA provides that if an Indian tribe and state fail to successfully negotiate a tribal-state compact, the United States Department of the Interior may approve gaming procedures pursuant to which Class III Gaming may be conducted on Indian lands. The Mohegan Compact, approved by the United States Secretary of the Interior in 1994, does not have a specific term and will remain in effect until terminated by written agreement of both parties, or the provisions are modified as a result of a change in applicable law. Our gaming operations are subject to the requirements and restrictions contained in the Mohegan Compact, which authorizes the Tribe to conduct most forms of Class III Gaming.

Tribal-state compacts have been the subject of litigation in a number of states, including Alabama, California, Florida, Kansas, Michigan, Mississippi, New Mexico, New York, Oklahoma, Oregon, South Dakota, Texas, Washington and Wisconsin. Tribes frequently seek to enforce the provision of IGRA which entitles tribes to bring suit in federal court against a state that fails to negotiate a tribal-state compact in good faith. The U.S. Supreme Court resolved this issue by holding that the Indian Commerce Clause does not grant Congress authority to abrogate sovereign immunity granted to the states under the Eleventh Amendment. Accordingly, IGRA does not grant jurisdiction over a state that did not consent to be sued.

There has been litigation in a number of states challenging the authority of state governors, under state law, to enter into tribal-state compacts without legislative approval. Federal courts have upheld such authority in Louisiana and Mississippi. The highest state courts of Arizona, Kansas, Michigan, New Mexico, New York and Rhode Island have held that the governors of those states did not have authority to enter into such compacts without the consent or authorization of the legislatures of those states. In the New Mexico and Kansas cases, the courts held that the authority to enter into such compacts is a legislative function under their respective state constitutions. The court in the New Mexico case also held that state law does not permit casino-style gaming.

In Connecticut, there has been no litigation challenging the governor’s authority to enter into tribal-state compacts. If such a suit were filed, however, the Tribe does not believe that the precedent in the New Mexico or Kansas cases would apply. At the time of execution of the Mohegan Compact, the Connecticut Attorney General issued a formal opinion, which states that, “existing state statutes provide the Governor with the authority to negotiate and execute the Mohegan Compact.” Thus, the Attorney General declined to follow the Kansas case. In addition, in a case brought by the MPT, the United States Court of Appeals for the Second Circuit has held that Connecticut law authorizes casino gaming. After execution of the Mohegan Compact, the Connecticut General Assembly passed a law requiring that future gaming compacts be approved by the legislature, but that law does not apply to previously executed compacts such as the Mohegan Compact.

Possible Changes in Federal Law

Several bills have been introduced in Congress which would amend IGRA. While there have been a number of technical amendments to the law, to date, there have been no material changes to IGRA. Any amendment to IGRA could change the regulatory environment and requirements within which the Tribe could conduct gaming.

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Pennsylvania Racing Regulations

Our harness racing operations at the Pocono Downs entities are subject to extensive regulation under the Pennsylvania Racing Act. Under that law, the Pennsylvania Harness Racing Commission, or Harness Racing Commission, is responsible for, among other things:

• granting permission annually to maintain racing licenses and schedule races;

• approving, after a public hearing, the opening of additional OTWs and racetracks;

• approving simulcasting activities;

• licensing all officers, directors, racing officials and certain other employees of a company; and

• approving all contracts entered into by a company affecting racing, pari-mutuel wagering, phone/internet wagering and OTW operations.

As in most states, the regulations and oversight applicable to our operations in Pennsylvania are intended primarily to safeguard the legitimacy of the sport and its freedom from inappropriate or criminal influences. The Harness Racing Commission has broad authority to regulate in the best interests of racing and may, to that end, disapprove the involvement of certain personnel in our operations, deny approval of certain acquisitions following their consummation or withhold permission for a proposed OTW site for a variety of reasons, including community opposition. The Pennsylvania legislature also has reserved the right to revoke the power of the Harness Racing Commission to approve additional OTWs and could, at any time, terminate pari-mutuel wagering as a form of legalized gaming in Pennsylvania or subject such wagering to additional restrictive regulation or taxation.

We have obtained permission from the Harness Racing Commission to conduct live racing at Pocono Downs and to operate the several OTWs that we own. The Harness Racing Commission can refuse to grant permission to continue to operate existing facilities.

Pennsylvania Gaming Regulations

Our slot machine operations at Pocono Downs are subject to extensive regulation under the Pennsylvania Gaming Act. Under that law, the PGCB is responsible for, among other things:

• granting permission annually to maintain existing slot machine licenses;

• approving, after a public hearing, the granting of additional slot machine licenses (to the extent allowed under the Pennsylvania Gaming Act);

• licensing all officers, directors, gaming officials and certain other employees of a company with slot machine operations; and

• approving all contracts entered into by a company affecting slot machine operations.

As in most states, the regulations and oversight applicable to our operations in Pennsylvania are intended primarily to safeguard the legitimacy of gaming and its freedom from inappropriate or criminal influences. The PGCB has broad authority to regulate in the best interests of gaming and may, to that end, disapprove the involvement of certain personnel in our operations, deny approval of certain acquisitions following their consummation or withhold permission on applicable gaming matters for a variety of reasons.

Material Agreements

The following is a summary of the material terms of several of our and the Tribe’s material agreements. This summary does not restate these agreements in their entirety. We urge you to read these agreements because they, and not these summaries, define our rights and obligations and the rights and obligations of the Tribe. Copies of these agreements are included as exhibits to this Form 10-K or by reference to previous filings in the schedule of exhibits hereto.

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Gaming Compact with the State of Connecticut

In April 1994, the Tribe and the State of Connecticut entered into a gaming compact to authorize and regulate the Tribe’s conduct of gaming on the Tribe’s land in Connecticut. The Mohegan Compact has a perpetual term and is substantively similar to the procedures that govern gaming operations of the MPT in Connecticut and provide, among other things, as follows:

(1) The Tribe is authorized to conduct on its reservation those Class III Gaming activities specifically enumerated in the Mohegan Compact or amendments thereto. The forms of Class III Gaming authorized under the Mohegan Compact include: (a) specific types of games of chance; (b) video facsimiles of such authorized games of chance (i.e., slot machines); (c) off-track pari-mutuel betting on animal races; (d) pari-mutuel betting, through simulcasting, on animal races; and (e) certain other types of pari-mutuel betting on games and races conducted at the gaming facility (some types currently are together with off-track pari-mutuel telephone betting on animal races, under a moratorium).

(2) The Tribe must establish standards of operations and management of all gaming operations in order to protect the public interest, ensure the fair and honest operation of gaming activities and maintain the integrity of all Class III Gaming activities conducted on the Tribe’s lands. The first of these standards was set forth in the Mohegan Compact and approved by the State of Connecticut gaming agency. State of Connecticut gaming agency approval is required for any revision to such standards affecting gaming. The Tribe must supervise the implementation of these standards by regulation through a Tribal gaming agency.

(3) Criminal law enforcement matters relating to Class III Gaming activities are under the concurrent jurisdiction of the State of Connecticut and the Tribe.

(4) All gaming employees must obtain and maintain a gaming employee license issued by the State of Connecticut gaming agency.

(5) Any enterprise providing gaming services or gaming equipment to the Tribe is required to hold a valid, current gaming services registration issued by the State of Connecticut gaming agency.

(6) The State of Connecticut annually assesses the Tribe for the costs attributable to its regulation of the Tribe’s gaming operations and for the provision of law enforcement at the Tribe’s gaming facility.

(7) Net revenues from the Tribe’s gaming operations may be applied only for purposes related to Tribal government operations and general welfare, Tribal economic development, charitable contributions and payments to local governmental agencies.

(8) Tribal ordinances and regulations governing health and safety standards at the gaming facilities shall be no less rigorous than certain State of Connecticut standards.

(9) Service of alcoholic beverages within any gaming facility is subject to regulation by the State of Connecticut.

(10) The Tribe waives any defense which it may have by virtue of sovereign immunity with respect to any action brought by the State of Connecticut to enforce the Mohegan Compact in the United States District Court for the District of Connecticut.

In May 1994, the Tribe and the State of Connecticut entered into a MOU, which sets forth certain matters regarding the implementation of the Mohegan Compact. The MOU stipulates that a portion of the revenues earned on slot machines must be paid to the State of Connecticut. This payment is known as the Slot Win Contribution. For each 12-month period commencing July 1, 1995, the Slot Win Contribution shall be the lesser of: (1) 30% of gross revenues from slot machines, or (2) the greater of (a) 25% of gross revenues from slot machines or (b) $80.0 million. The Slot Win Contribution payments will not be required if the State of Connecticut legalizes any other gaming operations with slot machines or other commercial casino games within the State of Connecticut except those operations consented to by the Tribe and the MPT.

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Agreement with the Town of Montville

On June 16, 1994, the Tribe and the Town of Montville entered into an agreement whereby the Tribe agreed to pay to the town $500,000 annually to minimize the impact on the town resulting from the decreased tax revenues on reservation land held in trust. The Tribe assigned its rights and obligations in the agreement with the Town of Montville to us.

Land Lease from the Tribe to the Authority

Mohegan Sun is located upon land that is held in trust for the Tribe by the United States. We entered into a land lease with the Tribe under which the Tribe leases to us the property and all buildings, improvements and related facilities constructed or installed on the property. The lease was approved by the Secretary of the Interior on, and became effective as of, September 29, 1995. Summarized below are several key provisions of this lease. See also “Part I. Item 2. Properties.”

Term

The term of the lease is 25 years with an option, exercisable by us, to extend the term for one additional 25-year period. Upon the termination of the lease, we will be required to surrender to the Tribe possession of the property and improvements, excluding any equipment, furniture, trade fixtures or other personal property.

Rent and Other Operating Expenses

We are required to pay to the Tribe a nominal annual rental fee. For any period when the Tribe or another agency or instrumentality of the Tribe is not the tenant under the lease, the rent will be 8% of the tenant’s gross revenues from the premises. We are responsible for the payment of all costs of owning, operating, constructing, maintaining, repairing, replacing and insuring the leased property.

Use of Leased Property

We may use the leased property and improvements solely for the construction and operation of Mohegan Sun, unless prior approval is obtained from the Tribe for any proposed alternative use. Similarly, no construction or alteration of any building or improvement located on the leased property by us may be made unless complete and final plans and specifications have been approved by the Tribe. Following foreclosure of any mortgage on our interest under the lease or any transfer of such interest to the holder of such mortgage in lieu of foreclosure, the leased property and improvements may be used for any lawful purpose, subject only to applicable codes and governmental regulations; provided, however, that a non-Indian holder of the leased property may not conduct gaming operations on the property.

Permitted Mortgages and Rights of Permitted Mortgagees

We may not mortgage, pledge or otherwise encumber our leasehold estate in the leased property except to a holder of a permitted mortgage. Under the lease, a “permitted mortgage” includes the leasehold mortgage securing our obligations under our secured financing granted by us that provides, among other things, that: (1) the Tribe will have the right to notice of, and to cure, any default by us; (2) the Tribe will have the right to prior notice of an intention by the holder to foreclose on the permitted mortgage and the right to purchase the mortgage in lieu of any foreclosure; and (3) the permitted mortgage is subject and subordinated to any and all access and utility easements granted by the Tribe under the lease. As provided under the lease, each holder of a permitted mortgage has the right to notice of any default by us under the lease and the opportunity to cure such default within any applicable cure period.

Default Remedies

We will be in default under the lease if, subject to the notice provisions, we fail to make lease payments or to comply with our covenants under the lease or if we pledge, encumber or convey our interest in the lease in

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violation of the terms of the lease. Following a default, the Tribe may, with approval from the United States Secretary of the Interior, terminate the lease unless a permitted mortgage remains outstanding with respect to the leased property. In that case, the Tribe may not: (1) terminate the lease or our right to possession of the leased property; (2) exercise any right of re-entry; (3) take possession of and/or relet the leased property or any portion thereof; or (4) enforce any other right or remedy which may materially and adversely affect the rights of the holder of the permitted mortgage, unless the default triggering such rights was a monetary default which such holder failed to cure after notice.

Priority Distribution Agreement with the Tribe

On August 1, 2001, we entered into a priority distribution agreement with the Tribe, which obligates us to make monthly payments to the Tribe to the extent of our net cash flows, as defined under the priority distribution agreement. The priority distribution agreement, which has a perpetual term, also clarifies and records the terms pursuant to which we made such payments to the Tribe prior to the effective date of the priority distribution agreement. The priority distribution agreement obligates us to make monthly priority distribution payments to the Tribe in a maximum aggregate amount of $14.0 million per calendar year, adjusted annually in accordance with the formula specified in the priority distribution agreement to reflect the effects of inflation. However, payments pursuant to the priority distribution agreement do not reduce our obligation to make payments for governmental services provided by the Tribe or any payments under any other agreements with the Tribe to the extent that such agreements are permitted under our bank credit facility. See “Certain Indebtedness—Bank Credit Facility.” The monthly payments under the priority distribution agreement are our limited obligations payable only to the extent of our net cash flows and are not secured by a lien or encumbrance on any of our assets or property.

Relinquishment Agreement with Trading Cove Associates

General

In February 1998, we entered into a relinquishment agreement with Trading Cove Associates, or TCA, under which we and TCA agreed to terminate a then-existing management agreement with TCA. This termination occurred on December 31, 1999. On January 1, 2000, we assumed the day-to-day management of Mohegan Sun. To compensate TCA for terminating its management rights, we agreed to pay to TCA 5% of revenues, as defined under the relinquishment agreement, generated by Mohegan Sun during the 15-year period commencing on January 1, 2000 and ending on December 31, 2014.

Relinquishment Payments

The payments under the relinquishment agreement are divided into senior relinquishment payments and junior relinquishment payments, each of which are 2.5% of revenues (as defined under the relinquishment agreement). Senior relinquishment payments are payable quarterly in arrears and commenced on April 25, 2000, and the junior relinquishment payments are payable semi-annually in arrears and commenced on July 25, 2000. Under the relinquishment agreement, revenues are defined as gross gaming revenues (other than Class II Gaming revenue) and all other facility revenues (including hotel revenues, room service, food and beverage sales, parking revenues, ticket revenues and other fees or receipts from the Mohegan Sun Arena and convention center and all rental or other receipts from the lessees, licensees and concessionaires, but not the gross receipts of such lessees, licensees and concessionaires, and proceeds of business interruption insurance) derived directly or indirectly from the facilities (as such term is defined under the relinquishment agreement). Under the relinquishment agreement, the definition of revenues excludes revenues generated from certain expansion areas of Mohegan Sun, such as the Casino of the Wind, as such areas do not constitute “facilities” as defined under the relinquishment agreement. Accordingly, revenues generated from such areas are not subject to the relinquishment agreement.

Subordination of Relinquishment Payments/Priority Distribution to the Tribe

The relinquishment agreement provides that each of the senior and junior relinquishment payments are subordinated in right of payment to senior secured obligations, which includes our bank credit facility and capital

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lease obligations, and that the junior relinquishment payments are further subordinated to payment of all other senior obligations. The relinquishment agreement also provides that all relinquishment payments are subordinated in right of payment to the minimum priority distribution payment, as defined under the relinquishment agreement, from us to the Tribe to the extent then due.

Trademarks

In connection with the relinquishment agreement, TCA granted us an exclusive, irrevocable, perpetual, world-wide and royalty-free license with respect to trademarks and other similar rights including the “Mohegan Sun” name, used at or developed for Mohegan Sun. We capitalized $130.0 million of the relinquishment liability in connection with the trademark value of the Mohegan Sun brand name.

Pocono Downs Purchase Agreement

In October 2004, we entered into a purchase agreement with a subsidiary of Penn National Gaming, Inc., pursuant to which we acquired the Pocono Downs entities for approximately $280.0 million. In August 2006, we entered into an amendment to the purchase agreement with the seller, a subsidiary of Penn National Gaming, Inc. Pursuant to the amendment, in exchange for our agreement to modify certain provisions of the purchase agreement, including the elimination of our post-closing termination rights, we agreed to receive an aggregate refund of $30.0 million of the original purchase price for the Pocono Downs entities, payable in five annual installments of $7.0 million, $7.0 million, $6.5 million, $6.0 million and $3.5 million in November 2007, 2008, 2009, 2010 and 2011, respectively. We received the $7.0 million installments due in November 2007 and 2008.

In March 2009, we entered into an agreement to accelerate the remaining $16.0 million outstanding refund payments due and discount the amount of such balance to approximately $13.1 million, which we received in March 2009.

Management and Development Agreements with Other Tribes

Cowlitz Project

In September 2004, Salishan-Mohegan entered into development and management agreements with the Cowlitz Tribe regarding the Cowlitz Project. Under the terms of the development agreement, Salishan-Mohegan administers and oversees the planning, designing, development, construction and furnishing, and provides assistance with the financing, of the Cowlitz Project. The development agreement provides for certain development fees of 3.0% of total Project Costs, as defined under the development agreement, which are to be distributed to Mohegan Ventures–NW and the Mohegan Tribe pursuant to the Salishan-Mohegan operating agreement. As of April 2006, Salishan-Mohegan purchased the land to be used as the site for the proposed casino, which will be transferred to the Cowlitz Tribe or the United States under certain conditions in the development agreement. The management agreement is for a period of seven years commencing with the opening of the proposed casino, during which Salishan-Mohegan will manage, operate and maintain the proposed casino. The management agreement provides for a management fee of 24.0% of Net Revenues, as defined under the management agreement, which approximates net income from the Cowlitz Project. Pursuant to the operating agreement, management fees will be allocated to the members of Salishan-Mohegan based on their respective membership interest percentages. Development of the Cowlitz Project is subject to certain governmental and regulatory approvals, including, but not limited to, negotiation of a gaming compact with the State of Washington and acceptance by the United States Department of the Interior of land into trust on behalf of the Cowlitz Tribe. The development agreement provides for termination of Salishan-Mohegan’s exclusive development rights if the land is not taken into trust by a certain date. In July 2009, amendment to the development agreement was amended to extend that date from December 31, 2010 to December 31, 2015. The management agreement is subject to approval by the NIGC.

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Menominee Project

In October 2004, we entered into a management agreement with the Menominee Tribe and the Menominee Kenosha Gaming Authority, or MKGA, regarding the Menominee Project. Terms of the management agreement grant us the exclusive right and obligation to manage, operate and maintain a proposed casino and destination resort to be located in Kenosha, Wisconsin, for a period of seven years commencing with the opening of the proposed casino, in consideration of a management fee of 13.4% of Net Revenues, as defined under the management agreement, which approximates net income earned from the Menominee Project. The management agreement is subject to approval by the NIGC.

In March 2007, WTG was formed to participate in the development of the Menominee Project. WTG consists of two members, our wholly-owned subsidiary, MVW, which holds an 85.4% membership interest in WTG, and a wholly-owned subsidiary of the Mohegan Tribe, MV, which holds the remaining 14.6% membership interest. Following formation in March 2007, WTG purchased the development rights for the Menominee Project under a development agreement with the Menominee Tribe and MKGA executed in October 2003, along with certain other assets, and assumed certain liabilities from Kenesah Gaming Development, LLC for consideration of $6.4 million. As a result of the purchase, we and the Mohegan Tribe, through MVW and MV, respectively, will receive development fees payable to WTG of 13.4% of Available Revenue Flow, as defined under the development agreement with the Menominee Tribe and MKGA, which approximates net income from the Menominee Project over a period of seven years following the opening of the casino. Development of the Menominee Project is subject to certain governmental and regulatory approvals, including but not limited to, the United States Department of the Interior accepting new land into trust for gaming at the project site in Kenosha, Wisconsin.

Certain Indebtedness

The following is a summary of the material terms of our material debt obligations. This summary does not restate in entirety the terms of the agreements under which we incurred the indebtedness. We urge you to read these agreements because they, and not these summaries, define our rights and obligations, and, in some cases, those of the Tribe. Some of these agreements are included as exhibits to this Form 10-K or by reference to previous filings in the schedule of exhibits hereto.

Bank Credit Facility

In December 2008, we amended our bank credit facility pursuant to a third amended and restated loan agreement. As of September 30, 2009, the bank credit facility provided for up to $850.0 million of borrowing capacity, consisting of a $150.0 million term loan and $700.0 million of revolving commitments, from a syndicate of 23 financial institutions and commercial banks, with Bank of America, N.A., serving as Administrative Agent. As of September 30, 2009, the term loan under the bank credit facility amortized at a rate of $750,000 per quarter until June 30, 2010, at which time the amortization rate was to increase to $30.0 million per quarter (with an automatic and permanent reduction of the revolving commitments by such amount following repayment). The maturity date of the bank credit facility is March 9, 2012, upon which date the remaining balances outstanding are payable. See below for further discussion of the bank credit facility as amended by subsequent event.

As of September 30, 2009, there was $713.0 million drawn on the bank credit facility, which was comprised of a $147.0 million term loan and $566.0 million in revolving loans. The revolving loans outstanding as of September 30, 2009 reflect the repayment of our 2003 senior subordinated notes at maturity on July 15, 2009 with proceeds from the bank credit facility. As of September 30, 2009, the amount under letters of credit issued pursuant to the bank credit facility totaled $4.6 million, of which no amounts were drawn. Inclusive of the term loan and letters of credit which reduce borrowing availability, and after taking into account restrictive financial covenants under the bank credit facility, line of credit and note indentures, we had approximately $129.4 million of borrowing capacity under the bank credit facility as of September 30, 2009.

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At our option, each advance of loan proceeds accrues interest on the basis of a base rate or on the basis of a one-month, two-month, three-month, six-month or twelve-month Eurodollar rate, plus in either case, the applicable rate based on either the applicable pricing period as set forth under the bank credit facility or our total leverage ratio, depending on whether the term loan remains outstanding (as each term is defined under the bank credit facility). We also pay commitment fees for the unused portion of the revolving loans on a quarterly basis equal to the product obtained by multiplying the applicable rate for commitment fees by the average daily unused commitment for that calendar quarter. As of September 30, 2009: (1) the applicable rate for base rate loans was between 2.25% and 3.25% if the term loan remains outstanding, and between 0.75% and 2.25% after full repayment of the term loan; (2) the applicable rate for Eurodollar rate loans was between 3.50% and 4.50% if the term loan remains outstanding, and between 2.00% and 3.50% after full repayment of the term loan; and (3) the applicable rate for commitment fees was 0.50% if the term loan remains outstanding, and between 0.20% and 0.50% after full repayment of the term loan. The base rate is the higher of Bank of America’s announced prime rate, the LIBOR rate for one-month contracts plus 1.25% or the federal funds rate plus 0.50%. Interest on base rate loans is payable quarterly in arrears. Interest on Eurodollar rate loans is payable at the end of each applicable interest period or quarterly in arrears, if earlier. As of September 30, 2009, we had $713.0 million in Eurodollar rate loans and no base rate loans outstanding. The Eurodollar rate loans outstanding at September 30, 2009 were comprised of: (1) a $147.0 million term loan based on a one-month Eurodollar rate of 0.25% plus an applicable rate of 3.75%, and (2) $566.0 million in revolving loans based on a one-month Eurodollar rate of 0.24% plus an applicable rate of 3.75%. The applicable rate for commitment fees was 0.50% as of September 30, 2009.

The bank credit facility is collateralized by a lien on substantially all of our assets, including the assets that comprise Pocono Downs and a leasehold mortgage on the land previously taken into trust by the federal government and improvements which comprise Mohegan Sun. We also will be required to pledge additional assets as collateral for the bank credit facility as we or our guarantor subsidiaries acquire them. Our obligations under the bank credit facility are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming. The bank credit facility subjects us to a number of restrictive covenants, including financial covenants. These financial covenants relate to, among other things, our maximum total leverage and senior leverage ratios, minimum fixed charge coverage ratio and maximum capital expenditures.

The bank credit facility includes non-financial covenants by us and the Tribe of the type customarily found in loan agreements for similar transactions including requirements that:

• the Tribe preserve its existence as a federally-recognized Indian tribe;

• the Tribe cause us to continually operate Mohegan Sun and the Pocono Downs entities in compliance with all applicable laws; and

• except under specific conditions, limit us from selling or disposing of our assets, limit the transfer of our and our guarantor subsidiaries’ assets to non-guarantor entities, limit the incurrence by us and our guarantor subsidiaries of other debt or contingent obligations and limit us and our guarantor subsidiaries’ ability to extend credit, make investments or commingle our assets with assets of the Tribe.

As of September 30, 2009, we and the Tribe were in compliance with all of our respective covenant requirements under the bank credit facility.

On October 26, 2009, we issued $200.0 million second lien senior secured notes with fixed interest payable at a rate of 11 ¹/2% per annum, or the 2009 second lien senior secured notes. The net proceeds from this financing were used to repay, among other things, the existing term loan under the bank credit facility, in full, as well as $41.0 million of revolving loans, including a $25.0 million permanent reduction in the revolving commitments. Concurrently with the issuance of the 2009 second lien senior secured notes, we entered into an amendment to the terms of the bank credit facility. Among other things, the amendment: (1) modified our maximum total

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leverage and senior leverage ratio covenants; (2) provided the ability to obtain a release from liens securing the bank credit facility of a portion of the land on which Pocono Downs is sited to permit its sale or lease to a third-party in connection with the development of a potential hotel project, consisting of a minimum of 200 rooms, subject to the satisfaction of customary conditions; (3) modified the terms of our covenant relating to the incurrence of permitted indebtedness to allow us or our subsidiaries to incur additional debt (which may consist of capital lease obligations) in an aggregate amount not to exceed $55.0 million, at any one time outstanding, in connection with the development of the potential hotel project at Pocono Downs; (4) modified the terms of our permitted capital expenditures covenant to affirmatively allow for the existing $125.0 million of permitted capital expenditures to be utilized for Pocono Downs in addition to Mohegan Sun and related businesses, including the payment of licensing fees associated with those operations; (5) permanently reduced the revolving commitments by $25.0 million; and (6) modified the applicable pricing rates as follows: (a) the applicable rate for base rate loans will be between 1.25% and 2.75%, and (b) the applicable rate for Eurodollar rate loans will be between 2.50% and 4.00%.

Upon the repayment of the $147.0 million term loan with proceeds from the issuance of the 2009 second lien senior secured notes and the $25.0 million permanent reduction in revolving commitments, the total commitment of the bank credit facility was reduced from $850.0 million to $675.0 million.

2005 6 ¹/8% Senior Unsecured Notes

In February 2005, we issued $250.0 million senior unsecured notes with fixed interest payable at a rate of 6.125% per annum, or the 2005 senior unsecured notes. The net proceeds from this financing were used to repay amounts outstanding under the then existing bank credit facility and to pay fees and expenses associated with the issuance. The 2005 senior unsecured notes mature on February 15, 2013. The first call date for the 2005 senior unsecured notes was February 15, 2009. Interest on the 2005 senior unsecured notes is payable semi-annually on February 15^th and August 15^th. The 2005 senior unsecured notes are uncollateralized general obligations, which are effectively subordinated, to the extent of the collateral, to all of our existing and future senior secured indebtedness, including the bank credit facility and the 2009 second lien senior secured notes. The 2005 senior unsecured notes rank equally in right of payment with the 2009 second lien senior secured notes and our senior relinquishment payment obligations under the relinquishment agreement that are then due and owing and rank senior to our junior relinquishment payment obligations under the relinquishment agreement that are then due and owing, the 2001 senior subordinated notes, the 2002 senior subordinated notes, the 2004 senior subordinated notes and the 2005 senior subordinated notes. The 2005 senior unsecured notes are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming.

2001 8 ³/8% Senior Subordinated Notes

In July 2001, we issued $150.0 million senior subordinated notes with fixed interest payable at a rate of 8.375% per annum, or the 2001 senior subordinated notes. The proceeds from this financing were used to pay transaction costs, pay down $90.0 million on the then existing bank credit facility and fund costs related to Project Sunburst. Interest on the 2001 senior subordinated notes is payable semi-annually on January 1^st and July 1^st. The 2001 senior subordinated notes mature on July 1, 2011. The first call date for the 2001 senior subordinated notes was July 1, 2006. The 2001 senior subordinated notes are uncollateralized general obligations and are subordinated to the bank credit facility, the 2005 senior unsecured notes, the 2009 second lien senior secured notes and, in a liquidation, bankruptcy or similar proceeding, our senior relinquishment payment obligations under the relinquishment agreement that are then due and owing. The 2001 senior subordinated notes rank equally with the 2002 senior subordinated notes, the 2004 senior subordinated notes, the 2005 senior subordinated notes and our junior relinquishment payment obligations under the relinquishment agreement that are then due and owing. The 2001 senior subordinated notes are fully and unconditionally guaranteed solely by MBC.

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In August 2004, we completed a cash tender offer and consent solicitation to repurchase any or all of the outstanding 2001 senior subordinated notes. As part of the tender offer, we solicited and received requisite consents to certain proposed amendments to the indentures governing the 2001 senior subordinated notes, which substantially eliminated all of the restrictive covenants thereunder. At such time, the aggregate principal amount of the 2001 senior subordinated notes tendered was $133.7 million.

We or our affiliates may, from time to time, seek to purchase or otherwise retire the remaining 2001 senior subordinated notes or other indebtedness for cash in open market purchases, privately negotiated transactions or otherwise, to reduce the amount of our outstanding indebtedness. Any such transactions will depend on prevailing market conditions, our liquidity, covenant restrictions and other factors.

2002 8% Senior Subordinated Notes

In February 2002, we issued $250.0 million senior subordinated notes with fixed interest payable at a rate of 8.000% per annum, or the 2002 senior subordinated notes. The proceeds from this financing were used to pay transaction costs and pay down $243.0 million on the then existing bank credit facility. Interest on the 2002 senior subordinated notes is payable semi-annually on April 1^st and October 1^st. The 2002 senior subordinated notes mature on April 1, 2012. The first call date for the 2002 senior subordinated notes was April 1, 2007. The 2002 senior subordinated notes are uncollateralized general obligations and are subordinated to the bank credit facility, the 2005 senior unsecured notes, the 2009 second lien senior secured notes and, in a liquidation, bankruptcy or similar proceeding, our senior relinquishment payment obligations under the relinquishment agreement that are then due and owing. The 2002 senior subordinated notes rank equally with the 2001 senior subordinated notes, the 2004 senior subordinated notes, the 2005 senior subordinated notes and our junior relinquishment payment obligations under the relinquishment agreement that are then due and owing. The 2002 senior subordinated notes are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming.

2003 6 ³/8% Senior Subordinated Notes

In July 2003, we issued $330.0 million senior subordinated notes with fixed interest payable at a rate of 6.375% per annum, or the 2003 senior subordinated notes. The proceeds from this financing were used to repurchase substantially all of the outstanding 8.75% senior subordinated notes issued in March 1999 and to pay fees and expenses associated with the issuance. Interest on the 2003 senior subordinated notes was payable semi-annually on January 15^th and July 15^th. The 2003 senior subordinated notes matured on July 15, 2009, at which time we repaid the 2003 senior subordinated notes with proceeds from the bank credit facility. As of September 30, 2008, in accordance with authoritative guidance issued by the FASB pertaining to the classification of short-term obligations expected to be refinanced, we classified the 2003 senior subordinated notes as long-term debt for financial reporting purposes based on our intent and ability to refinance this debt on a long-term basis through the use of proceeds from the bank credit facility. The 2003 senior subordinated notes were uncollateralized general obligations and were subordinated to the bank credit facility, the 2005 senior unsecured notes and, in a liquidation, bankruptcy or similar proceeding, our senior relinquishment payment obligations under the relinquishment agreement that were then due and owing. The 2003 senior subordinated notes ranked equally with the 2001 senior subordinated notes, the 2002 senior subordinated notes, the 2004 senior subordinated notes, the 2005 senior subordinated notes and our junior relinquishment payment obligations under the relinquishment agreement that were then due and owing. The 2003 senior subordinated notes were fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming.

2004 7 ¹/8% Senior Subordinated Notes

In August 2004, we issued $225.0 million senior subordinated notes with fixed interest payable at a rate of 7.125% per annum, or the 2004 senior subordinated notes. The net proceeds from this financing, together with

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$130.0 million of availability under the then existing bank credit facility, were used to repurchase substantially all of the outstanding 2001 senior subordinated notes and substantially all of the outstanding 1999 senior notes tendered in the tender offers described above and to pay fees and expenses associated with the issuance. The 2004 senior subordinated notes mature on August 15, 2014. The first call date for the 2004 senior subordinated notes was August 15, 2009. Interest on the 2004 senior subordinated notes is payable semi-annually on February 15^th and August 15^th. The 2004 senior subordinated notes are uncollateralized general obligations and are subordinated to the bank credit facility, the 2005 senior unsecured notes, the 2009 second lien senior secured notes and, in a liquidation, bankruptcy or similar proceeding, our senior relinquishment payment obligations under the relinquishment agreement that are then due and owing. The 2004 senior subordinated notes rank equally with the 2001 senior subordinated notes, the 2002 senior subordinated notes, the 2005 senior subordinated notes and our junior relinquishment payment obligations under the relinquishment agreement that are then due and owing. The 2004 senior subordinated notes are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming.

2005 6 ⁷/8% Senior Subordinated Notes

In February 2005, we issued $150.0 million senior subordinated notes with fixed interest payable at a rate of 6.875% per annum, or the 2005 senior subordinated notes. The net proceeds from this financing were used to repay amounts outstanding under the then existing bank credit facility and to pay fees and expenses associated with the issuance. The 2005 senior subordinated notes mature on February 15, 2015. The first call date for the 2005 senior subordinated notes is February 15, 2010. Interest on the 2005 senior subordinated notes is payable semi-annually on February 15^th and August 15^th. The 2005 senior subordinated notes are uncollateralized general obligations and are subordinated to the bank credit facility, the 2005 senior unsecured notes, the 2009 second lien senior secured notes and, in a liquidation, bankruptcy or similar proceeding, our senior relinquishment payment obligations under the relinquishment agreement that are then due and owing. The 2005 senior subordinated notes rank equally with the 2001 senior subordinated notes, the 2002 senior subordinated notes, the 2004 senior subordinated notes and our junior relinquishment payment obligations under the relinquishment agreement that are then due and owing. The 2005 senior subordinated notes are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming.

The senior and senior subordinated note indentures contain certain financial and non-financial covenants with which we and the Tribe must comply. The financial covenants include, among other things, limitations on restricted payments and the incurrence of indebtedness, while the non-financial covenants include, among other things, reporting obligations, compliance with laws and regulations and our continued existence. As of September 30, 2009, we and the Tribe were in compliance with all of their respective covenant requirements under the senior and senior subordinated note indentures.

Line of Credit

As of September 30, 2009, we had an $18.0 million revolving loan agreement with Bank of America, N.A., or the line of credit. The line of credit was amended in May 2009 to reduce the commitment from $25.0 million to $18.0 million and extend the maturity date from May 14, 2009 to May 14, 2010. Each advance accrues interest on the basis of a one-month Eurodollar rate or prime rate, plus the applicable margin determined on the basis of our total leverage ratio, as each term is defined under the line of credit. Borrowings under the line of credit are uncollateralized obligations. As of September 30, 2009, we had $12.2 million in Eurodollar rate loans outstanding, which were based on a one-month Eurodollar rate of 0.26% plus an applicable rate of 3.25%. The line of credit subjects us to certain covenants, including a covenant to maintain at least the line of credit commitment amount available for borrowing under the bank credit facility. As of September 30, 2009, we were in compliance with all covenant requirements under the line of credit and had $5.8 million of borrowing capacity thereunder.

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Letters of Credit

As of September 30, 2009, we maintained seven uncollateralized letters of credit to satisfy potential workers’ compensation liabilities, pari-mutuel wagering tax liabilities of the Pocono Downs entities, overdue amounts for purses due to horsemen at the Pocono Downs entities, potential contractor and subcontractor liabilities relating to Project Horizon, collateral obligations of a surety bond relating to Pennsylvania Gaming Tax expenses owed by Downs Racing to the PGCB, and two in connection with road work at the Pocono Downs facilities. The letters of credit expire(d) on various dates from November 2009 through September 2010, subject to renewals. As of September 30, 2009, no amounts were drawn on the letters of credit.

Salishan-Mohegan Bank Credit Facility

On September 30, 2009, Salishan-Mohegan entered into an amendment to the terms of its then existing $25.0 million revolving loan agreement with Bank of America, N.A., or the Salishan credit facility, dated October 17, 2006. Among other things, the amendment reduced the total commitment of the credit facility from $25.0 million to $17.0 million, extended the maturity date from September 30, 2009 to September 30, 2010 and modified the applicable pricing rates. At the option of Salishan-Mohegan, each advance of loan proceeds accrues interest on the basis of a base rate or on the basis of a one-month, two-month, three-month or six-month Eurodollar rate, plus a spread of 2.50% for base rate loans and an applicable rate, as defined under the Salishan credit facility, or 3.50% for Eurodollar rate loans. The base rate is the higher of Bank of America’s announced prime rate or the federal funds rate plus 0.50%. The applicable rate for commitment fees is 0.50%. The revolving loan has no mandatory amortization provisions and is payable in full at maturity. In connection with the amendment, the Tribe loaned Salishan-Mohegan $10.0 million, which was used to repay revolving loans under the Salishan credit facility. The Salishan credit facility is collateralized by a lien on substantially all of the existing and future assets of Salishan-Mohegan. The obligations of Salishan-Mohegan under the Salishan credit facility also are guaranteed by the Tribe. The Salishan credit facility subjects Salishan-Mohegan to a number of restrictive covenants, including financial and non-financial covenants customarily found in loan agreements for similar transactions.

As of September 30, 2009, Salishan-Mohegan had $13.3 million in base rate loans and no Eurodollar rate loan outstanding. The loans outstanding at September 30, 2009 were based on a base rate of 3.25% plus a spread of 2.50%. The applicable rate for commitment fees was 0.50% as of September 30, 2009. As of September 30, 2009, Salishan-Mohegan had $3.7 million of borrowing capacity under the Salishan credit facility.

Mohegan Tribe Promissory Note

On September 30, 2009, the Tribe loaned Salishan-Mohegan $10.0 million, which was used to repay revolving loans under the Salishan credit facility in connection with the September 30, 2009 amendment to the Salishan credit facility, as further described above. The promissory note executed by Salishan-Mohegan in favor of the Tribe, or the Mohegan Tribe promissory note, provides for the accrual of interest at an annual rate of 15.0% and matures on October 1, 2010. Accrued interest is paid at a monthly rate of 3.0%, with the remaining 12.0% due at maturity.

Environmental Matters

The site on which Mohegan Sun is located was formerly occupied by United Nuclear Corporation, a naval products manufacturer of, among other things, nuclear reactor fuel components. United Nuclear Corporation’s facility was officially decommissioned in June 1994 when the Nuclear Regulatory Commission confirmed that all licensable quantities of such nuclear material had been removed from the site and that any residual contamination from such material was remediated according to the Nuclear Regulatory Commission approved decommissioning plan.

From 1991 through 1993, United Nuclear Corporation commissioned environmental audits and soil sampling programs which detected, among other things, volatile organic chemicals, heavy metals and fuel hydrocarbons in the soil and groundwater. The Connecticut Department of Environmental Protection, or the DEP, reviewed the

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environmental audits and reports and established cleanup requirements for the site. In December 1994, the DEP approved United Nuclear Corporation’s remedial plan, which determined that groundwater remediation was unnecessary because although the groundwater beneath the site was contaminated, it met the applicable groundwater criteria given the classification of the groundwater under the site. In addition, extensive remediation of contaminated soils and additional investigation were completed to achieve the DEP’s cleanup criteria and demonstrate that the remaining soils complied with applicable cleanup criteria. Initial construction at the site also involved extensive soil excavation. According to the data gathered in a 1995 environmental report commissioned by United Nuclear Corporation, remediation is complete and is consistent with the applicable Connecticut cleanup requirements. The DEP has reviewed and approved the cleanup activities at the site, and, as part of the DEP’s approval, United Nuclear Corporation was required to perform post-closure groundwater monitoring at the site to ensure the adequacy of the cleanup. In addition, under the terms of United Nuclear Corporation’s environmental certification and indemnity agreement with the Department of the Interior (which took the former United Nuclear Corporation land into trust for the Tribe), United Nuclear Corporation agreed to indemnify the Department of the Interior for environmental actions and expenses based on acts or conditions existing or occurring as a result of United Nuclear Corporation’s activities on the property.

We are not currently incurring, and did not incur in the fiscal years ended September 30, 2009, 2008 and 2007, any material costs related to compliance with environmental requirements with respect to the Mohegan Sun site’s former use by the United Nuclear Corporation. Notwithstanding the foregoing, no assurance can be given that any existing environmental studies reveal all environmental liabilities, or that future laws, ordinances or regulations will not impose any material environmental liability, or that a material environmental condition does not otherwise currently exist.

Prior to acquiring the Pocono Downs entities, we conducted an extensive environmental investigation of the Pocono Downs facilities. In the course of that investigation, we identified several environmental conditions at Pocono Downs facility for which corrective actions were necessary to bring the property into compliance with applicable laws and regulations. Downs Racing implemented a comprehensive plan to mitigate and resolve these conditions. As of July 2008, Downs Racing has completed its remediation project and by all indications, remediation measures are functioning appropriately. In addition, in the summer of 2008, Pocono Downs was contacted by the Pennsylvania Department of Environmental Protection, or PA DEP, regarding permitting and other procedures for the management of the manure produced by the large volume of horses at the facility. Pocono Downs is currently completing the permitting process through the PA DEP and will evaluate additional measures that may be required or desired with respect to management of manure produced at its harness horseracing facility.

Employees and Labor Relations

As of September 30, 2009, the Connecticut entities employed approximately 7,965 full-time employees and 1,675 seasonal, part-time and on-call employees. Pursuant to the Tribal Employment Rights Ordinance, when recruiting and hiring personnel, except with respect to key personnel, Mohegan Sun is obligated to give preference first to qualified members of the Tribe and then to enrolled members of other Indian tribes. See “Certain Relationships and Related Transactions.” None of Mohegan Sun’s employees are covered by collective bargaining agreements.

As of September 30, 2009, the Pocono Downs entities employed approximately 775 full-time employees and 330 part-time and on-call employees. Certain of our Pocono Downs employees are represented under collective bargaining agreements between Downs Racing, the International Union of Operating Engineers Local Union 542C, or Local Union 542C, and Teamsters Local No. 401, or Local No. 401. The agreement with Local Union 542C expires on March 31, 2010 and relates to equipment and heavy equipment operators. The agreement with Local No. 401 expires on January 31, 2012 and relates to truck drivers and maintenance employees.

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Item 1A. Risk Factors.

In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, set forth below are cautionary statements identifying important factors that could cause actual events or results to differ materially from any forward-looking statements made by or on behalf of us, whether oral or written. We wish to ensure that any forward-looking statements are accompanied by meaningful cautionary statements in order to maximize to the fullest extent possible the protections of the safe harbor established in the Private Securities Litigation Reform Act of 1995. Accordingly, any such statements are qualified in their entirety by reference to, and are accompanied by, the following important factors that could cause actual events or results to differ materially from our forward-looking statements. Refer also to “Cautionary Note Regarding Forward-Looking Statements” on page 1 of this Form 10-K.

Risks Related to Our Business

Our substantial indebtedness could adversely affect our financial condition.

We currently have and will continue to have a significant amount of indebtedness. As of September 30, 2009, our debt totaled $1.63 billion. As of September 30, 2009, there was $713.0 million drawn on the bank credit facility, which was comprised of a $147.0 million term loan and $566.0 million in revolving loans. Inclusive of the term loan and letters of credit which reduce borrowing availability, and after taking into account restrictive financial covenants under the bank credit facility, line of credit and note indentures, we had approximately $129.4 million of borrowing capacity under the bank credit facility as of September 30, 2009. After also taking into consideration our October 26, 2009 issuance of $200.0 million second lien senior secured notes and the use of proceeds therefrom for repayment of the $147.0 million term loan and $41.0 million of revolving loans (including a $25.0 million permanent reduction in the revolving commitments), our borrowing capacity under the bank credit facility approximated $145.4 million as of September 30, 2009.

Our substantial indebtedness could have significant adverse effects on our business. Such adverse effects include, but are not limited to, the following:

• make it more difficult for us to satisfy our debt service obligations;

• increase our vulnerability to adverse economic, industry and competitive conditions;

• require us to dedicate a substantial portion of our cash flows from operations to payments on our indebtedness, thereby reducing the availability of our cash flows to fund working capital, capital expenditures and other general operating requirements;

• limit our flexibility in planning for, or reacting to, changes in our business and the gaming industry, which may place us at a disadvantage compared to our competitors with stronger liquidity positions, thereby hurting our results of operations and ability to meet our debt service obligations with respect to our outstanding indebtedness;

• restrict us from exploiting business opportunities;

• place us at a competitive disadvantage compared to our competitors that have less debt and lease obligations; and

• limit, along with the financial and other restrictive covenants in our outstanding indebtedness, the ability to borrow additional funds for working capital, capital expenditures, acquisitions, debt service requirements, execution of our business strategy or other general operating requirements on satisfactory terms or at all.

In addition, our bank credit facility and the indentures governing our existing senior and senior subordinated notes contain, and the agreements evidencing or governing other future indebtedness may contain, restrictive covenants that will limit our ability to engage in activities that may be in our long-term best interests. Our failure to comply with those covenants could result in an event of default which, if not cured or waived, could result in the acceleration of the required repayment of some or all of our indebtedness.

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Our failure to generate sufficient cash flows could prevent us from fulfilling our debt service obligations, and we may be forced to take other actions to satisfy our obligations under our indebtedness that may not be successful.

Our ability to make payments on and to refinance our indebtedness will depend upon our ability to generate cash flows from operations in the future. This, to a certain extent, is subject to financial, economic, political, competitive, regulatory and other factors beyond our control. If we are unable to generate sufficient cash flows from operations, or if future borrowings are not available to us under our bank credit facility or from other sources, we may be unable to meet our debt service obligations with respect to our outstanding indebtedness.

We believe that we will need to refinance all or part of our indebtedness at or prior to each maturity thereof. Our access to financing depends on the willingness of banks to lend to us, our credit rating and conditions in the capital markets in general. We cannot assure you that we will be able to obtain debt for refinancing or to fund our growth, or that financing options available to us will be on favorable or acceptable terms. We may have to adopt one or more alternative strategies, such as reducing or delaying planned capital expenditures, disposing of some of our assets and/or seeking to restructure some or all of our debt. These financing strategies may not be affected on satisfactory terms, if at all.

There is also a risk that the banks that participate in our bank credit facility may not be able to perform when we request additional funds to be advanced to us under our bank credit facility. If funds are not available to be drawn under the terms of the bank credit facility we may not be able to secure additional financing.

Our diversification efforts may not be successful.

We receive and evaluate various opportunities to diversify our business interests. These opportunities primarily include the development and/or management of, investment in, or ownership of other gaming enterprises through direct investments, acquisitions, joint venture arrangements and loan transactions. We are currently pursuing diversification efforts in the states of Washington (the Cowlitz Project) and Wisconsin (the Menominee Project) and in the Commonwealth of Massachusetts. Each of these efforts requires various levels of regulatory approval prior to development of the proposed projects, and a failure to achieve any of these approvals may result in the termination of the respective project. Additionally, there can be no assurance that we will continue to pursue any of these opportunities or that any of them will be consummated.

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.

Although we, the Tribe, MBC, Mohegan Ventures-NW, Mohegan Golf, MVW, and to the extent applicable, the Pocono Downs entities, WTG and MTGA Gaming, each have sovereign immunity and generally may not be sued without our and their respective consents, a limited waiver of sovereign immunity and consent to suit has been granted in connection with substantially all of our outstanding indebtedness. Each such waiver includes suits against us to enforce our obligation to repay certain outstanding indebtedness. Generally, waivers of sovereign immunity have been held to be enforceable against Indian tribes. In the event that any waiver of sovereign immunity is held to be ineffective, a claimant could be precluded from judicially enforcing its rights and remedies. With limited exceptions, we, the Tribe, MBC, Mohegan Ventures-NW, Mohegan Golf, MVW, the Pocono Downs entities, WTG and MTGA Gaming have not waived sovereign immunity from private civil suits, including violations of the federal securities laws. For this reason, a claimant may not have any remedy against us, the Tribe, MBC, Mohegan Ventures-NW, Mohegan Golf, MVW, the Pocono Downs entities, WTG or MTGA Gaming for violations of federal securities laws.

Disputes may be brought in a federal or state court that has jurisdiction over the matter. However, federal courts may not exercise jurisdiction over disputes not arising under federal law, and some courts have ruled that an Indian tribe is not a citizen of any state for purposes of obtaining federal diversity jurisdiction. Without our consent, state courts may not exercise jurisdiction over disputes with us arising on the Mohegan reservation. In

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addition, the Tribe’s Constitution has established a special court, the Gaming Disputes Court, to rule on disputes with respect to Mohegan Sun. The federal and state courts, under the doctrines of comity and exhaustion of tribal remedies, may (1) defer to the jurisdiction of the Gaming Disputes Court or (2) require that any plaintiff exhaust its remedies in the Gaming Disputes Court before bringing any action in federal or state court. Thus, there may be no federal or state court forum with respect to a dispute.

If an event of default occurs in connection with our indebtedness, no assurance can be given that a forum will be available to creditors other than the Gaming Disputes Court. In such court, there are presently limited precedents for the interpretation of Tribal law with respect to insolvency. Any execution of a judgment of the Gaming Disputes Court or any other court on Tribal lands will require the cooperation of the Tribe’s officials in the exercise of their police powers. Thus, to the extent that a judgment of the Gaming Disputes Court must be executed on Tribal lands, the practical realization of any benefit of such a judgment will be dependent upon the willingness and ability of Tribal officials to carry out such judgment. In addition, the land on which Mohegan Sun is located is owned by the United States in trust for the Tribe, and our creditors and the creditors of the Tribe may not foreclose upon or obtain title to the land. Additionally, although we do not presently hold any fee interest in real property, if we did in the future, federal law may not allow for real property interest to be mortgaged or, if mortgaged, transferred as a result of foreclosure.

The non-impairment provision of the Tribe’s Constitution is subject to change.

Unlike states, the Tribe is not subject to the U.S. Constitution’s provision restricting governmental impairment of contracts. The Tribe’s Constitution currently has a provision that prohibits the Tribe from enacting any law that would impair the obligations of contracts entered into in furtherance of the development, construction, operation and promotion of gaming on Tribal lands. However, this provision could be amended by a vote of 75% of the Tribe’s registered voters to impair the obligation of such contracts.

We and the Guarantors are controlled by a tribal government and may not necessarily be operated in the same way as if we and they were privately owned for-profit businesses.

We and the guarantors are subject to control by the Tribe. Our Management Board is comprised of the same nine members of the Mohegan Tribal Council, the governing body of the Tribe, with legislative and executive authority. As a sovereign government, the Tribe is governed by elected officials who have a responsibility for the welfare of all members of the Tribe. In making decisions relative to us and the guarantors, these officials may consider the interests of their electorate, instead of pure economic or other business factors.

Any rights as a creditor are limited to our assets and those of our guarantor subsidiaries.

Any rights as a creditor in a bankruptcy, if applicable, liquidation or reorganization or similar proceeding would be limited to our assets and the assets of our guarantor subsidiaries, and would not encompass the assets of any other subsidiary that is not a guarantor, the Tribe or its other affiliates.

We, the Tribe and our wholly-owned subsidiaries may not be subject to the federal bankruptcy laws, which could impair the ability of creditors to participate in the realization on our or our subsidiaries’ assets or the restructuring of related liabilities if we are unwilling or unable to meet our debt service obligations.

We, the Tribe and our wholly-owned subsidiaries may not be subject to, or permitted to seek protection under, the federal bankruptcy laws since an Indian tribe and we, as an instrumentality of the Tribe, may not be a “person” eligible to be a debtor under the U.S. Bankruptcy Code. Therefore, our creditors may not be able to seek liquidation of our assets or other action under federal bankruptcy laws. Also, the Gaming Disputes Court may lack powers typically associated with a federal bankruptcy court, such as the power to non-consensually alter liabilities, direct the priority of creditors’ payments and liquidate certain assets. The Gaming Disputes Court is a court of limited jurisdiction and may not have jurisdiction over all creditors of ours or our subsidiaries or over all of the territory in which we and our subsidiaries carry on business.

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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.

Our bank credit facility and the indentures to which we are a party contain customary operating and financial restrictions that limit our discretion on various business matters. These restrictions include covenants limiting our ability to:

• incur additional indebtedness;

• pay dividends or make other distributions;

• make certain investments;

• use assets as security in other transactions;

• sell certain assets or merge with or into another person;

• grant liens;

• make capital expenditures; and

• enter into transactions with affiliates.

These restrictions may, among other things, reduce our flexibility in planning for, or reacting to, changes in our business and the gaming industry in general and thereby may negatively impact our financial condition, results of operations and our ability to meet our debt service obligations.

The bank credit facility also requires us to maintain a fixed charge coverage ratio and not to exceed certain ratios of senior leverage and total leverage, as defined under the bank credit facility. If these ratios are not maintained or are exceeded, as applicable, it may not be possible for us to borrow additional funds to meet our obligations.

Our indentures also require us to maintain a fixed charge coverage ratio, as defined therein. If these ratios are not maintained, it may not be possible for us to borrow additional funds to meet our obligations.

Additionally, our failure to comply with covenants in our debt instruments could result in an event of default, which, if not cured or waived, could have a material adverse effect on us and could result in the acceleration of the required repayment of some or all of the then-outstanding amounts of such debt and an inability to make debt service payments.

Continued weakness or a further downturn in the United States economy could negatively impact our financial performance.

During periods of economic contraction, our revenues may decrease while some of our costs remain fixed, resulting in decreased earnings. This is because the gaming and other leisure activities that we offer are discretionary expenditures and participation in such activities may decline during economic downturns because consumers have less disposable income. Even an uncertain economic outlook may adversely affect consumer spending in our gaming operations and related facilities, because consumers spend less in anticipation of a potential economic downturn.

The current global economic recession has negatively impacted consumer confidence and the amount of consumer spending at Mohegan Sun and Pocono Downs. Continued adverse economic conditions such as a prolonged regional, national or global general economic downturn, including periods of increased inflation, unemployment levels, tax rates, interest rates, energy prices or declining consumer confidence could also further reduce consumer spending. Reduced consumer spending has and may continue to result in an adverse impact on our business, financial condition and operating results. Furthermore, uncertainty and adverse changes in the economy could also increase the cost and reduce the availability of sources of financing, which could have a

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material adverse impact on our financial condition and operating results. If adverse economic conditions continue or worsen, our business, assets, financial condition and results of operations could continue to be affected adversely.

The loss of a key management member could have a material adverse effect on us, Mohegan Sun and the Pocono Downs entities.

Our success depends in large part on the continued service of key management personnel, particularly Mitchell Grossinger Etess, Chief Executive Officer of the Authority and Chief Executive Officer and President of Mohegan Sun, Jeffrey E. Hartmann, Chief Operating Officer of the Authority and Executive Vice President and Chief Operating Officer of Mohegan Sun, Leo M. Chupaska, Chief Financial Officer of the Authority, and Robert J. Soper, President and General Manager of the Pocono Downs entities. The loss of the services of one or more of these individuals or other key personnel could have a material adverse effect on our business, operating results and financial condition. The key management personnel are currently retained pursuant to employment agreements.

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.

Our properties and operations are subject to a wide range of environmental laws and regulations governing, among other things, air emissions, wastewater discharges, the use, management and disposal of hazardous and non-hazardous materials and wastes, and the clean-up of contamination. Noncompliance with such laws and regulations, and past or future activities resulting in environmental releases, could cause us to incur substantial costs, including clean-up costs, fines and penalties, investments to retrofit or upgrade our facilities and programs, or could affect our operations.

The site on which Mohegan Sun is located was formerly occupied by United Nuclear Corporation, a naval products manufacturer of, among other things, nuclear reactor fuel components. Prior to the decommissioning of United Nuclear Corporation facilities on the site, extensive remediation of contaminated soils and additional investigations were completed. The site currently meets federal and state remediation requirements.

Prior to acquiring the Pocono Downs entities, we conducted an extensive environmental investigation of the Pocono Downs facilities. In the course of that investigation, we identified several environmental conditions at the Pocono Downs facility for which corrective actions were necessary to bring the property into compliance with applicable laws and regulations, including measures relating to a previously closed landfill at the site. Downs Racing implemented a comprehensive plan to mitigate and resolve these conditions. As of July 2008, Downs Racing has completed its remediation project and by all indications, remediation measures are functioning appropriately. In addition, in the summer of 2008, Downs Racing was contacted by the PA DEP regarding permitting and other procedures for the management of the manure produced by the large volume of horses at the facility. Downs Racing is currently completing the permitting process through the PA DEP and will evaluate additional measures that may be required or desired with respect to management of manure produced at its harness horseracing facility.

Notwithstanding the foregoing, we cannot assure you that:

• the various environmental reports or any other existing environmental studies prepared with respect to these sites revealed all environmental liabilities;

• any prior owners or tenants did not create any material environmental condition not known to us;

• future laws, ordinances or regulations will not impose any material environmental liability; or

• a material environmental condition does not otherwise exist on any site.

Any of the above could have a material adverse effect upon our future operating results and ability to meet our debt service obligations.

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Risks Related to Mohegan Sun

The following summarizes the material risks we face as a result of existing and potential competition that may affect our results of operations at Mohegan Sun. A more extensive discussion of the competitive landscape affecting Mohegan Sun can be found under “Market and Competition from Other Gaming Operations.” In addition, our harness racing and slot machine operations at Pocono Downs are subject to competition in Pennsylvania and Southeastern New York, as described below under “—Risks Related to Our Pocono Downs Operations.”

We face intense competition in our target market from Foxwoods Resort Casino.

The existing gaming industry in our market areas is highly competitive. Mohegan Sun primarily competes with Foxwoods Resort Casino, including MGM Grand at Foxwoods, which opened in May 2008, or collectively Foxwoods, owned and operated by the MPT. Foxwoods is approximately ten miles from Mohegan Sun and is the largest gaming facility in the United States in terms of total gaming positions. Foxwoods has been in operation for more than 15 years.

In addition to Foxwoods, we also face competition from existing casinos and other gaming operations elsewhere in our market areas and potentially from on-line gaming.

While Mohegan Sun and Foxwoods are the only two legally authorized gaming operations in New England offering traditional slot machines and table games, we also currently face competition from casinos in Atlantic City, New Jersey and several casinos and gaming facilities located on Indian tribal lands in the State of New York and Video Lottery Terminal, or VLT, facilities in the states of New York and Rhode Island, as well as potential competition from prospective gaming projects announced by other Indian tribes and the expansion of state-licensed gaming in the Northeastern United States. We also face existing and future competition in and from the Pennsylvania gaming market, both in the immediate market for Pocono Downs, and for Mohegan Sun, in marketing to and attracting patrons from the New York City metropolitan region.

In addition, congressional leaders are considering legislation to establish a licensing, taxing and enforcement framework for internet gaming, and, in November 2009, the U.S. Treasury Department and Federal Reserve Board delayed the December 1, 2009 effective date for financial institutions to comply with the Unlawful Internet Gambling Enforcement Act of 2006, or the UIGEA, by six months. Unless delayed further or amended, the UIGEA is scheduled to restrict credit card companies from processing on-line poker and other gaming transactions from United States’ cardholders effective June 1, 2010; however, no assurances can be made that the effectiveness of the UIGEA will not be further delayed or that the restrictions contained in the UIGEA will be implemented.

Mohegan Sun competes directly for customers with resort casinos in Atlantic City, New Jersey. Many of these casinos may have greater resources, operating experience and name recognition than Mohegan Sun and may benefit from available mass transit options. Moreover, several Atlantic City properties have completed or are undergoing renovation and expansion, which could make them more attractive destinations and divert potential customers from Mohegan Sun.

New York has six federally-recognized Indian tribes located in the central, northern and western parts of the state. Three of these tribes, the Oneida Nation of New York, the Seneca Nation and the St. Regis Mohawk Tribe of New York, currently engage in casino gaming. There are several active proposals for tribally-owned casinos in the Catskills region of New York, which under state legislation adopted in 2001, is permitted to host up to three tribal casinos, or the expansion of state-licensed VLT gaming and racino facilities in the region. In addition, the Shinnecock Indian Nation, a state-recognized tribe based on Long Island, recently received preliminary federal recognition from the BIA and is expected to receive a final decision on recognition before June 2010. If federally-recognized, the Shinnecock Indian Nation is expected to pursue one or more forms of gaming in the

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State of New York. Any of these projects, if successful, could add significant casino space and hotel rooms to the Northeastern United States gaming market and divert potential customers from Mohegan Sun and Pocono Downs.

Also, in New York, the state lottery has taken the legal position that electronic versions of roulette, baccarat, blackjack and craps are legal in the state and may be introduced as early as 2010. Additionally, the Governor of New York reopened the bidding process for a developer to build and operate VLTs at Aqueduct Racetrack, with that facility expected to open within two years.

Two facilities located in Rhode Island operate an aggregate of approximately 6,200 VLTs.

New market entrants in our market areas could adversely affect our operations and our ability to meet our financial obligations.

Under current law, outside of Atlantic City, New Jersey, full-scale commercial casino gaming in the Northeastern United States may be conducted only by federally-recognized Indian tribes operating under federal Indian gaming laws or on cruise ships in international waters. In recent years, there has been an increase in the number of Indian tribes seeking to engage in commercial casino gaming, including full-scale commercial casinos, in the Northeastern United States and efforts have continued by a number of individual groups seeking to obtain federal recognition as Indian tribes so that they may engage in commercial casino gaming in the Northeastern United States. These efforts are ongoing in Connecticut, Maine, Massachusetts, New York and Rhode Island.

In addition, a number of states, including Maine, Massachusetts, New Hampshire, Rhode Island and New York, have considered or are considering legalization of one or more forms of commercial casino gaming by non-Indians in one or more locations, and Maryland and Ohio have authorized slot machine facilities by voter referendum. Based on internal analysis of the existing and potential gaming market in our market areas, we believe that competition from other commercial casino gaming operations will continue to increase in the future. In Massachusetts, where we are seeking to operate commercial casino gaming, if legalized, we are unable to predict if we will be successful in our efforts. We are also unable to predict whether any of the efforts discussed above by other federally recognized Indian tribes, individual groups attempting to gain federal recognition as Indian tribes or legalization of commercial casino gaming by non-Indians will lead to the establishment of additional commercial casino gaming operations in the Northeastern United States. If established, we are uncertain of the impact such commercial casino gaming operations will have on 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.

The gaming industry in the State of Connecticut has experienced seasonal fluctuations, with the heaviest gaming activity occurring between the months of May and August. Similarly, the heaviest gaming activity has occurred at Mohegan Sun between the months of May and August. As a result of these seasonal fluctuations, we likely will continue to experience seasonal variations in our quarterly revenue and operating results that could result in decreased cash flows during periods in which gaming activity is not at peak levels. These variations in quarterly revenue and operating results could adversely affect our overall financial condition.

Negative conditions affecting the lodging industry may have an adverse affect on our revenue and cash flows.

We depend on the revenue generated from the hotel at Mohegan Sun, together with the revenue generated from the other portions of Mohegan Sun, to meet our debt obligations and fund our operations. Revenue generated from the operation of the hotel is subject primarily to conditions affecting our gaming operations, but is also subject to the lodging industry in general, and as a result, our cash flows and financial performance may be

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affected not only by the conditions in the gaming industry, but also by those in the lodging industry. Some of these conditions are as follows:

• changes in the local, regional or national economic climate;

• changes in local conditions such as an oversupply of hotel properties;

• decreases in the level of demand for hotel rooms and related services;

• the attractiveness of our hotel to consumers and competition from comparable hotels;

• cyclical over-building in the hotel industry;

• changes in travel patterns;

• changes in room rates and increases in operating costs due to inflation and other factors; and

• the periodic need to repair and renovate the hotel.

The current global economic recession has had a negative impact on the lodging industry and on our financial results. The continuation of, or adverse changes in, these conditions could further adversely affect our hotel’s financial performance and results of operations.

Our obligations under the relinquishment agreement could affect adversely our financial condition and prevent us from fulfilling our debt service obligations.

Pursuant to the terms of the relinquishment agreement, we are required, among other things, to pay TCA 5% of certain revenues (as defined under the relinquishment agreement) generated by Mohegan Sun during the 15-year period which commenced on January 1, 2000. During the fiscal year ended September 30, 2009, we paid $61.7 million in relinquishment payments.

This obligation consumes a significant portion of our operating cash flows that might otherwise be available to, among other things, reduce indebtedness and fund working capital, capital expenditures and other general operating requirements and thereby affect our ability to meet our debt service obligations. As a result, our flexibility in planning for, or reacting to, changes in our business and the gaming industry in general is reduced. This may place us at a disadvantage compared to our competitors that do not have such an obligation.

Our renovation projects may face significant inherent risks that could adversely affect our financial condition.

Construction costs and completion dates for our renovation projects are based on budgets, design documents and schedule estimates prepared with the assistance of architects, contractors and consultants. Such projects are inherently subject to significant development and construction risks, which could cause unanticipated cost increases. These include the following:

• escalation of construction costs above anticipated amounts;

• shortage of material and skilled labor;

• weather interference;

• engineering problems;

• environmental problems;

• fire, flood and other natural disasters;

• labor disputes; and

• geological, construction, demolition, excavation and/or equipment problems.

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Furthermore, although construction activities may be planned to minimize disruption, construction noise and debris and the temporary closing of some of the facility, such activities may disrupt our current operations. Unexpected construction delays could exacerbate or magnify these disruptions. We cannot assure you that our construction, renovation or expansion projects will not have a material adverse effect on our results of operations.

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.

In connection with any of our construction, renovation or expansion projects, we may suspend, elect not to proceed with or fail to complete such projects once they have been undertaken. In such case, we may be required to carry assets on our balance sheet for suspended projects or incur significant costs relating to design and construction work performed and materials purchased that may no longer be useful for terminated projects. In addition, our agreements or arrangements with third parties relating to the suspension or termination of such projects could cause us to incur additional fees and costs. Our suspension of, election not to proceed with, or failure to complete construction, renovation or expansion projects may result in adverse effects to our financial condition.

In September 2008, we announced the suspension of the hotel, retail and new parking garage elements of Project Horizon due to a slowdown in business volumes and uncertainties in the financial markets resulting from the ongoing national economic recession. We currently are evaluating our options with respect to development of the suspended elements, including a new hotel; however, we can provide no assurance as to if or when the suspended elements will resume or the effects that such delay will have on our business, operations or financial condition. As of September 30, 2009, we had incurred approximately $83.3 million for the suspended elements of Project Horizon and we estimate approximately $1.7 million in additional costs related thereto. During the fourth quarter ended September 30, 2009, we expensed $4.5 million of costs related to the suspended elements as such assets did not have any future use to us.

The risks associated with operating an expanded facility and managing its growth could have a material adverse effect on Mohegan Sun’s future performance.

With the opening of Casino of the Wind and Sunrise Square, we have a larger amount of gaming space, more entertainment venues and retail space than previously. If we complete the suspended elements of Project Horizon, we also will have a new hotel and additional retail space. There can be no assurance that we will be successful in integrating the new amenities into Mohegan Sun’s current operations or in managing the expanded resort. The failure to integrate and manage the new services and amenities successfully could have a material adverse effect on our results of operations and our ability to meet our debt service obligations with respect to our outstanding indebtedness.

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.

Gaming on the Tribe’s reservation is regulated extensively by federal, state and tribal regulatory bodies, including the NIGC and agencies of the State of Connecticut, such as the Department of Revenue Services’ Division of Special Revenue, the State Police and the Department of Consumer Protection’s Division of Liquor Control. As is the case with any casino, changes in applicable laws and regulations could limit or materially affect the types of gaming that may be conducted, or services provided, by us and the revenues realized therefrom.

Currently, the operation of all gaming on Indian lands is subject to IGRA. In past years, legislation has been introduced in Congress with the intent of modifying a variety of perceived problems with IGRA. Some of the proposals that have been considered would be prospective in effect and contain clauses that would grandfather

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existing Indian gaming operations such as Mohegan Sun. Legislation also has been proposed; however, which would have the effect of repealing many of the key provisions of IGRA and prohibiting the continued operation of particular classes of gaming on Indian reservations in states where such gaming is not otherwise allowed on a commercial basis. While none of the substantive proposed amendments to IGRA have been enacted, we cannot predict the effects of future legislative acts. In the event that Congress passes prohibitory legislation that does not include any grandfathering exemption for existing tribal gaming operations, and if such legislation is sustained in the courts against tribal challenge, our ability to meet our debt service obligations would be materially and adversely affected.

In addition, under federal law, gaming on Indian land is dependent on the permissibility under state law of specific forms of gaming or similar activities. If the State of Connecticut were to make various forms of gaming illegal or against public policy, such action may have an adverse effect on our ability to conduct our gaming operations. In fact, in January 2003, the State of Connecticut repealed its Las Vegas nights statute, but the state Attorney General opined that the repeal did not affect the two existing Indian gaming compacts. Connecticut currently permits, among other things, a state lottery, jai alai fronton betting, greyhound racing and off-track betting parlors.

A change in our current tax-exempt status, and that of our subsidiaries, could reduce our cash flow and have a material adverse effect on our ability to meet our debt service obligations.

Based on current interpretation of the Internal Revenue Code of 1986, as amended, or the Code, we, the Tribe and certain of our subsidiaries are not subject to federal income taxes. However, we cannot assure you that Congress will not reverse or modify the exemption for Indian tribes from federal income taxation.

Efforts have been made in Congress over the past several years to amend the Code to provide for taxation of the net income of tribal business entities. These efforts have included a House of Representatives bill that would have taxed gaming income earned by Indian tribes as unrelated business income subject to corporate tax rates. Although no such legislation has been enacted, such legislation could be passed in the future. A change in the tax law could have a material adverse effect on our financial performance.

Risks Related to Pocono Downs

The adoption of modifications to the Pennsylvania Race Horse Development and 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.

In the Commonwealth of Pennsylvania, the addition of table games at existing gaming facilities in the state, the licensing of additional resort hotel gaming facilities, which under existing law may offer up to 500 slot machines, and the licensing of video-poker at restaurants, private clubs and bars throughout the state, are under consideration by the state legislature. Since slot machine gaming is a relatively new industry in the Commonwealth of Pennsylvania and table gaming, if adopted, will be even newer, the legislature is likely to review and consider amendments to the Pennsylvania Gaming Act in future legislative sessions. As with any gaming operation, changes in applicable laws or regulations could limit or materially affect the types of gaming we may conduct or the services we may provide at Pocono Downs. If any legislation or legal challenges were to succeed, our ability to continue to operate a gaming site at Pocono Downs could be adversely affected.

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.

Two facilities operate close to Pocono Downs and are more likely than the other licensed slot operations to have an impact on our Pocono Downs operations. These two facilities are the Mount Airy Resort and Casino in Mount Pocono, approximately 40 miles from Pocono Downs, and Sands Bethlehem, in Bethlehem, approximately 70 miles from Pocono Downs.

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In addition to the current and future slot facilities in Pennsylvania, including two proposed facilities seeking approval in Philadelphia, Pocono Downs faces competition from a VLT gaming facility at Monticello Raceway in Monticello, New York and also from any full-scale casino gaming operation that is ultimately developed by an Indian tribe in the Catskills region. The Catskills are approximately 90 miles from Pocono Downs. Pocono Downs also faces competition from Tioga Downs Racetrack in Nichols, New York, approximately 100 miles from Pocono Downs, which operates a racetrack and gaming floor with 750 VLTs. Also, while the states of Maryland and Ohio are not in the immediate Pocono Downs market, expanded gaming in those states, authorized by voter referendum, may affect overall gaming in Pennsylvania, the OTW facilities and other gaming facilities with which Pocono Downs competes for patrons.

We are uncertain of the impact these racetracks and planned commercial casino gaming operations will have on our operations and our ability to meet our financial obligations.

Our operations of the Pocono Downs business subject us to regulation by the Pennsylvania Gaming Control Board and Pennsylvania’s State Harness Racing Commission.

As owners and operators of the Pocono Downs gaming and entertainment facility offering slot machine gaming, live harness racing and off-track wagering in the Commonwealth of Pennsylvania, we are subject to extensive state regulation by the Pennsylvania Gaming Control Board, or the PGCB, the Harness Racing Commission and other state regulatory bodies such as the liquor control board. Applicable rules and regulations may require that we obtain and renew periodically a variety of registrations, permits and approvals to conduct our operations. Regulatory bodies may, for any reason set forth in the applicable legislation, rules and regulations, limit, condition, suspend, deny or revoke a license to conduct our operations as we intend to conduct them. We cannot assure you that we will be able to continually renew all registrations, permits, approvals or licenses necessary to conduct our business in Pennsylvania as we intend to conduct it. Any of these events, or any changes in applicable laws or regulations, could have a material adverse effect on our business, financial condition and results of operations.

Changes in or the issuance of additional regulations by the PGCB may adversely affect our operations at Pocono Downs.

Under the Pennsylvania Gaming Act, the PGCB has broad authority to regulate gaming activities. Slot machine gaming is still a new industry in Pennsylvania and many of the rules and regulations governing gaming are still evolving. New or changing regulations could adversely affect our gaming operations at Pocono Downs.

Assessments for regulatory costs may negatively impact our operating results.

Under the Pennsylvania Gaming Act, the Pennsylvania Department of Revenue and the PGCB have the right to assess certain regulatory costs against slot machine operators. The amount of such costs and the allocation methodology for assessing licensed facilities has not been finalized in regulations. These assessments could adversely affect our operating results at Pocono Downs.

Item 1B. Unresolved Staff Comments.

None.

Item 2. Properties.

Mohegan Sun is located on 185 acres of the Tribe’s approximately 507-acre reservation just outside of Uncasville, Connecticut, approximately one mile from the interchange of Interstate 395 and Connecticut Route 2A. The land located in southeastern Connecticut upon which Mohegan Sun is situated is held in trust for the Tribe by the United States. Mohegan Sun has its own exit from Route 2A, giving patrons direct access to Interstate 395 and Interstate 95, the main highways connecting Boston, Providence and New York City. By highway, Mohegan Sun is approximately 125 miles from New York City, New York, 100 miles from Boston, Massachusetts, 45 miles from Hartford, Connecticut and 50 miles from Providence, Rhode Island.

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We have a lease with the Tribe for land on which Mohegan Sun is located. The initial term of the lease is 25 years, with an option to renew for one additional 25-year term provided that we are not in default under the lease. The lease also provides that all improvements constructed on the site will become the property of the Tribe. The lease is a net lease requiring that we assume all costs of operating, constructing, maintaining, repairing, replacing and insuring the leased property, in addition to the payment of a nominal annual rental fee.

We have entered into various lease agreements with the Tribe for properties adjacent to Mohegan Sun. The properties are used for providing access and/or parking for Mohegan Sun.

In connection with the purchase of the Pocono Downs entities, we acquired Pocono Downs, a harness racing facility located on approximately 400 acres of land in Plains Township, Pennsylvania. The harness racing facility is currently one of only two harness racetracks in Pennsylvania and one of only four thoroughbred and harness racing facilities in the state. It has a 5/8 mile all-weather, lighted track with seating for approximately 3,500 and parking capacity for approximately 6,500. Pocono Downs, the first slot machine facility in the Commonwealth of Pennsylvania, was opened at the Pocono Downs racetrack in November 2006. In addition, we also acquired the OTW facility located in Carbondale, Erie, which was subsequently sold to a third party in July 2007, and Lehigh Valley (Allentown), and we lease the East Stroudsburg and Hazleton facilities. The Lehigh Valley OTW is a 28,000 square-foot facility and is the largest OTW in the Commonwealth of Pennsylvania.

Salishan-Mohegan owns land in Clark County, Washington for the purposes of developing a casino to be owned by the Cowlitz Tribe. Mohegan Ventures-NW, one of three members in Salishan-Mohegan, is our wholly-owned subsidiary. The Mohegan Tribe is also a member of Salishan-Mohegan. The land shall be transferred to the Cowlitz Tribe or the United States upon: (1) receipt of necessary financing for the development of the proposed casino; and (2) the underlying property being accepted to be taken into trust by the United States Department of the Interior.

In November 2006, we formed a wholly owned subsidiary, Mohegan Golf, to purchase and operate a golf course in southeastern Connecticut. In May 2007, Mohegan Golf acquired substantially all of the assets of Pautipaug Country Club, Inc., which included a golf course located in Sprague and Franklin, Connecticut. The club was renamed Mohegan Sun Country Club at Pautipaug and first opened under the ownership of Mohegan Golf in June 2007.

Item 3. Legal Proceedings.

We are a defendant in litigation incurred in our normal course of business. We believe that, based on the advice of counsel, the aggregate liability, if any, arising from such litigation will not have a material adverse effect on our financial position, results of operations or cash flows.

Item 4. Submission of Matters to a Vote of Security Holders.

None.

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PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

We have not issued or sold any equity securities.

Item 6. Selected Financial Data.

The selected financial data shown below for the fiscal years ended September 30, 2009, 2008 and 2007 and as of September 30, 2009 and 2008, have been derived from our consolidated financial statements included in this Form 10-K. The selected financial data shown below for the fiscal years ended September 30, 2006 and 2005 and as of September 30, 2007, 2006 and 2005 have been derived from our financial statements for those years, which are not included in this Form 10-K. The financial information shown below should be read in conjunction with our consolidated financial statements and related notes beginning on page F-1 of this Form 10-K, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and the other financial and statistical data included in this Form 10-K. Amounts shown in the following table are in thousands.

	As of or for the Fiscal Years Ended September 30,
	2009			2008			2007			2006			2005
Operating Results:
Gross revenues	$	1,572,714		$	1,707,738		$	1,751,912		$	1,547,971		$	1,454,066
Promotional allowances		(117,597	)		(135,555	)		(131,846	)		(124,917	)		(125,148	)
Net revenues	$	1,455,117		$	1,572,183		$	1,620,066		$	1,423,054		$	1,328,918
Income from operations (1)	$	242,746		$	263,366		$	292,568		$	249,232		$	139,136
Total other expense (2)		(125,394	)(3)		(116,835	)		(120,670	)		(94,882	)(4)		(116,211	)
Income from continuing operations before minority interests		117,352			146,531			171,898			154,350			22,925
Minority interests		1,992			2,729			648			420			514
Income from continuing operations		119,344			149,260			172,546			154,770			23,439
Total income from discontinued operations (5)		-			-			21			147			228
Net income	$	119,344		$	149,260		$	172,567		$	154,917		$	23,667
Other Data:
Interest expense, net of capitalized interest	$	109,689		$	93,793		$	94,363		$	90,928		$	88,011
Capital expenditures	$	93,532		$	383,688		$	162,195		$	101,920		$	50,991
Net cash flows provided by operating activities	$	171,811		$	170,316		$	284,403		$	254,260		$	247,075
Balance Sheet Data:
Total assets	$	2,295,083		$	2,362,905		$	2,079,977		$	1,914,357		$	1,856,868
Long-term debt and capital lease obligations	$	1,609,215		$	1,528,991		$	1,276,109		$	1,225,804		$	1,226,348

(1) Total operating costs and expenses, included in income from operations include non-cash relinquishment liability reassessment credits of $45.7 million and $68.9 million for the fiscal years 2009 and 2008, respectively, and non-cash relinquishment liability reassessment charges of $3.0 million, $39.4 million and $123.6 million for the fiscal years 2007, 2006 and 2005, respectively. A discussion of our accounting for the relinquishment liability may be found in Notes 2 and 11 to our consolidated financial statements, beginning on page F-1 of this Form 10-K.

(2) For the fiscal years ended September 30, 2009, 2008, 2007, 2006 and 2005, total other expense includes $20.4 million, $27.1 million, $29.8 million, $30.7 million and $27.5 million, respectively, for the accretion of discount to the relinquishment liability, to reflect the impact of the time value of money. A discussion of our accounting for the relinquishment liability may be found in Notes 2 and 11 to our consolidated financial statements, beginning on page F-1 of this Form 10-K.

(3) Includes an $8.5 million gain on early extinguishment of debt in connection with a repurchase of $14.3 million of our outstanding 2001 8³/₈ % senior subordinated notes due July 1, 2011. A discussion of this transaction may be found in Note 6 to our consolidated financial statements, beginning on page F-1 of this Form 10-K. Also includes $4.5 million in asset write-offs related to previously capitalized Project Horizon costs. A discussion of this transaction may be found in Note 10 to our consolidated financial statements, beginning on page F-1 of this Form 10-K.

(4) Includes a non-cash gain of $24.5 million in connection with an amendment to the purchase agreement for Pocono Downs. A discussion of this transaction may be found in Note 10 to our consolidated financial statements, beginning on page F-1 of this Form 10-K.

(5) A discussion of our accounting for discontinued operations may be found in Note 16 to our consolidated financial statements, beginning on page F-1 of this Form 10-K.

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with our consolidated financial statements and related notes beginning on page F-1 of this Annual Report on Form 10-K, Item I. Business and Item 6. Selected Financial Data.

Overview

The Tribe and the Authority

The Mohegan Tribe of Indians of Connecticut, or the Mohegan Tribe or the Tribe, is a federally-recognized Indian tribe with an approximately 507-acre reservation situated in southeastern Connecticut, adjacent to Uncasville, Connecticut. Under the Indian Gaming Regulatory Act of 1988, or the IGRA, federally-recognized Indian tribes are permitted to conduct full-scale casino gaming operations on tribal lands, subject to, among other things, the negotiation of a gaming compact with the state in which they operate. The Tribe and the State of Connecticut have entered into such a compact, the Mohegan Compact, which has been approved by the United States Secretary of the Interior. We were established as an instrumentality of the Tribe, with the exclusive power to conduct and regulate gaming activities on tribal lands and the non-exclusive authority to conduct such activities elsewhere. Our gaming operation at Mohegan Sun is one of only two legally authorized gaming operations in New England offering traditional slot machines and table games. Through our subsidiary, Downs Racing, L.P., or Downs Racing, we also own and operate Mohegan Sun at Pocono Downs, a gaming and entertainment facility offering slot machines and harness racing situated on a 400-acre site in Plains Township, Pennsylvania, and several off-track wagering facilities, or OTW, located elsewhere in Pennsylvania, collectively the Pocono Downs entities. We are governed by a nine-member Management Board, whose members also comprise the Mohegan Tribal Council, the governing body of the Tribe. Any change in the composition of the Mohegan Tribal Council results in a corresponding change in our Management Board.

Mohegan Sun

In October 1996, we opened a gaming and entertainment complex known as Mohegan Sun. Mohegan Sun is located on a 185-acre site on the Tribe’s reservation overlooking the Thames River with direct access from Interstate 395 and Connecticut Route 2A. Mohegan Sun is approximately 125 miles from New York City, New York and approximately 100 miles from Boston, Massachusetts. In fiscal 2002, we completed a major expansion of Mohegan Sun known as Project Sunburst, which included increased gaming, restaurant and retail space, an entertainment arena, an approximately 1,200-room luxury Sky Hotel Tower and approximately 100,000 square feet of convention space. In fiscal 2007 and 2008, we completed the Sunrise Square and Casino of the Wind components of Project Horizon, respectively.

Mohegan Sun operates in an approximately 3.1 million square-foot facility, which includes the following:

Casino of the Earth

As of September 30, 2009, Casino of the Earth had approximately 188,000 square feet of gaming space and offered:

• approximately 3,700 slot machines and 190 table games (including blackjack, roulette, craps and baccarat);

• food and beverage amenities, including Birches Bar & Grill, an approximately 200-seat full-service restaurant, three full-service themed fine dining restaurants, with a fourth area featuring cuisine from all three adjacent restaurant themes, a 630-seat buffet, a Hong Kong-style food outlet offering authentic Southeast Asian cuisine, an 87-seat Bobby Flay’s Bobby’s Burger Palace and multiple service bars, all operated by us, as well as Frank Pepe Pizzeria Napoletana, operated by a third-party, and the recently opened Fidelia’s Market, a 123-seat multi-station food court, operated by us and third parties, for a total seating of approximately 2,000;

• the Wolf Den, an approximately 10,000-square-foot, 400-seat lounge featuring live entertainment seven days a week;

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• an approximately 9,000-square-foot simulcasting Racebook facility;

• four retail shops providing shopping opportunities ranging from Mohegan Sun logo souvenirs to cigars; and

• Sunrise Square, a 9,800-square-foot Asian-themed gaming area offering 46 table games.

Casino of the Sky

As of September 30, 2009, Casino of the Sky had approximately 119,000 square feet of gaming space and offered:

• approximately 2,300 slot machines and 110 table games (including blackjack, roulette and craps);

• food and beverage amenities, including a full-service restaurant, a 24-hour coffee shop, a 330-seat buffet and five lounges and bars, all operated by us, as well as five full-service restaurants, three quick-service restaurants and a multi-station food court, operated by third parties, for a total seating of approximately 2,600;

• Mohegan After Dark, consisting of Ultra 88, a nightclub, Lucky’s Lounge and Dubliner, an Irish pub, all operated by a third-party;

• the Mohegan Sun Arena with seating for up to 10,000;

• The Shops at Mohegan Sun containing 32 retail shops, seven of which we own;

• an approximately 1,200-room luxury Sky Hotel Tower with a private high limit table games suite;

• an approximately 20,000-square-foot spa operated by a third-party;

• approximately 100,000 square feet of convention space; and

• a child care facility and an arcade-style entertainment area operated by a third-party.

Casino of the Wind

As of September 30, 2009, Casino of the Wind had approximately 45,000 square feet of gaming space and offered:

• approximately 700 slot machines, 30 table games (including blackjack, roulette and craps) and a 42-table themed poker room; and

• 20,000 square feet of dining and retail amenities, including a two-level, 16,000-square-foot Jimmy Buffett’s Margaritaville Restaurant, operated by a third-party, and Chief’s Deli, a casual dining restaurant operated by us.

Mohegan Sun has parking spaces for approximately 13,000 guests and 3,900 employees. In addition, we operate a gasoline and convenience center, an approximately 3,600-square-foot, 20-pump facility located adjacent to Mohegan Sun.

Project Horizon

Project Horizon, Mohegan Sun’s second major expansion, was initially planned to include four major components: Sunrise Square, Casino of the Wind, Property Infrastructure, including a new parking garage, additional surface parking lots, site development and road improvements, and the Earth Expansion, including a new hotel and related retail areas, as well as improvements to the existing Winter Parking Garage and Winter Entrance. As of September 30, 2009, two of the components, Sunrise Square and Casino of the Wind, have been completed. Additionally, the Winter Parking Garage improvements, surface parking lots, site development and road improvements were completed as of September 30, 2009.

Sunrise Square was completed in August 2007 and includes 9,800 square feet of gaming space offering 46 table games, a 3,500-square-foot bus lobby and a 4,000-square-foot Hong Kong-style food outlet.

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Casino of the Wind was completed in August 2008 and adds approximately 45,000 square feet of gaming space, approximately 700 slot machines, 30 table games and a 42-table themed poker room, as well as approximately 20,000 square feet of dining and retail amenities.

In September 2008, we announced the suspension of the hotel, retail and new parking garage elements of Project Horizon due to a slowdown in business volumes and uncertainties in the financial markets resulting from the national economic recession. The costs incurred for the suspended elements were related to excavation and foundation work for the planned podium and hotel tower, as well as professional fees for design and architectural work. We are currently evaluating our options with respect to the development of the suspended elements, including the new hotel; however, we can provide no assurance as to if or when the suspended elements will resume. The specific factors that we will consider in determining the feasibility of the suspended elements include our financial performance, cash flow projections expected to be realized from the project, estimated project costs, ability to obtain financing, economic conditions, industry trends and competition.

The Winter Entrance of the Earth Expansion, which connects the Winter Parking Garage to Casino of the Earth, opened in early July 2009. The renovated Winter Entrance incorporates new food and beverage facilities, including: Bobby Flay’s Bobby’s Burger Palace, Frank Pepe Pizzeria Napoletana and Fidelia’s Market, a quick-serve dining area featuring Jasper White’s Summer Shack Express, Woodland Wok and Chief’s Bagels, Subs & Sweets. Additionally, Bobby Flay’s Bar American and The Original SoupMan were opened in November 2009. Bobby Flay’s Bar Americain is located in the area previously occupied by Fidelia’s Restaurant. The Original SoupMan is located in Fidelia’s Market. Estimated remaining project costs relating to the Winter Entrance consist primarily of costs to complete the theming of the Winter Entrance.

As of September 30, 2009, a breakdown of project costs incurred, estimated remaining project costs and total project costs for the various Project Horizon elements, was as follows:

(in millions, excluding capitalized interest)	Project Costs Incurred		Estimated Remaining Project Costs (1)		Total Project Costs
Components Completed or In Process:
Sunrise Square	$	16.7	$	-	$	16.7
Casino of the Wind		111.3		-		111.3
Property Infrastructure		37.2		-		37.2
Winter Parking Garage Improvements		3.4		-		3.4
Winter Entrance		35.6		12.4		48.0
Subtotal		204.2		12.4		216.6
Components Suspended:
Earth Expansion		81.1		1.7		82.8
New Parking Garage		2.2		-		2.2
Subtotal		83.3		1.7		85.0
Total	$	287.5	$	14.1	$	301.6

(1) Anticipated to be incurred in fiscal 2010.

Mohegan Basketball Club

In January 2003, we formed a wholly-owned subsidiary, Mohegan Basketball Club, LLC, or MBC, for the purpose of owning and operating a professional basketball team in the Women’s National Basketball Association, or WNBA. MBC entered into a membership agreement with the WNBA permitting it to operate the Connecticut Sun basketball team. The team plays its home games in the Mohegan Sun Arena.

Mohegan Golf

In November 2006, we formed a wholly-owned subsidiary, Mohegan Golf, LLC, or Mohegan Golf, to purchase and operate a golf course in southeastern Connecticut. In May 2007, Mohegan Golf acquired substantially all of

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the assets of Pautipaug Country Club Inc., or PCC, which included a golf course located in Sprague and Franklin, Connecticut. The golf course was renamed Mohegan Sun Country Club at Pautipaug and reopened under the ownership of Mohegan Golf in June 2007.

Pocono Downs

Through Downs Racing, we own and operate the slot machine and harness racing facility known as Mohegan Sun at Pocono Downs situated on a 400-acre site in Plains Township, Pennsylvania, and OTWs located in Carbondale, East Stroudsburg, Hazleton and Lehigh Valley, Pennsylvania. Harness racing has been conducted at Pocono Downs since 1965. The Lehigh Valley OTW is a 28,000-square-foot facility and is the largest OTW in the Commonwealth of Pennsylvania.

Downs Racing completed the 2009 harness racing season at Pocono Downs in November 2009 and will continue its harness racing activities when the 2010 racing season begins in the spring of 2010. Year-round simulcast pari-mutuel racing activities also are conducted at Pocono Downs and the OTW facilities. Construction of a new paddock, adjacent to the racetrack, was completed in April 2009.

Downs Racing holds a Category One slot machine license issued by the Pennsylvania Gaming Control Board, or PGCB, for the operation of slot machines at Pocono Downs. This license permits Downs Racing to install and operate up to 3,000 slot machines at Pocono Downs. Under certain circumstances, Downs Racing may install and operate up to a total of 5,000 slot machines.

Pocono Downs became the first location to offer slot machine gaming in the Commonwealth of Pennsylvania when Phase I of its gaming and entertainment facility opened in November 2006. The total cost incurred for development of the Phase I facility was approximately $70.0 million.

Pocono Downs opened Project Sunrise on July 17, 2008. Pocono Downs offers approximately 2,500 slot machines and electronic table games and several dining options including: Ruth’s Chris Steakhouse, Rustic Kitchen Bistro and Bar, which features dining and a live cooking show, Bar Louie, a casual bar and restaurant, Timbers Buffet, a 300-seat Mohegan Indian cultural heritage themed buffet, and a food court, including: Johnny Rockets, Hot Dog Hall of Fame, Puck Express by Wolfgang Puck and Ben & Jerry’s Ice Cream. Pocono Downs also offers a wide array of retail amenities, including: Brookstone, Marshall Rousso women’s couture, Misura men’s fine apparel boutique, Crossing Vineyards Wine and Cheese Shop, and MOGO, the Pocono Downs logo store. Project Sunrise also added three bars/lounges: Sunburst Bar, featured in the center of the gaming floor, Breakers Night Club and Pearl Sushi Bar. In addition, the food court that previously operated in the Phase I facility has been renovated as a 275-seat banquet and meeting venue, which opened in October 2008. The renovated facility now serves as a multi-purpose venue. The final cost of Project Sunrise, including the Phase I renovation, is anticipated to be approximately $198.0 million, excluding capitalized interest.

In March 2009, we and a subsidiary of Penn National Gaming, Inc. entered into an amendment to the purchase agreement for Pocono Downs. Pursuant to the amendment, the parties agreed to accelerate the remaining $16.0 million refund payment due to us and discount the amount of such balance to approximately $13.1 million, which we received in March 2009. We incurred a non-cash loss in connection with this transaction totaling approximately $1.6 million.

Other Diversification Projects

The Tribe has determined that it is in its long-term best interest to pursue diversification of its business interests, both directly and through us. As a result, from time to time, we and the Tribe receive and evaluate various proposed business opportunities. These opportunities primarily include the proposed development and management of, investment in, or proposed ownership of additional gaming enterprises through direct investments, acquisitions, joint venture arrangements and loan transactions. In addition to the developments described below, we and the Tribe are currently exploring other opportunities; there is no assurance, however, that we or the Tribe will continue to pursue any of these opportunities or that any of them will be consummated.

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Cowlitz Project

In July 2004, we formed Mohegan Ventures-Northwest, LLC, or Mohegan Ventures-NW, one of three current members in Salishan-Mohegan, LLC, or Salishan-Mohegan. Salishan-Mohegan was formed to participate in a proposed development and management of a casino to be located in Clark County, Washington, or the Cowlitz Project, and owned by the Cowlitz Indian Tribe, or the Cowlitz Tribe. Mohegan Ventures-NW holds a 49.15% membership interest, the Mohegan Tribe holds a 7.85% membership interest and Salishan Company, LLC, or Salishan Company, holds a 43% membership interest in Salishan-Mohegan. Mohegan Ventures-NW and the Mohegan Tribe each hold one of four seats on the Board of Managers of Salishan-Mohegan.

In September 2004, Salishan-Mohegan entered into development and management agreements with the Cowlitz Tribe regarding the Cowlitz Project, which agreements have been amended from time to time. Under the terms of the development agreement, Salishan-Mohegan administers and oversees the planning, designing, development, construction and furnishing, and provides assistance with the securing of financing, of the Cowlitz Project. The development agreement provides for certain development fees of 3% of total Project Costs, as defined under the development agreement, which are to be distributed to Mohegan Ventures-NW pursuant to the Salishan-Mohegan operating agreement. As of April 2006, Salishan-Mohegan purchased the land to be used as the site for the proposed casino, which will be transferred to the Cowlitz Tribe or the United States under certain conditions in the development agreement. The management agreement is for a period of seven years commencing with the opening of the proposed casino, during which Salishan-Mohegan will manage, operate and maintain the proposed casino. The management agreement provides for a management fee of 24% of Net Revenues, as defined under the management agreement, which approximates net income from the Cowlitz Project. Pursuant to the operating agreement, management fees will be allocated to the members of Salishan-Mohegan based on their respective membership interest percentages. Development of the Cowlitz Project is subject to certain governmental and regulatory approvals, including, but not limited to, negotiation of a gaming compact with the State of Washington and acceptance by the United States Department of the Interior of land into trust on behalf of the Cowlitz Tribe. The development agreement provides for termination of Salishan-Mohegan’s exclusive development rights if the land is not taken into trust by a certain date. In July 2009, the development agreement was amended to extend that date from December 31, 2010 to December 31, 2015. The management agreement is subject to approval by the National Indian Gaming Commission, or the NIGC.

In May 2008, the Bureau of Indian Affairs, or BIA, published a final rule relating to gaming on trust lands acquired after October 17, 1988. The new rule addresses, among other things, the process used by the BIA to determine what lands should be taken into trust for an initial reservation or restored lands for a tribe, such as the Cowlitz Tribe, seeking its initial or restored reservation. The new rule also expressly provides that a tribe may rely on earlier final agency decisions, including decisions of the NIGC, regarding lands to be taken into trust. In November 2005, the Cowlitz Tribe received an opinion from the NIGC determining that if the Secretary of the Interior takes the Cowlitz Project site into trust, the land will constitute restored lands of the Cowlitz Tribe. Based on this opinion by the NIGC, the additional analysis called for under the May 2008 rule is not expected to apply to the BIA’s decision in connection with the Cowlitz Tribe. In May 2008, the BIA published a Final Environmental Impact Statement, or Final EIS, for the Cowlitz Project site.

In February 2009, the U.S. Supreme Court issued a decision in a case involving the State of Rhode Island and the Narragansett Indian Tribe, which held that the Secretary of the Interior may exercise his authority to acquire trust title to land for an Indian tribe under the Indian Reorganization Act only if the tribe was “under federal jurisdiction” when the Indian Reorganization Act was enacted on June 18, 1934 (Carcieri v. Salazar, 555 U.S.              (2009) or the Carcieri decision). Since the trust land application for the Cowlitz Project requires action by the Secretary of the Interior under the Indian Reorganization Act, the Carcieri decision may delay action on that application until the BIA and the United States Department of the Interior determine whether the Cowlitz Tribe was under federal jurisdiction at that time, and an adverse decision may lead to a rejection of the trust land application. The Cowlitz Tribe did not receive federal recognition until 2000, so, based on the Carcieri decision, the tribe must establish that it was under federal jurisdiction in 1934 by separate means. In September 2009, following earlier congressional hearings on the Carcieri decision, the Chairman of the Senate Indian Affairs

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Committee introduced legislation to reverse the impact of the decision and reaffirm the authority of the Secretary of the Interior to take land into trust for Indian tribes regardless of when the tribe was recognized by the federal government. On December 17, 2009, the full Senate Indian Affairs Committee passed the bill. We believe that the Cowlitz Tribe, as a federally-recognized but landless tribe, will ultimately be able to establish its reservation and that casino gaming will be permitted on such lands; however, we can provide no assurance in this regard.

In light of the aforementioned and the inherent uncertainty in the development of the Cowlitz Project, we maintain a reserve for doubtful collection of the Salishan-Mohegan receivables, which is based on our estimate of the probability that the receivables will be collected. While certain events described above, including the publication of the Final EIS for the Cowlitz Project site, are generally positive steps in furtherance of the project, other events, including the Carcieri decision, may ultimately delay or prevent the completion of the project. However, considered collectively, these events have not materially changed our current interest in or assessment of the Cowlitz Project, nor do such events affect the extent to which we plan to continue our involvement in the Cowlitz Project.

Menominee Project

In October 2004, we entered into a management agreement with the Menominee Indian Tribe of Wisconsin, or the Menominee Tribe, and the Menominee Kenosha Gaming Authority, or MKGA. The terms of the management agreement grant us the exclusive right and obligation to manage, operate and maintain a proposed casino and destination resort to be located in Kenosha, Wisconsin, or the Menominee Project, for a period of seven years commencing with the opening of the proposed casino, in consideration of a management fee of 13.4% of Net Revenues, as defined under the management agreement, which approximates net income earned from the Menominee Project. The management agreement is subject to approval by the NIGC.

In March 2007, Wisconsin Tribal Gaming, LLC, or WTG, was formed to participate in the Menominee Project. WTG consists of two members, our wholly-owned subsidiary, Mohegan Ventures Wisconsin, LLC, or MVW, which holds an 85.4% membership interest in WTG, and a wholly-owned subsidiary of the Mohegan Tribe, Mohegan Ventures, LLC, or MV, which holds the remaining 14.6% membership interest. Following formation in March 2007, WTG purchased the development rights for the Menominee Project under a development agreement with the Menominee Tribe and MKGA, which was executed in October 2003, along with certain other assets, and assumed certain liabilities from Kenesah Gaming Development, LLC, for consideration of $6.4 million. The development agreement provides for certain development fees of 13.4% of Available Revenue Flow, as defined under the development agreement, which approximates net income from the Menominee Project over a period of seven years following the opening of the proposed casino, which are to be paid to WTG and distributed to the Authority and the Mohegan Tribe, through MVW and MV, respectively. Development of the Menominee Project is subject to certain governmental and regulatory approvals, including, but not limited to, the United States Department of the Interior accepting land into trust for the Menominee Tribe’s project site in Kenosha, Wisconsin.

In January 2009, the BIA informed the Menominee Tribe of the decision by the United States Secretary of the Interior to decline to take the Menominee Project site in Kenosha into trust for the Menominee Tribe. The rejection of the application to take the Kenosha site into trust was based on a policy for reviewing trust land acquisitions for off-reservation gaming projects adopted by the BIA in January 2008 in a guidance memorandum and contradicted an earlier recommendation from the BIA’s Regional Director. In March 2009, the Menominee Tribe withdrew a related lawsuit against the federal government while reserving its right to re-file in the event the January 2008 guidance memorandum is not withdrawn and the decision on the Menominee Project site is not reconsidered and reversed by the Secretary of the Interior. The United States Supreme Court’s Carcieri decision, discussed above, is not expected to affect the Menominee Project. We believe the rejection of the land into trust application for the Kenosha site announced in January 2009 decreased the probability that the Menominee Tribe will obtain the necessary regulatory approvals in order to proceed with the Menominee Project, and officials appointed by the new presidential administration have not yet taken a position on reversal of the January 2008 guidance memorandum or the January 2009 rejection of the Kenosha application. As of September 30, 2008, we

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had fully reserved the WTG receivables pertaining to reimbursable development costs and expenses in connection with the Menominee Project and have written-off the remaining related development rights intangible asset. As of September 30, 2009, the WTG receivables remain fully reserved.

Pursuant to an option agreement, as amended, which was assigned to WTG upon its purchase of the development rights for the Menominee Project, for the purchase of Dairyland Greyhound Park in Kenosha, the proposed site for the Menominee Project, in November 2009, WTG consented to the cessation of operations at the Dairyland Greyhound Park and the option payments were accordingly adjusted, subject to various conditions. The current operators of the Dairyland Greyhound Park have announced that the facility will be closed in January 2010.

Other Projects

In March 2008, we formed Mohegan Gaming & Hospitality, LLC, or MG&H, with the Tribe to evaluate and pursue new business opportunities. Our wholly-owned subsidiary, MTGA Gaming, LLC, or MTGA Gaming, holds a 49% membership interest in MG&H and the Tribe holds the remaining 51% membership interest. MG&H subsequently formed a wholly-owned subsidiary, Mohegan Resorts, LLC, or Mohegan Resorts. It is anticipated that certain of our and the Tribe’s future diversification efforts will be conducted, either directly or indirectly, through MG&H and/or Mohegan Resorts. Mohegan Resorts is currently evaluating potential gaming opportunities in the Commonwealth of Massachusetts, and a wholly-owned subsidiary of Mohegan Resorts has entered into a ground lease for approximately 152 acres of land located in Palmer, Massachusetts, which would serve as a potential site for future gaming development, if legalized in the Commonwealth of Massachusetts. A wholly-owned subsidiary of Mohegan Resorts also was a partner in an unsuccessful effort, ended in September 2008, to secure a gaming license for the development of a gaming facility in the State of Kansas.

Explanation of Key Financial Statement Captions

Gross Revenues

Our gross revenues are derived primarily from the following four sources:

• gaming revenues, which include revenues from slot machines, table games, keno, live harness racing at Pocono Downs and Racebook operations, including pari-mutuel wagering revenues from our Racebook operations at Mohegan Sun and our Pennsylvania OTW facilities;

• food and beverage revenues;

• hotel revenues; and

• retail, entertainment and other revenues, which include revenues from retail shops we manage, the Mohegan Sun Arena, MBC and Mohegan Golf.

Our largest component of revenues is gaming revenues, which are recognized as amounts wagered less prizes paid out, and is comprised primarily of revenues from slot machines and table games at Mohegan Sun, as well as slot machines at Pocono Downs. Revenues from slot machines are the largest component of our gaming revenues. Gross slot revenues, also referred to as gross slot win, represent all amounts played in the slot machines reduced by: (1) winnings paid out, and (2) slot tickets issued. Pursuant to the Mohegan Compact and requirements of our Pennsylvania Category One slot machine license, we report gross slot revenues and other statistical information related to slot machine operations to the State of Connecticut and the Commonwealth of Pennsylvania. On a monthly basis, we also post this information on our website at www.mtga.com.

Other commonly used terms in the discussion of revenues from slot machines include base jackpots, progressive slot machines, progressive jackpots, net slot revenues, slot handle, gross slot hold percentage, net slot hold percentage, rated players and slot win efficiency. Base jackpots represent the fixed minimum amount of slot machine payouts for a specific combination. We charge base jackpots to revenues when established. Progressive slot machines retain a portion of each amount wagered and aggregate the retained amounts with similar amounts from other slot machines in order to create one-time winnings that are substantially larger than those paid in the

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ordinary course of play. We refer to such aggregated amounts as progressive jackpots. Wide-area progressive jackpot amounts are paid by third-party vendors, and remitted as a weekly payment to each vendor based on a percentage of the slot handle for each wide-area progressive slot machine. We accrue in-house progressive jackpot amounts until paid, and such accrued amounts are deducted from gross slot revenues, along with wide-area progressive jackpot amounts, to arrive at net slot revenues, also referred to as net slot win. Net slot revenues are included in gaming revenues in the accompanying consolidated statements of income. Slot handle is the total amount wagered by patrons on slot machines during the period, including free promotional slot plays issued to patrons. Gross slot hold percentage is the gross slot win as a percentage of slot handle. Net slot hold percentage is the net slot win as a percentage of slot handle. Rated players are patrons whose gaming activities are tracked under our Player’s Club program. Slot win efficiency is a measure of our percentage of gross slot revenues in a market area compared to the percentage of the slot machines we operate in that market area.

Commonly used terms in the discussion of revenues from table games include table games revenues, table games drop and table games hold percentage. Table games revenues represents the closing table games inventory plus table games drop and credit slips for cash, chips or tokens returned to the casino cage, less opening table games inventory, discounts provided on patron losses, free bet coupons and chip fills to the tables. Table games drop is the total amount of cash, free bet coupons, cash advance drafts, customer deposit withdrawals, safekeeping withdrawals and credit issued at the table contained in the locked container at each gaming table. Table games hold percentage is the table games revenues as a percentage of table games drop.

Revenues from food and beverage, hotel, retail, entertainment events and other services are recognized at the time the service is performed. Minimum rental revenues that we receive pursuant to our rental lease agreements for The Shops at Mohegan Sun and tenants at Pocono Downs are recognized on a straight-line basis over the terms of the leases. Percentage rents are recognized in the period in which the tenants exceed their respective percentage rent thresholds.

Promotional Allowances

We operate a program for our guests at Mohegan Sun and Pocono Downs, without membership fees, called the Player’s Club. This program provides complimentary food, beverage, hotel, retail, entertainment and other services to guests, as applicable, based on points that are awarded for guests’ gaming activities. These points may be used to purchase, among other things, items at the retail stores and restaurants located within Mohegan Sun and Pocono Downs, including The Shops at Mohegan Sun and the Mohegan Sun gasoline and convenience center. Points also may be used to purchase hotel services and tickets to entertainment events held at Mohegan Sun facilities. The retail value of these complimentary items is included in gross revenues when redeemed at facilities operated by us and then deducted as promotional allowances to arrive at net revenues. The cost associated with reimbursing third parties for the value of these complimentary items redeemed at third-party outlets is charged to gaming expenses.

We also have ongoing promotional programs which offer coupons to our guests for the purchase of food, beverage, hotel and retail amenities offered within Mohegan Sun and Pocono Downs, as applicable. The retail value of items or services purchased with coupons at facilities operated by us within Mohegan Sun and Pocono Downs is included in gross revenues and the respective coupon value is deducted as promotional allowances to arrive at net revenues. The cost associated with reimbursing third parties for the value of coupons redeemed at third-party outlets is charged to gaming expenses.

Gaming Expenses

Gaming expenses primarily include the portion of gross revenues from slot machines that must be paid to the State of Connecticut and the PGCB, which are referred to as Slot Win Contribution and Pennsylvania Gaming Tax, respectively. For each 12-month period commencing July 1, 1995, the Slot Win Contribution from Mohegan Sun is the lesser of: (1) 30% of gross revenues from slot machines at Mohegan Sun, or (2) the greater of (a) 25%

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of gross revenues from slot machines at Mohegan Sun or (b) $80.0 million. Pennsylvania Gaming Tax payments payable to the PGCB on a daily basis is 55% of gross revenues from slot machines at Pocono Downs, 2% of which is subject to a $10.0 million minimum annual threshold.

Gaming expenses also include, among other things, expenses associated with operation of slot machines, table games, keno, live harness racing at Pocono Downs and Racebook, certain marketing expenses, and promotional expenses for the Player’s Club points and coupons redeemed at our hotel, restaurants and retail outlets, as well as third-party tenant outlets.

Income from Operations

We calculate income from operations as net revenues less total operating costs and expenses. Income from operations represents only those amounts that relate to our consolidated operations and excludes accretion of discount to the relinquishment liability, interest income and expense, write-off of debt issuance costs, gain on early extinguishment of debt, minority interests, income from discontinued operations and other non-operating income and expense.

Reassessment of Relinquishment Liability and Accretion of Discount to the Relinquishment Liability

In February 1998, we entered into a relinquishment agreement with Trading Cove Associates, or TCA. The relinquishment agreement provides that we will make certain payments to TCA out of, and determined as a percentage of, revenues, as defined under the relinquishment agreement, generated by Mohegan Sun over a 15-year period. In accordance with authoritative guidance issued by the FASB pertaining to the accounting for contingencies, we have recorded a relinquishment liability of the estimated present value of its obligations under the relinquishment agreement. We reassess projected revenues and consequently the relinquishment liability: (1) annually in conjunction with the budgeting process, or (2) when necessary to account for material increases or decreases in projected revenues over the relinquishment period. Further, we record a quarterly accretion to the relinquishment liability to reflect the impact of the time value of money. Since there is a high level of estimation and judgment (including those related to estimates of future revenue projections and impact and timing of future competition) used with respect to calculating this liability, future events that affect such estimates and judgments may cause the actual liability to significantly differ from the estimate. In addition, we have capitalized $130.0 million of this relinquishment liability in connection with a trademark value of the Mohegan Sun brand name. In accordance with authoritative guidance issued by the FASB pertaining to intangible assets, the Mohegan Sun trademark is no longer subject to amortization because it has been deemed to have an indefinite useful life. The Mohegan Sun trademark is assessed at least annually for impairment pursuant to appropriate accounting standards.

Results of Operations

Summary Operating Results

As of September 30, 2009, we own and operate Mohegan Sun, the Connecticut Sun WNBA franchise and the Mohegan Sun Country Club in Connecticut, collectively the Connecticut entities, and the Pocono Downs entities. All of our revenues are derived from these operations. The Connecticut Sun WNBA franchise and the Mohegan Sun Country Club are aggregated with the Mohegan Sun operating segment because these operations all share similar economic characteristics. Our executive officers review and assess the performance and operating results and determine the proper allocation of resources to the Connecticut entities and the Pocono Downs entities on a separate basis. We, therefore, believe that we have two separate reportable segments due to the differing nature of their operations: (1) Mohegan Sun, which comprises the operations of the Connecticut entities, and (2) Pocono Downs, which comprises the operations of the Pocono Downs entities.

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The following table summarizes our results from operations on a property basis (in thousands, except where noted):

	For the Fiscal Years Ended September 30,
	2009			2008			2007			Dollar Variance						Percentage Variance
										09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Net revenues:
Mohegan Sun	$	1,203,765		$	1,362,945		$	1,430,560		$	(159,180	)	$	(67,615	)	(11.7%	)	(4.7%	)
Pocono Downs		251,352			209,238			189,506			42,114			19,732		20.1%		10.4%
Total	$	1,455,117		$	1,572,183		$	1,620,066		$	(117,066	)	$	(47,883	)	(7.4%	)	(3.0%	)
Income (loss) from operations:
Mohegan Sun	$	247,678		$	280,232		$	287,017		$	(32,554	)	$	(6,785	)	(11.6%	)	(2.4%	)
Pocono Downs		12,378			12,093			16,137			285			(4,044	)	2.4%		(25.1%	)
Corporate expenses		(17,310	)		(28,959	)		(10,586	)		11,649			(18,373	)	(40.2%	)	173.6%
Total	$	242,746		$	263,366		$	292,568		$	(20,620	)	$	(29,202	)	(7.8%	)	(10.0%	)
Net income	$	119,344		$	149,260		$	172,567		$	(29,916	)	$	(23,307	)	(20.0%	)	(13.5%	)
Operating margin:
Mohegan Sun		20.6%			20.6%			20.1%			-			0.5%		-		2.5%
Pocono Downs		4.9%			5.8%			8.5%			(0.9%	)		(2.7%	)	(15.5%	)	(31.8%	)
Total		16.7%			16.8%			18.1%			(0.1%	)		(1.3%	)	(0.6%	)	(7.2%	)

The most significant factors and trends that we believe impacted our financial performance were as follows:

• the national economic recession and the related weakening of consumer discretionary spending;

• increased competition and promotional spending in the Northeast gaming market from gaming facilities at Empire City in Yonkers, New York, Foxwoods in Mashantucket, Connecticut, and Twin River in Lincoln, Rhode Island, which resulted in lower slot revenues at Mohegan Sun;

• the execution of a company-wide cost containment program, which positively impacted operating costs and expenses at Mohegan Sun and Pocono Downs;

• the July 2008 opening of Project Sunrise, which generated additional slot and food and beverage revenues at Pocono Downs;

• additional gaming and hotel capacity added by Foxwoods following the May 2008 opening of its MGM Grand at Foxwoods, which negatively impacted gaming and non-gaming revenues at Mohegan Sun;

• increased competition in the Northeastern Pennsylvania gaming market following the October 2007 opening of Mount Airy Casino Resort, or Mount Airy, and the May 2009 opening of Sands Casino Resort Bethlehem, or Sands Bethlehem, which negatively impacted slot revenues at Pocono Downs;

• the August 2008 opening of Casino of the Wind, including our 42-table poker room; and

• increased promotional room rates offered to gaming patrons, designed to maintain hotel occupancy levels to support gaming and non-gaming revenues at Mohegan Sun.

Non-recurring factors that affected our financial performance were as follows:

• an $8.5 million non-operating gain on early extinguishment of debt in fiscal 2009 in connection with the repurchase of $14.3 million of our outstanding 2001 8³/₈% senior subordinated notes due July 1, 2011;

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• an $8.1 million reduction in free promotional play contribution in fiscal 2009 as compared to fiscal 2008 resulting from a settlement with the State of Connecticut regarding contribution payments on our free promotional slot play program, which had the effect of reducing operating costs and expenses at Mohegan Sun;

• $4.5 million in non-operating asset write-offs in fiscal 2009 related to previously capitalized Project Horizon costs;

• $2.0 million in utility rebates received from the Tribe, our utility provider, and $3.2 million in lower tribal services expense in fiscal 2009;

• a $1.6 million non-operating loss in fiscal 2009 in connection with the amendment to the purchase agreement for Pocono Downs to accelerate the outstanding refund payment;

• $9.5 million in non-operating charges in fiscal 2008 for additional reserves against the net assets of WTG in connection with the Menominee Project;

• a $2.6 million increase in bad debt expense related to gaming receivables at Mohegan Sun in fiscal 2008 as compared to fiscal 2007;

• a $3.5 million operating charge in fiscal 2007 in connection with a settlement of property tax litigation related to the Pocono Downs facility; and

• non-cash relinquishment liability reassessment credits of $45.7 million and $68.9 million in fiscal 2009 and 2008, respectively, and a relinquishment liability reassessment charge of $3.0 million in fiscal 2007.

Net revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased as a result of declines in both gaming and non-gaming revenues at Mohegan Sun, partially offset by increased slot and non-gaming revenues at Pocono Downs and reduced promotional allowances at Mohegan Sun. Net revenues for the fiscal year ended September 30, 2009 also reflect the addition of poker revenues at Mohegan Sun.

Net revenues for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased primarily as a result of declines in slot and table games revenues at Mohegan Sun. These declines were partially offset by increased slot revenues at Pocono Downs due to a full year of slot operations and the opening of Project Sunrise and higher entertainment revenues at Mohegan Sun.

Income from operations for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily as a result of the reduction in net revenues at Mohegan Sun and the decrease in the non-cash relinquishment liability reassessment credit, which was $45.7 million for the fiscal year ended September 30, 2009 compared to $68.9 million for the prior fiscal year. The non-cash relinquishment liability reassessment credits had the effect of reducing operating expenses. These results were partially offset by the reduction in free promotional slot play contribution at Mohegan Sun and the impact of our company-wide cost containment program. Income from operations for the fiscal year ended September 30, 2009 also reflects lower Corporate-related expenses primarily resulting from the non-recurring charges recorded in fiscal 2008 in connection with the Menominee Project. The slight decrease in total operating margin was primarily attributable to increased operating costs and expenses at Pocono Downs, including high post-opening staffing costs in connection with Project Sunrise and increased depreciation expense on Project Sunrise and related slot machines and equipment placed into service in July 2008. Pocono Downs has a significantly lower operating margin than Mohegan Sun due to higher gaming tax rates assessed by the Commonwealth of Pennsylvania.

Income from operations for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased as a result of the decline in net revenues at Mohegan Sun, increased operating costs and expenses at Pocono Downs due to the opening of Project Sunrise and a full year of slot operations and higher Corporate-related expenses primarily due to the additional reserves recorded against the net assets of WTG in connection with the Menominee Project and increased tribal services expense. The total decrease in income from operations was

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partially offset by the growth in net revenues at Pocono Downs and the non-cash relinquishment liability reassessment credit, which was $68.9 million for the fiscal year ended September 30, 2008 compared to a $3.0 million non-cash relinquishment liability reassessment charge for the prior fiscal year. The non-cash relinquishment liability reassessment credit had the effect of reducing operating expenses. The decrease in total operating margin was primarily attributable to the reduction in Pocono Downs’ operating margin resulting from the weakening economy, new competition from Mount Airy and the increased operating costs and expenses. Pocono Downs has a significantly lower operating margin than Mohegan Sun due to higher gaming tax rates assessed by the Commonwealth of Pennsylvania. The decrease in total operating margin also was due to the increase in Corporate-related expenses.

Net income for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily as a result of the reduction in income from operations, increased interest expense, the asset write-offs related to Project Horizon and the loss on the amendment to the purchase agreement for Pocono Downs, partially offset by the gain on early extinguishment of debt and the non-recurring charges in connection with the Menominee Project. The increased interest expense was due to higher weighted average outstanding debt, resulting from additional borrowings on our bank credit facility to fund capital expenditures for Project Horizon and Project Sunrise, and lower capitalized interest, partially offset by lower weighted average interest rate.

Net income for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased primarily due to the decrease in income from operations.

Mohegan Sun

Gross Revenues

Gross revenues consisted of the following (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Dollar Variance						Percentage Variance
							09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Gaming	$	1,078,286	$	1,209,547	$	1,286,915	$	(131,261	)	$	(77,368	)	(10.9%	)	(6.0%	)
Food and beverage		77,457		93,028		94,905		(15,571	)		(1,877	)	(16.7%	)	(2.0%	)
Hotel		39,567		48,740		47,333		(9,173	)		1,407		(18.8%	)	3.0%
Retail, entertainment and other		116,982		139,490		129,658		(22,508	)		9,832		(16.1%	)	7.6%
Total	$	1,312,292	$	1,490,805	$	1,558,811	$	(178,513	)	$	(68,006	)	(12.0%	)	(4.4%	)

The following table summarizes the percentage of gross revenues from each of the four revenue sources:

	For the Fiscal Years Ended September 30,
	2009	2008	2007
Gaming	82.2%	81.1%	82.6%
Food and beverage	5.9%	6.2%	6.1%
Hotel	3.0%	3.3%	3.0%
Retail, entertainment and other	8.9%	9.4%	8.3%
Total	100.0%	100.0%	100.0%

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The following table presents data related to gaming revenues (in thousands, except where noted):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Variance						Percentage Variance
							09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Slot handle	$	9,255,718	$	10,110,965	$	10,601,193	$	(855,247	)	$	(490,228	)	(8.5%	)	(4.6%	)
Gross slot revenues	$	779,625	$	855,859	$	921,651	$	(76,234	)	$	(65,792	)	(8.9%	)	(7.1%	)
Net slot revenues	$	751,304	$	823,776	$	889,409	$	(72,472	)	$	(65,633	)	(8.8%	)	(7.4%	)
Weighted average number of slot machines (in units)		6,752		6,159		6,060		593			99		9.6%		1.6%
Gross slot hold percentage		8.4%		8.5%		8.7%		(0.1%	)		(0.2%	)	(1.2%	)	(2.3%	)
Gross slot win per unit per day (in dollars)	$	316	$	380	$	417	$	(64	)	$	(37	)	(16.8%	)	(8.9%	)
Table games drop	$	2,108,767	$	2,609,726	$	2,482,494	$	(500,959	)	$	127,232		(19.2%	)	5.1%
Table games revenues	$	305,896	$	374,485	$	386,357	$	(68,589	)	$	(11,872	)	(18.3%	)	(3.1%	)
Weighted average number of table games (in units)		326		322		302		4			20		1.2%		6.6%
Table games hold percentage (1)		14.5%		14.4%		15.6%		0.1%			(1.2%	)	0.7%		(7.7%	)
Table games revenue per unit per day (in dollars)	$	2,573	$	3,177	$	3,511	$	(604	)	$	(334	)	(19.0%	)	(9.5%	)
Poker revenues (2)	$	11,974	$	875	$	-	$	11,099		$	875		1,268.5%		100.0%
Weighted average number of poker tables (in units)		42		4		-		38			4		950.0%		100.0%
Poker revenue per unit per day (in dollars)	$	781	$	631	$	-	$	150		$	631		23.8%		100.0%

(1) Table games hold percentage is relatively predictable over longer periods of time, but can significantly fluctuate over shorter periods.

(2) Reflects results of the 42-table poker room, which opened in August 2008.

The following table presents slot data related to Mohegan Sun’s market area (in thousands, except where noted):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Variance						Percentage Variance
							09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Northeast gaming market (1) (2):
Gross slot revenues	$	2,538,152	$	2,656,519	$	2,496,947	$	(118,367	)	$	159,572		(4.5%	)	6.4%
Mohegan Sun slot win market share		31.9%		33.2%		36.9%		(1.3%	)		(3.7%	)	(3.9%	)	(10.0%	)
Mohegan Sun slot win efficiency		123.5%		133.9%		139.3%		(10.4%	)		(5.4%	)	(7.8%	)	(3.9%	)
Connecticut gaming market (3):
Gross slot revenues	$	1,467,457	$	1,603,695	$	1,725,117	$	(136,238	)	$	(121,422	)	(8.5%	)	(7.0%	)
Free promotional slot plays (4)		85,288		97,523		38,263		(12,235	)		59,260		(12.5%	)	154.9%
Mohegan Sun free promotional slot plays (4)		27,981		27,671		-		310			27,671		1.1%		100.0%
Mohegan Sun slot win market share		53.1%		53.4%		53.4%		(0.3%	)		-		(0.6%	)	-
Mohegan Sun slot win efficiency		114.8%		118.3%		117.1%		(3.5%	)		1.2%		(3.0%	)	1.0%

(1) Northeast gaming market consists of Mohegan Sun, Foxwoods, Twin River, Newport Grand and Empire City.

(2) Includes free promotional slot plays.

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(3) Connecticut gaming market consists of Mohegan Sun and Foxwoods.

(4) Free promotional slot plays are included in slot handle, but not reflected in slot revenues.

Gaming revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased due to lower slot and table games revenues, partially offset by the addition of poker revenues from our new poker room in Casino of the Wind. The decline in slot revenues resulted from lower slot handle due to reduced consumer discretionary spending on activities such as gaming, leisure and hospitality likely caused by the national economic recession. During the fiscal year ended September 30, 2009, the number of Mohegan Sun’s rated slot player trips declined 2.3%, while spending per rated slot player decreased 8.2% as compared to the prior fiscal year. Increased promotional spending by competitors, as well as additional gaming and hotel capacity added by Foxwoods, following the May 2008 opening of its MGM Grand at Foxwoods, also may have contributed to the decline in slot revenues. Additionally, slot revenues were impacted by unfavorable winter weather conditions and reduced entertainment events at the Mohegan Sun Arena. We believe our slot win efficiency in the Northeast gaming market likely was impacted by some customers in the New York City and Boston area markets choosing to frequent closer gaming facilities in the states of New York and Rhode Island, and increased promotional spending by competitors. Our slot win efficiency in the Connecticut gaming market decreased due to higher weighted average number of slot machines following the August 2008 opening of Casino of the Wind and increased promotional spending by Foxwoods. The decline in table games revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year was primarily attributable to lower table games drop, in particular, high-limit table games play. During the fiscal year ended September 30, 2009, the number of Mohegan Sun’s rated table games patron trips increased 5.1%, while spending per rated table games patron decreased 21.2% as compared to the prior fiscal year, reflecting the decline in high-limit table games play, as well as the overall reduction in consumer spending likely caused by the national economic recession. Table games hold percentage is relatively predictable over longer periods of time, but can significantly fluctuate over shorter periods.

Gaming revenues for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased due to declines in slot and table games revenues. The decrease in slot revenues likely resulted from the weakening economy, increased promotional spending from Foxwoods, including free promotional slot plays, and increased competition from Empire City and Twin River, as well as Foxwoods, following the opening of its MGM Grand at Foxwoods. The decline in slot revenues also was likely attributable, in part, to the weakening of consumer discretionary spending and high gas prices, both resulting in lower spending by gaming patrons. The decrease in our gross slot hold percentage was primarily attributable to the redemption of free promotional slot plays. We believe our slot win efficiency in the Northeast gaming market likely was impacted, in part, by increased competition from Empire City and Twin River and higher gas prices, as customers in the New York City and Boston area markets likely chose to frequent closer gaming facilities in the states of New York and Rhode Island. The decline in table games revenues was primarily attributable to a decrease in table games hold percentage, partially offset by an increase in table games drop. Table games hold percentage is relatively predictable over longer periods of time, but can significantly fluctuate over shorter periods. The growth in table games drop primarily resulted from increased high-limit table games play and the success of our Asian table games business.

Food and beverage revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily due to a $12.9 million decline in food revenues, resulting from a 20.5% reduction in the number of meals served at Mohegan Sun-owned food outlets. The decreased number of meals served reflects, in part, the temporary closure of the Mohegan Sun Earth food court and the remodeling of Birches Bar & Grill, to accommodate the renovation and re-opening of the Winter Entrance, as well as the May 2009 permanent closure of Fidelia’s Restaurant in Casino of the Sky, an outlet owned and operated by Mohegan Sun, which was replaced by Bobby Flay’s Bar Americain in November 2009. Food and beverage revenues also were negatively impacted by the July 2009 opening of Frank Pepe Pizzeria Napoletana and the September 2008 opening of Jimmy Buffett’s Margaritaville Restaurant, both of which resulted in decreased patron visitation at Mohegan Sun-owned food outlets. Additionally, the decrease in food and beverage revenues likely was attributable to the overall weakness in consumer spending, as well as a reduction in banquet revenues from the Mohegan Sun convention center and

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reduced entertainment events at the Mohegan Sun Arena. The decreased number of meals served was partially offset by a 4.6% increase in the average price per cover.

Food and beverage revenues for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased primarily due to a $2.0 million decline in food revenues, partially offset by a slight increase in beverage revenues. The decline in food revenues primarily resulted from a 6.5% reduction in the number of meals served due to decreased patronage at Mohegan Sun-owned food outlets. The decrease in the number of meals served was partially offset by the addition of revenues from the Hong Kong-style food outlet in Sunrise Square, and a 4.2% increase in the average price per cover.

The following table presents data related to hotel revenues:

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Variance					Percentage Variance
							09 vs. 08			08 vs. 07		09 vs. 08		08 vs. 07
Rooms occupied		409,100		402,600		399,500		6,500			3,100	1.6%		0.8%
Average daily room rate (ADR)	$	92	$	113	$	112	$	(21	)	$	1	(18.6%	)	0.9%
Occupancy rate		95.4%		93.6%		93.2%		1.8%			0.4%	1.9%		0.4%
Revenue per available room (REVPAR)	$	88	$	105	$	104	$	(17	)	$	1	(16.2%	)	1.0%

Hotel revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily as a result of lower room rates offered to gaming patrons to compete with increased hotel and meeting room capacity added by MGM Grand at Foxwoods and room pricing pressures from our competitors. ADR was adversely impacted by lower demand for higher-rate group business, consistent with nationwide trends of reduced business travel and convention visits. Reductions in room rates are designed to maintain occupancy levels to support gaming and other revenues.

Hotel revenues for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily as a result the slight increases in ADR and hotel occupancy. The increase in ADR was supported by more entertainment events, as further discussed below. The increase in hotel occupancy was primarily attributable to rooms being out of service during the prior fiscal year due to a hotel room renovation program, which began in January 2007 and was completed in June 2007.

Retail, entertainment and other revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily due to a $10.2 million decline in entertainment revenues. The decline in entertainment revenues resulted from a significant decrease in the number of shows at the Mohegan Sun Arena, including fewer headliner shows, primarily due to a reduction in available entertainment acts on tour and scheduling dates reserved for the Connecticut Sun basketball team which were not utilized. These factors resulted in a 21.5% decrease in Arena tickets sold. The decrease in retail, entertainment and other revenues also was due to a $9.6 million decline in gasoline revenues, as a result of a significant decrease in the average price per gallon of gasoline sold.

Retail, entertainment and other revenues for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily as a result of a $10.6 million growth in entertainment revenues due to an increase in the number of shows at the Mohegan Sun Arena, resulting in a 12.4% increase in Arena tickets sold, as well as a 10.7% increase in the average price per ticket from more headliner shows performed in the Arena. The growth in retail, entertainment and other revenues also was the result of a $2.4 million increase in gasoline revenues due to an increase in the average price per gallon of gasoline sold. The increase in retail, entertainment and other revenues was partially offset by a $4.4 million decline in retail revenues due to decreased patronage at Mohegan Sun-owned retail outlets.

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Promotional Allowances

The retail value of providing promotional allowances was included in revenues as follows (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Dollar Variance						Percentage Variance
							09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Food and beverage	$	37,115	$	43,544	$	45,591	$	(6,429	)	$	(2,047	)	(14.8%	)	(4.5%	)
Hotel		16,369		15,246		16,385		1,123			(1,139	)	7.4%		(7.0%	)
Retail, entertainment and other		55,043		69,070		66,275		(14,027	)		2,795		(20.3%	)	4.2%
Total	$	108,527	$	127,860	$	128,251	$	(19,333	)	$	(391	)	(15.1%	)	(0.3%	)

The estimated cost of providing promotional allowances was included in operating costs and expenses, primarily gaming, as follows (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Dollar Variance						Percentage Variance
							09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Food and beverage	$	38,231	$	45,371	$	46,427	$	(7,140	)	$	(1,056	)	(15.7%	)	(2.3%	)
Hotel		9,552		8,048		8,866		1,504			(818	)	18.7%		(9.2%	)
Retail, entertainment and other		45,874		58,893		53,790		(13,019	)		5,103		(22.1%	)	9.5%
Total	$	93,657	$	112,312	$	109,083	$	(18,655	)	$	3,229		(16.6%	)	3.0%

Promotional allowances for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased as a result of lower redemptions under the Player’s Club program commensurate with the declines in business volumes.

Promotional allowances for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased as a result of reductions in food and beverage and hotel promotional offerings to patrons, offset by higher retail, entertainment and other promotional allowances, primarily driven by the higher retail price of entertainment offerings and gasoline.

Operating Costs and Expenses

Operating costs and expenses consisted of the following (in thousands):

	For the Fiscal Years Ended September 30,
	2009			2008			2007		Dollar Variance						Percentage Variance
									09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Gaming	$	654,806		$	739,327		$	736,492	$	(84,521	)	$	2,835		(11.4%	)	0.4%
Food and beverage		36,239			46,084			45,384		(9,845	)		700		(21.4%	)	1.5%
Hotel		13,513			17,314			16,959		(3,801	)		355		(22.0%	)	2.1%
Retail, entertainment and other		40,761			56,019			47,010		(15,258	)		9,009		(27.2%	)	19.2%
Advertising, general and administrative		178,852			207,164			211,643		(28,312	)		(4,479	)	(13.7%	)	(2.1%	)
Pre-opening costs and expenses		58			1,204			445		(1,146	)		759		(95.2%	)	170.6%
Depreciation and amortization		77,536			84,548			82,613		(7,012	)		1,935		(8.3%	)	2.3%
Relinquishment liability reassessment		(45,678	)		(68,947	)		2,997		23,269			(71,944	)	(33.7%	)	(2,400.5%	)
Total	$	956,087		$	1,082,713		$	1,143,543	$	(126,626	)	$	(60,830	)	(11.7%	)	(5.3%	)

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Gaming costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily as a result of reduced Slot Win Contribution commensurate with the lower slot revenues, as well as decreased non-gaming complimentaries redeemed by casino patrons at Mohegan Sun-owned outlets. The decline in gaming costs and expenses also reflects the reduction in free promotional slot play contribution and the impact of our cost containment program, which resulted in reductions in payroll costs and casino marketing and promotional expenditures. Lower redemption costs due to decreased utilization of Player’s Club points at third-party outlets also contributed to the decrease in gaming costs and expenses. Additionally, gaming costs and expenses reflect a reduction in bad debt expense related to gaming receivables. Expenses associated with the combined Slot Win Contribution and free promotional slot play contribution totaled $193.8 million and $221.0 million for the fiscal years ended September 30, 2009 and 2008, respectively. Gaming costs and expenses as a percentage of gaming revenues was 60.7% for the fiscal year ended September 30, 2009 compared to 61.1% for the prior fiscal year.

Gaming costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily as a result of higher bad debt expense related to gaming receivables, additional expenses associated with the free promotional slot play contribution, increased payroll costs due to market driven compensation adjustments and increased medical benefit costs, greater air-travel expenditures for high-limit table games players and an increase in non-gaming complimentaries redeemed by casino patrons at Mohegan Sun-owned outlets. These increases were partially offset by reduced Slot Win Contribution, commensurate with the lower slot revenues, as well as a reduction in redemption costs due to decreased utilization of Player’s Club points and promotional expenditures targeting third-party outlets. Expenses associated with the combined Slot Win Contribution and free promotional slot play contribution totaled $221.0 million and $230.4 million for the fiscal years ended September 30, 2008 and 2007, respectively. Gaming costs and expenses as a percentage of gaming revenues was 61.1% for the fiscal year ended September 30, 2008 compared to 57.2% for the prior fiscal year.

Food and beverage costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased due to reduced payroll costs primarily resulting from our cost containment efforts, as well as the temporary closure of the Mohegan Sun Earth food court and the remodeling of Birches Bar & Grill, to accommodate the renovation and re-opening of the Winter Entrance, and the May 2009 permanent closure of Fidelia’s Restaurant. Lower cost of goods sold as a result of the reduction in the number of meals served also contributed to the decrease in food and beverage costs and expenses. The decline in food and beverage costs and expenses was partially offset by decreased use of food and beverage complimentaries, resulting in lower amounts of food and beverage costs being allocated to gaming costs and expenses.

Food and beverage costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily as a result of higher payroll and medical insurance costs, partially offset by lower cost of goods sold and other operating costs. The increase in food and beverage costs and expenses also resulted from decreased use of food and beverage complimentaries, resulting in lower amounts of food and beverage costs being allocated to gaming costs and expenses.

Hotel costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily as a result of increased use of hotel complimentaries, resulting in higher amounts of hotel costs being allocated to gaming costs and expenses. The reduction in hotel costs and expenses also reflects the impact of our cost containment program.

Hotel costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily as a result of higher payroll and medical benefit costs, as well as an increase in other operating costs, including costs for the replacement of room supplies.

Retail, entertainment and other costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily due to a significant reduction in direct entertainment costs resulting from the decreased number of shows at the Mohegan Sun Arena. Lower cost of goods sold as a result of the reduction in

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the average cost per gallon of gasoline sold and reduced patronage at Mohegan Sun-owned retail outlets also contributed to the decrease in retail, entertainment and other costs and expenses. Additionally, the decline in retail, entertainment and other costs and expenses reflects the impact of our cost containment efforts. The decline in retail, entertainment and other costs and expenses was partially offset by decreased use of retail, entertainment and other complimentaries, resulting in lower amounts of retail, entertainment and other costs and expenses being allocated to gaming costs and expenses.

Retail, entertainment and other costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily due to higher direct entertainment costs resulting from the increased number of shows at the Mohegan Sun Arena. Increased cost of goods sold for gasoline resulting from the increase in the average cost per gallon of gasoline sold also contributed to the growth in retail, entertainment and other costs and expenses. These increases were partially offset by increased use of entertainment and other complimentaries resulting in higher amounts of retail, entertainment and other costs and expenses being allocated to gaming costs and expenses, as well as decreased cost of goods sold for retail due to lower patronage at Mohegan Sun-owned retail outlets.

Advertising, general and administrative costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily as a result of our cost containment program, which resulted in significant reductions in certain costs and expenses such as payroll and advertising costs and professional and consulting expenditures. The cost containment program also resulted in reductions in most other general and administrative costs and expenses necessary to support Mohegan Sun operations. Additionally, the decline in advertising, general and administrative costs and expenses reflects non-recurring utility rebates received from the Tribe and lower tribal services expense.

Advertising, general and administrative costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased primarily as a result of non-recurring one-time costs relating to the hotel room renovation program and the Mohegan Sun ten-year anniversary festivities for employees and patrons, both of which occurred in fiscal 2007. These reductions were partially offset by higher payroll costs primarily due to market driven compensation adjustments and increased medical benefit costs, as well as increased professional costs and consulting expenditures.

Pre-opening costs and expenses for the fiscal year ended September 30, 2009 were minimal.

Pre-opening costs and expenses for the fiscal year ended September 30, 2008 were comprised of direct incremental personnel, consulting and other costs associated with the Casino of the Wind component of Project Horizon. Construction of Casino of the Wind commenced in June 2007 and was completed in August 2008.

Depreciation and amortization expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily due to fully depreciated furniture and equipment related to Project Sunburst, which was placed into service in fiscal 2002.

Depreciation and amortization expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily due to the commencement of depreciation on Casino of the Wind and related slot machines and equipment placed into service in August 2008.

Relinquishment liability reassessment for the fiscal year ended September 30, 2009 had the effect of substantially reducing operating expenses. The relinquishment liability reassessment credit was the result of revised Mohegan Sun revenue projections as of the end of the fiscal year ended September 30, 2009 compared to estimates as of the end of the prior fiscal year on the determination of the relinquishment liability. Our accounting policy is to reassess Mohegan Sun revenue projections, and consequently the relinquishment liability, at least annually in conjunction with our budgeting process or when necessary to account for material increases or decreases in Mohegan Sun’s projected revenues over the remaining relinquishment period, which expires on December 31, 2014. In fiscal 2009, based on continued declines in business volumes, we concluded that Mohegan Sun’s

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projected revenues over the remaining relinquishment period would decrease by approximately $917.7 million, thereby decreasing the related relinquishment liability, causing us to record the non-cash relinquishment liability credit of $45.7 million for the fiscal year ended September 30, 2009.

Relinquishment liability reassessment for the fiscal year ended September 30, 2008 had the effect of substantially reducing operating expenses. The relinquishment liability reassessment credit was the result of revised Mohegan Sun revenue projections as of the end of the fiscal year ended September 30, 2008 compared to estimates as of the end of the prior fiscal year on the determination of the relinquishment liability. In fiscal 2008, based on the suspension of Project Horizon, a slowdown in business volumes and increased competition in the Northeast gaming market, we concluded that Mohegan Sun’s projected revenues over the remaining relinquishment period would decrease by approximately $1.55 billion, thereby decreasing the related relinquishment liability, causing us to record the non-cash relinquishment liability credit of $68.9 million for the fiscal year ended September 30, 2008.

Free Promotional Slot Play Contribution Settlement

In 2006, the State of Connecticut asserted that we and the Mashantucket Pequot Tribe, or MPT, were required to include the value of all free slot plays under our free promotional slot play programs in gross revenues for purposes of calculating Slot Win Contribution payments. In December 2006, the State of Connecticut filed suit against the MPT seeking a declaratory judgment that free promotional slot plays utilized by patrons at Foxwoods constitutes a “wager” for purposes of calculating slot win contribution payments. In October 2007, the Tribe entered into an agreement with the State of Connecticut to escrow, on a monthly basis, an amount equal to 25% of the value of all free promotional slot plays utilized by patrons at Mohegan Sun. In September 2009, we reached a settlement with the State of Connecticut regarding contribution payments on our free promotional slot play program. Pursuant to the settlement, we agreed to the release and disbursement of $12.2 million of payments escrowed by us, including accrued interest thereon. Of the total amount escrowed, $6.5 million was distributed to us and $5.7 million was distributed to the State of Connecticut pursuant to the settlement agreement. For the fiscal year ended September 30, 2009, gaming costs and expenses reflect a $1.1 million credit relating to the free promotional slot play contribution. For the fiscal year ended September 30, 2008, gaming costs and expenses reflect $6.9 million in expenses associated with the free promotional slot play contribution.

In addition to the disbursement of the escrowed funds under the terms of the settlement agreement, effective July 1, 2009, the State of Connecticut agreed that no value shall be attributed to free promotional slot plays utilized by patrons at Mohegan Sun for purposes of calculating monthly contribution payments, provided that the aggregate amount of such free promotional slot plays during any month does not exceed 5.5% of gross revenues from slot machines for such month. In the event free promotional slot plays exceed 5.5% of monthly gross revenues from slot machines, contribution payments are required on such excess face amount of free promotional slot plays at the same rate as Slot Win Contribution payments, or 25%.

Pocono Downs

Gross Revenues

Gross revenues consisted of the following (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Dollar Variance				Percentage Variance
							09 vs. 08		08 vs. 07		09 vs. 08	08 vs. 07
Gaming	$	239,055	$	201,227	$	182,428	$	37,828	$	18,799	18.8%	10.3%
Food and beverage		15,648		10,940		7,192		4,708		3,748	43.0%	52.1%
Retail, entertainment and other		5,719		4,766		3,481		953		1,285	20.0%	36.9%
Total	$	260,422	$	216,933	$	193,101	$	43,489	$	23,832	20.0%	12.3%

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The following table summarizes the percentage of gross revenues from each of the three revenue sources:

	For the Fiscal Years Ended September 30,
	2009	2008	2007
Gaming	91.8%	92.8%	94.5%
Food and beverage	6.0%	5.0%	3.7%
Retail, entertainment and other	2.2%	2.2%	1.8%
Total	100.0%	100.0%	100.0%

The following table presents data related to gaming revenues (in thousands, except where noted):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Variance						Percentage Variance
							09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Slot handle	$	2,628,844	$	2,008,678	$	1,690,417	$	620,166		$	318,261		30.9%		18.8%
Gross slot revenues	$	217,679	$	176,173	$	157,185	$	41,506		$	18,988		23.6%		12.1%
Net slot revenues	$	217,835	$	176,743	$	156,031	$	41,092		$	20,712		23.2%		13.3%
Weighted average number of slot machines (in units)		2,470		1,476		1,143		994			333		67.3%		29.1%
Gross slot hold percentage		8.3%		8.8%		9.3%		(0.5%	)		(0.5%	)	(5.7%	)	(5.4%	)
Gross slot win per unit per day (in dollars)	$	241	$	326	$	427	$	(85	)	$	(101	)	(26.1%	)	(23.7%	)

The following table presents slot data related to Pocono Downs’ market area (in thousands, except where noted):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Variance						Percentage Variance
							09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Northeastern Pennsylvania gaming market (1):
Gross slot revenues	$	479,121	$	336,145	$	157,185	$	142,976		$	178,960		42.5%		113.9%
Free promotional slot plays (2)	$	70,031	$	14,998		-	$	55,033		$	14,998		366.9%		100.0%
Pocono Downs free promotional slot plays (2)	$	26,348	$	3,132		-	$	23,216		$	3,132		741.3%		100.0%
Pocono Downs slot win market share		45.4%		52.4%		100.0%		(7.0%	)		(47.6%	)	(13.4%	)	(47.6%	)
Pocono Downs slot win efficiency		111.8%		142.0%		100.0%		(30.2%	)		42.0%		(21.3%	)	42.0%

(1) Northeastern Pennsylvania market consists of Pocono Downs, Mount Airy, which opened on October 22, 2007, and Sands Bethlehem, which opened on May 20, 2009.

(2) Free promotional slot plays are included in slot handle, but not reflected in slot revenues.

Gaming revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased due to a full year of operations of Project Sunrise. We believe gaming revenues likely were negatively impacted by increased competition following the May 2009 opening of Sands Bethlehem, as well as the national economic recession. The decrease in gross slot hold percentage was primarily attributable to increased free promotional slot plays provided to Pocono Downs Player’s Club members. The decreases in our gross slot win per unit per day and slot win efficiency in the Northeastern Pennsylvania gaming market were primarily attributable to an

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increase in the weighted average number of slot machines at Pocono Downs following the opening of Project Sunrise. The decline in our slot win market share in the Northeastern Pennsylvania slot gaming market was attributable to the opening of Sands Bethlehem.

Gaming revenues for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily due to a full year of slot operations and the opening of Project Sunrise, partially offset by increased competition following the October 2007 opening of Mount Airy. Slot results also were impacted by the weakening economy, business disruptions caused by Project Sunrise construction and increased promotional activities from Mount Airy, including free promotional slot plays. The decrease in gross slot win per unit per day was primarily attributable to the increase in the weighted average number of slot machines at Pocono Downs following the opening of Project Sunrise. The decrease in gross slot hold percentage was primarily attributable to the redemption of free promotional slot plays.

Food and beverage revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased due to higher average price per cover as a result of a full year of operations of the 300-seat Timbers Buffet.

Food and beverage revenues for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily due to the opening of new food and beverage outlets in connection with Project Sunrise, increased utilization of Pocono Downs Player’s Club points and promotional coupons at the property’s restaurants and a full period of slot operations, which resulted in increased patron visitation to the facility.

Retail, entertainment and other revenues for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased primarily due to the addition of tenant revenues from outlets opened in connection with Project Sunrise and entertainment revenues from live concerts at the harness racing facility, as well as increased ATM commissions due to an increase in the number and utilization of ATM machines at the facility.

Retail, entertainment and other revenues for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily due to the opening of new retail outlets in connection with Project Sunrise, increased utilization of Pocono Downs Player’s Club points and promotional coupons at the property’s retail outlets and a full period of slot operations, which resulted in increased patron visitation to the facility.

Promotional Allowances

The retail value of providing promotional allowances was included in revenues as follows (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Dollar Variance					Percentage Variance
							09 vs. 08			08 vs. 07		09 vs. 08		08 vs. 07
Food and beverage	$	7,889	$	6,072	$	2,547	$	1,817		$	3,525	29.9%		138.4%
Retail		1,181		1,623		1,048		(442	)		575	(27.2%	)	54.9%
Total	$	9,070	$	7,695	$	3,595	$	1,375		$	4,100	17.9%		114.0%

The estimated cost of providing promotional allowances was included in gaming costs and expenses as follows (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Dollar Variance					Percentage Variance
							09 vs. 08			08 vs. 07		09 vs. 08		08 vs. 07
Food and beverage	$	7,226	$	6,898	$	2,816	$	328		$	4,082	4.8%		145.0%
Retail		1,979		2,223		991		(244	)		1,232	(11.0%	)	124.3%
Total	$	9,205	$	9,121	$	3,807	$	84		$	5,314	0.9%		139.6%

Promotional allowances for the fiscal years ended September 30, 2009 and 2008 compared to the respective prior fiscal year increased due to higher redemptions under the Player’s Club program at food and beverage outlets.

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Operating Costs and Expenses

Operating costs and expenses consisted of the following (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007		Dollar Variance						Percentage Variance
							09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Gaming	$	178,282	$	152,707	$	132,841	$	25,575		$	19,866		16.7%		15.0%
Food and beverage		6,481		3,867		5,115		2,614			(1,248	)	67.6%		(24.4%	)
Retail, entertainment and other		1,529		829		1,425		700			(596	)	84.4%		(41.8%	)
Advertising, general and administrative		26,798		22,243		19,942		4,555			2,301		20.5%		11.5%
Pre-opening costs and expenses		224		3,448		3,391		(3,224	)		57		(93.5%	)	1.7%
Depreciation and amortization		25,660		14,051		10,655		11,609			3,396		82.6%		31.9%
Total	$	238,974	$	197,145	$	173,369	$	41,829		$	23,776		21.2%		13.7%

Gaming costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased as a result of additional operating costs and expenses necessary to support Project Sunrise, including an increase in the Pennsylvania Gaming Tax commensurate with the growth in slot revenues, and higher redemption costs due to increased utilization of Player’s Club points and promotional coupons at third-party outlets. The increase in gaming costs and expenses also was due to high post-opening staffing costs in connection with Project Sunrise. Gaming costs and expenses for the fiscal year ended September 30, 2009 also reflect the impact of our cost containment efforts. Expenses associated with the Pennsylvania Gaming Tax totaled $125.3 million and $103.4 million for the fiscal years ended September 30, 2009 and 2008, respectively. Gaming costs and expenses as a percentage of gaming revenues was 74.6% for the fiscal year ended September 30, 2009 compared to 75.9% for the prior fiscal year.

Gaming costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily as a result of additional operating costs and expenses necessary to support Project Sunrise and a full period of slot operations, including the Pennsylvania Gaming Tax, as well as increased non-gaming complimentaries redeemed by casino patrons at Pocono Downs-owned outlets. The increase in gaming costs and expenses also reflects approximately $1.1 million in expenses incurred for leased slot machines and related costs during the transition from the Phase I slot facility to the Phase II slot facility. Expenses associated with the Pennsylvania Gaming Tax totaled $103.4 million and $92.2 million for the fiscal years ended September 30, 2008 and 2007, respectively. Gaming costs and expenses as a percentage of gaming revenues was 75.9% for the fiscal year ended September 30, 2008 compared to 72.8% for the prior fiscal year.

Food and beverage costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased due to additional costs and expenses necessary to support the new food and beverage outlets opened in connection with Project Sunrise, partially offset by increased use of food and beverage complimentaries resulting in higher amounts of food and beverage costs being allocated to gaming costs and expenses.

Food and beverage costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased primarily as a result of increased use of food and beverage complimentaries resulting in higher amounts of food and beverage costs being allocated to gaming costs and expenses, partially offset by additional costs and expenses necessary to support food and beverage outlets in connection with Project Sunrise.

Retail, entertainment and other costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased primarily due to higher entertainment costs and expenses resulting from the live concerts at the harness racing facility. Retail, entertainment and other costs and expenses reflect lower retail costs and expenses due to the January 2009 closure of Reflections, Pocono Downs’ souvenir store.

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Retail, entertainment and other costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased primarily as a result of increased use of retail complimentaries resulting in higher amounts of retail costs being allocated to gaming costs and expenses, partially offset by additional costs and expenses necessary to support retail outlets in connection with Project Sunrise.

Advertising, general and administrative costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased as a result of additional costs and expenses necessary to support Project Sunrise, including payroll and utility costs.

Advertising, general and administrative costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily as a result of additional costs and expenses necessary to support Project Sunrise and a full period of slot operations, as well as increased advertising expenditures in response to new competition. These increases were partially offset by the $3.5 million non-recurring charge recorded in the prior fiscal year in connection with the settlement of property tax litigation related to the Pocono Downs facility.

Pre-opening costs and expenses for the fiscal year ended September 30, 2009 were minimal.

Pre-opening costs and expenses for the fiscal year ended September 30, 2008 were comprised of direct incremental personnel, consulting and other costs associated with Project Sunrise. Construction of Project Sunrise commenced in May 2007 and was completed in July 2008.

Depreciation and amortization expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased primarily due to a full year of depreciation on Project Sunrise and related slot machines and equipment placed into service in July 2008.

Depreciation and amortization expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily due to additional depreciation charges related to Project Sunrise and the related slot machines and equipment.

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Corporate Expenses and Other Income (Expense)

Corporate expenses and other income (expense) consisted of the following (in thousands):

	For the Fiscal Years Ended September 30,
	2009			2008			2007			Dollar Variance					Percentage Variance
										09 vs. 08			08 vs. 07		09 vs. 08		08 vs. 07
Corporate expenses:
Depreciation and amortization	$	83		$	3,771	(1)	$	79		$	(3,688	)	$	3,692	(97.8%	)	4,673.4%
Corporate expenses		17,227			25,188	(2)		10,507			(7,961	)		14,681	(31.6%	)	139.7%
Total Corporate expenses	$	17,310		$	28,959		$	10,586		$	(11,649	)	$	18,373	(40.2%	)	173.6%
Other income (expense):
Accretion of discount to the relinquishment liability (3)	$	(20,425	)	$	(27,085	)	$	(29,794	)	$	6,660		$	2,709	(24.6%	)	(9.1%	)
Interest income (4)		3,912			3,795			3,695			117			100	3.1%		2.7%
Interest expense, net of capitalized interest		(109,689	)		(93,793	)		(94,363	)		(15,896	)		570	16.9%		(0.6%	)
Write-off of debt issuance costs		-			-			(71	)(5)		-			71	-		(100.0%	)
Gain on early extinguishment of debt		8,466	(6)		-			-			8,466			-	100.0%		-
Other income (expense), net (8)		(7,658	)(7)		248			(137	)		(7,906	)		385	(3,187.9%	)	(281.0%	)
Total other expense	$	(125,394	)	$	(116,835	)	$	(120,670	)	$	(8,559	)	$	3,835	7.3%		(3.2%	)

(1) Includes $3.7 million in charges to write-off the Menominee development rights intangible asset.

(2) Includes $5.8 million in charges to adjust the allowance on the future collection of reimbursable development costs and expenses in connection with the Menominee Project.

(3) Our accretion of the discount to the relinquishment liability reflects the accretion of the discount to the present value of the relinquishment liability for the impact of the time value of money.

(4) Comprised primarily of interest earned on long-term receivables from the Menominee Tribe related to the Menominee Project and the Cowlitz Tribe related to the Cowlitz Project.

(5) Represents the unamortized debt issuance costs written-off upon the termination of our $450.0 million prior bank credit facility in March 2007.

(6) Represents the gain associated with the early extinguishment of approximately $14.3 million of our outstanding 2001 8 3/8% senior subordinated notes due July 1, 2011.

(7) Includes $4.5 million in asset write-offs relating to Project Horizon and a $1.6 million loss in connection with the amendment to the purchase agreement for Pocono Downs.

(8) Generally represents gain (loss) on disposal of property and equipment, except when noted.

Total Corporate costs and expenses for the fiscal year ended September 30, 2009 compared to the prior fiscal year decreased primarily as a result of the $9.5 million non-recurring charges recorded in fiscal 2008 for additional reserves against the net assets of WTG in connection with the Menominee Project. The decrease in total Corporate expenses also was attributable to a reduction in professional costs and consulting expenditures related to certain gaming diversification efforts that ended in fiscal 2008, in particular, our effort to secure a gaming license in Wyandotte County, Kansas. Additionally, the decrease in total Corporate expenses resulted from the impact of our cost containment program, partially offset by increased rental expense in connection with a ground lease for a 152-acre site located in Palmer, Massachusetts.

Total Corporate costs and expenses for the fiscal year ended September 30, 2008 compared to the prior fiscal year increased primarily as a result of the $9.5 million in charges for additional reserves recorded against the net assets of WTG. These additional reserves were initially recorded for WTG following the issuance of new guidance by the BIA in January 2008 on its policy for taking off-reservation land into trust for gaming purposes and were subsequently

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increased in September 2008 following an unfavorable decision by the U.S. Department of the Interior to reject the Menominee Tribe’s request to suspend review of its application to take off-reservation land into trust in connection with the Menominee Project and a federal court’s subsequent refusal to issue a temporary restraining order to prevent U.S. Department of the Interior from taking further action on the application. The increase in total Corporate costs and expenses also was attributable to increased tribal services expense and higher professional costs and consulting expenditures related to various gaming diversification efforts of $2.8 million and $2.7 million, respectively.

Interest expense, net of capitalized interest, for the fiscal year ended September 30, 2009 compared to the prior fiscal year increased primarily due to higher weighted average outstanding debt and lower capitalized interest, partially offset by decreased weighted average interest rate. The weighted average outstanding debt was $1.65 billion for the fiscal year ended September 30, 2009 compared to $1.40 billion for the prior fiscal year. Capitalized interest was $1.1 million for the fiscal year ended September 30, 2009 compared to $6.5 million for the prior fiscal year. The increase in weighted average outstanding debt was due to additional borrowings on our bank credit facility to fund capital expenditures for Project Horizon and Project Sunrise. The weighted average interest rate was 6.7% for the fiscal year ended September 30, 2009 compared to 7.2% for the prior fiscal year.

Interest expense, net of capitalized interest, for the fiscal year ended September 30, 2008 compared to the prior fiscal year decreased due to increases in capitalized interest relating to Project Horizon and Project Sunrise of $2.5 million and $2.4 million, respectively, to $3.5 million and $3.0 million, respectively, for the fiscal year ended September 30, 2008 from $1.0 million and $638,000, respectively, for the prior fiscal year. The decrease in interest expense also was attributable to lower weighted average interest rate, partially offset by increased weighted average outstanding debt. The weighted average interest rate was 7.2% for the fiscal year ended September 30, 2008 compared to 7.4% for the prior fiscal year. The weighted average outstanding debt was $1.40 billion for the fiscal year ended September 30, 2008 compared to $1.30 billion for the prior fiscal year. The increase in weighted average outstanding debt was due to additional borrowings on our bank credit facility to fund Project Horizon and Project Sunrise.

Seasonality

The gaming industry in Northeast gaming market is seasonal in nature, with the peak gaming activity often occurring at Mohegan Sun between the months of May and August. Additionally, live harness racing activity at Pocono Downs is seasonal, with the racing season commencing in late March/early April and usually ending in the fall. The overall Northeastern Pennsylvania gaming market also is expected to be seasonal in nature. Accordingly, the results of operations for the fiscal year ended September 30, 2009 are not necessarily indicative of the operating results for interim periods.

Liquidity, Capital Resources and Capital Spending

Our cash flows consisted of the following (in thousands):

	For the Fiscal Years Ended September 30,
	2009			2008			2007			Dollar Variance						Percentage Variance
										09 vs. 08			08 vs. 07			09 vs. 08		08 vs. 07
Net cash provided by operating activities	$	171,811		$	170,316		$	284,403		$	1,495		$	(114,087	)	0.9%		(40.1%	)
Net cash used in investing activities		(158,968	)		(319,694	)		(187,446	)		160,726			(132,248	)	(50.3%	)	70.6%
Net cash provided by (used in) financing activities		(31,379	)		126,847			(66,223	)		(158,226	)		193,070		(124.7%	)	(291.5%	)
Net (decrease) increase in cash and cash equivalents	$	(18,536	)	$	(22,531	)	$	30,734		$	3,995		$	(53,265	)	(17.7%	)	(173.3%	)

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As of September 30, 2009 and 2008, we held cash and cash equivalents of $64.7 million and $83.2 million, respectively. As a result of the cash-based nature of our business, operating cash flow levels tend to follow trends in our operating income, excluding the effects of non-cash charges, such as depreciation and amortization, accretion of discounts and relinquishment liability reassessments. The slight increase in cash provided by operating activities for the fiscal year ended September 30, 2009 compared to the prior fiscal year was primarily attributable to lower working capital requirements as compared to the prior fiscal year, partially offset by decreased operating income after adjustments for non-cash items. The decrease in cash provided by operating activities for the fiscal year ended September 30, 2008 compared to the prior fiscal year was attributable to a decrease in operating income after adjustments for non-cash items and higher working capital requirements.

Operating activities are a significant source of our cash flows. We use our cash flows provided by operating activities primarily to meet our working capital requirements, provide funding for our maintenance and development capital expenditures, reduce our debt, provide distributions to the Tribe, provide payments under the relinquishment agreement, and from time to time, make investments. There are numerous potential factors which may cause a substantial reduction in the amount of such cash flows, including, but not limited to, the following:

• the national economic recession, which has resulted in reduced spending on discretionary items such as gaming activities and could result in further reduced spending;

• increased competition (including the legalization or expansion of gaming in New England, New York, New Jersey or Pennsylvania);

• unfavorable weather conditions;

• changes in applicable laws or policies regarding smoking or alcohol service at Mohegan Sun and Pocono Downs;

• an infrastructure or transportation disruption, such as the closure of Interstate 95 or 395 through Connecticut, for an extended period of time; and

• an act of terrorism on the United States of America.

In addition to cash generated by operating activities, we have relied on external sources of liquidity to meet our capital requirements. The decrease in cash used in investing activities for the fiscal year ended September 30, 2009 compared to the prior fiscal year was primarily attributable to a $140.2 million decrease in capital expenditures due to the completion of Project Sunrise and the suspension of Project Horizon and the $13.1 million accelerated refund payment in connection with the amendment to the purchase agreement for Pocono Downs. The increase in cash used in investing activities for the fiscal year ended September 30, 2008 compared to the prior fiscal year was primarily attributable to a $185.3 million increase in capital expenditures due to the construction of Project Horizon and Project Sunrise. The decrease in cash provided by financing activities for the fiscal year ended September 30, 2009 compared to the prior fiscal year was primarily attributable to a $168.4 million decrease in total net borrowings, partially offset by an $8.5 million decline in distributions to the Tribe. On July 15, 2009, we repaid our outstanding 2003 6 ³/8% $330.0 million senior subordinated notes at maturity with proceeds from our bank credit facility. The increase in cash provided by financing activities for the fiscal year ended September 30, 2008 compared to the prior fiscal year was primarily attributable to a $190.3 million increase in total net borrowings.

Cost Containment Program

As a result of declines in business volumes and uncertainties in the financial markets, we have taken a series of steps to reduce expenditures, including the September 2008 suspension of the hotel, retail and new parking garage elements of Project Horizon, in an effort to, among other things, ensure continued compliance with our financial covenants under our bank credit facility. In February 2009, we also implemented a company-wide cost containment program, which included employee salary rollbacks, suspension of all annual and merit-based compensation increases, reduction in work hours, suspension of employer-matching 401(k) contributions and

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funding of other contributions to the Mohegan Retirement and 401(k) Plan. In addition, we implemented, and continue to implement, initiatives to reduce operating expenses, including reductions in advertising expenditures, certain marketing programs, hours of operation in certain food and beverage and retail outlets, where warranted, and reductions in most other operating cost categories. Consolidated cost savings for fiscal 2009 totaled approximately $86.0 million. We continue to monitor revenues and expenditures to ensure continued compliance with applicable covenants and may need to implement additional cost containment measures based upon future operating results.

External Sources of Liquidity

Notes

We financed the purchase of the Pocono Downs entities and most of the costs to construct Mohegan Sun and Pocono Downs with the net proceeds from the issuance of notes and borrowings under our bank credit facilities. As of September 30, 2009, we had outstanding:

• $2.0 million in 8 ³/8% senior subordinated notes due July 1, 2011, or the 2001 senior subordinated notes;

• $250.0 million in 8% senior subordinated notes due April 1, 2012, or the 2002 senior subordinated notes;

• $225.0 million in 7 ¹/8% senior subordinated notes due August 15, 2014, or the 2004 senior subordinated notes;

• $250.0 million in 6 ¹/8% senior notes due February 15, 2013, or the 2005 senior unsecured notes; and

• $150.0 million in 6 ⁷/8% senior subordinated notes due February 15, 2015, or the 2005 senior subordinated notes.

In March 2009, we repurchased and extinguished a principal amount of $14.3 million of the outstanding 2001 senior subordinated notes. The aggregate amount paid for this purchase was approximately $6.1 million, which represented a purchase price of approximately $5.8 million and accrued interest of $273,000. We realized a gain on early extinguishment of debt in connection with this transaction totaling approximately $8.5 million. An aggregate principal amount of approximately $2.0 million of the 2001 senior subordinated notes remains outstanding as of September 30, 2009.

On July 15, 2009, we repaid our 2003 senior subordinated notes at maturity with proceeds from our bank credit facility.

On October 26, 2009, we issued $200.0 million second lien senior secured notes with fixed interest payable at a rate of 11 ¹/2% per annum, or the 2009 second lien senior secured notes. The net proceeds from this financing were used to repay our then existing term loan under the bank credit facility in the aggregate principal amount of $147.0 million, to repay $41.0 million of revolving loans under the bank credit facility (including a $25.0 million permanent reduction in the revolving commitments), and to pay related transaction costs and expenses associated with the issuance. The 2009 second lien senior secured notes mature on November 1, 2017. The first call date for the 2009 second lien senior secured notes is November 1, 2013. Interest on the 2009 second lien senior secured notes is payable semi-annually on May 1^st and November 1^st, commencing May 1, 2010. The 2009 second lien senior secured notes are collateralized by a second lien on substantially all of our property and assets, and that of our existing and future guarantor subsidiaries, and are effectively subordinated to all of our first lien secured debt, including the borrowings under the bank credit facility, to the extent of the collateral securing such debt. The 2009 second lien senior secured notes rank equally in right of payment with all of our and our existing and future guarantor subsidiaries’ senior indebtedness and with our senior relinquishment payment obligations under the relinquishment agreement that are then due and owing, but, to the extent of the value of the collateral, rank

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effectively senior to all of our unsecured senior indebtedness, including the 2005 senior unsecured notes and payment obligations under the relinquishment agreement. The 2009 second lien senior secured notes rank senior to all of our and our existing and future guarantor subsidiaries’ subordinated indebtedness, including the 2001 senior subordinated notes, the 2002 senior subordinated notes, the 2004 senior subordinated notes and the 2005 senior subordinated notes. The 2009 second lien senior secured notes are fully guaranteed, jointly and severally, on a second lien senior secured basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming.

The 2009 second lien senior secured notes and guarantees have not been and will not be registered under the Securities Act of 1933 or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements.

We or our affiliates may, from time to time, seek to purchase or otherwise retire the remaining 2001 senior subordinated notes or other indebtedness for cash in open market purchases, privately negotiated transactions or otherwise, to reduce the amount of our outstanding indebtedness. Any such transactions will depend on prevailing market conditions, our liquidity, contractual restrictions and other factors.

MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming are full and unconditional guarantors, on a joint and several basis, of each of these notes, except for the 2001 senior subordinated notes, which are fully and unconditionally guaranteed solely by MBC.

The senior and senior subordinated note indentures contain certain financial and non-financial covenants with which we and the Tribe must comply. The financial covenants include, among other things, limitations on restricted payments and the incurrence of indebtedness, while the non-financial covenants include, among other things, reporting obligations, compliance with laws and regulations and our continued existence. As of September 30, 2009, we and the Tribe were in compliance with all respective covenant requirements under the senior and senior subordinated note indentures.

In October 2009, Moody’s Investors Services assigned a B1 credit rating on our 2009 second lien senior secured notes and affirmed its Caa2 credit rating on our senior subordinated notes, while Standard and Poor’s Ratings Services assigned a B- credit rating on the 2009 second lien senior secured notes and affirmed its CCC+ credit rating on the senior subordinated notes. These actions were primarily to reflect the issuance of the 2009 second lien senior secured notes and favorable amendments to our maximum total leverage and senior leverage ratio covenants under our bank credit facility, as further discussed below. At the same time, Moody’s Investors Services also lowered its credit rating on the 2005 senior unsecured notes from B1 to B2. In November 2009, Standard and Poor’s Ratings Services lowered its credit rating on the 2005 senior unsecured notes from B- to CCC+. These actions reflect the issuance of the 2009 second lien senior secured notes, which rank ahead of the 2005 senior unsecured notes. Such credit ratings may impact our ability to access the debt capital markets in the future. In the event we are able to access the debt capital markets, our costs of the issuance of new debt may be greater than costs incurred by us in the past. We also could be subject to more restrictive covenants and other terms in connection with any such issuance.

If we are unable to sufficiently offset declines in our revenues with appropriate cost reductions or if we are unable to execute our cost containment initiatives outlined earlier, we may not be able to satisfy our incurrence of indebtedness covenant under our note indentures. In such event, the indentures may restrict us from borrowing additional funds, including under our bank credit facility, to meet our obligations. While we could seek to obtain amendments to our indentures to reduce or eliminate this restriction, no assurance can be made that we would be able to obtain such amendments.

Bank Credit Facility

In December 2008, we amended our bank credit facility pursuant to a third amended and restated loan agreement. As of September 30, 2009, the bank credit facility provided for up to $850.0 million of borrowing capacity,

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consisting of a $150.0 million term loan and $700.0 million of revolving commitments, from a syndicate of 23 financial institutions and commercial banks, with Bank of America, N.A., serving as Administrative Agent. As of September 30, 2009, the term loan under the bank credit facility amortized at a rate of $750,000 per quarter until June 30, 2010, at which time the amortization rate was to increase to $30.0 million per quarter (with an automatic and permanent reduction of the revolving commitments by such amount following repayment). The maturity date of the bank credit facility is March 9, 2012, upon which date the remaining balances outstanding are payable. See below for further discussion of the bank credit facility as amended by subsequent event.

As of September 30, 2009, there was $713.0 million drawn on the bank credit facility, which was comprised of a $147.0 million term loan and $566.0 million in revolving loans. The revolving loans outstanding as of September 30, 2009 reflect the repayment of our 2003 senior subordinated notes at maturity on July 15, 2009 with proceeds from the bank credit facility. As of September 30, 2009, the amount under letters of credit issued pursuant to the bank credit facility totaled $4.6 million, of which no amounts were drawn. Inclusive of the term loan and letters of credit, which reduce borrowing availability under the bank credit facility, and after taking into account restrictive financial covenants under the bank credit facility, line of credit and note indentures, we had approximately $129.4 million of borrowing capacity under the bank credit facility as of September 30, 2009. After also taking into consideration our October 26, 2009 issuance of $200.0 million second lien senior secured notes and the use of proceeds therefrom for repayment of the $147.0 million term loan and $41.0 million of revolving loans (including a $25.0 million permanent reduction in the revolving commitments), our borrowing capacity under the bank credit facility approximated $145.4 million as of September 30, 2009. See below for further discussion of the bank credit facility as amended by subsequent event.

At our option, each advance of loan proceeds accrues interest on the basis of a base rate or on the basis of a one-month, two-month, three-month, six-month or twelve-month Eurodollar rate, plus in either case, the applicable rate based on either the applicable pricing period as set forth under the bank credit facility or our total leverage ratio, depending on whether the term loan remains outstanding (as each term is defined under the bank credit facility). We also pay commitment fees for the unused portion of the revolving loans on a quarterly basis equal to the product obtained by multiplying the applicable rate for commitment fees by the average daily unused commitment for that calendar quarter. As of September 30, 2009: (1) the applicable rate for base rate loans was between 2.25% and 3.25% if the term loan remains outstanding, and between 0.75% and 2.25% after full repayment of the term loan; (2) the applicable rate for Eurodollar rate loans was between 3.50% and 4.50% if the term loan remains outstanding, and between 2.00% and 3.50% after full repayment of the term loan; and (3) the applicable rate for commitment fees was 0.50% if the term loan remains outstanding, and between 0.20% and 0.50% after full repayment of the term loan. The base rate is the higher of Bank of America’s announced prime rate, the LIBOR rate for one-month contracts plus 1.25% or the federal funds rate plus 0.50%. Interest on base rate loans is payable quarterly in arrears. Interest on Eurodollar rate loans is payable at the end of each applicable interest period or quarterly in arrears, if earlier. As of September 30, 2009, we had $713.0 million in Eurodollar rate loans and no base rate loans outstanding. The Eurodollar rate loans outstanding at September 30, 2009 were comprised of: (1) a $147.0 million term loan based on a one-month Eurodollar rate of 0.25% plus an applicable rate of 3.75%, and (2) $566.0 million in revolving loans based on a one-month Eurodollar rate of 0.24% plus an applicable rate of 3.75%. The applicable rate for commitment fees was 0.50% as of September 30, 2009.

The bank credit facility is collateralized by a lien on substantially all of our assets, including the assets that comprise Pocono Downs and a leasehold mortgage on the land previously taken into trust by the federal government and improvements which comprise Mohegan Sun. We also will be required to pledge additional assets as collateral for the bank credit facility as we or our guarantor subsidiaries acquire them. Our obligations under the bank credit facility are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs entities, Mohegan Golf, MVW, WTG and MTGA Gaming. The bank credit facility subjects us to a number of restrictive covenants, including financial covenants. These financial covenants relate to, among other things, our maximum total debt and maximum senior debt leverage ratios, minimum fixed charge coverage ratio and maximum capital expenditures.

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The bank credit facility includes non-financial covenants by us and the Tribe of the type customarily found in loan agreements for similar transactions including requirements that:

• the Tribe preserve its existence as a federally-recognized Indian tribe;

• the Tribe cause us to continually operate Mohegan Sun and the Pocono Downs entities in compliance with all applicable laws; and

• except under specific conditions, limit us from selling or disposing of our assets, limit the transfer of our and our guarantor subsidiaries’ assets to non-guarantor entities, limit the incurrence by us and our guarantor subsidiaries of other debt or contingent obligations and limit us and our guarantor subsidiaries’ ability to extend credit, make investments or commingle our assets with assets of the Tribe.

Our bank credit facility requires us to comply with certain financial covenants at the end of each of our fiscal quarters, including a minimum fixed charge coverage ratio, a maximum total leverage ratio and a maximum senior leverage ratio.

As of September 30, 2009, our minimum fixed charge coverage ratio covenant, as defined under the bank credit facility, was as follows:

Fiscal Quarters Ending:
September 30, 2009 through March 31, 2010	1.05:1.00
June 30, 2010 and thereafter	1.10:1.00

As of September 30, 2009, our maximum total leverage ratio covenant, or the ratio of total debt to annualized EBITDA, as such terms are defined under the bank credit facility, was as follows:

Fiscal Quarters Ending:
September 30, 2009 and December 31, 2009	7.25:1.00
March 31, 2010 and June 30, 2010	7.00:1.00
September 30, 2010 and December 31, 2010	6.75:1.00
March 31, 2011 and June 30, 2011	6.50:1.00
September 30, 2011	6.25:1.00
December 31, 2011 and thereafter	6.00:1.00

As of September 30, 2009, our maximum senior leverage ratio covenant, or ratio of total debt minus subordinated obligations to annualized EBITDA, as such terms are defined under the bank credit facility, was as follows:

Fiscal Quarters Ending:
September 30, 2009 and December 31, 2009	4.75:1.00
March 31, 2010	4.50:1.00
June 30, 2010 through December 31, 2010	4.25:1.00
March 31, 2011 through September 30, 2011	4.00:1.00
December 31, 2011 and thereafter	3.50:1.00

If we are unable to sufficiently offset declines in our revenues with appropriate cost reductions or if we are unable to execute our cost containment initiatives outlined earlier, we may not be able to satisfy our financial covenants under the bank credit facility. In such event, we would need to obtain waivers or amendments under the bank credit facility; however, no assurance can be made that we would be able to obtain such waivers or amendments. If we were unable to obtain such waivers or amendments, we would be in default under the bank credit facility, which may result in cross-defaults under our senior and senior subordinated notes. If such defaults or cross-defaults were to occur, it would allow our lenders to exercise their rights and remedies as defined under

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their respective agreements, including their right to accelerate the repayment of outstanding indebtedness. If such acceleration were to occur, we cannot provide any assurance that we would be able to obtain the financing necessary to repay such accelerated indebtedness.

As of September 30, 2009, we and the Tribe were in compliance with all of our respective covenant requirements under the bank credit facility.

On October 26, 2009, concurrently with the issuance of the 2009 second lien senior secured notes, we entered into an amendment to the terms of the bank credit facility. Among other things, the amendment modified our maximum total leverage and senior leverage ratio covenants as follows:

Maximum total leverage ratio covenant, or the ratio of total debt to annualized EBITDA, as such terms are defined under the bank credit facility:

Fiscal Quarters Ending:
September 30, 2009 and December 31, 2009	7.25:1.00
March 31, 2010 and June 30, 2010	7.25:1.00
September 30, 2010 and December 31, 2010	7.25:1.00
March 31, 2011	7.00:1.00
June 30, 2011	6.75:1.00
September 30, 2011	6.50:1.00
December 31, 2011 and thereafter	6.25:1.00

Maximum senior leverage ratio covenant, or ratio of total debt minus subordinated obligations to annualized EBITDA, as such terms are defined under the bank credit facility:

Fiscal Quarters Ending:
September 30, 2009 and December 31, 2009	4.75:1.00
March 31, 2010	4.75:1.00
June 30, 2010 through December 31, 2010	4.50:1.00
March 31, 2011 through September 30, 2011	4.25:1.00
December 31, 2011 and thereafter	3.75:1.00

The amendment also: (1) provided the ability to obtain a release from liens securing the bank credit facility of a portion of the land on which Pocono Downs is sited to permit its sale or lease to a third-party in connection with the development of a potential hotel project, consisting of a minimum of 200 rooms, subject to the satisfaction of customary conditions; (2) modified the terms of our covenant relating to the incurrence of permitted indebtedness to allow us or our subsidiaries to incur additional debt (which may consist of capital lease obligations) in an aggregate amount not to exceed $55.0 million, at any one time outstanding, in connection with the development of the potential hotel project at Pocono Downs; (3) modified the terms of our permitted capital expenditures covenant to affirmatively allow for the existing $125.0 million of permitted capital expenditures to be utilized for Pocono Downs in addition to Mohegan Sun and related businesses, including the payment of licensing fees associated with those operations; (4) permanently reduced the revolving commitments by $25.0 million; and (5) modified the applicable pricing rates as follows: (a) the applicable rate for base rate loans will be between 1.25% and 2.75%, and (b) the applicable rate for Eurodollar rate loans will be between 2.50% and 4.00%.

Upon the repayment of the $147.0 million term loan with proceeds from the issuance of the 2009 second lien senior secured notes and the $25.0 million permanent reduction in revolving commitments, the total commitment of the bank credit facility was reduced from $850.0 million to $675.0 million.

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Line of Credit

As of September 30, 2009, we had an $18.0 million revolving loan agreement with Bank of America, N.A., or the line of credit. The line of credit was amended in May 2009 to reduce the commitment from $25.0 million to $18.0 million and extend the maturity date from May 14, 2009 to May 14, 2010. Each advance accrues interest on the basis of a one-month Eurodollar rate or prime rate, plus the applicable margin determined on the basis of our leverage ratio, as each term is defined under the line of credit. Borrowings under the line of credit are uncollateralized obligations. As of September 30, 2009, we had $12.2 million in Eurodollar rate loans outstanding, which were based on a one-month Eurodollar rate of 0.26% plus an applicable rate of 3.25%. The line of credit subjects us to certain covenants, including a covenant to maintain at least the line of credit commitment amount available for borrowing under the bank credit facility. As of September 30, 2009, we were in compliance with all covenant requirements under the line of credit and had $5.8 million of borrowing capacity thereunder.

Letters of Credit

As of September 30, 2009, we maintained seven uncollateralized letters of credit to satisfy potential workers’ compensation liabilities, pari-mutuel wagering tax liabilities of the Pocono Downs entities, overdue amounts for purses due to horsemen at the Pocono Downs entities, potential contractor and subcontractor liabilities relating to Project Horizon, collateral obligations of a surety bond relating to Pennsylvania Gaming Tax expenses owed by Downs Racing to the PGCB, and two in connection with road work at the Pocono Downs facilities. The letters of credit expire(d) on various dates from November 2009 through September 2010, subject to renewals. As of September 30, 2009, no amounts were drawn on the letters of credit.

Salishan-Mohegan Bank Credit Facility

On September 30, 2009, Salishan-Mohegan entered into an amendment to the terms of its then existing $25.0 million revolving loan agreement with Bank of America, N.A., or the Salishan credit facility, dated October 17, 2006. Among other things, the amendment reduced the total commitment of the credit facility from $25.0 million to $17.0 million, extended the maturity date from September 30, 2009 to September 30, 2010 and modified the applicable pricing rates. At the option of Salishan-Mohegan, each advance of loan proceeds accrues interest on the basis of a base rate or on the basis of a one-month, two-month, three-month or six-month Eurodollar rate, plus a spread of 2.50% for base rate loans and an applicable rate, as defined under the Salishan credit facility, of 3.50% for Eurodollar rate loans. The base rate is the higher of Bank of America’s announced prime rate or the federal funds rate plus 0.50%. The applicable rate for commitment fees is 0.50%. The revolving loan has no mandatory amortization provisions and is payable in full at maturity. In connection with the amendment, the Tribe loaned Salishan-Mohegan $10.0 million, which was used to repay revolving loans under the Salishan credit facility. The Salishan credit facility is collateralized by a lien on substantially all of the existing and future assets of Salishan-Mohegan. The obligations of Salishan-Mohegan under the Salishan credit facility also are guaranteed by the Tribe. The Salishan credit facility subjects Salishan-Mohegan to a number of restrictive covenants, including financial and non-financial covenants customarily found in loan agreements for similar transactions.

As of September 30, 2009, Salishan-Mohegan had $13.3 million in base rate loans and no Eurodollar rate loan outstanding. The loans outstanding at September 30, 2009 were based on a base rate of 3.25% plus a spread of 2.50%. The applicable rate for commitment fees was 0.50% as of September 30, 2009. As of September 30, 2009, Salishan-Mohegan had $3.7 million of borrowing capacity under the Salishan credit facility.

Mohegan Tribe Promissory Notes

On September 30, 2009, the Tribe loaned Salishan-Mohegan $10.0 million, which was used to repay revolving loans under the Salishan credit facility in connection with the September 30, 2009 amendment to the Salishan credit facility, as further described above. The promissory note executed by Salishan-Mohegan in favor of the

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Tribe provides for the accrual of interest at an annual rate of 15.0% and matures on October 1, 2010. Accrued interest is paid at a monthly rate of 3.0%, with the remaining 12.0% due at maturity.

In June 2008, the Tribe loaned MG&H $8.3 million, which was used to fund MG&H’s portion of a $25.0 million Privilege Fee payment to the State of Kansas in connection with MG&H’s effort, ended in September 2008, to secure a gaming license for the development of a gaming facility in the State of Kansas. The promissory note executed by MG&H in favor of the Tribe provided for the accrual of interest at an annual rate of 12.0% and was due to mature on October 15, 2008. In September 2008, MG&H repaid the $8.3 million outstanding on the promissory note following a refund of the Privilege Fee payment as a result of the selection of another applicant by the Kansas Lottery Gaming Facility Review Board.

Capital Expenditures

Capital Expenditures Incurred

Capital expenditures totaled $93.5 million for the fiscal year ended September 30, 2009. These capital expenditures were comprised of the following:

• Capital expenditures at Mohegan Sun and Pocono Downs of $90.7 million and $2.8 million, respectively. Mohegan Sun expenditures consisted of $71.9 million in costs related to Project Horizon, including $1.1 million in capitalized interest, and $18.8 million in maintenance and development capital expenditures. Pocono Downs expenditures included $5.4 million in capital expenditures, primarily consisting of construction expenditures for a new paddock for the harness racing facility, partially offset by a $2.6 million reduction in the final cost of Project Sunrise. During the fiscal year ended September 30, 2009, Pocono Downs also received a $2.0 million facility improvement grant from the Commonwealth of Pennsylvania pursuant to the Pennsylvania Race Horse Development Gaming Act, which was recorded as a reduction to property and equipment.

Capital expenditures totaled $383.7 million for the fiscal year ended September 30, 2008. These capital expenditures were comprised of the following:

• Capital expenditures at Mohegan Sun and Pocono Downs of $210.5 million and $173.2 million, respectively. Mohegan Sun expenditures consisted of $172.8 million in costs related to Project Horizon, including $3.5 million in capitalized interest, $26.3 million in maintenance capital expenditures and $11.4 million in property renovation expenditures. Pocono Downs expenditures consisted of $169.6 million in costs related to Project Sunrise, including $3.0 million in capitalized interest, and $3.6 million in maintenance capital expenditures.

Capital expenditures totaled $162.2 million for the fiscal year ended September 30, 2007. These capital expenditures were comprised of the following:

• Capital expenditures at Mohegan Sun and Pocono Downs of $103.7 million and $58.4 million, respectively. Mohegan Sun expenditures consisted of $46.5 million in costs related to Project Horizon, including $1.0 million in capitalized interest, $34.0 million in maintenance capital expenditures and $23.2 million in property renovation expenditures. Pocono Downs expenditures consisted of $56.4 million in costs for the Phase 1 slot facility and to begin construction on Project Sunrise, including $638,000 in capitalized interest, and $2.0 million in maintenance capital expenditures. Capital expenditures for Corporate were minimal.

Expected Future Capital Expenditures

Capital expenditures for fiscal year 2010 are forecast to be approximately $44.2 million. Capital expenditures for fiscal 2010 at Mohegan Sun, exclusive of Project Horizon spending, are forecast to be approximately $27.0

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million in maintenance and development expenditures, primarily relating to the replacement and improvement of information technology equipment, systems and software, the replacement and enhancement of slot machines, and utility infrastructure upgrades.

Total project costs for Project Horizon are currently estimated to be approximately $301.6 million, excluding capitalized interest. As of September 30, 2009, project costs incurred for Project Horizon, excluding capitalized interest, totaled approximately $287.5 million. Remaining project costs are estimated to total approximately $14.1 million and are anticipated to be incurred in fiscal 2010.

Capital expenditures for fiscal 2010 at Pocono Downs are forecast to be approximately $3.0 million in maintenance and development expenditures.

Capital expenditures for fiscal 2010 at Corporate are forecast to be minimal.

Sources of Funding for Capital Expenditures

We will primarily rely on cash generated from operations to finance maintenance capital expenditures at Mohegan Sun and Pocono Downs. We plan to finance capital expenditures for Project Horizon through a combination of operating cash flows and draws under our bank credit facility.

Interest Expense

For the fiscal years ended September 30, 2009, 2008 and 2007, we incurred the following in interest expense, net of capitalized interest (in thousands):

	For the Fiscal Years Ended September 30,
	2009			2008			2007
Bank credit facility	$	21,748		$	8,978		$	2,799
Prior bank credit facility		-			-			2,755
2005 6 1/ 8% senior unsecured notes		15,313			15,313			15,313
2001 8 3/ 8 % senior subordinated notes		742			1,369			1,369
2002 8% senior subordinated notes		20,000			20,000			20,000
2003 6 3/ 8% senior subordinated notes		16,655			21,038			21,038
2004 7 1/ 8% senior subordinated notes		16,031			16,031			16,031
2005 6 7/ 8% senior subordinated notes		10,313			10,313			10,313
Line of credit		338			388			641
WNBA promissory note		81			181			301
Salishan-Mohegan bank credit facility		743			1,153			1,186
Mohegan Tribe promissory note (Salishan-Mohegan)		4			-			-
Mohegan Tribe promissory note (MG&H)		-			244			-
Capital leases		273			47			-
Amortization of net deferred gain on settlement of derivative instruments		228			455			455
Amortization of debt issuance costs		8,282			4,831			3,835
Capitalized interest		(1,062	)		(6,548	)		(1,673	)
Total interest expense, net of capitalized interest	$	109,689		$	93,793		$	94,363

Sufficiency of Resources

We believe that existing cash balances, financing arrangements and operating cash flows will provide us with sufficient resources to meet our existing debt obligations, relinquishment payments and foreseeable capital expenditure requirements with respect to current operations and distributions to the Tribe for at least the next

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twelve months. However, we can provide no assurance in this regard. Please refer to “Part I. Item 1A. Risk Factors” for further details regarding risks relating to our sufficiency of resources. Any future investments in Mohegan Sun and Pocono Downs are anticipated to be funded through a combination of operating cash flows and draws under our bank credit facility. Inclusive of the term loan and letters of credit, which reduce borrowing availability under the bank credit facility, we had approximately $129.4 million of borrowing capacity under the bank credit facility as of September 30, 2009, after taking into account restrictive financial covenants under the bank credit facility, line of credit and note indentures. After also taking into consideration our October 26, 2009 issuance of $200.0 million second lien senior secured notes and the use of proceeds therefrom for repayment of the $147.0 million term loan and $41.0 million of revolving loans (including a $25.0 million permanent reduction in the revolving commitments), our borrowing capacity under the bank credit facility approximated $145.4 million as of September 30, 2009. Distributions to the Tribe are anticipated to approximate between $59.0 million and $64.0 million for fiscal 2010.

Contractual Obligations and Commitments

Our future payment obligations related to our debt and certain other material contractual obligations and the timing of those payments are set forth below.

			Payments due by period
Contractual Obligations (in thousands)	Total		Less than 1 year (1)		1-3 years		3-5 years		More than 5 years
Long-term debt (2)	$	1,628,040	$	26,430	$	976,010	$	475,000	$	150,600
Interest payments on long-term debt (3)		337,342		94,240		177,062		60,647		5,393
Construction (4)		14,147		14,147		-		-		-
Procurement (5)		72,293		15,059		30,852		24,091		2,291
Capital leases (6)		6,949		919		1,389		1,499		3,142
Operating leases (7)		4,789		3,944		537		192		116
Total	$	2,063,560	$	154,739	$	1,185,850	$	561,429	$	161,542

(1) Represents payment obligations from October 1, 2009 to September 30, 2010.

(2) Represents long-term debt maturities scheduled as of September 30, 2009.

(3) Represents interest payments expected to be paid on long-term debt as of September 30, 2009, pursuant to respective debt agreements.

(4) Represents expenditures we must pay in connection with Project Horizon, exclusive of amounts reflected in our consolidated balance sheets.

(5) Represents expenditures we must pay in connection with agreements entered into with vendors for inventory and other items, exclusive of amounts reflected in our consolidated balance sheets.

(6) Represents lease payments to the Tribe relating to property located adjacent to the Tribe’s reservation that is used for parking and access to Mohegan Sun.

(7) Represents leases for various buildings, equipment and land at Mohegan Sun and Pocono Downs, as well as the ground lease for the 152-acre site located in Palmer, Massachusetts.

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In addition to the contractual obligations described above, we have certain other contractual commitments as of September 30, 2009. The calculation of the estimated payments in the following table are based, in large part, on revenue projections over an extended period of time, as well as other factors that are more fully described below. Since there are high levels of estimation and judgment used with respect to calculating these liabilities, future events that affect such estimates and judgments may cause the actual payments to significantly differ from the estimates set forth below. The amounts included in the table are estimates and, while certain agreements are perpetual in term, for the purposes of calculating these amounts, we have assumed that the table contains information for only ten years.

	Payments due by period
Contractual Commitments (in thousands)	Less than 1 year (1)		1-3 years		3-5 years		5-10 years
Minimum Slot Win Contribution (2)	$	192,591	$	402,689	$	427,213	$	1,185,350
Relinquishment (3)		59,046		121,192		134,091		17,506
Priority distributions (4)		18,614		39,399		42,483		121,332
Town of Montville (5)		500		1,000		1,000		2,500
Pennsylvania Gaming Tax (6)		129,600		278,877		291,485		810,689
Pennsylvania property tax (7)		2,195		4,646		5,142		2,925
Total	$	402,546	$	847,803	$	901,414	$	2,140,302

(1) Amounts represent payment commitments from October 1, 2009 to September 30, 2010.

(2) Slot Win Contribution payments are a portion of gross revenues from slot machines at Mohegan Sun that we must pay to the State of Connecticut pursuant to the Mohegan Compact. Slot Win Contribution payments are the lesser of: (1) 30% of gross revenues from slot machines at Mohegan Sun, or (2) the greater of (a) 25% of gross revenues from slot machines at Mohegan Sun or (b) $80.0 million.

(3) Relinquishment payments are made by us to TCA pursuant to the relinquishment agreement. Relinquishment payments are 5% of revenues, as defined in the relinquishment agreement. The payments due reflect our estimates of amounts to be paid under the relinquishment agreement based on our estimated future revenues subject to the relinquishment agreement.

(4) Priority distributions are monthly payments required to be made by us to the Tribe pursuant to the priority distribution agreement. The payments are calculated based on our net cash flows, as defined under the priority distribution agreement, and are limited to a maximum amount of $14.0 million pursuant to the priority distribution agreement, as adjusted annually based on the Consumer Price Index, or CPI. For the purposes of calculating these amounts, we have assumed that we will pay the maximum amount in each of the years covered by the table, as adjusted by an annual CPI adjustment of 3.84%.

(5) We have an agreement with the Town of Montville to pay the town an annual payment of $500,000 to minimize the impact on the town resulting from the decreased tax revenues on reservation land held in trust.

(6) Pennsylvania Gaming Tax payments are a portion of gross revenues from slot machines at Pocono Downs that Downs Racing must pay to the PGCB on a daily basis, which includes local share assessments to be paid to cities and municipalities hosting Pocono Downs and amounts to be paid to the Pennsylvania Harness Horsemen’s Association. Pennsylvania Gaming Tax payments payable to the PGCB on a daily basis is 55% of gross revenues from slot machines at Pocono Downs, 2% of which is subject to a $10.0 million minimum annual threshold.

(7) Pursuant to a property tax litigation settlement, Downs Racing is required to make agreed upon annual payments to the Wilkes-Barre school district for each tax year through 2015.

Critical Accounting Policies and Estimates

We have identified the following critical accounting policies that affect our more significant judgments and estimates used in the preparation of our consolidated financial statements. The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related

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disclosures of contingent assets and liabilities. On an on-going basis, we evaluate those estimates, including those related to revenue recognition, allowance for doubtful accounts, the liability associated with unredeemed Player’s Club points, self-insurance accrual, the relinquishment liability, asset impairment, contingencies and litigation. These estimates are based on information that is currently available to us and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ from those estimates.

We believe that the following critical accounting policies affect significant judgments and estimates used in the preparation of our consolidated financial statements:

Revenue Recognition

We recognize gaming revenues as amounts wagered less prizes paid out. Revenues from food and beverage, hotel, retail, entertainment and other services are recognized at the time the service is performed. Minimum rental revenues are recognized on a straight-line basis over the terms of the related leases. Percentage rents are recognized in the period in which the tenants exceed their respective percentage rent thresholds.

Allowance for Doubtful Accounts

We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of our patrons to make required payments, which results in bad debt expense. We determine the adequacy of this allowance by continually evaluating individual patron receivables, considering the patron’s financial condition, credit history and current economic conditions. If the financial condition of patrons were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required.

We also maintain allowances for doubtful accounts for reimbursable costs and expenses advanced by Salishan-Mohegan on behalf of the Cowlitz Tribe and WTG on behalf of the Menominee Tribe for the development of the Cowlitz Project in Clark County, Washington and the Menominee Project in Kenosha, Wisconsin, respectively, to be owned by the Cowlitz Tribe and Menominee Tribe, respectively. Due to the inherent uncertainty in the development of the Cowlitz Project, we maintain a reserve based on our estimate of the probability that the receivables will be collected. Future complications in the receipt of financing, the relevant land being taken into trust or other matters affecting the Cowlitz Project could affect the collectibility of the receivables and may lead to changes in the allowance for doubtful accounts. The WTG receivables were fully reserved as of September 30, 2009.

Unredeemed Player’s Club Points

We maintain an accrual for unredeemed Player’s Club points. The accrual is based on the estimated cost of the points expected to be redeemed as of the respective balance sheet date. We determine the adequacy of this accrual by periodically evaluating the historical redemption experience and projected trends related to this accrual.

Self-insurance Accruals

We are self-insured up to certain limits for costs associated with workers’ compensation, general liability and employee medical coverage. Insurance claims and reserves include accruals of estimated settlements for known claims, as well as accruals of estimates of incurred but not reported claims. In estimating these costs, we consider historical loss experience and makes judgments about the expected levels of costs per claim. We also utilize information provided by independent consultants to assist in the determination of estimated accruals. These claims are accounted for based on estimates of the undiscounted claims, including those claims incurred but not reported. We believe the use of these estimates to account for these liabilities provides a consistent and effective way to measure these accruals; however, changes in health care costs, accident frequency and severity and other factors can materially affect the estimate for these liabilities. We continually monitor the potential changes in future estimates, evaluates insurance accruals and makes adjustments when necessary.

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Relinquishment Liability

In accordance with authoritative guidance issued by the FASB pertaining to the accounting for contingencies, we have recorded a relinquishment liability of the estimated present value of our obligations under the relinquishment agreement. We reassess projected revenues and consequently the relinquishment liability: (1) annually in conjunction with the budgeting process, or (2) when necessary to account for material increases or decreases in projected revenues over the relinquishment period. If the reassessment causes an overall increase to the projected revenues over the relinquishment period, the relinquishment liability will be increased by 5% of such increase in revenues, discounted at our risk-free rate of investment, which is an incremental layer. If the reassessment causes an overall decrease to the projected revenues over the relinquishment period, the relinquishment liability will be decreased by 5% of such decrease in revenues, discounted based upon a weighted average discount rate, which is a decremental layer. The weighted average discount rate is defined as the average discount rate used to discount all the previous incremental layers weighted by the amount of each such incremental layer. Further, we record a quarterly accretion to the relinquishment liability to reflect the impact of the time value of money. Since there is a high level of estimation and judgment (including those related to estimates of future revenue projections and impact and timing of future competition) used with respect to calculating this liability, future events that affect such estimates and judgments may cause the actual liability to significantly differ from the estimate.

Property and Equipment

Property and equipment are stated at cost. Depreciation is recorded over the estimated useful lives of the assets, other than land, on a straight-line basis. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful lives of the improvements. Useful life estimates of asset categories are as follows:

Buildings and land improvements	40 years
Furniture and equipment	3 - 7 years

The costs of significant improvements are capitalized. Costs of normal repairs and maintenance are charged to expense as incurred. Gains or losses on disposition of property and equipment are included in the determination of net income.

In accordance with authoritative guidance issued by the FASB pertaining to the accounting for the impairment of long-lived assets, the carrying value of our assets is assessed when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If it is determined that an impairment loss has occurred based on current and future levels of income and expected future cash flows, as well as other factors, then an impairment loss is recognized in the respective consolidated statement of income.

In September 2008, we announced the suspension of the hotel, retail and new parking garage elements of Project Horizon due to a slowdown in business volumes and uncertainties in the financial markets resulting from the national economic recession. While we are currently evaluating our options with respect to the development of the suspended elements, including the new hotel, we can provide no assurance as to if or when the suspended elements will resume. The specific factors that we will consider in determining the feasibility of the suspended elements include our financial performance, cash flow projections expected to be realized from the project, estimated project costs, ability to obtain financing, economic conditions, industry trends and competition. We currently believe that the assets related to the suspended elements have a future benefit. We have assessed the carrying value of these assets as of September 30, 2009 and 2008 and determined that no impairment existed.

Goodwill

In accordance with authoritative guidance issued by the FASB pertaining to goodwill, the goodwill associated with the acquisition of the Pocono Downs entities is not subject to amortization, but is assessed at least annually for impairment by comparing the fair value of the recorded assets to their carrying amount. If the carrying

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amount of the goodwill exceeds its fair value, an impairment loss will be recognized immediately. We assessed the goodwill for impairment using an income approach as of September 30, 2009 and determined that no impairment existed. The income approach requires us to make assumptions regarding future revenues and expenses, discount rates and the terminal value of the Pocono Downs entities. The amount by which the estimated fair value of the Pocono Downs entities exceeds its book value has remained consistent as of September 30, 2009 and 2008. If any of the following occurs, the goodwill may be impaired and subject to a non-cash write-down in a future period, which could have a material adverse impact on the accompanying consolidated financial statements: (1) if estimates of projected cash flows of the Pocono Downs entities are not met; (2) if the discount rate increases; or (3) if terminal growth rates decrease.

Intangible Assets

Our trademark for Mohegan Sun is no longer subject to amortization as it has been deemed to have an indefinite useful life. The trademark is assessed at least annually for impairment pursuant to appropriate accounting standards. The intangible asset associated with the acquisition of the Pocono Downs entities also is assessed at least annually for impairment. If estimates of projected cash flows of the Pocono Downs entities are not met, the slot license intangible asset may be impaired and subject to a non-cash write-down in a future period, which could have a material adverse impact on the accompanying consolidated financial statements. The intangible assets associated with the acquisitions of the WNBA franchise and the assets of PCC are tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. In accordance with authoritative guidance issued by the FASB pertaining to intangible assets, the development rights intangible asset related to the Menominee Project was determined to be fully impaired and was written-off during fiscal 2008.

Litigation

We are subject to various claims and legal actions in the ordinary course of business. Some of these matters relate to personal injuries to customers and damages to customers’ personal assets. We estimate guest claims expense and accrues for such liabilities based upon historical experience in other current liabilities in our consolidated balance sheets.

Impact of Inflation

Absent changes in competitive and economic conditions or in specific prices affecting the hospitality and gaming industry, we do not expect that inflation will have a significant impact on our operations. Changes in specific prices, such as fuel and transportation prices, relative to the general rate of inflation may have a material adverse effect on the hospitality and gaming industry in general.

New Accounting Pronouncements

Accounting Standards Recently Adopted

In June 2009, the FASB issued guidance which established the FASB Accounting Standard Codification (“Codification”) as the single source of authoritative U.S. GAAP recognized by the FASB for non-governmental agencies (other than guidance issued by the Securities and Exchange Commission). The Codification did not change U.S. GAAP but, instead, changed the referencing of authoritative accounting literature. The new guidance became effective for financial statements issued for interim and annual periods ending after September 15, 2009. Its adoption required us to adjust references to authoritative accounting literature in our financial statements, but did not affect our financial position, results of operations or cash flows.

In May 2009, the FASB issued guidance pertaining to subsequent events. The new guidance incorporates into the FASB authoritative literature, accounting guidance that originated as auditing standards about events or transactions that occur after the balance sheet date but before the financial statements are issued. It retains the

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auditing standard requirements to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the balance sheet date and to disclose but not recognize subsequent events that provide evidence about conditions that arose after the balance sheet date but before the financial statements are issued. The reporting entity is required to disclose the date through which it has evaluated subsequent events. The new guidance became effective for interim and annual periods ending after June 15, 2009. In preparing the accompanying consolidated financial statements, we have evaluated events subsequent to September 30, 2009 through the issuance of the financial statements on December 28, 2009.

In March 2008, the FASB issued guidance pertaining enhanced disclosures for derivative instruments and hedging activities, including disclosures regarding how: (1) an entity uses derivative instruments; (2) derivative instruments and related hedged items are accounted for; and (3) derivative instruments and related hedged items affect an entity’s financial position, financial performance and cash flows. We adopted the new guidance effective January 1, 2009. Since the new guidance requires only additional disclosures concerning derivatives and hedging activities, its adoption did not affect the presentation of our financial position, results of operations or cash flows.

In October 2008, we adopted guidance pertaining to fair value measurements for financial assets and liabilities. We deferred the provisions that relate to non-financial assets in accordance with the new guidance, which allowed for such a deferral. The major categories of assets that are measured at fair value for which we have not applied the new guidance include the measurement of fair value in the first step of a goodwill impairment test pursuant to appropriate accounting standards. The new guidance clarifies how companies are required to use a fair value measure for recognition and disclosure by establishing a common definition of fair value, a framework for measuring fair value, and expanding disclosures about fair value measurements. Its adoption for financial assets and liabilities did not have a material impact on our financial position, results of operations or cash flows. We adopted the provisions related to non-financial assets and liabilities as of October 2009. Its adoption did not have a material impact on our financial position, results of operations or cash flows.

In April 2009, the FASB issued additional guidance for estimating fair value when the volume and level of activity for the asset or liability have significantly decreased and re-emphasizes that regardless of market conditions the fair value measurement is an exit price concept. It also clarifies and includes additional factors to consider in determining whether there has been a significant decrease in market activity for an asset or liability and provides additional clarification on estimating fair value when the market activity for an asset or liability has significantly declined. The FASB also provided a new other-than-temporary impairment model for debt securities only, which shifts the focus from an entity’s intent to hold until recovery to its intent to sell. Additionally, the FASB requires publicly-traded companies to provide disclosures on the fair value of financial instruments in interim financial statements. This guidance became effective for interim and annual periods ending after June 15, 2009. Its adoption did not have a material impact on our financial position, results of operations or cash flows.

Accounting Standards Issued But Not Yet Adopted

In August 2009, the FASB issued guidance pertaining to fair value measurements for liabilities when quoted prices for the liabilities are not available. The new guidance is effective for the first reporting period (including interim periods) beginning after October 1, 2009. We are currently evaluating the potential impact, if any, that the new guidance may have on our financial position, results of operations or cash flows.

In June 2009, the FASB issued guidance to address the elimination of the concept of a qualifying special purpose entity. The new guidance also replaces the quantitative-based risks and rewards calculation for determining which enterprise has a controlling financial interest in a variable interest entity with an approach focused on identifying which enterprise has the power to direct the activities of a variable interest entity and the obligation to absorb losses of the entity or the right to receive benefits from the entity. Additionally, it provides more timely and useful information about an enterprise’s involvement with a variable interest entity. The new guidance is effective for fiscal years beginning after November 15, 2009. We are currently evaluating the potential impact, if any, that the new guidance may have on our financial position, results of operations or cash flows.

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In December 2007, the FASB issued guidance pertaining to business combinations and non-controlling interests in consolidated financial statements. The new guidance requires the acquiring entity in a business combination to record all assets acquired and liabilities assumed at their respective acquisition-date fair values. It also requires additional disclosure of information surrounding a business combination, such that users of the entity’s financial statements can fully understand the nature and financial impact of the business combination. Additionally, it requires entities to report non-controlling (minority) interests in subsidiaries as equity in the consolidated financial statements. We are required to adopt the new guidance in our fiscal year beginning October 1, 2009. The new provisions related to business combinations will only impact us if we are a party to a business combination after the pronouncement has been adopted.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk.

Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates, foreign currency exchange rates and commodity prices. Our primary exposure to market risk is interest rate risk associated with our bank credit facility in which interest will accrue on the basis of a base rate formula or a Eurodollar-based formula, plus applicable rates, as defined under the bank credit facility. As of September 30, 2009, we had $713.0 million drawn on the bank credit facility.

We attempt to manage our interest rate risk through a controlled combination of long-term fixed rate borrowings and variable rate borrowings in accordance with established policies and procedures. We do not hold or issue financial instruments for speculative or trading purposes.

The following table provides information as of September 30, 2009 about our current financial instruments, or debt obligations, that are sensitive to changes in interest rates. The table presents principal payments and related weighted average interest rates by expected maturity dates. Weighted average variable rates are based on implied forward rates in respective yield curves, which should not be considered to be precise indicators of actual future interest rates. Fair values for variable-rate debt instruments are considered to approximate their carrying amounts and fair values for fixed-rate debt instruments, which are publicly-traded, and are based on quoted market prices as of September 30, 2009.

	Expected Maturity Date
	2010		2011		2012		2013		2014		Thereafter		Total		Fair Value
Liabilities (in thousands)
Long-term debt and capital lease obligations (including current portions):
Fixed rate	$	919	$	12,691	$	250,708	$	250,735	$	225,764	$	153,142	$	893,959	$	703,638
Average interest rate		4.1%		13.4%		8.0%		6.1%		7.1%		6.8%		7.1%
Variable rate	$	26,430	$	1,000	$	713,000	$	-	$	-	$	600	$	741,030	$	618,329
Average interest rate (1)		3.9%		2.6%		4.9%		-		-		-		4.9%

(1) A 100 basis point change in average interest rate would impact interest expense by approximately $7.4 million.

Item 8. Financial Statements and Supplementary Data.

Our consolidated financial statements and notes thereto, referred to in Item 15(a)(1) of this Annual Report on Form 10-K, are filed as part of this report and appear in this Annual Report on Form 10-K beginning on page F-1.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

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Item 9A(T). Controls and Procedures.

Disclosure Controls and Procedures

Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2009. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Securities and Exchange Commission. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosures. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of September 30, 2009, our chief executive officer and chief financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

Management Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting for the Authority. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

• Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

• Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of our management; and

• Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management assessed the effectiveness of our internal control over financial reporting as of September 30, 2009. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework.

Based on our assessment, management concluded that, as of September 30, 2009, our internal control over financial reporting is effective based on those criteria.

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This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Our internal control over financial reporting was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.

This management report shall not be deemed to be filed for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section unless we specifically state that this report is to be considered “filed” under the Exchange Act or incorporate it by reference into a filing under the Securities Act of 1933 or the Exchange Act.

Changes in Internal Control Over Financial Reporting

There have not been any changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended September 30, 2009, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information.

None.

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PART III

Item 10. Directors, Executive Officers and Corporate Governance.

We are governed by a nine-member Management Board, whose members also comprise the Mohegan Tribal Council, the governing body of the Tribe. Any change in the composition of the Tribal Council results in a corresponding change in our Management Board. The members and their terms are as follows: Allison D. Johnson, Mark F. Brown, Cheryl A. Todd and Thayne D. Hutchins, Jr. are each serving four-year terms expiring in October 2011, while Marilynn R. Malerba, Bruce S. Bozsum, William Quidgeon, Jr., Ralph James Gessner, Jr. and Kathleen M. Regan-Pyne are each serving four-year terms expiring in October 2013. Upon expiration of their respective terms, the eligible voters of the Tribe may reelect current Tribal Council members who choose to run for reelection or elect new Tribal Council members. See “Part I. Item 1. Business—Mohegan Tribe of Indians of Connecticut” and “Part I. Item 1. Business—Mohegan Tribal Gaming Authority.”

Management Board and Executive Officers

The following table provides information, as of the date of filing, with respect to (1) the members of the Management Board and (2) each of the executive officers of Mohegan Tribal Gaming Authority, Mohegan Sun and the Pocono Downs entities.

Name	Age	Position
Marilynn R. Malerba	56	Chairwoman and Member, Management Board
Bruce S. Bozsum	49	Vice Chairman and Member, Management Board
Allison D. Johnson	39	Recording Secretary and Member, Management Board (1)
Ralph James Gessner, Jr.	40	Corresponding Secretary and Member, Management Board (1)
Thayne D. Hutchins, Jr.	38	Treasurer and Member, Management Board (1)
Mark F. Brown	52	Member, Management Board (1)
William Quidgeon, Jr.	47	Member, Management Board (1)
Cheryl A. Todd.	49	Member, Management Board
Kathleen M. Regan-Pyne	53	Member, Management Board
Mitchell Grossinger Etess	51	Chief Executive Officer, Mohegan Tribal Gaming Authority
Jeffrey E. Hartmann	48	Chief Operating Officer, Mohegan Tribal Gaming Authority
Leo M. Chupaska	61	Chief Financial Officer, Mohegan Tribal Gaming Authority
Robert J. Soper	37	President and General Manager, Pocono Downs entities

(1) Designates a member of the Audit Committee.

Marilynn R. Malerba—Ms. Malerba was first seated on the Tribal Council and the Management Board and was elected Vice-Chairwoman of the Management Board in October 2005. Ms. Malerba was re-elected in October 2009, at which time she was elected Chairwoman of the Tribal Council and Management Board. Ms. Malerba served as the Director and later, Executive Director of the Tribe’s Health and Human Services Department from 1997 until 2005 and was responsible for the development of that department and various programs that directly benefit the Tribe’s membership. Prior to her employment with the Tribe, Ms. Malerba held director and manager positions with Lawrence & Memorial Hospital in New London, Connecticut, and currently serves on its Board of Directors. Ms. Malerba holds a Master’s degree in Public Policy from the University of Connecticut.

Bruce S. Bozsum—Mr. Bozsum was first seated on the Tribal Council and the Management Board in October 2004. He served as Chairman of the Tribal Council and Management Board from October 2005 until October 2009. Mr Bozsum was re-elected in October 2009, at which time he was elected Vice Chairman of the Tribal Council and Management Board. Mr. Bozsum previously served as the Manager of Cultural and Community Programs for the Tribe from 2000 to 2004, and was responsible for educational outreach programs, the annual Wigwam Festival and Cultural Week. Previously, he worked as a Floor Supervisor for the Tribe’s High Stakes Bingo operation.

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Allison D. Johnson—Ms. Johnson was seated on the Tribal Council and the Management Board in October 2005, and was re-elected in October 2007. Ms. Johnson served as a Human Resources Manager and Human Resource Generalist for the Tribal government from June 2003 to October 2005. Ms. Johnson worked in the Human Resource department at Mohegan Sun from 2000 to 2003, serving as Benefits Manager prior to her employment with the Tribe. Ms. Johnson has held management positions in commercial leasing and retail sales and support. Ms. Johnson served as an Alternate Commissioner for the Mohegan Tribal Employment Rights Commission. She is a graduate of San Diego Miramar College in California with a degree in liberal arts.

Ralph James Gessner, Jr.—Mr. Gessner was first seated on the Tribal Council and the Management Board in October 2005, and was re-elected in October 2009. Mr. Gessner brought nine years of casino experience to his service on the Management Board. Beginning in 1997, Mr. Gessner served as Executive Host at Mohegan Sun and subsequently, Manager and Director of Executive Hosts then Vice President of Casino Marketing. Mr. Gessner holds a bachelor’s degree in hotel and restaurant management from the University of Southwestern Louisiana and serves as Co-Chair of the Sachem Fund, an organization dedicated to redevelopment in the Tribe’s neighboring town of Norwich.

Thayne D. Hutchins, Jr.—Mr. Hutchins was first seated on the Tribal Council and the Management Board in October 2007, after serving as a staff accountant in the finance department of the Tribe for six years. Mr. Hutchins graduated Magna Cum Laude from Eastern Connecticut State University holding a Bachelor of Art’s degree in economics with a concentration in accounting, and currently serves on the Board of the Southeastern Connecticut Enterprise Region.

Mark F. Brown—Mr. Brown has been a member of the Tribal Council and the Management Board since October 1995, and was re-elected in October 2007. He served as Chairman of the Management Board and the Tribal Council from October 2000 until October 2005. Mr. Brown worked with the Tribe’s historian during the period in which the Tribe was working to obtain federal recognition, and also served on the Tribal Constitutional Review Board from 1993 to 1995. Mr. Brown served as a law enforcement officer for over twelve years. In addition to serving on various external and Tribal boards and committees, Mr. Brown serves as Chairman of the Authority’s Audit Committee.

William Quidgeon, Jr.—Mr. Quidgeon was first seated on the Tribal Council and the Management Board in October 2005, and was re-elected in October 2009. Mr. Quidgeon served in several capacities for the Tribal government and Mohegan Sun prior to being seated on the Tribal Council and the Management Board. Mr. Quidgeon previously served in the Engineering Department at Mohegan Sun and as Senior Project Manager for the Mohegan Tribal Development Department from 1999 to 2005, where he was responsible for renovations and construction within the casino and Tribal government. He also served as Board Chairman of Mohegan Information Technology Group, a limited liability company previously organized by the Tribe, and currently serves as Co-Chair of the Sachem Fund, an organization dedicated to redevelopment in the Tribe’s neighboring town of Norwich.

Cheryl A. Todd—Ms. Todd was first seated on the Tribal Council and the Management Board in March 2007, after serving as Executive Assistant to the Chairman of the Management Board for 11 years. Ms. Todd was re-elected to the Tribal Council and Management Board in October 2007. As Executive Assistant to the Chairman, she participated in the daily operations of the Tribe, interacting with every department within the government and Mohegan Sun, including, federal, state and local government representatives, officials from other Indian Nations and corporate and financial executives. Ms. Todd also served previously on the Mohegan Strategic Planning Committee and the Mohegan Election Committee. Prior to her employment with the Tribe, Ms. Todd held multiple positions at the Naval Submarine Base in Groton, Connecticut.

Kathleen M. Regan-Pyne—Ms. Regan-Pyne was first seated on the Tribal Council and the Management Board in October 2009. Prior to being seated on the Tribal Council and the Management Board, Ms. Regan-Pyne served as the Manager of Tribal Career Development for the Tribe and Mohegan Sun beginning in July 2006. Prior to her employment with the Tribe and Mohegan Sun, Ms. Regan-Pyne worked for over twenty years in the insurance/

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financial services industry and, most recently, as Director of Life Claims at Lincoln Life & Annuity. Ms. Regan-Pyne is a graduate of Eastern Connecticut State University and, among other honors, has been elected to the Connecticut Women’s Basketball Hall of Fame.

Mitchell Grossinger Etess—Mr. Etess assumed the role of Chief Executive Officer of the Authority in May 2006, while continuing in his current role as President and Chief Executive Officer of Mohegan Sun. Mr. Etess has served as the President and Chief Executive Officer of Mohegan Sun since August 2004. Prior to that, Mr. Etess served as Executive Vice President of Marketing of the Authority. Mr. Etess served as the Authority’s Executive Vice President of Marketing from October 1999 to August 2004 and served as its Senior Vice President of Marketing from November 1995 to October 1999. Prior to his employment with Mohegan Sun, Mr. Etess was Vice President of Marketing at Players Island and, from 1989 to 1994, was Senior Vice President of Marketing and Hotel Operations at Trump Plaza Hotel and Casino. Prior thereto, Mr. Etess held various management positions in the hospitality and advertising industries.

Jeffrey E. Hartmann—Mr. Hartmann assumed the role of Chief Operating Officer of the Authority in May 2006, while continuing in his current role as Executive Vice President and Chief Operating Officer of Mohegan Sun. Mr. Hartmann has served as the Executive Vice President and Chief Operating Officer of Mohegan Sun since August 2004. Prior to that, Mr. Hartmann served as Executive Vice President of Finance and the Chief Financial Officer of the Authority. Mr. Hartmann has 15 years of experience in the casino and hotel industry. Mr. Hartmann served as the Authority’s Executive Vice President of Finance and Chief Financial Officer from October 1999 through August 2004 and served as its Senior Vice President of Finance and Chief Financial Officer from December 1996 to October 1999. Prior to joining the Authority, Mr. Hartmann worked for Foxwoods from August 1991 to December 1996, including, as Vice President of Finance for Foxwoods Management Company. Mr. Hartmann was employed by Coopers & Lybrand, LLP, an independent public accounting firm, as an Audit Manager from 1984 to 1991. Mr. Hartmann is a certified public accountant.

Leo M. Chupaska—Mr. Chupaska was named Chief Financial Officer of the Authority in August 2004. Mr. Chupaska also served as Chief Financial Officer of Mohegan Sun from May 2006 to June 2007. Prior to his position at the Authority, Mr. Chupaska served as Chief Financial Officer of the Tribe from September 1996 through August 2004, and was a member of the Financial Advisory Committee of the Authority’s Audit Committee. Prior to joining the Tribe, Mr. Chupaska served as Director of Financial Services for Lawrence & Memorial Hospital in New London, Connecticut. Mr. Chupaska is a certified public accountant.

Robert J. Soper—Mr. Soper served as the President and Chief Executive Officer of the Pocono Downs entities from January 2005 to January 2009, and has served as President and General Manager since January 2009. Prior to assuming these positions, Mr. Soper served as Senior Vice President of Administration at Mohegan Sun from 2001 to 2005 and Senior Attorney for the Tribe from 1997 to 2001.

Audit Committee

We have a separately-designated standing Audit Committee established in accordance with applicable provisions of the Exchange Act. The Audit Committee is comprised of members from the Management Board. All members of our Audit Committee are able to read and understand fundamental financial statements, including, a balance sheet, income statement and cash flow statement. The Management Board has determined that none of its members, and, accordingly, no member of the Audit Committee, is a financial expert, meaning that no person has past employment experience in finance or accounting, requisite professional certification in accounting or any other comparable experience or background, which results in the individual’s financial sophistication, including being or having been a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities. However, the Audit Committee is advised on financial matters through a Financial Advisory Committee, comprised of one or more financial experts independent from us.

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Code of Ethics

We have adopted a code of ethics that applies to all of our executive officers, including our principal executive officer and principal financial officer. Our code of ethics is available on our website at www.mtga.com under “Corporate Governance.”

If we make any substantive amendments to the code of ethics or grant any waiver, including any implicit waiver, from a provision of the code of ethics to our principal executive or principal financial and accounting officer, we will disclose the nature of such amendment or waiver on our website and in a report on Form 8-K.

Item 11. Executive Compensation.

Compensation Discussion and Analysis

Executive Compensation Objectives

We operate in an extremely competitive environment and believe that our current and future success is closely correlated with the retention of highly talented employees and a strong management team. Accordingly, our executive compensation program is intended to meet three principal objectives: (1) attract, reward and retain senior management employees; (2) motivate these individuals to achieve our short-term and long-term company goals that enhance the value of the Mohegan Sun brand; and (3) promote internal pay equity and external competitiveness.

Our philosophy relating to executive compensation is to attract and retain highly qualified people by offering base salaries, cash-based incentive compensation opportunities and other employee benefits at levels that will enable us to offer our executives total compensation opportunities in line with those offered by our industry peers. We face unique challenges in designing our executive compensation program, because, as an instrumentality of the Tribe, we cannot offer equity-based compensation to our executives, unlike many of our industry peers. As a result, we strive to design a cash-based compensation program that rewards our executives with competitive compensation while providing proper incentives to achieve our financial and operational objectives at both the operating unit and company-wide levels. Additionally, we strive to ensure that our executive compensation program is straightforward, transparent and understandable.

Role of the Compensation Committee and Senior Management

Our nine-member Management Board, whose members also comprise the Tribal Council, serves as our Compensation Committee and has final authority over the design, negotiation and implementation of our executive compensation program. As more fully described below, Mr. Etess, along with our Senior Vice President of Casino Operations and Vice President of Human Resources of Mohegan Sun, have taken leading roles in the design of our executive compensation program. In addition, acting within the boundaries of our annual budget as approved by the Management Board, Mr. Etess determines the salaries of, and bonuses with respect to non-equity incentive compensation paid to, our executives.

Elements of Compensation

Historically, executive compensation offered to our named executive officers, or NEOs, consisted of annual compensation, in the form of base salaries and employee benefits/perquisites, and incentive compensation, in the form of an annual cash bonus opportunity. We also offer our executives the opportunity to defer all or a portion of their cash compensation under a deferred compensation plan, or DCP, sponsored by the Tribe, as well as permit them to participate in our retirement and 401(k) plan, also sponsored by the Tribe.

During fiscal 2006, a thorough review of our executive compensation program was undertaken with the assistance of Mercer Human Resources Consulting, or Mercer, a nationally-recognized compensation consulting firm. Based on the Mercer review, Mr. Etess, along with the Senior Vice President of Administration and Vice

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President of Human Resources of Mohegan Sun, designed a new cash-based annual incentive compensation program, titled the “Mohegan Sun Executive Compensation Performance Reward Program,” or PRP. During fiscal 2009, as a result of declines in business volumes and uncertainties in the financial markets, we undertook a series of initiatives to reduce expenditures. Among those initiatives was the February 2009 implementation of a company-wide cost containment program, which included, among other things, employee salary rollbacks, suspension of all annual and merit-based compensation increases, suspension of employer-matching 401(k) contributions and funding of other contributions to the Mohegan Retirement and 401(k) Plan, and suspension of annual cash bonuses, including those under the PRP. Additional information about the elements of compensation offered to our NEOs in fiscal 2009 is set forth below.

Annual Compensation

Annual compensation consists of base salaries and employee benefits. These elements are intended to provide some degree of compensation certainty to our NEOs by providing compensation that, unlike incentive compensation, is not “at-risk” based upon company performance.

Base Salary

We believe that a competitive base salary is an important component of compensation as it provides a degree of financial stability to our NEOs and is a critical factor in recruiting and retaining our NEOs. Base salary also is designed to recognize the scope of responsibilities placed on each NEO and to reward the NEO for their unique leadership skills, management experience and contributions to our company.

In determining base salary levels, we take into consideration economic and industry conditions and company performance. We do not assign relative weights to company and individual performance, but instead make a subjective determination after considering such measures collectively. Base salary also is evaluated relative to other components of our executive compensation program to ensure that each NEO’s total compensation and mix of components is consistent with our overall compensation objectives and philosophies.

During fiscal 2009, we entered into amended employment agreements with Messrs. Etess, Hartmann and Chupaska with base salaries and other benefits that, when combined, provide annual compensation amounts reflecting our need to compete for, and retain, management talent in a competitive environment. Recognizing the negative impact of the current economic conditions on our company, the amended employment agreements reflect, among other things, agreements by Messrs. Etess, Hartmann and Chupaska to forgo their 2009 annual salary increases and include a 10% reduction in each NEO’s salary. Also during fiscal 2009 and 2008, we entered into employment agreements with Messrs. Soper and Arnheim, respectively, which provide for competitive compensation for both NEOs.

Employee Benefits

Our NEOs receive certain employee benefits. For fiscal 2009, these benefits included health insurance, dental and vision coverage, prescription drug plans, long-term disability care and the opportunity to participate in the Tribe’s DCP, retirement and 401(k) plan and flexible spending accounts. However, as discussed earlier, due to the implementation of our company-wide cost containment program, employer-matching of 401(k) contributions and funding of other contributions to the Mohegan Retirement and 401(k) Plan were suspended. All of our NEOs receive payment of premiums for supplemental long-term disability policies, other than Mr. Arnheim.

Incentive Compensation

We have historically offered our NEOs the opportunity to earn additional incentive compensation in the form of cash bonuses under the PRP. However, due to the implementation of our company-wide cost containment program, substantially all of the annual cash bonuses to employees, including those under the PRP, were suspended for fiscal 2009.

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Mohegan Sun Executive Compensation Performance Reward Program

Background

In fiscal 2006, Mercer conducted a market pricing assessment of the relative competitiveness of our total cash compensation to our NEOs, other than Messrs. Soper and Arnheim, and 25 other senior executives. For the NEOs, other than Messrs. Soper and Arnheim, Mercer compared their compensation to that paid to executives in similar positions in publicly-traded companies with similar annual revenues, as well as companies in the leisure, hospitality and gaming industries.

The data reviewed by Mercer included base salary compensation, cash bonuses and the present value associated with long-term incentive compensation, such as stock options and shares of restricted stock, paid by the comparator companies. The market data indicated that the base salaries of Messrs. Etess, Hartmann and Chupaska exceeded the 75^th percentile of base salaries paid by comparator companies. In addition, total cash compensation, paid by us in the form of base salary plus an annual cash bonus, was at or above the 50^th percentile in the case of Mr. Etess, and above the 75^th percentile, in the cases of Messrs. Hartmann and Chupaska. However, due to our inability to offer equity-based compensation, the total direct compensation for the measured NEOs was substantially behind comparator companies, lagging behind the 25^th percentile in the case of Mr. Etess, and behind the 50^th percentile, in the case of Messrs. Hartmann and Chupaska. These findings were replicated at all positions that were measured by Mercer. Accordingly, the Mercer review concluded that the absence of any long-term compensation opportunities negatively affected the level of competitiveness of the total direct compensation afforded to our executives.

In fiscal 2007, in an attempt to bridge the gap in total direct compensation identified by the Mercer review, we developed and implemented a new cash-based incentive compensation program for our executives. The new cash-based incentive compensation program was again offered in fiscal 2008. Messrs. Etess, Hartmann and Chupaska elected to forgo consideration under this program in fiscal 2008. The PRP was not extended to executives serving at the Pocono Downs entities, so Mr. Soper did not participate in the PRP during fiscal 2008. As noted previously, we suspended annual cash bonuses to all employees, including those under the PRP, in fiscal 2009.

Overview of the PRP

The PRP was designed to focus participants toward the successful attainment of formal goals that are tied to our strategic vision and business missions, as approved by the Management Board. The program highlights the following:

• proper alignment of our executive compensation program with competitive markets;

• establishment of defined pay practices within the organization and facilitation of internal pay equity comparisons and analysis; and

• movement of bonus compensation decisions toward an “at risk” model, where payout levels are determined by individual and company-wide performance as measured against pre-defined goals.

The PRP established three levels of awards, two of which can impact NEO compensation:

• Chief Executive Level: Defined as those positions which oversee and are ultimately accountable for company-wide performance, provide policy level direction across department and enterprise lines, direct the development of strategic business plans across all departmental lines, and are responsible for the overall business strategy and tactical planning and delivery of operational results. Their actions or failure to act have the highest consequence of error on overall operations.

• Senior Executive Level: Defined as those positions responsible for delivering focused strategic business plans throughout their enterprise and the departments for which they oversee. As a group, they are responsible for directing the development of strategic business plans to achieve our approved

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business strategies and ultimately, prompt the delivery of successful performance of all departments and enterprises. Their individual or collective actions or failure to act have the second highest consequence of error on overall operations.

Both the Chief Executive and Senior Executive levels were established with an “at risk” bonus amount of 60% of base salary, so as to afford our executives at these levels total potential compensation at a level equal to 90% of the 50^th percentile of total direct compensation paid by comparator companies to executives in similar positions, according to the Mercer market data.

The PRP is intended to compensate executives based on their performance over four primary measurement areas, including: financial performance, customer service, organizational, and learning and growth. The measurement areas are derived from the guiding principles of our organization since Mohegan Sun’s establishment in 1996. The financial performance area accounts for 50% of the “at risk” pool.

The actual targets used, and the extent of the “at risk” pool each of the areas comprises, may be determined following an annual strategic planning process at the discretion of Mr. Etess in conjunction with the Senior Vice President of Casino Operations, Senior Vice President of Finance and Chief Financial Officer and Vice President of Human Resources of Mohegan Sun.

As previously indicated, we suspended cash bonuses under the PRP for fiscal 2009. We are in the process of evaluating the feasibility of re-implementing the PRP for fiscal 2010, and no assurances can be made whether we will re-implement the program.

Compensation Committee Report

The nine-member Management Board serves as our Compensation Committee. The Management Board met with management to review and discuss the preceding Compensation Discussion and Analysis. Based on such review and discussion, the Management Board approved this Compensation Discussion and Analysis and authorized it to be included in this Annual Report on Form 10-K for the 2009 fiscal year.

Management Board

Marilynn R. Malerba

Bruce S. Bozsum

Allison D. Johnson

Ralph James Gessner, Jr.

Thayne D. Hutchins, Jr.

Mark F. Brown

William Quidgeon, Jr.

Cheryl A. Todd

Kathleen M. Regan-Pyne

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Summary Compensation Table

Name and Principal Position	Fiscal Year	Salary ($)	Bonus (2) ($)	Non-Equity Incentive Plan Compensation ($)	All Other Compensation (3) ($)	Total ($)
Mitchell Grossinger Etess	2009	1,367,129	-	-	6,264	1,373,393
Chief Executive Officer,	2008	1,182,899	372,035	-	60,537	1,615,471
Mohegan Tribal Gaming Authority	2007	1,118,879	372,960	164,775	58,079	1,714,693
Jeffrey E. Hartmann	2009	1,216,485	-	-	5,586	1,222,071
Chief Operating Officer,	2008	1,079,077	351,738	-	50,119	1,480,934
Mohegan Tribal Gaming Authority	2007	1,028,773	342,924	165,475	48,203	1,585,375
Leo M. Chupaska	2009	686,430	-	-	5,984	692,414
Chief Financial Officer,	2008	655,093	201,424	-	37,330	893,847
Mohegan Tribal Gaming Authority	2007	612,821	204,274	86,103	30,480	933,678
Toby A. Arnheim (1)	2009	468,270	-	-	122,988	591,258
Senior Vice President of Project Management,	2008	201,923	-	-	65,451	267,374
Mohegan Tribal Gaming Authority	2007	-	-	-	-	-
Robert J. Soper	2009	408,485	-	-	1,202	409,687
President and General Manager,	2008	343,624	127,101	-	6,750	477,475
Mohegan Sun at Pocono Downs	2007	347,164	161,338	-	6,774	515,276

(1) Employment commenced April 28, 2008.

(2) For fiscal 2008 and 2007, the minimum bonus requirements effective under the then existing employment agreements for Messrs. Etess, Hartmann and Chupaska were equal to 33.3% of the NEO’s base annual salary.

(3) Below is a breakdown of “All Other Compensation:”

Name	Fiscal Year	401(k) (1) ($)	Life Insurance (2) ($)	Income Taxes for Life Insurance Benefits (3) ($)	Retirement (4) ($)	Excess Long- Term Disability (5) ($)	Living Allowances (6) ($)	Income Taxes for Living Allowances (7) ($)	Moving Allowances (8) ($)	Income Taxes for Taxable Moving Allowances (9) ($)	Total ($)
Mitchell Grossinger Etess	2009	3,856	1,065	489	228	626	-	-	-	-	6,264
	2008	6,900	30,035	13,780	636	9,186	-	-	-	-	60,537
	2007	6,750	30,035	13,780	624	6,890		-	-	-	58,079
Jeffrey E. Hartmann	2009	3,645	745	342	228	626	-	-	-	-	5,586
	2008	6,900	24,299	11,148	636	7,136	-	-	-	-	50,119
	2007	6,750	24,299	11,178	624	5,352	-	-	-	-	48,203
Leo M. Chupaska	2009	2,087	2,086	957	228	626	-	-	-	-	5,984
	2008	6,900	2,086	957	636	26,751	-	-	-	-	37,330
	2007	6,750	2,086	957	624	20,063	-	-	-	-	30,480
Toby A. Arnheim	2009	-	-	-	228	626	80,887	36,948	2,947	1,352	122,988
	2008	-	-	-	36	105	30,000	13,764	15,077	6,469	65,451
	2007	-	-	-	-	-	-	-	-	-	-
Robert J. Soper	2009	1,202	-	-	-	-	-	-	-	-	1,202
	2008	6,750	-	-	-	-	-	-	-	-	6,750
	2007	6,750	-	-	24	-	-	-	-	-	6,774

(1) Employer-matching 401(k) contributions.

(2) Premium payments on life insurance policies owned by the individual.

(3) Reimbursements for the payment of income taxes pertaining to certain life insurance benefits.

(4) Employer retirement contributions.

(5) Premium payments on long-term disability policies.

(6) Employer payments of living allowances.

(7) Reimbursements for the payment of income taxes pertaining to certain living allowances.

(8) Employer payments of moving allowances.

(9) Reimbursements for the payment of income taxes pertaining to certain moving allowances.

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Nonqualified Deferred Compensation

We offer our NEOs the opportunity to participate in the DCP sponsored by the Tribe. The DCP is a non-qualified plan that allows our executives to defer all or a portion of their compensation. We do not make contributions to the DCP on behalf of our executives.

Name	Executive Contributions in Last Fiscal Year ($)	Registrant Contributions in Last Fiscal Year ($)	Aggregate Earnings in Last Fiscal Year ($)		Aggregate Withdrawals/ Distributions ($)		Aggregate Balance at Last Fiscal Year End ($)
Mitchell Grossinger Etess	751,921	-	430,489		-		4,050,507
Jeffrey E. Hartmann	751,224	-	432,484		-		4,699,619
Leo M. Chupaska	134,271	-	76,990		-		1,816,737
Toby A. Arnheim	-	-	-		-		-
Robert J. Soper	-	-	(1,204	)	(14,907	)	-

NEOs may elect to defer all or a portion of their compensation under the DCP. The amounts deferred by each NEO is deemed to be invested in the fund(s) designated by each NEO from among a number of funds offered under the DCP. NEOs may change their deemed investments from time to time. For fiscal 2009, the following funds were available under the DCP:

Fund Name

Schwab Value Advantage Money Fund (Select)

PIMCO Total Return (Instl)

Blackrock Global Allocation (I)

American Beacon Large Cap Value (Pin)

Davis New York Venture A Schwab S&P 500 Index

American Funds Growth Fund R4

Columbia Mid Cap Value (Z)

Morgan Stanley Inst Mid Growth (I)

Columbia Small Cap Value II (Z)

Wells Fargo Adv Small Cap Growth (Adm)

Thornburg International Value (I)

Lazard Emerging Markets (Inst)

Cohen & Steers Real

Jennison Utility (A)

T. Rowe Price Health Sciences

Allianz RCM Technology (Instl)

In accordance with federal law, elections to defer compensation generally must be made prior to the year in which the services to which the compensation relates will be performed. Once made, an election to defer compensation to be earned in the upcoming year is irrevocable. At the time a deferral election is made, the NEO chooses the date on which payment of the amount of compensation for the upcoming year credited to the DCP is to commence, as well as whether to receive the payments either in a lump sum or in up to fifteen annual installments. NEOs may change the form and timing of payments elected with respect to particular deferrals, subject to compliance with the terms of the DCP then in effect, including, any grandfathered terms resulting from changes in applicable U.S. federal income tax laws or regulations.

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Potential Payments and Benefits upon Termination or Change in Control

The table below reflects potential payments to our NEOs in the event of a termination of employment, based on the terms of their employment agreements, as described below. The amounts shown represent our reasonable estimates of the amounts which would be paid to the NEOs upon their termination, assuming in each case, that the termination occurred on September 30, 2009, the last business day of fiscal 2009. The actual amounts to be paid can only be determined at the time of the NEO’s separation from the company. Due to our sovereignty, potential payments upon change in control are not included within the table below, as these are not applicable.

	Salary ($)	Target Bonus ($)	Continuation of Medical Benefits ($)	Penalty Payment (2) ($)	Relocation Expenses ($)	Total ($)
Mitchell Grossinger Etess
Termination without cause	3,759,605	-	19,241	250,000	-	4,028,846
Termination due to medical disability (1)	683,565	-	1,025,347	-	-	1,708,912
Jeffrey E. Hartmann
Termination without cause	3,345,334	-	19,241	250,000	-	3,614,575
Termination due to medical disability (1)	608,243	-	912,364	-	-	1,520,607
Leo M. Chupaska
Termination without cause	1,201,253	-	13,399	-	-	1,214,652
Termination due to medical disability (1)	343,215	-	514,823			858,038
Toby A. Arnheim
Termination without cause	500,000	-	-	-	25,000	525,000
Termination due to medical disability	-	-	-	-	-	-
Robert J. Soper
Termination without cause	714,849	-	16,500	-	-	731,349
Termination due to medical disability (1)	204,243	-	306,364	-	-	510,607

(1) Pursuant to each NEO’s employment agreement, upon termination without cause, the continuation of medical benefits shall be provided by us for a period of one year. For termination due to medical disability, we are required to provide each NEO with compensation and benefits for a period of 180 days; thereafter, if we, at our option, suspend the NEO’s employment or the NEO is deemed permanently disabled, we shall provide disability insurance coverage providing for payment of 50% of the NEO’s base annual salary for a period of two years commencing at the termination or suspension of the NEO’s employment agreement.

(2) Pursuant to each NEO’s employment agreement, upon termination without cause, in the event the NEO agrees to the early withdrawal of their deferred compensation balance, we shall pay the penalty for early withdrawal, including the necessary gross-up for income taxes in an amount not to exceed: (a) the lesser of the actual penalty or $250,000 if such withdrawal occurs on or before December 31, 2009, and (b) the lesser of the actual penalty or $166,650 if such withdrawal occurs after December 31, 2009 but on or before December 31, 2010. We are not be required to pay any portion of any penalty incurred for early withdrawal occurring after December 31, 2010. The above payments assume that each NEO withdraws their deferred compensation on or before December 31, 2009, in which case, we will pay the lesser of the actual penalty or $250,000.

Messrs. Etess and Hartmann. Under our employment agreements with these NEOs, we may terminate the NEO’s employment for “cause,” defined as: (1) the NEO’s violation of the non-competition, non-solicitation and non-disclosure covenants contained in their employment agreement; (2) the loss or suspension by the State of Connecticut of the NEO’s license for Class III gaming for a period of thirty (30) consecutive days; (3) conviction of any crime committed by the NEO involving fraud, theft or moral turpitude; or (4) an intentional material breach of the NEO’s obligations under their employment agreement. In the event that we terminate the NEO for cause, the NEO is not entitled to any further compensation from and after the date of termination. In the event of termination other than for cause, the NEO is entitled to receive a severance payment in the amount of the NEO’s base annual salary from the date of termination to the expiration date of NEO’s employment agreement in the

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same amount and at the same intervals as would have been paid had the NEO’s employment continued. Should we terminate the NEO’s employment other than for cause, the NEO may withdraw his deferred compensation and, in turn, we have agreed, under certain circumstances outlined in the employment agreements, to pay the penalty for early withdrawal of their deferred compensation, in amounts not to exceed the maximum balances outlined in their employment agreements. Additionally, in the event of termination other than for cause, we have agreed to pay the amount, if any, of income taxes payable by the NEO in connection with any penalty payments made by us in amounts not to exceed the maximum balances outlined in their employment agreements.

Mr. Chupaska. Under our employment agreement with Mr. Chupaska, we may terminate his employment for cause, as defined above. In the event that we terminate Mr. Chupaska for cause, he is not entitled to any further compensation from and after the date of termination. In the event of termination other than for cause, Mr. Chupaska is entitled to receive a severance payment in the amount of his base annual salary from the date of termination to the expiration date of the agreement in the same amount and at the same intervals as would have been paid had his employment continued.

Mr. Soper. Under our employment agreement with Mr. Soper, we may terminate his employment for cause, substantially as defined above. In the event that we terminate Mr. Soper for cause, he is not entitled to any further compensation from and after the date of termination. In the event of termination other than for cause, Mr. Soper is entitled to receive a severance payment in the amount of his base annual salary from the date of termination to the expiration date of the agreement, except in the event of a sale of the business. In such event, if Mr. Soper is not employed in substantially the same position at the same compensation by the purchaser of the business or by another casino operated directly or indirectly by us, Mr. Soper is entitled to receive severance in the amount of his base annual salary from the date of termination and for a period equal to the lesser of: (1) one year, or (2) through the expiration of the agreement. Mr. Soper’s severance shall be payable in the same amount and at the same intervals as would have been paid had his employment continued.

Mr. Arnheim. Under our employment agreement with Mr. Arnheim, we may terminate his employment for good cause, which is defined in Mr. Arnheim’s agreement as: (1) violation of the Authority’s standards and policies for personal conduct; (2) breach by Mr. Arnheim of the covenants contained in his agreement, including his covenant not to compete and not to solicit; (3) conviction of a felony or misdemeanor or any crime involving moral turpitude; (4) misconduct in the course and scope of employment including theft, misappropriation of Authority property, dishonesty or fraud; (5) knowing violation of any law or regulation resulting in adverse consequences to us; (6) Mr. Arnheim’s engagement, directly or indirectly, in a conflict of interest; (7) failure or refusal by Mr. Arnheim to follow the directives of our Chief Executive Officer or Chief Operating Officer; or (8) failure to maintain or obtain gaming or other necessary licenses for Mr. Arnheim to perform his duties. In the event that we terminate Mr. Arnheim for good cause, he is not entitled to any further compensation from and after the date of termination. In the event of termination other than for good cause, Mr. Arnheim is entitled to receive a severance payment equal to the lesser of: (1) the amount that would have been payable had the agreement continued through the expected expiration date of the original term, or (2) one year of his base annual salary plus a lump sum of $25,000 for relocation expenses.

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Compensation of the Management Board

The following table provides compensation information for each member of our Management Board during fiscal 2009.

Name	Fees Earned ($)	All Other Compensation (1) ($)	Total ($)
Marilynn R. Malerba *	164,291	253	164,544
Bruce S. Bozsum *	181,452	279	181,731
Allison D. Johnson *	131,432	203	131,635
Ralph James Gessner, Jr. *	131,432	203	131,635
Thayne D. Hutchins, Jr. *	131,432	203	131,635
Mark F. Brown *	177,779	508	178,287
William Quidgeon, Jr. *	131,432	203	131,635
Cheryl A. Todd *	131,432	203	131,635
Kathleen M. Regan-Pyne *	-	-	-
Mark W. Hamilton (2)	131,432	203	131,635

  * Represents current Management Board members.

(1) Represents payment of premiums on life insurance policies of which the member is the owner.

(2) Term expired effective October 4, 2009.

Members of the Management Board are paid annual salaries by the Tribe for their services as members of the Tribal Council. Due to the dual role played by these individuals in our governance, as well as the Tribe’s, under the terms of an arrangement established at the time of Mohegan Sun’s inception, we are responsible to fund a portion of the compensation paid to the Tribal Council. For fiscal 2009, we were allocated 60% of such payment obligations, based on consideration of the amount of time that the Tribal Council functioned in its capacity as the Management Board as opposed to its capacity as the Tribal Council, including participation in weekly Management Board meetings, weekly meetings with the Authority’s executive team and bi-weekly executive committee meetings. In addition, certain members of the Tribal Council make periodic trips to Pocono Downs. We believe that the fiscal 2010 activities of the Tribal Council will be consistent with their fiscal 2009 activities and as such we expect to fund 60% of their fiscal 2010 compensation.

Compensation Committee Interlocks and Insider Participation

As noted above, the Management Board serves as our Compensation Committee.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

We have no outstanding equity securities.

Item 13. Certain Relationships and Related Transactions, and Director Independence.

Procedure for Review of Related Party Transactions

Potential conflicts of interest, including related party transactions reportable under Securities and Exchange Commission rules, must be approved in advance. We have a code of ethics, located on our website at “www.mtga.com”, which applies to our Chief Executive Officer, or principal executive officer, our Chief Financial Officer, or principal financial officer, and all other executive officers, whom we collectively refer to as our principal officers and specifically addresses conflicts of interest. Pursuant to the code ethics, principal officers with an actual or potential conflict of interest must disclose such conflict to the Director of Regulation, his designee or to the Chairman or Chairwoman of the Management Board. Consistent with our practice, only the Management Board may waive a provision of this code of ethics for our principal officers.

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The Management Board reviews all transactions between us and any of our principal officers. In addition, our corporate governance practices include procedures for discussing and assessing relationships, including business, financial and family member, among us and our principal officers, to the extent that they may arise. The Management Board reviews any transaction with a principal officer to determine, on a case-by-case basis, whether a conflict of interest exists. The Management Board ensures that all directors voting on such a matter have no interest in the matter and discusses the transaction with counsel as deemed necessary.

Transactions between the Tribe, the Authority and the Authority’s Subsidiaries

In September 2009, the Tribe loaned Salishan-Mohegan, LLC $10.0 million, which was used to repay revolving loans under the Salishan bank credit facility in connection with the September 30, 2009 amendment to the Salishan bank credit facility. The promissory note executed by Salishan-Mohegan, LLC in favor of the Tribe, or the Mohegan Tribe promissory note, provides for the accrual of interest at an annual rate of 15% and matures on October 1, 2010. Accrued interest is paid at a monthly rate of 3.0%, with the remaining 12.0% due at maturity. For the fiscal year ended September 30, 2009, Salishan-Mohegan, LLC incurred $4,000 of interest expense on the Mohegan Tribe promissory note.

In March 2008, MTGA Gaming, LLC and the Tribe formed Mohegan Gaming & Hospitality, or MG&H. The Tribe holds a 51% membership interest in MG&H and MTGA Gaming, LLC holds the remaining 49% interest. In June 2008, the Tribe loaned MG&H $8.3 million, which was used to fund MG&H’s portion of a $25.0 million Privilege Fee payment to the State of Kansas in connection with MG&H’s effort, ended in September 2008, to secure a gaming license for the development of a gaming facility in the State of Kansas. The promissory note executed by MG&H in favor of the Tribe provided for the accrual of interest at an annual rate of 12.0% and was due to mature on October 15, 2008. In September 2008, MG&H repaid the $8.3 million outstanding on the promissory note following a refund of the Privilege Fee payment as a result of the selection of another applicant by the Kansas Lottery Gaming Facility Review Board. For the fiscal year ended September 30, 2008, MG&H incurred $244,000 of interest expense on the promissory note.

In March 2007, we formed Wisconsin Tribal Gaming, LLC, or WTG, to participate in the Menominee Project. WTG consists of two members, our wholly-owned subsidiary, Mohegan Ventures Wisconsin, LLC, which holds an 85.4% membership interest, and a wholly-owned subsidiary of the Mohegan Tribe, Mohegan Ventures, LLC, which holds the remaining 14.6% membership interest. Following formation in March 2007, WTG purchased the development rights for the Menominee Project, along with certain other assets, and assumed certain liabilities from Kenesah Gaming Development, LLC for consideration of $6.4 million.

In August 2006, we purchased a 5% membership interest in Salishan-Mohegan, LLC from Mohegan Ventures-Northwest, LLC and sold such 5% interest to the Tribe for approximately $351,000, reflecting the carrying value of such interest. In October 2006, a 2.85% membership interest in Salishan-Mohegan, LLC was transferred from Salishan Company to the Tribe, in exchange for the Tribe’s guarantee of the Salishan bank credit facility. The value of the membership interest transferred was approximately $197,000, reflecting the carrying value of the 2.85% interest. Subsequent to this transaction, Mohegan Ventures-Northwest, LLC holds a 49.15% membership interest, the Tribe holds a 7.85% membership interest and Salishan Company holds a 43% membership interest in Salishan-Mohegan, LLC. Mohegan Ventures-Northwest, LLC and the Tribe continue to each hold one of four seats on the Board of Managers of Salishan-Mohegan.

Services Provided by the Tribe to the Authority

The Tribe provides governmental and certain administrative services to us in conjunction with the operation of Mohegan Sun. For the fiscal years ended September 30, 2009, 2008 and 2007, we incurred $23.7 million, $23.9 million and $21.5 million, respectively, of expenses for such services.

We purchase the majority of our utilities, including electricity, gas, water and waste water services, from an instrumentality of the Tribe, the Mohegan Tribal Utility Authority. For the fiscal years ended September 30, 2009, 2008 and 2007, we incurred costs of $22.6 million, $23.6 million and $23.7 million, respectively, for such utilities.

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The Tribe previously provided services through its Development Department for projects related to Mohegan Sun. The Development Department of the Tribe, including personnel assigned to the department, was transferred to us during the fiscal year ended September 30, 2007. Prior to this transfer, we recorded $53,000 of capital expenditures associated with the Tribe’s Development Department for the fiscal year ended September 30, 2007.

Leases by the Tribe to the Authority

We lease the land on which Mohegan Sun is located from the Tribe pursuant to a long-term lease agreement. We are required to pay to the Tribe a nominal annual rental fee under the lease agreement. The lease has an initial term of 25 years and is renewable for an additional 25-year term upon expiration.

We are a tenant under a land lease agreement with the Tribe for access to Mohegan Sun. For each of the fiscal years ended September 30, 2009, 2008 and 2007, we expensed $50,000 relating to this land lease agreement.

In July 2008, we entered into a new land lease agreement with the Tribe, replacing a prior land lease agreement, for property located adjacent to the Tribe’s reservation that is used for Mohegan Sun employee parking. The new agreement requires us to make monthly payments equaling $75,000 until maturity on June 30, 2018. For the fiscal years ended September 30, 2008 and 2007, we expensed $159,000 and $212,000, respectively, relating to the prior land lease agreement. In July 2009, we entered into an additional land lease agreement with the Tribe relating to property located adjacent to the Tribe’s reservation that is used for parking and access to Mohegan Sun. The agreement requires us to make monthly payments equaling $30,000 through June 30, 2010 and $100 subsequent to June 30, 2010 until maturity on June 30, 2018. We have classified both leases as capital leases for financial reporting purposes due to the existence of bargain purchase options at the expiration of the leases.

Distributions by the Authority to the Tribe

In August 2001, we and the Tribe entered into an agreement, or the priority distribution agreement, which obligates us to make monthly payments to the Tribe to the extent of our net cash flow, as defined under the priority distribution agreement. The priority distribution agreement, which has a perpetual term, limits the maximum aggregate priority distribution payments by us to the Tribe in each calendar year to $14.0 million, as adjusted annually in accordance with a formula specified in the priority distribution agreement to reflect the effects of inflation. However, payments pursuant to the priority distribution agreement do not reduce our obligations to make payments to reimburse the Tribe for governmental services provided by the Tribe or any payments under any other agreements with the Tribe. The monthly priority distribution payments under the priority distribution agreement are limited obligations payable only to the extent of our net cash flow, as defined under the priority distribution agreement, and are not secured by a lien or encumbrance on any of our assets or property. We reflected payments associated with the priority distribution agreement of $17.9 million, $17.3 million and $16.8 million for the fiscal years ended September 30, 2009, 2008 and 2007, respectively.

In compliance with restrictive financial covenants under our bank credit facility, line of credit and note indentures, we distributed to the Tribe $53.6 million, $62.7 million and $58.2 million, net of $17.9 million, $17.3 million and $16.8 million, respectively, relating to priority distribution payments for the fiscal years ended September 30, 2009, 2008 and 2007, respectively.

Mohegan Tribal Employment Rights Ordinance

In September 1995, the Tribe adopted the Mohegan Tribal Employment Rights Ordinance, as amended from time to time, or the TERO, which sets forth hiring and contracting preference requirements for employers and entities conducting business on Tribal lands on or adjacent to the Mohegan Reservation. Pursuant to the TERO, we and other covered employers are required to give hiring, promotion, training, retention and other employment-related preferences to Native Americans who meet the minimum qualifications for the applicable employment position. However, this preference requirement does not apply to key employees as such persons are defined under the TERO.

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Similarly, any entity awarding a contract or subcontract valued up to $200,000 to be performed on Tribal lands must give preference, first, to certified Mohegan entities submitting commercially responsible bids, and second, to other certified Native American entities. This contracting preference is conditioned upon the bid by the preferred certified entity being within 5% of the lowest bid by a non-certified entity. Contracts in excess of $200,000 are awarded to the lowest commercially responsible bidder, on a competitive basis, with preference to certified Mohegan entities and then other certified Native American entities in the event of a matching bid. The TERO establishes procedures and requirements for certifying Mohegan entities and other Native American entities. Certification is based largely on the level of ownership and control exercised by the members of the Tribe or other Native American tribes, as the case may be, over the entity bidding on a contract.

As of September 30, 2009, approximately 120 of our employees were members of the Tribe.

Corporate Governance and Management Board Independence

We are governed by a nine-member Management Board, whose members also comprise the Mohegan Tribal Council, the governing body of the Tribe. Any change in the composition of the Mohegan Tribal Council results in a corresponding change in our Management Board. The registered voters of the Tribe elect all members of the Tribal Council. Upon election, the Tribal Council and Management Board members each serve for a four-year term on a staggered basis. Incumbent members of the Tribal Council do not nominate candidates for election. Accordingly, the Tribal Council and Management Board do not maintain a nominating committee, nor do they utilize any procedures to screen candidates for election. Instead, the registered voters of the Tribe elect all members of the Tribal Council. In order to qualify for, and seek election to a position on the Tribal Council, a person: (1) must be at least 21 years of age prior to the date of the election; (2) must be a registered voting member of the Tribe in good standing; (3) must not have been convicted of any violation of the Tribal Election Ordinance; and (4) must not have been convicted of either a felony or a misdemeanor involving moral integrity, such as forgery or bribery.

As described above, all members of the Management Board also are members of the Tribal Council and the Tribe. Due to the relationships between the Tribe and us, as described above, none of the Management Board members would qualify as “independent directors” within the rules of The New York Stock Exchange or the NASDAQ Stock Market.

Item 14. Principal Accounting Fees and Services.

The following table sets forth the aggregate fees paid or accrued for professional services rendered by PricewaterhouseCoopers LLP for the audit of our annual financial statements for fiscal 2009 and 2008 and the aggregate fees paid or accrued for audit-related services and all other services rendered by PricewaterhouseCoopers LLP for fiscal 2009 and 2008.

	Fiscal Year 2009		Fiscal Year 2008
Audit fees	$	710,888	$	757,159
Audit-related fees		47,660		-
Tax fees		4,250		4,250
All other fees		3,000		3,000
Total	$	765,798	$	764,409

The category of “Audit fees” includes fees for our annual audit, quarterly reviews and services rendered in connection with regulatory filings with the Securities and Exchange Commission, such as the issuance of comfort letters and consents.

The category of “Audit-related fees” includes internal control reviews.

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The category of “Tax fees” includes consultation related to Corporate development activities and the preparation of tax returns for certain subsidiaries.

The category of “All other fees” includes the licensure of accounting and finance research technology owned by PricewaterhouseCoopers LLP.

All above audit services, audit-related services and tax services were pre-approved by the Audit Committee, which concluded that the provision of such services by PricewaterhouseCoopers LLP was compatible with the maintenance of that firm’s independence in the conduct of its auditing functions. The Audit Committee’s outside auditor independence policy provides for pre-approval of all services performed by the outside auditors.

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PART IV

Item 15. Exhibits, Financial Statement Schedules.

A(1). Financial Statements

The following financial statements and reports appear in this Annual Report on Form 10-K beginning on page F-2 and are incorporated by reference in Part II, Item 8:

Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets of the Mohegan Tribal Gaming Authority as of September 30, 2009 and 2008	F-3
Consolidated Statements of Income of the Mohegan Tribal Gaming Authority for the Fiscal Years Ended September 30, 2009, 2008 and 2007	F-4
Consolidated Statements of Changes in Capital of the Mohegan Tribal Gaming Authority for the Fiscal Years Ended September 30, 2009, 2008 and 2007	F-5
Consolidated Statements of Cash Flows of the Mohegan Tribal Gaming Authority for the Fiscal Years Ended September 30, 2009, 2008 and 2007	F-6
Notes to Consolidated Financial Statements of the Mohegan Tribal Gaming Authority	F-7
Non Wholly-Owned Guarantor Subsidiary Financial Statements	F-52

A(2). Financial Statement Schedules

The following schedule appears on page S-1 of this Annual Report on Form 10-K and is incorporated by reference herein:

Schedule II—Valuation and Qualifying Accounts and Reserves for the Fiscal Years Ended September 30, 2009, 2008 and 2007

Schedules other than that listed above are omitted because they are not required or are not applicable, or the required information is shown in the consolidated financial statements or notes to the consolidated financial statements.

A(3). Exhibits

The exhibits to this Annual Report on Form 10-K are listed on the exhibit index, which appears elsewhere herein and is incorporated herein by reference.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Mohegan Tribal Gaming Authority has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on December 28, 2009.

MOHEGAN TRIBAL GAMING AUTHORITY
By:	/S/    MARILYNN R. MALERBA
	Marilynn R. Malerba Chairwoman, Management Board

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Mohegan Tribal Gaming Authority and in the capacities indicated on December 28, 2009.

Signature	Title
/s/    MARILYNN R. MALERBA         Marilynn R. Malerba	Chairwoman and Member, Management Board
/s/    BRUCE S. BOZSUM         Bruce S. Bozsum	Vice Chairman and Member, Management Board
/s/    MITCHELL GROSSINGER ETESS         Mitchell Grossinger Etess	Chief Executive Officer, Mohegan Tribal Gaming Authority (Principal Executive Officer)
/s/    LEO M. CHUPASKA         Leo M. Chupaska	Chief Financial Officer, Mohegan Tribal Gaming Authority (Principal Financial and Accounting Officer)
/s/    ALLISON D. JOHNSON         Allison D. Johnson	Recording Secretary and Member, Management Board
/s/    RALPH JAMES GESSNER JR.         Ralph James Gessner Jr.	Corresponding Secretary and Member, Management Board
/s/    THAYNE D. HUTCHINS JR.         Thayne D. Hutchins Jr.	Treasurer and Member, Management Board
/s/    MARK F. BROWN         Mark F. Brown	Member, Management Board
/s/    WILLIAM QUIDGEON JR.         William Quidgeon Jr.	Member, Management Board
/s/    CHERYL A. TODD         Cheryl A. Todd	Member, Management Board
/s/    KATHLEEN M. REGAN-PYNE         Kathleen M. Regan-Pyne	Member, Management Board

Supplemental information to be furnished with reports filed pursuant to Section 15(d) of the Securities Exchange Act of 1934 by registrants which have not registered securities pursuant to Section 12 of the Securities Exchange Act of 1934.

The registrant has not sent an annual report or proxy statement to security holders. The registrant will not be sending an annual report or proxy statement to its security holders subsequent to the filing of this Annual Report on Form 10-K.

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets of Mohegan Tribal Gaming Authority as of September 30, 2009 and 2008	F-3
Consolidated Statements of Income of Mohegan Tribal Gaming Authority for the Fiscal Years Ended September 30, 2009, 2008 and 2007	F-4
Consolidated Statements of Changes in Capital of Mohegan Tribal Gaming Authority for the Fiscal Years Ended September 30, 2009, 2008 and 2007	F-5
Consolidated Statements of Cash Flows of Mohegan Tribal Gaming Authority for the Fiscal Years Ended September 30, 2009, 2008 and 2007	F-6
Notes to Consolidated Financial Statements of Mohegan Tribal Gaming Authority	F-7
Non Wholly-Owned Guarantor Subsidiary Financial Statements	F-52
Schedule  II—Valuation and Qualifying Accounts and Reserves for the Fiscal Years Ended September 30, 2009, 2008 and 2007	S-1

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Management Board of

the Mohegan Tribal Gaming Authority:

In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all material respects, the financial position of Mohegan Tribal Gaming Authority and its subsidiaries (the “Authority”) at September 30, 2009 and 2008, and the results of their operations and their cash flows for each of the three years in the period ended September 30, 2009 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the accompanying index, Schedule II—Valuation and Qualifying Accounts and Reserves, presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedule are the responsibility of the Authority’s management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers, LLP

Hartford, Connecticut

December 28, 2009

F-2

MOHEGAN TRIBAL GAMING AUTHORITY

CONSOLIDATED BALANCE SHEETS

(in thousands)

	September 30, 2009		September 30, 2008
ASSETS
Current assets:
Cash and cash equivalents	$	64,664	$	83,200
Restricted cash		1,899		1,605
Receivables, net		23,360		40,746
Inventories		15,521		17,931
Other current assets		25,578		28,024
Total current assets		131,022		171,506
Non-current assets:
Property and equipment, net		1,676,763		1,693,402
Goodwill		39,459		39,459
Other intangible assets, net		389,914		390,057
Other assets, net		57,925		68,481
Total assets	$	2,295,083	$	2,362,905
LIABILITIES AND CAPITAL
Current liabilities:
Current portion of long-term debt	$	26,430	$	27,938
Current portion of relinquishment liability		71,912		81,337
Current portion of capital lease		919		630
Trade payables		19,900		23,986
Construction payables		18,959		102,661
Accrued interest payable		16,356		20,125
Other current liabilities		124,834		141,411
Total current liabilities		279,310		398,088
Non-current liabilities:
Long-term debt, net of current portion		1,593,185		1,522,314
Long-term debt, due to Mohegan Tribe		10,000		-
Relinquishment liability, net of current portion		226,511		304,031
Capital lease, net of current portion		6,030		6,677
Other long-term liabilities		362		526
Total liabilities		2,115,398		2,231,636
Minority interests		3,830		3,258
Commitments and Contingencies
Capital:
Retained earnings		175,855		128,011
Total capital		175,855		128,011
Total liabilities and capital	$	2,295,083	$	2,362,905

The accompanying notes are an integral part of these consolidated financial statements.

F-3

MOHEGAN TRIBAL GAMING AUTHORITY

CONSOLIDATED STATEMENTS OF INCOME

(in thousands)

	For the Fiscal Year Ended September 30, 2009			For the Fiscal Year Ended September 30, 2008			For the Fiscal Year Ended September 30, 2007
Revenues:
Gaming	$	1,317,341		$	1,410,774		$	1,469,343
Food and beverage		93,105			103,968			102,097
Hotel		39,567			48,740			47,333
Retail, entertainment and other		122,701			144,256			133,139
Gross revenues		1,572,714			1,707,738			1,751,912
Less—Promotional allowances		(117,597	)		(135,555	)		(131,846	)
Net revenues		1,455,117			1,572,183			1,620,066
Operating costs and expenses:
Gaming		833,088			892,034			869,333
Food and beverage		42,720			49,951			50,499
Hotel		13,513			17,314			16,959
Retail, entertainment and other		42,290			56,848			48,435
Advertising, general and administrative		205,650			229,407			231,585
Corporate expenses		17,227			25,188			10,507
Pre-opening costs and expenses		282			4,652			3,836
Depreciation and amortization		103,279			102,370			93,347
Relinquishment liability reassessment		(45,678	)		(68,947	)		2,997
Total operating costs and expenses		1,212,371			1,308,817			1,327,498
Income from operations		242,746			263,366			292,568
Other income (expense):
Accretion of discount to the relinquishment liability		(20,425	)		(27,085	)		(29,794	)
Interest income		3,912			3,795			3,695
Interest expense, net of capitalized interest		(109,689	)		(93,793	)		(94,363	)
Write-off of debt issuance costs		-			-			(71	)
Gain on early extinguishment of debt		8,466			-			-
Other income (expense), net		(7,658	)		248			(137	)
Total other expense		(125,394	)		(116,835	)		(120,670	)
Income from continuing operations before minority interests		117,352			146,531			171,898
Minority interests		1,992			2,729			648
Income from continuing operations		119,344			149,260			172,546
Discontinued operations:
Income from discontinued operations		-			-			94
Loss on sale of discontinued operations		-			-			(73	)
Total income from discontinued operations		-			-			21
Net income	$	119,344		$	149,260		$	172,567

The accompanying notes are an integral part of these consolidated financial statements.

F-4

MOHEGAN TRIBAL GAMING AUTHORITY

CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL

(in thousands)

	Total Capital
Balance, September 30, 2006	$	(38,855	)
Net income		172,567
Distributions to Tribe		(75,000	)
Capital adjustment from majority-owned subsidiary transaction		39
Balance, September 30, 2007		58,751
Net income		149,260
Distributions to Tribe		(80,000	)
Balance, September 30, 2008		128,011
Net income		119,344
Distributions to Tribe		(71,500	)
Balance, September 30, 2009	$	175,855

The accompanying notes are an integral part of these consolidated financial statements.

F-5

MOHEGAN TRIBAL GAMING AUTHORITY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	For the Fiscal Year Ended September 30, 2009			For the Fiscal Year Ended September 30, 2008			For the Fiscal Year Ended September 30, 2007
Cash flows provided by (used in) operating activities:
Net income	$	119,344		$	149,260		$	172,567
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization		103,279			102,370			93,444
Accretion of discount to the relinquishment liability		20,425			27,085			29,794
Relinquishment liability reassessment		(45,678	)		(68,947	)		2,997
Cash paid for accretion of discount to the relinquishment liability		(22,090	)		(27,762	)		(30,022	)
Gain on early extinguishment of debt		(8,466	)		-			-
Loss on amendment to the purchase agreement for Pocono Downs		1,646			-			-
Accretion of discount on amendment to the purchase agreement for Pocono Downs		(430	)		(1,246	)		(1,584	)
Net loss on disposition of assets		1,185			295			1,678
Net loss on sale of Erie off-track wagering facility		-			-			73
Non-cash asset write-offs		4,512			-			-
Provision for losses on receivables		9,937			18,338			3,396
Amortization of debt issuance costs		8,282			4,831			3,835
Write-off of debt issuance costs		-			-			71
Amortization of net deferred gain on settlement of derivative instruments		228			455			455
Minority interests		(1,992	)		(2,729	)		(648	)
Changes in operating assets and liabilities:
Decrease (increase) in receivables		10,269			(24,977	)		1,379
Decrease (increase) in inventories		2,410			(812	)		(1,603	)
Increase in other assets		(6,327	)		(8,603	)		(8,737	)
(Decrease) increase in trade payables		(4,086	)		6,600			(2,944	)
(Decrease) increase in other liabilities		(20,637	)		(3,842	)		20,252
Net cash flows provided by operating activities		171,811			170,316			284,403
Cash flows provided by (used in) investing activities:
Purchases of property and equipment, net of (decrease) increase in construction payables of $(83,702), $66,259 and $30,017, respectively		(177,234	)		(317,429	)		(132,178	)
Payment of Category One slot machine license fee		-			-			(50,000	)
Acquisition of Menominee Project development rights and other related assets		-			-			(6,381	)
Acquisition of Pautipaug Country Club assets		-			-			(4,651	)
Proceeds from settlement of contract dispute		-			-			2,000
Proceeds from sale of Erie off-track wagering facility		-			-			6,967
Proceeds from amendment to the purchase agreement for Pocono Downs		20,063			7,000			-
Proceeds from Commonwealth of Pennsylvania’s facility improvement grant		2,000			-			-
Issuance of third-party loans and advances		(3,858	)		(8,933	)		(4,461	)
Proceeds from asset sales		123			785			362
Payments received on third-party loans		232			623			512
(Increase) decrease in restricted cash		(294	)		(1,740	)		384
Net cash flows used in investing activities		(158,968	)		(319,694	)		(187,446	)
Cash flows provided by (used in) financing activities:
Prior Bank Credit Facility borrowings - revolving loan		-			-			278,000
Prior Bank Credit Facility repayments - revolving loan		-			-			(278,000	)
Bank Credit Facility borrowings - revolving loan		1,052,000			575,000			206,000
Bank Credit Facility repayments - revolving loan		(486,000	)		(608,000	)		(173,000	)
Bank Credit Facility borrowings - term loan		-			300,000			-
Bank Credit Facility repayments - term loan		(153,000	)		-			-
Salishan Credit Facility borrowings - revolving loan		2,250			3,750			17,250
Salishan Credit Facility repayments - revolving loan		(10,000	)		-			-
Line of Credit borrowings		547,230			565,746			524,313
Line of Credit repayments		(537,987	)		(579,399	)		(507,722	)
Borrowings from the Mohegan Tribe		10,000			8,333			-
Payments to the Mohegan Tribe		-			(8,333	)		-
Payments on long-term debt		(336,806	)		(1,000	)		(3,550	)
Principal portion of relinquishment liability payments		(39,602	)		(48,352	)		(47,399	)
Distributions to Tribe		(71,500	)		(80,000	)		(75,000	)
Capitalized debt issuance costs		(9,810	)		(2,775	)		(7,081	)
Payments on capital lease obligations		(718	)		(177	)		(34	)
Minority interest contributions and advances		2,564			2,054			-
Net cash flows provided by (used in) financing activities		(31,379	)		126,847			(66,223	)
Net (decrease) increase in cash and cash equivalents		(18,536	)		(22,531	)		30,734
Cash and cash equivalents at beginning of year		83,200			105,731			74,997
Cash and cash equivalents at end of year	$	64,664		$	83,200		$	105,731
Supplemental disclosure:
Cash paid during the year for interest	$	106,008		$	95,204		$	92,501

The accompanying notes are an integral part of these consolidated financial statements.

F-6

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1—ORGANIZATION AND BASIS OF PRESENTATION:

The Mohegan Tribe of Indians of Connecticut (the “Mohegan Tribe” or the “Tribe”) established the Mohegan Tribal Gaming Authority (the “Authority”) in July 1995 with the exclusive power to conduct and regulate gaming activities for the Tribe on Tribal lands and the non-exclusive authority to conduct such activities elsewhere. The Tribe is a federally-recognized Indian tribe with an approximately 507-acre reservation situated in southeastern Connecticut, adjacent to Uncasville, Connecticut. Under the Indian Gaming Regulatory Act of 1988, federally-recognized Indian tribes are permitted to conduct full-scale casino gaming operations on tribal land, subject to, among other things, the negotiation of a compact with the affected state. The Tribe and the State of Connecticut have entered into such a compact (the “Mohegan Compact”), which has been approved by the United States Secretary of the Interior. The Authority is primarily engaged in the ownership, operation and development of gaming facilities. In October 1996, the Authority opened a gaming and entertainment complex known as Mohegan Sun. The Authority is governed by a nine-member Management Board, whose members also comprise the Mohegan Tribal Council, the governing body of the Tribe. Any change in the composition of the Tribal Council results in a corresponding change in the Authority’s Management Board.

The following subsidiaries are wholly-owned by the Authority: Mohegan Basketball Club, LLC (“MBC”), Mohegan Golf, LLC (“Mohegan Golf”), Mohegan Commercial Ventures-PA, LLC (“MCV-PA”), Mohegan Ventures-Northwest, LLC (“Mohegan Ventures-NW”), Mohegan Ventures Wisconsin, LLC (“MVW”) and MTGA Gaming, LLC (“MTGA Gaming”). MBC owns and operates a professional basketball team in the Women’s National Basketball Association (“WNBA”), the Connecticut Sun, and owns approximately 3.6% of the membership interest in WNBA, LLC. Mohegan Golf owns and operates the Mohegan Sun Country Club at Pautipaug (“Mohegan Sun Country Club”) golf course in southeastern Connecticut.

MCV-PA holds a 0.01% general partnership interest in Downs Racing, L.P., Backside, L.P., Mill Creek Land, L.P. and Northeast Concessions, L.P. (collectively, the “Pocono Downs Entities”), while the Authority holds a 99.99% limited partnership interest in each such entity. Downs Racing, L.P. (“Downs Racing”) owns and operates Mohegan Sun at Pocono Downs (“Pocono Downs”), a gaming and entertainment facility offering slot machines and harness racing in Plains Township, Pennsylvania, and several off-track wagering (“OTW”) facilities located elsewhere in Pennsylvania. The Authority views Mohegan Sun and the properties owned by the Pocono Downs Entities as two separate operating segments.

Mohegan Ventures-NW and the Tribe hold 49.15% and 7.85% membership interests in Salishan-Mohegan, LLC (“Salishan-Mohegan”), respectively, which was formed with an unrelated third-party to participate in a proposed development and management of a casino to be owned by the federally-recognized Cowlitz Indian Tribe of Washington (the “Cowlitz Tribe”) and to be located in Clark County, Washington (the “Cowlitz Project”).

MVW and Mohegan Ventures, LLC (“MV”), a wholly-owned subsidiary of the Tribe, hold 85.4% and 14.6% membership interests in Wisconsin Tribal Gaming, LLC (“WTG”), respectively, which was formed to participate in a proposed development of a casino to be owned by the federally-recognized Menominee Indian Tribe of Wisconsin (the “Menominee Tribe”) and to be located in Kenosha, Wisconsin (the “Menominee Project”).

MTGA Gaming and the Tribe hold 49% and 51% membership interests in Mohegan Gaming & Hospitality, LLC (“MG&H”), respectively. MG&H holds a 100% membership interest in Mohegan Resorts, LLC (“Mohegan Resorts”). It is anticipated that certain of the Authority’s and the Tribe’s future diversification efforts will be conducted, either directly or indirectly, through MG&H and Mohegan Resorts. Mohegan Resorts currently holds a 100% membership interest in Mohegan Resorts Mass, LLC, which was formed to evaluate potential gaming opportunities in the Commonwealth of Massachusetts.

F-7

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Authority and its majority and wholly-owned subsidiaries and entities. In accordance with authoritative guidance issued by the Financial Accounting Standard Board (the “FASB”) pertaining to consolidation of variable interest entities, the accounts of Salishan-Mohegan are consolidated into the accounts of Mohegan Ventures-NW, and the accounts of MG&H, Mohegan Resorts and its subsidiaries are consolidated into the accounts of MTGA Gaming, as Mohegan Ventures-NW and MTGA Gaming are deemed to be the primary beneficiaries. In consolidation, all intercompany balances and transactions were eliminated.

Management’s Use of Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires the Authority to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. The most significant estimates included in the accompanying consolidated financial statements relate to the assessment of asset impairment, estimated collectibility of receivables, the relinquishment liability, the liability associated with unredeemed Player’s Club points and employee medical coverage and workers’ compensation self-insurance reserves. Actual results could differ from those estimates.

Reclassifications

Certain amounts in the accompanying consolidated financial statements for fiscal years 2008 and 2007 were reclassified to conform to the fiscal year 2009 presentation.

Cash and Cash Equivalents

The Authority classifies deposits that can be redeemed on demand and investments with an original maturity of three months or less when purchased as cash and cash equivalents. Cash equivalents are carried at cost, which approximates market value. For financial reporting purposes, cash and cash equivalents include all operating cash and in-house funds.

Restricted Cash

The Authority classifies cash that is contractually restricted as to its withdrawal or usage as restricted cash. As of September 30, 2009, restricted cash was comprised of amounts set aside by Downs Racing in accordance with the Race Horse Development and Gaming Act of 2004 (the “Pennsylvania Gaming Act”), and Pennsylvania state statutes. The Pennsylvania Gaming Act requires Downs Racing to deposit a percentage of gross revenues from slot machines into a separate interest bearing account for the benefit of horsemen, through purses and health and pension benefits, and breeders. In addition, Pennsylvania state statutes require Downs Racing to deposit net amounts received from the sale of lottery tickets into a designated account.

As of September 30, 2008, restricted cash related to amounts for the racing and lottery funds, described above, and a building permit fee dispute between the Township of Plains, Pennsylvania and Downs Racing. In January 2009, the dispute was settled and the related restricted cash was released to Downs Racing.

Receivables

Accounts receivable consists primarily of casino receivables, which represent credit extended to approved casino customers, and hotel and other non-gaming receivables. The Authority maintains an allowance for doubtful

F-8

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

accounts, which is based on the Authority’s estimate of the amount expected to be uncollectible considering historical experience, the information management obtains regarding the creditworthiness of the customer and all other available information. Future business or economic trends could affect the collectibility of these receivables.

Receivables from affiliates, which were included in other assets, net, in the accompanying consolidated balance sheets, consist primarily of reimbursable costs and expenses advanced by WTG on behalf of the Menominee Tribe for the Menominee Project (refer to Note 13) and Salishan-Mohegan on behalf of the Cowlitz Tribe for the Cowlitz Project (refer to Note 14). The WTG receivables are payable upon the receipt of necessary financing for the development of the proposed casino. As of September 30, 2008, the Authority had fully reserved the WTG receivables, and as of September 30, 2009, the WTG receivables remain fully reserved. The Salishan-Mohegan receivables are payable upon: (1) the receipt of necessary financing for the development of the proposed casino, and (2) the related property being taken into trust by the United States Department of the Interior. Due to the inherent uncertainty in the development of the Cowlitz Project, the Authority maintains a reserve for doubtful collection of the Salishan-Mohegan receivables, which is based on the Authority’s estimate of the probability that the receivables will be collected. Future complications in the receipt of financing, the relevant land being taken into trust or other matters affecting the Cowlitz Project could affect the collectibility of the receivables.

Inventories

Inventories are stated at the lower of cost or market value and consist primarily of food and beverage, retail, hotel and operating supplies. Cost is determined using the Average Cost Method. The Authority reduces the carrying value of slow-moving inventory to net realizable value, based on the Authority’s estimate of the amount of inventory that may not be utilized in future casino operations considering the duration of time items are held in inventory and information the Authority obtains regarding the plans to utilize such inventory. Future business trends could affect the timely use of inventories.

Property and Equipment

Property and equipment are stated at cost. Depreciation is recorded over the estimated useful lives of the assets, other than land, on a straight-line basis. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful lives of the improvements. Useful life estimates of asset categories are as follows:

Buildings and land improvements	40 years
Furniture and equipment	3 - 7 years

The costs of significant improvements are capitalized. Costs of normal repairs and maintenance are charged to expense as incurred. Gains or losses on disposition of property and equipment are included in the determination of net income.

In accordance with authoritative guidance issued by the FASB pertaining to the accounting for the impairment of long-lived assets, the carrying value of the Authority’s assets is assessed when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If it is determined that an impairment loss has occurred based on current and future levels of income and expected future cash flows, as well as other factors, then an impairment loss is recognized in the respective consolidated statement of income. The Authority assessed the carrying value of the relevant assets as of September 30, 2009 and 2008, including those related to the suspended elements of Mohegan Sun’s expansion project (“Project Horizon”), and determined that no impairment existed.

F-9

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Capitalized Interest

Interest costs associated with major development and construction projects are capitalized and included in the cost of the respective project. When no debt is incurred specifically for a project, interest is capitalized on amounts expended on the project utilizing the weighted-average interest cost of the Authority’s outstanding borrowings. Capitalization of interest ceases when the project is substantially completed or development activity is suspended for more than a brief period.

Goodwill

In accordance with authoritative guidance issued by the FASB pertaining to goodwill, the goodwill associated with the acquisition of the Pocono Downs Entities is not subject to amortization, but is assessed at least annually for impairment by comparing the fair value of the recorded assets to their carrying amount. If the carrying amount of the goodwill exceeds its fair value, an impairment loss will be recognized immediately. The Authority assessed the goodwill for impairment using an income approach as of September 30, 2009 and 2008 and determined that no impairment existed. The income approach requires the Authority to make assumptions regarding future revenues and expenses, discount rates and the terminal value of the Pocono Downs Entities. The amount by which the estimated fair value of the Pocono Downs Entities exceeds its book value has remained consistent as of September 30, 2009 and 2008. If any of the following occurs, the goodwill may be impaired and subject to a non-cash write-down in a future period, which could have a material adverse impact on the accompanying consolidated financial statements: (1) if estimates of projected cash flows of the Pocono Downs Entities are not met; (2) if the discount rate increases; or (3) if terminal growth rates decrease.

Other Intangible Assets

Intangible assets relate primarily to the acquisitions of the Pocono Downs Entities, the WNBA franchise and the assets of Pautipaug Country Club Inc. (“PCC”). In January 2005, the Authority and its wholly owned subsidiary, MCV-PA, acquired all of the partnership interests in the Pocono Downs Entities. In connection with the acquisition, Downs Racing gained the right to apply for a Category One slot machine license. The right to apply for the license was determined by the Authority to be an intangible asset with an indefinite useful life. The Authority, with assistance from an independent valuation firm, estimated the fair value of the intangible asset to be $214.0 million. The valuation firm used the Income Approach—Excess Earnings Method. Conditional and permanent Category One slot machine licenses were granted to and approved for Downs Racing by the Pennsylvania Gaming Control Board (the “PGCB”) in September 2006 and December 2006, respectively. A one-time slot machine license fee of $50.0 million was paid to the PGCB in October 2006, which was added to the existing slot license intangible asset of $214.0 million. The total slot license intangible asset of $264.0 million, with an indefinite useful life, was included in the accompanying consolidated balance sheets. The slot license intangible asset is assessed at least annually for impairment in accordance with authoritative guidance issued by the FASB pertaining to intangible assets. The Authority applied the fair value test as of September 30, 2009 and 2008 and determined that no impairment existed. If estimates of projected cash flows of the Pocono Downs Entities are not met, the slot license intangible asset may be impaired and subject to a non-cash write-down in a future period, which could have a material adverse impact on the accompanying consolidated financial statements.

The intangible assets associated with the acquisitions of the WNBA franchise and the assets of PCC are tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. In accordance with authoritative guidance issued by the FASB pertaining to intangible assets, a development rights intangible asset related to the Menominee Project was determined to be fully impaired and was written-off during fiscal 2008 (refer to Note 13).

F-10

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

In connection with a Relinquishment Agreement (refer to Note 11), Trading Cove Associates (“TCA”) granted the Authority an exclusive, irrevocable, perpetual, world-wide and royalty-free license with respect to trademarks and other similar rights, including the “Mohegan Sun” name used at or developed for Mohegan Sun. The Mohegan Sun trademark was appraised by an independent valuation firm to have a value of $130.0 million and was included as an intangible asset in the accompanying consolidated balance sheets. The independent valuation firm used the Income Approach—Relief from Royalty Method. In accordance with authoritative guidance issued by the FASB pertaining to intangible assets, the Mohegan Sun trademark is no longer subject to amortization as it is deemed to have an indefinite useful life. The Mohegan Sun trademark is assessed at least annually for impairment pursuant to appropriate accounting standards. The Authority assessed the Mohegan Sun trademark for impairment as of September 30, 2009 and 2008 and determined that no impairment existed. The balance of the Mohegan Sun trademark was as follows (in thousands):

	September 30,
	2009			2008
Trademark	$	130,000		$	130,000
Accumulated amortization		(10,308	)		(10,308	)
Trademark, net	$	119,692		$	119,692

Deferred Financing Costs

Debt issuance costs incurred in connection with the issuance of long-term debt are capitalized and amortized to interest expense based on the related debt agreements on a straight-line basis, which approximates the Effective Interest Method. The unamortized amounts are included in other assets, net, in the accompanying consolidated balance sheets.

Unredeemed Player’s Club Points

The Authority maintains an accrual for unredeemed Player’s Club points. The accrual is based on the estimated cost of the points expected to be redeemed as of the respective balance sheet date. The Authority determines the adequacy of this accrual by periodically evaluating the historical redemption experience and projected trends related to this accrual. Actual results could differ from those estimates.

Base Jackpots

Base jackpots represent the fixed minimum amount of slot machine payouts for a specific combination. The Authority charges base jackpots to revenues when established. These amounts are included in other current liabilities in the accompanying consolidated balance sheets.

Self-insurance Accruals

The Authority is self-insured up to certain limits for costs associated with workers’ compensation, general liability and employee medical coverage. Insurance claims and reserves include accruals of estimated settlements for known claims, as well as accruals of estimates of incurred but not reported claims. These accruals are included in other current liabilities in the accompanying consolidated balance sheets. In estimating these costs, the Authority considers historical loss experience and makes judgments about the expected levels of costs per claim. The Authority also utilizes information provided by independent consultants to assist in the determination of estimated accruals. These claims are accounted for based on estimates of the undiscounted claims, including

F-11

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

those claims incurred but not reported. The Authority believes the use of these estimates to account for these liabilities provides a consistent and effective way to measure these accruals; however, changes in health care costs, accident frequency and severity and other factors can materially affect the estimate for these liabilities. The Authority continually monitors the potential changes in future estimates, evaluates insurance accruals and makes adjustments when necessary.

Relinquishment Liability

In accordance with authoritative guidance issued by the FASB pertaining to the accounting for contingencies, the Authority has recorded a relinquishment liability of the estimated present value of its obligations under a Relinquishment Agreement (refer to Note 11). The Authority reassesses projected revenues and consequently the relinquishment liability: (1) annually in conjunction with the budgeting process, or (2) when necessary to account for material increases or decreases in projected revenues over the relinquishment period. If the reassessment causes an overall increase to the projected revenues over the relinquishment period, the relinquishment liability will be increased by 5% of such increase in revenues, discounted at the Authority’s risk-free rate of investment, which is an incremental layer. If the reassessment causes an overall decrease to the projected revenues over the relinquishment period, the relinquishment liability will be decreased by 5% of such decrease in revenues, discounted based upon a weighted average discount rate, which is a decremental layer. The weighted average discount rate is defined as the average discount rate used to discount all the previous incremental layers weighted by the amount of each such incremental layer. Further, the Authority records a quarterly accretion to the relinquishment liability to reflect the impact of the time value of money. Since there is a high level of estimation and judgment (including those related to estimates of future revenue projections and impact and timing of future competition) used with respect to calculating this liability, future events that affect such estimates and judgments may cause the actual liability to significantly differ from the estimate.

Fair Value of Financial Instruments

The fair value amounts presented below are reported to satisfy the disclosure requirements pursuant to authoritative guidance issued by the FASB pertaining to disclosures about fair values of financial instruments, and are not necessarily indicative of the amounts that the Authority could realize in a current market exchange.

In October 2008, the Authority adopted fair value provisions in accordance with authoritative guidance issued by the FASB pertaining to financial assets and liabilities. The guidance clarifies how companies are required to use a fair value measure for recognition and disclosure by establishing a common definition of fair value, a framework for measuring fair value, and expanded disclosures about fair value measurements. The Authority applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels:

• Level 1—Quoted prices for identical assets or liabilities in active markets;

• Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, or valuations based on models where the significant inputs are observable or can be corroborated by observable market data; and

• Level 3—Valuations based on models where the significant inputs are not observable. The unobservable inputs reflect the Authority’s estimates or assumptions that market participants would use in pricing the asset or liability.

The Authority’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of financial assets and liabilities and their placement within the fair value hierarchy.

F-12

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The carrying amount of cash and cash equivalents, receivables, trade payables and promissory notes approximates fair value. The fair values of the Authority’s financing facilities and notes were as follows (in thousands):

	September 30, 2009
	Carrying Value		Fair Value
Bank Credit Facility	$	713,000	$	590,899
2005 6 1/ 8% Senior Unsecured Notes		250,000		205,000
2001 8 3/ 8% Senior Subordinated Notes		2,010		1,688
2002 8% Senior Subordinated Notes		250,000		210,000
2004 7 1/ 8% Senior Subordinated Notes		225,000		162,000
2005 6 7/ 8% Senior Subordinated Notes		150,000		108,000

The estimated fair value of the Authority’s financing facilities and notes was based on quoted market prices or prices of similar instruments on or about September 30, 2009.

Revenue Recognition

The Authority recognizes gaming revenues as amounts wagered less prizes paid out. Revenues from food and beverage, hotel, retail, entertainment and other services are recognized at the time the service is performed. Minimum rental revenues are recognized on a straight-line basis over the terms of the related leases. Percentage rents are recognized in the period in which the tenants exceed their respective percentage rent thresholds.

Promotional Allowances

The Authority operates a program for guests at Mohegan Sun and Pocono Downs, without membership fees, called the Player’s Club. This program provides complimentary food, beverage, hotel, retail, entertainment and other services to guests, as applicable, based on points that are awarded for guests’ gaming activities. These points may be used to purchase, among other things, items at the retail stores and restaurants located within Mohegan Sun and Pocono Downs, including The Shops at Mohegan Sun and the Mohegan Sun gasoline and convenience center. Points also may be used to purchase hotel services and tickets to entertainment events held at Mohegan Sun facilities. The retail value of these complimentary items is included in gross revenues when redeemed at facilities operated by the Authority and then deducted as promotional allowances to arrive at net revenues. The cost associated with reimbursing third parties for the value of these complimentary items redeemed at third-party outlets is charged to gaming expenses.

In addition, the Authority has ongoing promotional programs which offer coupons to guests for the purchase of food, beverage, hotel and retail amenities offered within Mohegan Sun and Pocono Downs, as applicable. The retail value of items or services purchased with coupons at facilities operated by the Authority within Mohegan Sun and Pocono Downs is included in gross revenues and the respective coupon value is deducted as promotional allowances to arrive at net revenues. The cost associated with reimbursing third parties for the value of coupons redeemed at third-party outlets is charged to gaming expenses.

The retail value of providing promotional allowances was included in revenues as follows (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007
Food and beverage	$	45,004	$	49,616	$	48,138
Hotel		16,369		15,246		16,385
Retail, entertainment and other		56,224		70,693		67,323
Total	$	117,597	$	135,555	$	131,846

F-13

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The estimated cost of providing promotional allowances was included in operating costs and expenses, primarily gaming, as follows (in thousands):

	For the Fiscal Years Ended September 30,
	2009		2008		2007
Food and beverage	$	45,457	$	52,269	$	49,243
Hotel		9,552		8,048		8,866
Retail, entertainment and other		47,853		61,116		54,781
Total	$	102,862	$	121,433	$	112,890

The Authority records free or discounted food and beverage and other services in accordance with authoritative guidance issued by the FASB pertaining to the accounting for consideration given by a vendor to a customer. In certain circumstances, the Authority also offers cash inducements and discounts on patron losses at Mohegan Sun that result in a reduction to gaming revenues. The offsets to gaming revenues were $7.3 million, $21.1 million and $10.3 million relating to discounts provided on patron losses for the fiscal years ending September 30, 2009, 2008 and 2007, respectively, and $1.4 million, $1.2 million and $752,000 relating to Player’s Club points redeemed for cash for the fiscal years ended September 30, 2009, 2008 and 2007, respectively.

Gaming Expenses

Gaming expenses primarily include the portion of gross revenues from slot machines that must be paid to the State of Connecticut and the PGCB, which are referred to as Slot Win Contribution and Pennsylvania Gaming Tax, respectively (refer to Note 10). Gaming expenses also include, among other things, payroll costs, expenses associated with the operation of slot machines, table games, keno, live harness racing at Pocono Downs and Racebook, certain marketing expenses, and promotional expenses for the Player’s Club points and coupons redeemed at the hotel, restaurants and retail outlets, as well as third-party tenant outlets.

Advertising

The Authority expenses the production costs of advertising the first time the advertising takes place. Prepaid rental fees associated with billboard advertising are capitalized and amortized over the term of the related rental agreement. Total advertising costs for the fiscal years ended September 30, 2009, 2008 and 2007 were $30.7 million, $43.3 million and $42.7 million, respectively. As of September 30, 2009, prepaid advertising was $3,000. The Authority did not record any prepaid advertising at September 30, 2008.

Corporate Expenses

Corporate expenses represent an allocation of governmental and certain administrative services provided by the Tribe, payroll costs, professional fees and various other expenses not directly related to the Authority’s operations at Mohegan Sun or Pocono Downs. In addition, Corporate expenses include the costs associated with the Authority’s various gaming diversification efforts, which are expensed as incurred, except when reimbursable by a third-party.

Pre-Opening Costs and Expenses

For the fiscal year ended September 30, 2009, pre-opening costs and expenses were minimal. For the fiscal years ended September 30, 2008 and 2007, pre-opening costs and expenses consisted primarily of direct incremental personnel, consulting and other costs associated with the development of Phases I and II of the gaming facility at

F-14

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Pocono Downs and the construction of Casino of the Wind component of Project Horizon at Mohegan Sun. Construction of the Phase I facility at Pocono Downs commenced in September 2005 and was completed in November 2006, while construction of the Phase II facility (“Project Sunrise”) commenced in May 2007 and was completed in July 2008. Construction of Casino of the Wind commenced in June 2007 and was completed in August 2008. In accordance with authoritative guidance issued by the FASB pertaining to the reporting on the costs of start-up activities, pre-opening costs and expenses are expensed as incurred.

Income Taxes

The Tribe is a sovereign Indian nation with independent legal jurisdiction over its people and its land. Like other sovereign governments, the Tribe and its entities, including the Authority, are not subject to federal, state or local income taxes.

New Accounting Standards

Accounting Standards Recently Adopted

In June 2009, the FASB issued guidance which established the FASB Accounting Standard Codification (“Codification”) as the single source of authoritative U.S. GAAP recognized by the FASB for non-governmental agencies (other than guidance issued by the Securities and Exchange Commission). The Codification did not change U.S. GAAP but, instead, changed the referencing of authoritative accounting literature. The new guidance became effective for financial statements issued for interim and annual periods ending after September 15, 2009. Its adoption required the Authority to adjust references to authoritative accounting literature in its financial statements, but did not affect the Authority’s financial position, results of operations or cash flows.

In May 2009, the FASB issued guidance pertaining to subsequent events. The new guidance incorporates into the FASB authoritative literature, accounting guidance that originated as auditing standards about events or transactions that occur after the balance sheet date but before the financial statements are issued. It retains the auditing standard requirements to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the balance sheet date and to disclose but not recognize subsequent events that provide evidence about conditions that arose after the balance sheet date but before the financial statements are issued. The reporting entity is required to disclose the date through which it has evaluated subsequent events. The new guidance became effective for interim and annual periods ending after June 15, 2009. In preparing the accompanying consolidated financial statements, the Authority has evaluated events subsequent to September 30, 2009 through the issuance of the financial statements on December 28, 2009. Subsequent events identified are disclosed in Note 19.

In March 2008, the FASB issued guidance pertaining enhanced disclosures for derivative instruments and hedging activities, including disclosures regarding how: (1) an entity uses derivative instruments; (2) derivative instruments and related hedged items are accounted for; and (3) derivative instruments and related hedged items affect an entity’s financial position, financial performance and cash flows. The Authority adopted the new guidance effective January 1, 2009. Since the new guidance requires only additional disclosures concerning derivatives and hedging activities, its adoption did not affect the presentation of the Authority’s financial position, results of operations or cash flows. See Note 6 for the Authority’s disclosures regarding derivative instruments and hedging activities.

In October 2008, the Authority adopted guidance pertaining to fair value measurements for financial assets and liabilities. The Authority deferred the provisions that relate to non-financial assets in accordance with the new guidance, which allowed for such a deferral. The major categories of assets that are measured at fair value for

F-15

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

which the Authority has not applied the new guidance include the measurement of fair value in the first step of a goodwill impairment test pursuant to appropriate accounting standards. The new guidance clarifies how companies are required to use a fair value measure for recognition and disclosure by establishing a common definition of fair value, a framework for measuring fair value, and expanding disclosures about fair value measurements. Its adoption for financial assets and liabilities did not have a material impact on the Authority’s financial position, results of operations or cash flows. The Authority adopted the provisions related to non-financial assets and liabilities as of October 2009. Its adoption did not have a material impact on the Authority’s financial position, results of operations or cash flows.

In April 2009, the FASB issued additional guidance for estimating fair value when the volume and level of activity for the asset or liability have significantly decreased and re-emphasizes that regardless of market conditions the fair value measurement is an exit price concept. It also clarifies and includes additional factors to consider in determining whether there has been a significant decrease in market activity for an asset or liability and provides additional clarification on estimating fair value when the market activity for an asset or liability has significantly declined. The FASB also provided a new other-than-temporary impairment model for debt securities only, which shifts the focus from an entity’s intent to hold until recovery to its intent to sell. Additionally, the FASB requires publicly-traded companies to provide disclosures on the fair value of financial instruments in interim financial statements. This guidance became effective for interim and annual periods ending after June 15, 2009. Its adoption did not have a material impact on the Authority’s financial position, results of operations or cash flows.

Accounting Standards Issued But Not Yet Adopted

In August 2009, the FASB issued guidance pertaining to fair value measurements for liabilities when quoted prices for the liabilities are not available. The new guidance is effective for the first reporting period (including interim periods) beginning after October 1, 2009. The Authority is currently evaluating the potential impact, if any, that the new guidance may have on its financial position, results of operations or cash flows.

In June 2009, the FASB issued guidance to address the elimination of the concept of a qualifying special purpose entity. The new guidance also replaces the quantitative-based risks and rewards calculation for determining which enterprise has a controlling financial interest in a variable interest entity with an approach focused on identifying which enterprise has the power to direct the activities of a variable interest entity and the obligation to absorb losses of the entity or the right to receive benefits from the entity. Additionally, it provides more timely and useful information about an enterprise’s involvement with a variable interest entity. The new guidance is effective for fiscal years beginning after November 15, 2009. The Authority is currently evaluating the potential impact, if any, that the new guidance may have on its financial position, results of operations or cash flows.

In December 2007, the FASB issued guidance pertaining to business combinations and non-controlling interests in consolidated financial statements. The new guidance requires the acquiring entity in a business combination to record all assets acquired and liabilities assumed at their respective acquisition-date fair values. It also requires additional disclosure of information surrounding a business combination, such that users of the entity’s financial statements can fully understand the nature and financial impact of the business combination. Additionally, it requires entities to report non-controlling (minority) interests in subsidiaries as equity in the consolidated financial statements. The Authority is required to adopt the new guidance in its fiscal year beginning October 1, 2009. The new provisions related to business combinations will only impact the Authority if it is party to a business combination after the pronouncement has been adopted.

F-16

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 3—RECEIVABLES, NET:

Components of receivables, net, were as follows (in thousands):

	September 30,
	2009			2008
Gaming	$	34,107		$	45,706
Hotel		844			1,162
Other		7,714			6,721
Subtotal		42,665			53,589
Allowance for doubtful accounts		(19,305	)		(12,843	)
Total receivables, net	$	23,360		$	40,746

NOTE 4—PROPERTY AND EQUIPMENT, NET:

Components of property and equipment, net, were as follows (in thousands):

	September 30,
	2009			2008
Land	$	64,799		$	64,439
Land improvements		86,601			63,226
Buildings and improvements		1,651,723			1,600,108
Furniture and equipment		496,959			493,909
Construction in process		84,351			91,762
Subtotal		2,384,433			2,313,444
Less: accumulated depreciation		(707,670	)		(620,042	)
Total property and equipment, net	$	1,676,763		$	1,693,402

For the fiscal years ended September 30, 2009, 2008 and 2007, depreciation expense totaled $102.7 million, $97.9 million and $92.8 million, respectively. Capitalized interest totaled $1.1 million, $6.5 million and $1.7 million for the fiscal years ended September 30, 2009, 2008 and 2007, respectively.

In September 2008, the Authority announced the suspension of the hotel, retail and new parking garage elements of Project Horizon due to a slowdown in business volumes and uncertainties in the financial markets resulting from the national economic recession. During the fourth quarter ended September 30, 2009, the Authority expensed $4.5 million of costs related to the suspended elements as such assets did not have any future use to the Authority. This expense was recorded in other income (expense), net, in the accompanying respective consolidated statement of income. While the Authority is currently evaluating its options with respect to the development of the suspended elements, including the new hotel, it can provide no assurance as to if or when the suspended elements will resume. The specific factors that the Authority will consider in determining the feasibility of the suspended elements include the Authority’s financial performance, cash flow projections expected to be realized from the project, estimated project costs, ability to obtain financing, economic conditions, industry trends and competition. As of September 30, 2009 and 2008, assets related to the suspended elements totaled $78.3 million and $80.6 million, respectively, and were included in construction in process. These assets related to excavation and foundation work for the planned podium and hotel tower, as well as professional fees for design and architectural work. The Authority currently believes that the assets related to the suspended elements have a future benefit. The Authority assessed the carrying value of these assets as of September 30, 2009 and 2008 and determined that no impairment existed.

F-17

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 5—OTHER CURRENT ASSETS AND OTHER CURRENT LIABILITIES:

Components of other current assets were as follows (in thousands):

	September 30,
	2009		2008
Non-qualified deferred compensation	$	14,714	$	11,675
Current portion of Pocono Downs purchase settlement		-		6,950
Prepaid expenses and miscellaneous other current assets		10,864		9,399
Total other current assets	$	25,578	$	28,024

Components of other current liabilities were as follows (in thousands):

	September 30,
	2009		2008
Accrued payroll and related taxes and benefits	$	42,717	$	51,600
Slot Win Contribution payable		14,853		16,751
Amounts due to horsemen		9,118		5,376
Miscellaneous other current liabilities		58,146		67,684
Total other current liabilities	$	124,834	$	141,411

NOTE 6—FINANCING FACILITIES:

Financing facilities consisted of the following (in thousands):

	September 30,
	2009		2008
Bank Credit Facility	$	713,000	$	300,000
2005 6 1/ 8% Senior Unsecured Notes		250,000		250,000
2001 8 3/ 8% Senior Subordinated Notes		2,010		16,345
2002 8% Senior Subordinated Notes		250,000		250,000
2003 6 3/ 8% Senior Subordinated Notes		-		330,000
2004 7 1/ 8% Senior Subordinated Notes		225,000		225,000
2005 6 7/ 8% Senior Subordinated Notes		150,000		150,000
Line of Credit		12,180		2,938
WNBA Promissory Note		2,000		3,000
Salishan Credit Facility		13,250		21,000
Mohegan Tribe Promissory Note		10,000		-
Menominee Kenosha Gaming Authority Note Payable (Note 13)		600		600
Subtotal		1,628,040		1,548,883
Net deferred gain on derivative instruments sold		1,575		1,369
Total debt	$	1,629,615	$	1,550,252

F-18

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Maturities of the Authority’s debt as of September 30, 2009 were as follows (in thousands):

Fiscal Years	Long-Term Debt Maturities
2010	$	26,430
2011		13,010
2012		963,000
2013		250,000
2014		225,000
Thereafter		150,600
Total	$	1,628,040

Prior Bank Credit Facility

In March 2007, the Authority extinguished its Amended and Restated Loan Agreement, dated March 25, 2003, as amended (the “Prior Bank Credit Facility”). In connection with the extinguishment of the Prior Bank Credit Facility, certain unamortized debt issuance costs totaling $71,000 were charged as a write-off of debt issuance costs in the accompanying consolidated statement of income for the fiscal year ended September 30, 2007.

Bank Credit Facility

In March 2007, the Authority entered into a Second Amended and Restated Loan Agreement (the “Bank Credit Facility”) providing for up to $1.0 billion in borrowing capacity from a syndicate of 23 financial institutions and commercial banks, with Bank of America, N.A., serving as Administrative Agent. This Bank Credit Facility replaced the Prior Bank Credit Facility. The five-year senior secured revolving credit facility included a $300.0 million term loan conversion provision which was triggered upon the initial accumulation of $300.0 million in total borrowings under the Bank Credit Facility on August 15, 2008.

In December 2008, the Authority entered into an amendment to the terms of the Bank Credit Facility pursuant to a Third Amended and Restated Loan Agreement in connection with the suspension of Project Horizon. Among other things, the amended Bank Credit Facility reduced the total commitment of the credit facility from $1.0 billion to $850.0 million, consisting of a $150.0 million term loan and $700.0 million of revolving commitments, with the $150.0 million reduction being applied to reduce the existing $300.0 million term loan via incremental funding under the revolver, and reduced the increase option from $250.0 million to $150.0 million. As of September 30, 2009, the term loan under the Bank Credit Facility amortized at a rate of $750,000 per quarter until June 30, 2010, at which time the amortization rate was to increase to $30.0 million per quarter (with an automatic and permanent reduction of the revolving commitments by such amount following repayment). The maturity date of the Bank Credit Facility is March 9, 2012, upon which date the remaining balances outstanding are payable. Refer to information below and Note 19 for further discussion of the Bank Credit Facility as amended by subsequent event.

As of September 30, 2009, there was $713.0 million drawn on the Bank Credit Facility, which was comprised of a $147.0 million term loan and $566.0 million in revolving loans. The revolving loans outstanding as of September 30, 2009 reflect the repayment of the Authority’s 6 ³/8% $330.0 million Senior Subordinated Notes at maturity on July 15, 2009 with proceeds from the Bank Credit Facility. As of September 30, 2009, the amount under letters of credit issued pursuant to the Bank Credit Facility totaled $4.6 million, of which no amount was drawn (refer to “Letters of Credit” below). Inclusive of the term loan and letters of credit, which reduce borrowing availability, and after taking into account restrictive financial covenants under the Bank Credit Facility, Line of Credit and note indentures, the Authority had approximately $129.4 million of borrowing capacity under the Bank Credit Facility as of September 30, 2009.

F-19

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

At the Authority’s option, each advance of loan proceeds accrues interest on the basis of a Base Rate or on the basis of a one-month, two-month, three-month, six-month or twelve-month Eurodollar Rate, plus in either case, the Applicable Rate based on either the applicable pricing period as set forth under the Bank Credit Facility or the Authority’s total leverage ratio, depending on whether the term loan remains outstanding (as each term is defined under the Bank Credit Facility). The Authority also pays commitment fees for the unused portion of the revolving loans on a quarterly basis equal to the product obtained by multiplying the Applicable Rate for commitment fees by the average daily unused commitment for that calendar quarter. As of September 30, 2009: (1) the Applicable Rate for Base Rate loans was between 2.25% and 3.25% if the term loan remains outstanding, and between 0.75% and 2.25% after full repayment of the term loan; (2) the Applicable Rate for Eurodollar Rate loans was between 3.50% and 4.50% if the term loan remains outstanding, and between 2.00% and 3.50% after full repayment of the term loan; and (3) the Applicable Rate for commitment fees was 0.50% if the term loan remains outstanding, and between 0.20% and 0.50% after full repayment of the term loan. The Base Rate is the higher of Bank of America’s announced Prime Rate, the LIBOR Rate for one-month contracts plus 1.25% or the Federal Funds Rate plus 0.50%. Interest on Base Rate loans is payable quarterly in arrears. Interest on Eurodollar Rate loans is payable at the end of each applicable interest period or quarterly in arrears, if earlier. As of September 30, 2009, the Authority had $713.0 million in Eurodollar Rate loans and no Base Rate loans outstanding. The Eurodollar Rate loans outstanding at September 30, 2009 were comprised of: (1) a $147.0 million term loan based on a one-month Eurodollar Rate of 0.25% plus an Applicable Rate of 3.75%, and (2) $566.0 million in revolving loans based on a one-month Eurodollar Rate of 0.24% plus an Applicable Rate of 3.75%. The Applicable Rate for commitment fees was 0.50% as of September 30, 2009. As of September 30, 2009 and 2008, accrued interest, including commitment fees, on the Bank Credit Facility was $1.1 million and $89,000, respectively.

The Bank Credit Facility is collateralized by a lien on substantially all of the Authority’s assets, including the assets that comprise Pocono Downs and a leasehold mortgage on the land previously taken into trust by the federal government and improvements which comprise Mohegan Sun. The Authority also will be required to pledge additional assets as collateral for the Bank Credit Facility as it or its guarantor subsidiaries acquire them. The Authority’s obligations under the Bank Credit Facility are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW, WTG and MTGA Gaming. The Bank Credit Facility subjects the Authority to a number of restrictive covenants, including financial covenants. These financial covenants relate to, among other things, the Authority’s maximum total leverage and senior leverage ratios, minimum fixed charge coverage ratio and maximum capital expenditures.

The Bank Credit Facility includes non-financial covenants by the Authority and the Tribe of the type customarily found in loan agreements for similar transactions including requirements that:

• the Tribe preserves its existence as a federally-recognized Indian tribe;

• the Tribe causes the Authority to continually operate Mohegan Sun and the Pocono Downs Entities in compliance with all applicable laws; and

• except under specific conditions, limit the Authority from selling or disposing of its assets, limit the transfer of the Authority’s and its guarantor subsidiaries’ assets to non-guarantor entities, limit the incurrence by the Authority and its guarantor subsidiaries of other debt or contingent obligations and limit the Authority’s and its guarantor subsidiaries’ ability to extend credit, make investments or commingle their assets with assets of the Tribe.

As of September 30, 2009, the Authority and the Tribe were in compliance with all of their respective covenant requirements under the Bank Credit Facility.

F-20

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

On October 26, 2009, the Authority issued $200.0 million Second Lien Senior Secured Notes with fixed interest payable at a rate of 11 ¹/2% per annum (the “2009 Second Lien Senior Secured Notes”). The net proceeds from this financing were used to repay, among other things, the existing term loan under the Bank Credit Facility, in full, as well as $41.0 million of revolving loans, including a $25.0 million permanent reduction in the revolving commitments). Concurrently with the issuance of the 2009 Second Lien Senior Secured Notes, the Authority entered into an amendment to the terms of the Bank Credit Facility. Among other things, the amendment: (1) modified the Authority’s maximum total leverage and senior leverage ratio covenants; (2) provided the ability to obtain a release from liens securing the Bank Credit Facility of a portion of the land on which Pocono Downs is sited to permit its sale or lease to a third-party in connection with the development of a potential hotel project, consisting of a minimum of 200 rooms, subject to the satisfaction of customary conditions; (3) modified the terms of the Authority’s covenant relating to the incurrence of permitted indebtedness to allow the Authority or its subsidiaries to incur additional debt (which may consist of capital lease obligations) in an aggregate amount not to exceed $55.0 million, at any one time outstanding, in connection with the development of the potential hotel project at Pocono Downs; (4) modified the terms of the Authority’s permitted capital expenditures covenant to affirmatively allow for the existing $125.0 million of permitted capital expenditures to be utilized for Pocono Downs in addition to Mohegan Sun and related businesses, including the payment of licensing fees associated with those operations; and (5) modified the applicable pricing rates as follows: (a) the Applicable Rate for Base Rate loans will be between 1.25% and 2.75%, and (b) the Applicable Rate for Eurodollar Rate loans will be between 2.50% and 4.00%.

Upon repayment of the term loan under the Bank Credit Facility and the $25.0 million permanent reduction in revolving commitments in connection with the transactions, as discussed above, the total commitment of the Bank Credit Facility was reduced from $850.0 million to $675.0 million. Refer to Note 19 for further discussion of the Authority’s issuance of the 2009 Second Lien Senior Secured Notes and the amendment to the Bank Credit Facility.

2005 6 ¹/8% Senior Unsecured Notes

In February 2005, the Authority issued $250.0 million Senior Notes with fixed interest payable at a rate of 6.125% per annum (the “2005 Senior Unsecured Notes”). The net proceeds from this financing were used to repay amounts outstanding under the then existing bank credit facility and to pay fees and expenses associated with the issuance. The 2005 Senior Unsecured Notes mature on February 15, 2013. The first call date for the 2005 Senior Unsecured Notes was February 15, 2009. Interest on the 2005 Senior Unsecured Notes is payable semi-annually on February 15^th and August 15^th. The 2005 Senior Unsecured Notes are uncollateralized general obligations of the Authority, which are effectively subordinated, to the extent of the collateral, to all of the existing and future senior secured indebtedness of the Authority, including the Bank Credit Facility and the 2009 Second Lien Senior Secured Notes. The 2005 Senior Unsecured Notes rank equally in right of payment with the 2009 Second Lien Senior Secured Notes and the Authority’s Senior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing and rank senior to the Authority’s Junior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing, the 2001 Senior Subordinated Notes, the 2002 Senior Subordinated Notes, the 2004 Senior Subordinated Notes and the 2005 Senior Subordinated Notes. The 2005 Senior Unsecured Notes are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW, WTG and MTGA Gaming. Refer to Note 18 for condensed consolidating financial information of the Authority and its guarantor subsidiaries and non-guarantor entities. As of September 30, 2009 and 2008, accrued interest on the 2005 Senior Unsecured Notes was $1.9 million.

2001 8 ³/8% Senior Subordinated Notes

In July 2001, the Authority issued $150.0 million Senior Subordinated Notes with fixed interest payable at a rate of 8.375% per annum (the “2001 Senior Subordinated Notes”). The proceeds from this financing were used to

F-21

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

pay transaction costs, pay down $90.0 million on the then existing bank credit facility and fund costs related to Project Sunburst. Interest on the 2001 Senior Subordinated Notes is payable semi-annually on January 1^st and July 1^st. The 2001 Senior Subordinated Notes mature on July 1, 2011. The first call date for the 2001 Senior Subordinated Notes was July 1, 2006. The 2001 Senior Subordinated Notes are uncollateralized general obligations of the Authority and are subordinated to the Bank Credit Facility, the 2005 Senior Unsecured Notes, the 2009 Second Lien Senior Secured Notes and, in a liquidation, bankruptcy or similar proceeding, the Authority’s Senior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing. The 2001 Senior Subordinated Notes rank equally with the 2002 Senior Subordinated Notes, the 2004 Senior Subordinated Notes, the 2005 Senior Subordinated Notes and the Authority’s Junior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing. The 2001 Senior Subordinated Notes are fully and unconditionally guaranteed solely by MBC. Refer to Note 18 for condensed consolidating financial information of the Authority and its guarantor subsidiaries and non-guarantor entities.

In August 2004, the Authority completed a cash tender offer and consent solicitation to repurchase any or all of its outstanding 2001 Senior Subordinated Notes. As part of the tender offer, the Authority solicited and received requisite consents to certain proposed amendments to the indentures governing the 2001 Senior Subordinated Notes, which substantially eliminated all of the restrictive covenants thereunder. At such time, the aggregate principal amount of the 2001 Senior Subordinated Notes tendered was $133.7 million.

In March 2009, the Authority repurchased and extinguished an additional principal amount of $14.3 million of its outstanding 2001 Senior Subordinated Notes. The aggregate amount paid for this purchase was approximately $6.1 million, which represented a purchase price of approximately $5.8 million and accrued interest of $273,000. The Authority realized a gain on early extinguishment of debt in connection with this transaction totaling approximately $8.5 million, which was recorded in the accompanying consolidated statement of income for the fiscal year ended September 30, 2009. An aggregate principal amount of approximately $2.0 million of the 2001 Senior Subordinated Notes remains outstanding as of September 30, 2009. As of September 30, 2009 and 2008, accrued interest on the 2001 Senior Subordinated Notes was $42,000 and $342,000, respectively.

The Authority or its affiliates may, from time to time, seek to purchase or otherwise retire the Authority’s remaining 2001 Senior Subordinated Notes or other indebtedness for cash in open market purchases, privately negotiated transactions or otherwise, to reduce the amount of the Authority’s outstanding indebtedness. Any such transactions will depend on prevailing market conditions, the Authority’s liquidity, covenant restrictions and other factors.

2002 8% Senior Subordinated Notes

In February 2002, the Authority issued $250.0 million Senior Subordinated Notes with fixed interest payable at a rate of 8.000% per annum (the “2002 Senior Subordinated Notes”). The proceeds from this financing were used to pay transaction costs and pay down $243.0 million on the then existing bank credit facility. Interest on the 2002 Senior Subordinated Notes is payable semi-annually on April 1^st and October 1^st. The 2002 Senior Subordinated Notes mature on April 1, 2012. The first call date for the 2002 Senior Subordinated Notes was April 1, 2007. The 2002 Senior Subordinated Notes are uncollateralized general obligations of the Authority and are subordinated to the Bank Credit Facility, the 2005 Senior Unsecured Notes, the 2009 Second Lien Senior Secured Notes and, in a liquidation, bankruptcy or similar proceeding, the Authority’s Senior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing. The 2002 Senior Subordinated Notes rank equally with the 2001 Senior Subordinated Notes, the 2004 Senior Subordinated Notes, the 2005 Senior Subordinated Notes and the Authority’s Junior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing. The 2002 Senior Subordinated Notes are fully and

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW, WTG and MTGA Gaming. Refer to Note 18 for condensed consolidating financial information of the Authority and its guarantor subsidiaries and non-guarantor entities. As of September 30, 2009 and 2008, accrued interest on the 2002 Senior Subordinated Notes was $10.0 million.

2003 6 ³/8% Senior Subordinated Notes

In July 2003, the Authority issued $330.0 million Senior Subordinated Notes with fixed interest payable at a rate of 6.375% per annum (the “2003 Senior Subordinated Notes”). The proceeds from this financing were used to repurchase substantially all of the outstanding 8.75% Senior Subordinated Notes issued in March 1999 and to pay fees and expenses associated with the issuance. Interest on the 2003 Senior Subordinated Notes was payable semi-annually on January 15^th and July 15^th. The 2003 Senior Subordinated Notes matured on July 15, 2009, at which time the Authority repaid the 2003 Senior Subordinated Notes with proceeds from the Bank Credit Facility. As of September 30, 2008, in accordance with authoritative guidance issued by the FASB pertaining to the classification of short-term obligations expected to be refinanced, the Authority classified the 2003 Senior Subordinated Notes as long-term debt for financial reporting purposes based on the Authority’s intent and ability to refinance this debt on a long-term basis through the use of proceeds from the Bank Credit Facility. The 2003 Senior Subordinated Notes were uncollateralized general obligations of the Authority and were subordinated to the Bank Credit Facility, the 2005 Senior Unsecured Notes and, in a liquidation, bankruptcy or similar proceeding, the Authority’s Senior Relinquishment Payment obligations under the Relinquishment Agreement that were then due and owing. The 2003 Senior Subordinated Notes ranked equally with the 2001 Senior Subordinated Notes, the 2002 Senior Subordinated Notes, the 2004 Senior Subordinated Notes, the 2005 Senior Subordinated Notes and the Authority’s Junior Relinquishment Payment obligations under the Relinquishment Agreement that were then due and owing. The 2003 Senior Subordinated Notes were fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW, WTG and MTGA Gaming. Refer to Note 18 for condensed consolidating financial information of the Authority and its guarantor subsidiaries and non-guarantor entities. As of September 30, 2008, accrued interest on the 2003 Senior Subordinated Notes was $4.4 million.

2004 7 ¹/8% Senior Subordinated Notes

In August 2004, the Authority issued $225.0 million Senior Subordinated Notes with fixed interest payable at a rate of 7.125% per annum (the “2004 Senior Subordinated Notes”). The net proceeds from this financing, together with $130.0 million of availability under the then existing bank credit facility, were used to repurchase substantially all of the outstanding 2001 Senior Subordinated Notes and substantially all of the outstanding 1999 Senior Notes tendered in the tender offers described above and to pay fees and expenses associated with the issuance. The 2004 Senior Subordinated Notes mature on August 15, 2014. The first call date for the 2004 Senior Subordinated Notes was August 15, 2009. Interest on the 2004 Senior Subordinated Notes is payable semi-annually on February 15^th and August 15^th. The 2004 Senior Subordinated Notes are uncollateralized general obligations of the Authority and are subordinated to the Bank Credit Facility, the 2005 Senior Unsecured Notes, the 2009 Second Lien Senior Secured Notes and, in a liquidation, bankruptcy or similar proceeding, the Authority’s Senior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing. The 2004 Senior Subordinated Notes rank equally with the 2001 Senior Subordinated Notes, the 2002 Senior Subordinated Notes, the 2005 Senior Subordinated Notes and the Authority’s Junior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing. The 2004 Senior Subordinated Notes are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW, WTG and MTGA Gaming. Refer to Note 18 for condensed consolidating financial information of the Authority and its guarantor subsidiaries and non-guarantor entities. As of September 30, 2009 and 2008, accrued interest on the 2004 Senior Subordinated Notes was $2.0 million.

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

2005 6 ⁷/8% Senior Subordinated Notes

In February 2005, the Authority issued $150.0 million Senior Subordinated Notes with fixed interest payable at a rate of 6.875% per annum (the “2005 Senior Subordinated Notes”). The net proceeds from this financing were used to repay amounts outstanding under the then existing bank credit facility and to pay fees and expenses associated with the issuance. The 2005 Senior Subordinated Notes mature on February 15, 2015. The first call date for the 2005 Senior Subordinated Notes is February 15, 2010. Interest on the 2005 Senior Subordinated Notes is payable semi-annually on February 15^th and August 15^th. The 2005 Senior Subordinated Notes are uncollateralized general obligations of the Authority and are subordinated to the Bank Credit Facility, the 2005 Senior Unsecured Notes, the 2009 Second Lien Senior Secured Notes and, in a liquidation, bankruptcy or similar proceeding, the Authority’s Senior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing. The 2005 Senior Subordinated Notes rank equally with the 2001 Senior Subordinated Notes, the 2002 Senior Subordinated Notes, the 2004 Senior Subordinated Notes and the Authority’s Junior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing. The 2005 Senior Subordinated Notes are fully and unconditionally guaranteed, on a joint and several basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW, WTG and MTGA Gaming. Refer to Note 18 for condensed consolidating financial information of the Authority and its guarantor subsidiaries and non-guarantor entities. As of September 30, 2009 and 2008, accrued interest on the 2005 Senior Subordinated Notes was $1.3 million.

The senior and senior subordinated note indentures contain certain financial and non-financial covenants with which the Authority and the Tribe must comply. The financial covenants include, among other things, limitations on restricted payments and the incurrence of indebtedness, while the non-financial covenants include, among other things, reporting obligations, compliance with laws and regulations and the continued existence of the Authority. As of September 30, 2009, both the Authority and the Tribe were in compliance with all of their respective covenant requirements under the senior and senior subordinated note indentures.

WNBA Promissory Note

The Authority and MBC are parties to a membership agreement with WNBA, LLC (the “Membership Agreement”). The Membership Agreement sets forth the terms and conditions pursuant to which MBC acquired a membership in the WNBA and the right to own and operate a professional basketball team in the WNBA. The Authority guaranteed the obligations of MBC under the Membership Agreement.

In consideration for this acquisition, MBC paid $2.0 million, with funds advanced from the Authority, and issued a promissory note to the WNBA (the “WNBA Note”) for $8.0 million. The WNBA Note accrues interest at an annual rate equal to a three-month Eurodollar Rate plus 1.50%. The Authority guaranteed the obligations of MBC under the WNBA Note. Pursuant to the WNBA Note, principal payments of $1.0 million, subject to adjustment for certain revenue thresholds and interest payments, are required to be paid to the WNBA on each anniversary date of the WNBA Note. The WNBA Note is scheduled to mature in January 2011, but will mature no later than January 2013. As of September 30, 2009 and 2008, accrued interest on the WNBA Note was $34,000 and $94,000, respectively. Refer to Note 15 for further discussion of the Authority’s investment in the WNBA franchise.

Line of Credit

As of September 30, 2009, the Authority had an $18.0 million revolving loan agreement with Bank of America, N.A. (the “Line of Credit”). The Line of Credit was amended in May 2009 to reduce the commitment from $25.0 million to $18.0 million and extend the maturity date from May 14, 2009 to May 14, 2010. Each advance accrues

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

interest on the basis of a one-month Eurodollar Rate or Prime Rate, plus the Applicable Margin determined on the basis of the Authority’s leverage ratio, as each term is defined under the Line of Credit. Borrowings under the Line of Credit are uncollateralized obligations of the Authority. As of September 30, 2009, the Authority had $12.2 million in Eurodollar Rate loans outstanding, which were based on a one-month Eurodollar Rate of 0.26% plus an Applicable Rate of 3.25%. The Line of Credit subjects the Authority to certain covenants, including a covenant to maintain at least the Line of Credit commitment amount available for borrowing under the Bank Credit Facility. As of September 30, 2009, the Authority was in compliance with all covenant requirements under the Line of Credit and had $5.8 million of borrowing capacity thereunder. As of September 30, 2009 and 2008, there was no accrued interest on the Line of Credit.

Letters of Credit

As of September 30, 2009, the Authority maintained seven uncollateralized letters of credit to satisfy potential workers’ compensation liabilities, pari-mutuel wagering tax liabilities of the Pocono Downs Entities, overdue amounts for purses due to horsemen at the Pocono Downs Entities, potential contractor and subcontractor liabilities relating to Project Horizon, collateral obligations of a surety bond relating to Pennsylvania Gaming Tax expenses owed by Downs Racing to the PGCB and two in connection with road work at the Pocono Downs facilities. The letters of credit expire(d) on various dates from November 2009 through September 2010, subject to renewals. As of September 30, 2009, no amounts were drawn on the letters of credit.

Salishan-Mohegan Bank Credit Facility

On September 30, 2009, Salishan-Mohegan entered into an amendment to the terms of its then existing $25.0 million revolving loan agreement with Bank of America, N.A. (the “Salishan Credit Facility”), dated October 17, 2006. Among other things, the amendment reduced the total commitment of the credit facility from $25.0 million to $17.0 million, extended the maturity date from September 30, 2009 to September 30, 2010 and modified the applicable pricing rates. At the option of Salishan-Mohegan, each advance of loan proceeds accrues interest on the basis of a Base Rate or on the basis of a one-month, two-month, three-month or six-month Eurodollar Rate, plus a spread of 2.50% for Base Rate loans and an Applicable Rate, as defined under the Salishan Credit Facility, of 3.50% for Eurodollar Rate loans. The Base Rate is the higher of Bank of America’s announced Prime Rate or the Federal Funds Rate plus 0.50%. The Applicable Rate for commitment fees is 0.50%. The revolving loan has no mandatory amortization provisions and is payable in full at maturity. In connection with the September 2009 amendment, the Tribe loaned Salishan-Mohegan $10.0 million, which was used to repay revolving loans under the Salishan Credit Facility. The Salishan Credit Facility is collateralized by a lien on substantially all of the existing and future assets of Salishan-Mohegan. The obligations of Salishan-Mohegan under the Salishan Credit Facility also are guaranteed by the Tribe. The Salishan Credit Facility subjects Salishan-Mohegan to a number of restrictive covenants, including financial and non-financial covenants customarily found in loan agreements for similar transactions.

As of September 30, 2009, Salishan-Mohegan had $13.3 million in Base Rate loans and no Eurodollar Rate loan outstanding. The loans outstanding at September 30, 2009 were based on a Base Rate of 3.25% plus a spread of 2.50%. The Applicable Rate for commitment fees was 0.50% as of September 30, 2009. As of September 30, 2009, Salishan-Mohegan had $3.7 million of borrowing capacity under the Salishan Credit Facility. As of September 30, 2009 and 2008, accrued interest on the Salishan Credit Facility was $2,000 and $11,000, respectively.

Mohegan Tribe Promissory Note

On September 30, 2009, the Tribe loaned Salishan-Mohegan $10.0 million, which was used to repay revolving loans under the Salishan Credit Facility in connection with the September 30, 2009 amendment to the Salishan

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Credit Facility, as further described above. The promissory note executed by Salishan-Mohegan in favor of the Tribe (the “Mohegan Tribe Promissory Note”) provides for the accrual of interest at an annual rate of 15% and matures on October 1, 2010. Accrued interest is paid at a monthly rate of 3.0%, with the remaining 12.0% due at maturity. As of September 30, 2009, accrued interest on the Mohegan Tribe Promissory Note was $4,000.

Derivative Instruments

The Authority is considered an “end user” of derivative instruments and engages in derivative transactions, from time to time, for risk management purposes only. There were no derivative instruments held by the Authority as of September 30, 2009 and 2008.

Interest rate swap agreements hedging outstanding debt instruments of the Authority, which qualified for hedge accounting in accordance with authoritative guidance issued by the FASB pertaining to the accounting for derivative instruments and hedging activities, and were designated as fair value hedges, were sold in prior fiscal years for a net aggregate gain of $1.7 million. This gain was deferred and added to the carrying value of the respective notes being hedged and is being amortized and recorded to interest expense over the remaining term of the respective notes. For the fiscal years ended September 30, 2009, 2008 and 2007, the Authority recorded amortization of $228,000, $455,000 and $455,000, respectively, for interest expense related to the sale of these derivative instruments. The Authority expects to record $467,000 to offset interest expense over the next 12 months.

NOTE 7—LEASES:

The Authority leases space to certain tenants in The Shops at Mohegan Sun and certain other areas of Mohegan Sun. The Authority also leases the rights to access and utilize Mohegan Sun’s rooftop for the installation and operation of antenna towers. The total minimum future rental income on non-cancelable leases expected to be earned by the Authority is as follows (in thousands):

	Fiscal Years Ending September 30,
	2010		2011		2012		2013		2014		Thereafter		Total
Minimum Future Rental Income	$	4,636	$	4,397	$	3,112	$	2,229	$	1,830	$	6,040	$	22,244

The Authority is obligated under numerous operating leases for equipment, buildings and land at Mohegan Sun and the Pocono Downs Entities. The Authority also is obligated under a ground lease for a 152-acre site located in Palmer, Massachusetts, which would serve as a potential site for future gaming development, if legalized in the Commonwealth of Massachusetts. Total rental expense was $15.2 million, $14.3 million and $11.4 million for the fiscal years ended September 30, 2009, 2008 and 2007, respectively. The total minimum future rental expense on non-cancelable leases expected to be incurred by the Authority is as follows (in thousands):

	Fiscal Years Ending September 30,
	2010		2011		2012		2013		2014	Thereafter	Total
Minimum Future Rental Expense	$	3,944	$	537	$	192	$	116	-	-	$	4,789

The Authority also has loaned funds to tenants related to The Shops at Mohegan Sun and certain other Mohegan Sun and Pocono Downs outlets. As of September 30, 2009 and 2008, outstanding tenant loans were $7.4 million and $5.6 million, respectively. These loans mature in periods between three and ten years. These amounts, net of allowance for doubtful accounts of $482,000 and $85,000 as of September 30, 2009 and 2008, respectively, were included in other assets, net, in the accompanying consolidated balance sheets.

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 8—RELATED PARTY TRANSACTIONS:

The Tribe provides governmental and certain administrative services to the Authority in conjunction with the operation of Mohegan Sun. For the fiscal years ended September 30, 2009, 2008 and 2007, the Authority incurred $23.7 million, $23.9 million and $21.5 million, respectively, of expenses for such services.

The Authority purchases the majority of its utilities, including electricity, gas, water and waste water services, from an instrumentality of the Tribe, the Mohegan Tribal Utility Authority. For the fiscal years ended September 30, 2009, 2008 and 2007, the Authority incurred costs of $22.6 million, $23.6 million and $23.7 million, respectively, for such utilities.

The Authority is a tenant under a land lease agreement with the Tribe for access to Mohegan Sun. For each of the fiscal years ended September 30, 2009, 2008 and 2007, the Authority expensed $50,000 relating to this land lease agreement.

The Authority leases the land on which Mohegan Sun is located from the Tribe pursuant to a long-term lease agreement. The Authority is required to pay to the Tribe a nominal annual rental fee under the lease agreement. The lease has an initial term of 25 years and is renewable for an additional 25-year term upon expiration.

In September 2009, the Tribe loaned Salishan-Mohegan $10.0 million, which was used to repay revolving loans under the Salishan Credit Facility in connection with the September 30, 2009 amendment to the Salishan Credit Facility, as further described above. The Mohegan Tribe Promissory Note executed by Salishan-Mohegan in favor of the Tribe provides for the accrual of interest at an annual rate of 15% and matures on October 1, 2010. Accrued interest is paid at a monthly rate of 3.0%, with the remaining 12.0% due at maturity.

In July 2008, the Authority entered into a new land lease agreement with the Tribe, replacing a prior land lease agreement, for property located adjacent to the Tribe’s reservation that is used for Mohegan Sun employee parking. The new agreement requires the Authority to make monthly payments equaling $75,000 until maturity on June 30, 2018. The Authority classified this lease as a capital lease for financial reporting purposes due to the existence of a bargain purchase option at the expiration of the lease. For the fiscal year ended September 30, 2008 and 2007, the Authority expensed $159,000 and $212,000, respectively, relating to the prior land lease agreement.

In July 2009, the Authority entered into an additional land lease agreement with the Tribe relating to property located adjacent to the Tribe’s reservation that is used for parking and access to Mohegan Sun. The agreement requires the Authority to make monthly payments equaling $30,000 through June 30, 2010 and $100 subsequent to June 30, 2010 until maturity on June 30, 2018. The Authority classified this lease as a capital lease for financial reporting purposes due to the existence of a bargain purchase option at the expiration of the lease.

The Tribe previously provided services through its Development Department for projects related to Mohegan Sun. The Development Department of the Tribe, including personnel assigned to the department, was transferred to the Authority during the fiscal year ended September 30, 2007. Prior to this transfer, the Authority recorded $53,000 of capital expenditures associated with the Tribe’s Development Department for the fiscal year ended September 30, 2007.

In March 2008, MTGA Gaming and the Tribe formed MG&H. The Tribe holds a 51% membership interest in MG&H and MTGA Gaming holds the remaining 49% interest. In June 2008, the Tribe loaned MG&H $8.3 million, which was used to fund MG&H’s portion of a $25.0 million Privilege Fee payment to the State of Kansas in connection with MG&H’s effort, ended in September 2008, to secure a gaming license for the development of a gaming facility in the State of Kansas. The promissory note executed by MG&H in favor of the

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Tribe provided for the accrual of interest at an annual rate of 12.0% and was due to mature on October 15, 2008. In September 2008, MG&H repaid the $8.3 million outstanding on the promissory note following a refund of the Privilege Fee payment as a result of the selection of another applicant by the Kansas Lottery Gaming Facility Review Board. For the fiscal year ended September 30, 2008, MG&H incurred $244,000 of interest expense on the promissory note.

In August 2006, the Authority purchased a 5% membership interest in Salishan-Mohegan from Mohegan Ventures-NW and sold such 5% interest to the Tribe for approximately $351,000, reflecting the carrying value of such interest. In October 2006, a 2.85% membership interest in Salishan-Mohegan was transferred from Salishan Company to the Tribe, in exchange for the Tribe’s guarantee of the Salishan Credit Facility. The value of the membership interest transferred was approximately $197,000, reflecting the carrying value of the 2.85% interest. Subsequent to this transaction, Mohegan Ventures-NW holds a 49.15% membership interest, the Tribe holds a 7.85% membership interest and Salishan Company holds a 43% membership interest in Salishan-Mohegan (refer to Note 14). Mohegan Ventures-NW and the Tribe continue to each hold one of four seats on the Board of Managers of Salishan-Mohegan.

In September 1995, the Tribe adopted the Mohegan Tribal Employment Rights Ordinance, as amended from time to time (the “TERO”), which sets forth hiring and contracting preference requirements for employers and entities conducting business on Tribal lands on or adjacent to the Mohegan Reservation. Pursuant to the TERO, the Authority and other covered employers are required to give hiring, promotion, training, retention and other employment-related preferences to Native Americans who meet the minimum qualifications for the applicable employment position. However, this preference requirement does not apply to key employees as such persons are defined under the TERO.

Similarly, any entity awarding a contract or subcontract valued up to $200,000 to be performed on Tribal lands must give preference, first, to certified Mohegan entities submitting commercially responsible bids, and second, to other certified Native American entities. This contracting preference is conditioned upon the bid by the preferred certified entity being within 5% of the lowest bid by a non-certified entity. Contracts in excess of $200,000 are awarded to the lowest commercially responsible bidder, on a competitive basis, with preference to certified Mohegan entities and then other certified Native American entities in the event of a matching bid. The TERO establishes procedures and requirements for certifying Mohegan entities and other Native American entities. Certification is based largely on the level of ownership and control exercised by the members of the Tribe or other Native American tribes, as the case may be, over the entity bidding on a contract.

As of September 30, 2009, approximately 120 employees of the Authority were members of the Tribe.

NOTE 9—EMPLOYEE BENEFIT PLANS:

The Authority maintains a retirement savings plan for its employees under Section 401(k) and Section 401(a) of the Internal Revenue Code (the “Mohegan Retirement and 401(k) Plan”). Under the 401(k) portion of the plan, participants may contribute between 1% and 25% of eligible compensation up to the maximum allowed by the Internal Revenue Code. The Authority may make discretionary matching contributions of 100% of participants’ elective deferral contributions up to a maximum of 3% of participants’ compensation. Under the retirement portion of the plan, the Authority may make discretionary retirement contributions based on a rate of $0.30 per qualified hour worked. In general, employees become eligible for the Mohegan Retirement and 401(k) Plan after 90 days of service and become fully vested after six years of service. In February 2009, the Authority suspended both its discretionary matching 401(k) contributions and retirement contributions in connection with the implementation of its cost containment program, as described in Note 6. For the fiscal years ended September 30, 2009, 2008 and 2007, the Authority contributed $3.7 million, $11.2 million and $10.2 million, net of forfeitures, to the Mohegan Retirement and 401(k) Plan, respectively.

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The Authority, together with the Tribe, maintains a non-qualified deferred compensation plan (the “Deferred Compensation Plan”) for certain key employees. Under the Deferred Compensation Plan, participants may defer up to 100% of their compensation. For the fiscal years ended September 30, 2009, 2008 and 2007, participants’ contributions, net of withdrawals and changes in fair value of investments, totaled $3.0 million, ($93,000) and $2.9 million, respectively.

NOTE 10—COMMITMENTS AND CONTINGENCIES:

Slot Win Contribution and Free Promotional Slot Play Contribution

In May 1994, the Tribe and the State of Connecticut entered into a Memorandum of Understanding (“MOU”), which sets forth certain matters regarding implementation of the Mohegan Compact. The MOU stipulates that a portion of revenues earned on slot machines must be paid to the State of Connecticut (“Slot Win Contribution”). Slot Win Contribution payments are not required if the State of Connecticut legalizes any other gaming operations with slot machines or other commercial casino table games within the State of Connecticut, except those consented to by the Tribe and the Mashantucket Pequot Tribe (the “MPT”). For each 12-month period commencing July 1, 1995, Slot Win Contribution payments shall be the lesser of: (1) 30% of gross revenues from slot machines, or (2) the greater of (a) 25% of gross revenues from slot machines or (b) $80.0 million.

In 2006, the State of Connecticut asserted that the Authority and the MPT were required to include the value of all free slot plays under their free promotional slot play programs in gross revenues for purposes of calculating Slot Win Contribution payments. In December 2006, the State of Connecticut filed suit against the MPT seeking a declaratory judgment that free promotional slot plays utilized by patrons at Foxwoods Resort Casino constitutes a “wager” for purposes of calculating slot win contribution payments. In October 2007, the Tribe entered into an agreement with the State of Connecticut to escrow, on a monthly basis, an amount equal to 25% of the value of all free promotional slot plays utilized by patrons at Mohegan Sun. In September 2009, the Authority reached a settlement with the State of Connecticut regarding contribution payments on the Authority’s free promotional slot play program. Pursuant to the settlement, the parties agreed to the release and disbursement of $12.2 million of payments escrowed by the Authority, including accrued interest thereon. Of the total amount escrowed, $6.5 million was distributed to the Authority and $5.7 million was distributed to the State of Connecticut pursuant to the settlement agreement. For the fiscal year ended September 30, 2009, gaming costs and expenses reflect a $1.1 million credit relating to the free promotional slot play contribution. For the fiscal year ended September 30, 2008, gaming costs and expenses reflect $6.9 million in expenses associated with the free promotional slot play contribution.

In addition to the disbursement of the escrowed funds under the terms of the settlement agreement, effective July 1, 2009, the State of Connecticut agreed that no value shall be attributed to free promotional slot plays utilized by patrons at Mohegan Sun for purposes of calculating monthly contribution payments, provided that the aggregate amount of such free promotional slot plays during any month does not exceed 5.5% of gross revenues from slot machines for such month. In the event free promotional slot plays exceed 5.5% of monthly gross revenues from slot machines, contribution payments are required on such excess face amount of free promotional slot plays at the same rate as Slot Win Contribution payments, or 25%.

The Authority reflected expenses associated with the combined Slot Win Contribution and free promotional slot play contribution totaling $193.8 million, $221.0 million and $230.4 million for the fiscal years ended September 30, 2009, 2008 and 2007, respectively. As of September 30, 2009 and 2008, the combined outstanding Slot Win Contribution and free promotional slot play contribution payments to the State of Connecticut totaled $14.9 million and $17.5 million, respectively.

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Pennsylvania Gaming Tax

Downs Racing holds a Category One slot machine license issued by the PGCB for the operation of slot machines at Pocono Downs. This license permits Downs Racing to install and operate up to 3,000 slot machines at Pocono Downs. However, under certain circumstances, Downs Racing may install and operate up to a total of 5,000 slot machines. After the satisfaction of certain regulatory conditions and payment of a $50.0 million one-time slot machine license fee to the PGCB in October 2006, Downs Racing opened Phase I of its gaming and entertainment facility in November 2006.

The Pennsylvania Gaming Act stipulates that holders of Category One slot machine licenses must pay Pennsylvania Gaming Tax to the PGCB on a daily basis, which includes local share assessments to be paid to the cities and municipalities hosting Pocono Downs and amounts to be paid to the Pennsylvania Harness Horsemen’s Association, Inc. (the “PHHA”). The Pennsylvania Gaming Tax payable to the PGCB on a daily basis is currently 55% of gross revenues from slot machines, 2% of which is subject to a $10.0 million minimum annual threshold. Downs Racing must pay, on an annual basis, to the PGCB, amounts necessary to ensure that the host cities and municipalities receive an annual minimum of $10.0 million from the local share assessments. Downs Racing maintains a $5.0 million escrow deposit in the name of the Commonwealth of Pennsylvania for Pennsylvania Gaming Tax payments to the PGCB, which was included in other assets, net, in the accompanying consolidated balance sheets.

The Authority reflected expenses associated with the Pennsylvania Gaming Tax totaling $125.3 million, $103.4 million and $92.2 million for the fiscal years ended September 30, 2009, 2008 and 2007, respectively. As of September 30, 2009 and 2008, outstanding Pennsylvania Gaming Tax payments to the PGCB totaled $4.6 million and $5.2 million, respectively.

PGCB Regulatory Fees

In addition to the Pennsylvania Gaming Tax described above, holders of slot machine licenses also are required to reimburse the PGCB for administrative and operating expenses incurred. The assessment of this amount on Downs Racing and other slot facility operators is yet to be finalized. Based upon an estimate of gross revenues from slot machines at Pocono Downs compared to current and future licensees in the Commonwealth of Pennsylvania, Downs Racing is recording expenses associated with this reimbursement at a rate of 1.5% of gross revenues from slot machines. This rate has been approved by the PGCB, which receives corresponding payments on a weekly basis from Downs Racing. The Authority reflected expenses associated with the regulatory fee assessment totaling $3.7 million, $2.7 million and $2.4 million for the fiscal years ended September 30, 2009, 2008 and 2007, respectively. As of September 30, 2009 and 2008, outstanding regulatory fee payments to the PGCB totaled $23,000 and $73,000, respectively. Additionally, in order to fund current operations of the PGCB, two loans in the amount of $36.0 million and $22.6 million were granted to the PGCB from gaming tax funds received by the Commonwealth of Pennsylvania. These loans cover expenses incurred by the PGCB from inception to June 30, 2008, and are anticipated to be repaid, in total, by slot machine licensees once all approved gaming facilities are opened. In addition, a payment of $7.0 million was made to the PGCB from the current licensees, of which the Company paid $800,000. Each licensee’s share of these costs will be proportionally allocated based on each licensee’s gross revenues from slot machines. In January 2007, Downs Racing made a prepayment to the PGCB of $800,000 for a portion of its incurred expenses, which was included in other current assets in the accompanying consolidated balance sheets.

Priority Distribution

In August 2001, the Authority and the Tribe entered into an agreement (the “Priority Distribution Agreement”), which obligates the Authority to make monthly payments to the Tribe to the extent of the Authority’s Net Cash

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Flow, as defined under the Priority Distribution Agreement. The Priority Distribution Agreement, which has a perpetual term, limits the maximum aggregate priority distribution payments by the Authority to the Tribe in each calendar year to $14.0 million, as adjusted annually in accordance with a formula specified in the Priority Distribution Agreement to reflect the effects of inflation. However, payments pursuant to the Priority Distribution Agreement do not reduce the Authority’s obligations to make payments to reimburse the Tribe for governmental services provided by the Tribe or any payments under any other agreements with the Tribe. The monthly priority distribution payments under the Priority Distribution Agreement are limited obligations of the Authority payable only to the extent of its Net Cash Flow, as defined under the Priority Distribution Agreement, and are not secured by a lien or encumbrance on any assets or properties of the Authority. The Authority reflected payments associated with the Priority Distribution Agreement of $17.9 million, $17.3 million and $16.8 million for the fiscal years ended September 30, 2009, 2008 and 2007, respectively.

Agreement with the Town of Montville

In June 1994, the Tribe and the Town of Montville (the “Town”) entered into an agreement whereby the Tribe agreed to pay to the Town an annual payment of $500,000 to minimize the impact on the Town resulting from the decreased tax revenues on reservation land held in trust. The Tribe has assigned its rights and obligations in the agreement with the Town to the Authority.

Land Lease from the Tribe to the Authority

The land upon which Mohegan Sun is located is held in trust for the Tribe by the United States. The Tribe and the Authority entered into a land lease agreement under which the Tribe leases to the Authority the property and all buildings, improvements and related facilities constructed or installed on the property. The lease was amended in March 2007 to update the legal description of the property covered under the lease, which was approved by the Secretary of the Interior in April 2007. Summarized below are several key provisions of the lease agreement:

Term

The term of the lease is 25 years with an option, exercisable by the Authority, to extend the term for one additional 25-year period. Upon the termination of the lease, the Authority will be required to surrender to the Tribe, possession of the property and improvements, excluding any equipment, furniture, trade fixtures or other personal property.

Rent and Other Operating Expenses

The Authority is required to pay to the Tribe a nominal annual rental fee. For any period when the Tribe or another agency or instrumentality of the Tribe is not the tenant under the lease, the rent will be 8% of the tenant’s gross revenues from the premises. The Authority is responsible for the payment of all costs of owning, operating, constructing, maintaining, repairing, replacing and insuring the leased property.

Use of Leased Property

The Authority may use the leased property and improvements solely for the construction and operation of Mohegan Sun, unless prior approval is obtained from the Tribe for any proposed alternative use. Similarly, no construction or alteration of any building or improvement located on the leased property by the Authority may be made unless complete and final plans and specifications have been approved by the Tribe. Following foreclosure of any mortgage on the Authority’s interest under the lease or any transfer of such interest to the holder of such mortgage in lieu of foreclosure, the leased property and improvements may be used for any lawful purpose, subject only to applicable codes and governmental regulations provided; however, a non-Indian holder of the leased property may in no event conduct gaming operations on the property.

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Permitted Mortgages and Rights of Permitted Mortgagees

The Authority may not mortgage, pledge or otherwise encumber its leasehold estate in the leased property except to a holder of a permitted mortgage. Under the lease, a permitted mortgage includes the leasehold mortgage securing the Authority’s obligations under the Bank Credit Facility granted by the Authority that provides, among other things, that: (1) the Tribe will have the right to notice of, and to cure, any default of the Authority; (2) the Tribe will have the right to prior notice of an intention by the holder to foreclose on the permitted mortgage and the right to purchase the mortgage in lieu of any foreclosure; and (3) the permitted mortgage is subject and subordinated to any and all access and utility easements granted by the Tribe stated under the lease.

As provided under the lease, each holder of a permitted mortgage has the right to notice of any default of the Authority under the lease and the opportunity to cure such default within any applicable cure period.

Default Remedies

The Authority will be in default under the lease if, subject to the notice provisions, it fails to make lease payments or to comply with its covenants under the lease or if it pledges, encumbers or conveys its interest in the lease in violation of the terms of the lease. Following a default, the Tribe may, with approval from the Secretary of the Interior, terminate the lease unless a permitted mortgage remains outstanding with respect to the leased property. In such case, the Tribe may not: (1) terminate the lease or the Authority’s right to possession of the leased property; (2) exercise any right of re-entry; (3) take possession of and/or relet the leased property or any portion thereof; or (4) enforce any other right or remedy, which may materially and adversely affect the rights of the holder of the permitted mortgage, unless the default triggering such rights was a monetary default of which such holder failed to cure after notice.

ACLS of New England, Inc.

The Authority has a 10-year laundry service agreement with ACLS of New England, Inc. (“ACLS”). The Authority has an option to renew the agreement for one additional 10-year term after its expiration in October 2012. Under the laundry service agreement, the Authority is required to pay an agreed upon rate for laundry services, adjusted annually for the Consumer Price Index and unusual increases in energy costs. Additionally, the Authority has made a $500,000 loan to ACLS to develop the laundry service facility. Pursuant to the terms of the loan, interest accrues based on the exercise of the renewal options or certain other circumstances. In the event that circumstances occur where interest accrues, interest will accrue at an annual rate of 5% commencing from the date of the advance.

The Authority also entered into co-investment and escrow agreements with the MPT and ACLS. Under the terms of those agreements, the Authority and the MPT may, under certain circumstances, become joint owners of the laundry facility and consequently be jointly and severally obligated to repay a term loan, which is secured by a mortgage on the laundry facility. The terms of the agreements are 10 years, and should the Authority and the MPT become obligated to repay the term loan, the maximum potential future principal payments (undiscounted) that the Authority and the MPT could be required to make are approximately $2.4 million as of September 30, 2009.

Pocono Downs Purchase Settlement

In August 2006, the Authority entered into an amendment to the October 2004 purchase agreement for Pocono Downs with the seller, a subsidiary of Penn National Gaming, Inc. (“Penn National”). Pursuant to the amendment, in exchange for the Authority’s agreement to modify certain provisions of the purchase agreement,

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

including the elimination of the Authority’s post-closing termination rights, the Authority agreed to receive an aggregate refund of $30.0 million of the original purchase price for the Pocono Downs Entities, payable in five annual installments of $7.0 million, $7.0 million, $6.5 million, $6.0 million and $3.5 million in November 2007, 2008, 2009, 2010 and 2011, respectively. The Authority received the $7.0 million installments due in November 2007 and 2008. In accordance with authoritative guidance issued by the FASB pertaining to business combinations and other relevant accounting guidance, the $24.5 million present value of the payments for the $30.0 million refund, calculated utilizing the Authority’s risk-free rate of investment, was recorded as a receivable and a non-operating gain upon the execution of the amendment. The difference between the present value and the contract value was being recorded as non-operating income over the duration of the payment schedule. Accretion of discount to the gain on the Pocono Downs purchase settlement was $430,000, $1.2 million and $1.6 million for the fiscal years ended September 30, 2009, 2008 and 2007, respectively. As of September 30, 2008, the Pocono Downs purchase settlement receivable was $21.3 million and was included in other current assets and other assets, net, in the accompanying respective consolidated balance sheet.

In March 2009, the parties entered into an agreement to accelerate the remaining $16.0 million outstanding refund payment due to the Authority and discount the amount of such balance to approximately $13.1 million, which the Authority received in March 2009. The Authority incurred a non-operating loss in connection with this transaction totaling $1.6 million, which was recorded in other income (expense), net, in the accompanying consolidated statement of income for the fiscal year ended September 30, 2009.

Horsemen’s Agreement

In January 2005, Downs Racing entered into an agreement with the PHHA, which represents owners, trainers and drivers at the Pocono Downs harness racing facility. The agreement governs all live harness racing events and simulcasting and account wagering conducted at Pocono Downs and the OTW facilities through December 31, 2010.

Among other things, the agreement provides for a payment to the PHHA at a rate of 3.7% of the initial $100.0 million of pari-mutuel wagering held at the Pocono Downs facilities and 4.3% of pari-mutuel wagering held at the Pocono Downs facilities in excess of $100.0 million and all pari-mutuel wagering held outside the Commonwealth of Pennsylvania. This amount is comprised of a minimum payment of $420,000 for certain operating costs and expenses of the PHHA, with the remainder being allocated to purses owed to horsemen for each live racing event. Downs Racing also is required to distribute to the PHHA approximately 2.5% and 1.1% in fees earned on live races conducted at Pocono Downs and simulcast and wagering locations inside and outside the Commonwealth of Pennsylvania, respectively. The Pennsylvania Gaming Act also requires the holders of slot machine licenses to make payments at a rate of up to 12% of gross revenues from slot machines into statutory funds for the benefit of horsemen and breeders. As of September 30, 2009 and 2008, outstanding amounts to the PHHA for purses earned by horsemen but not yet paid and other fees totaled $9.1 million and $5.4 million, respectively.

Pennsylvania Property Tax

A final settlement was reached in June 2007 between the various parties involved in a dispute with Downs Racing relating to certain property tax assessments in Wilkes-Barre, Pennsylvania. Based on the settlement, Downs Racing’s liability for tax periods through June 30, 2007 was $3.5 million, which was recorded as a charge to income from operations in the accompanying consolidated statement of income for the fiscal year ended September 30, 2007. In addition, Downs Racing made annual payments, based on the agreed upon amounts, of $1.7 million and $1.6 million for the fiscal years ended September 2009 and 2008, respectively, which were recorded as charges to income from operations in the accompanying respective consolidated statements of income. Downs Racing will continue to make agreed upon payments for each tax year through 2015 totaling $14.9 million.

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Project Horizon Suspension

In September 2008, the Authority announced the suspension of the hotel, retail and new parking garage elements of Project Horizon due to a slowdown in business volumes and uncertainties in the financial markets resulting from the national economic recession. While the Authority is currently evaluating its options with respect to the development of the suspended elements, including the new hotel, it can provide no assurance as to if or when the suspended elements will resume. The specific factors that the Authority will consider in determining the feasibility of the suspended elements include the Authority’s financial performance, cash flow projections expected to be realized from the project, estimated project costs, ability to obtain financing, economic conditions, industry trends and competition. As of September 30, 2009 and 2008, assets related to the suspended elements totaled $78.3 million and $80.6 million, respectively, and were included in property and equipment, net, in the accompanying consolidated balance sheets. The Authority currently believes that the assets related to the suspended elements have a future benefit. The Authority assessed the carrying value of these assets as of September 30, 2009 and 2008 and determined that no impairment existed.

The following information summarizes the contingencies with respect to the suspended elements of Project Horizon:

Severance

The Authority terminated certain construction-related employees due to the suspension of Project Horizon. The costs associated with such post-employment severance benefits were expensed at the time the termination was communicated to the employees. The Authority incurred $745,000 of expenses for such costs for the fiscal year ended September 30, 2009.

Construction Materials and Other Costs

Certain construction materials purchased for Project Horizon may not be utilized if the suspended elements do not resume. The costs associated with these materials will be expensed at the time such materials are determined to no longer have future benefit or value to the Authority. The Authority expensed $4.5 million of assets during the fourth quarter ended September 30, 2009, which were recorded in other income (expense), net, in the accompanying respective consolidated statement of income.

Construction and Other Agreements

The Authority entered into certain construction agreements in connection with Project Horizon that allow for termination of such agreements without cause. In the event of termination of such agreements, the Authority will only be obligated to pay for those costs incurred through the date of termination, and in some cases, certain termination-related costs. The Authority does not anticipate that such termination-related costs will be material.

The Authority also entered into certain other agreements in connection with Project Horizon, including service and leasing agreements. The Authority does not anticipate that termination of any of these other agreements will give rise to liabilities that will be material.

The Authority can provide no assurances that actual costs associated with the termination of agreements resulting from the suspension of Project Horizon will approximate estimated costs or that such costs will occur when anticipated. Costs relating to the termination of agreements will be expensed at such time that the agreements are terminated. The Authority incurred no such costs during the fiscal year ended September 30, 2009.

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Construction Insurance

In June 2007, the Authority obtained construction insurance coverage from various insurance carriers in connection with Project Horizon. All premiums were fully paid through June 1, 2009. Effective January 31, 2009, the Authority cancelled the workers’ compensation, general liability and umbrella insurance coverage for Project Horizon and received a refund of premiums paid totaling $2.2 million.

Litigation

The Authority is a defendant in certain litigation incurred in the normal course of business. In the opinion of management, based on the advice of counsel, the aggregate liability, if any, arising from such litigation will not have a material effect on the Authority’s financial position, results of operations or cash flows.

NOTE 11—RELINQUISHMENT AGREEMENT:

In February 1998, the Authority and TCA entered into a relinquishment agreement (the “Relinquishment Agreement”). Effective January 1, 2000 (the “Relinquishment Date”), the Relinquishment Agreement superseded a then existing management agreement with TCA. The Relinquishment Agreement provides, among other things, that the Authority will make certain payments to TCA out of, and determined as a percentage of, Revenues, as defined under the Relinquishment Agreement, generated by Mohegan Sun over a 15-year period commencing on the Relinquishment Date. The payments (“Senior Relinquishment Payments” and “Junior Relinquishment Payments”) have separate schedules and priorities. Senior Relinquishment Payments commenced on April 25, 2000, 25 days following the end of the first three-month period after the Relinquishment Date and continue at the end of each three-month period thereafter until January 25, 2015. Junior Relinquishment Payments commenced on July 25, 2000, 25 days following the end of the first six-month period after the Relinquishment Date and continue at the end of each six-month period thereafter until January 25, 2015. Each Senior Relinquishment Payment and Junior Relinquishment Payment is an amount equal to 2.5% of the Revenues generated by Mohegan Sun over the immediately preceding three-month or six-month payment period, as the case may be. Revenues are defined under the Relinquishment Agreement as gross gaming revenues, other than Class II Gaming revenues, and all other revenues, as defined, including, without limitation, hotel revenues, room service revenues, food and beverage revenues, ticket revenues, fees or receipts from the convention/events center and all rental revenues or other receipts from lessees and concessionaires but not the gross receipts of such lessees, licenses and concessionaires, derived directly or indirectly from the facilities, as defined. Revenues under the Relinquishment Agreement exclude revenues generated from certain expansion areas of Mohegan Sun, such as Casino of the Wind, as such areas do not constitute facilities as defined under the Relinquishment Agreement.

In the event of any bankruptcy, liquidation, reorganization or similar proceeding relating to the Authority, the Relinquishment Agreement provides that each of the Senior and Junior Relinquishment Payments then due and owing are subordinated in right of payment to senior secured obligations, which include the Bank Credit Facility, the 2009 Second Lien Senior Secured Notes and capital lease obligations, and that the Junior Relinquishment Payments then due and owing are further subordinated to payment of all other senior obligations, including the Authority’s 2005 Senior Unsecured Notes. The Relinquishment Agreement also provides that all relinquishment payments are subordinated in right of payment to the minimum priority distribution payments, which are required monthly payments made by the Authority to the Tribe under the Priority Distribution Agreement, to the extent then due. The Authority, in accordance with authoritative guidance issued by the FASB pertaining to the accounting for contingencies, has recorded a relinquishment liability of the estimated present value of its obligations under the Relinquishment Agreement.

A relinquishment liability of $549.1 million was established at September 30, 1998 based on the present value of the estimated future Mohegan Sun revenues utilizing the Authority’s risk-free investment rate. At September 30,

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

2009, the carrying amount of the relinquishment liability was $298.4 million as compared to $385.4 million at September 30, 2008. The decrease in the relinquishment liability during the fiscal year ended September 30, 2009 was due to $61.7 million in relinquishment payments and a $45.7 million relinquishment liability reassessment credit. This reduction in the liability was offset by $20.4 million representing the accretion of discount to the relinquishment liability.

Relinquishment payments consisted of the following (in millions):

	For the Fiscal Years Ended September 30,
	2009		2008		2007
Payments representing principal amounts	$	39.6	$	48.4	$	47.5
Payments representing accretion of discount		22.1		27.7		30.0
Total payments	$	61.7	$	76.1	$	77.5

The accretion of discount to the relinquishment liability reflects the accretion of the discount to the present value of the relinquishment liability for the impact of the time value of money. At September 30, 2009 and 2008, relinquishment payments earned but unpaid were $14.7 million and $17.4 million, respectively.

The relinquishment liability reassessment credits of $45.7 million and $68.9 million for the fiscal years ended September 30, 2009 and 2008, respectively, and the relinquishment liability reassessment charge of $3.0 million for the fiscal year ended September 30, 2007, resulted from revised Mohegan Sun revenue projections as of the end of the respective fiscal year compared to estimates as of the end of the prior fiscal year on the determination of the relinquishment liability.

In fiscal 2009, based on continued declines in business volumes, the Authority concluded that Mohegan Sun’s projected revenues over the remaining relinquishment period, which expires on December 31, 2014, would decrease by approximately $917.7 million, thereby decreasing the related relinquishment liability, causing the Authority to record the non-cash relinquishment liability credit of $45.7 million for the fiscal year ended September 30, 2009.

In fiscal 2008, based on the Authority’s suspension of Project Horizon, a slowdown in business volumes and increased competition in the Northeast gaming market, the Authority concluded that Mohegan Sun’s projected revenues over the remaining relinquishment period would decrease by approximately $1.55 billion, thereby decreasing the related relinquishment liability, causing the Authority to record the non-cash relinquishment liability credit of $68.9 million for the fiscal year ended September 30, 2008.

In fiscal 2007, based on revised revenue projections for Project Horizon and delayed competition in the Northeast gaming market, the Authority concluded that Mohegan Sun’s projected revenues over the remaining relinquishment period would increase by approximately $139.8 million, thereby increasing the related relinquishment liability, causing the Authority to record the non-cash relinquishment liability charge of $3.0 million for the fiscal year ended September 30, 2007.

NOTE 12—MOHEGAN GOLF, LLC:

In November 2006, the Authority formed Mohegan Golf as its wholly-owned subsidiary to purchase and operate a golf course in southeastern Connecticut. Mohegan Golf is a full and unconditional guarantor of the Authority’s outstanding indebtedness under the Bank Credit Facility and senior and senior subordinated notes. Refer to Note 18 for condensed consolidating financial information of the Authority, its guarantor subsidiaries and non-guarantor entities.

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In May 2007, Mohegan Golf acquired substantially all of the assets of PCC, which included a golf course located in Sprague and Franklin, Connecticut. The club was renamed Mohegan Sun Country Club at Pautipaug and reopened under the ownership of Mohegan Golf in June 2007. Mohegan Golf incurred acquisition costs of $4.7 million for the property and other items acquired from PCC, which was allocated among the following assets and liabilities: (1) property and equipment valued at $3.1 million; (2) a membership intangible asset resulting from the contractual agreement with PCC’s members established at the time of acquisition, valued at $1.7 million; (3) current assets of $210,000; (4) environmental obligations of $300,000; and (5) capital lease obligations of $34,000. The membership intangible asset is being amortized on a straight-line basis over its estimated useful life of fifteen years and is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. As of September 30, 2009 and 2008, accumulated amortization on the membership intangible asset was $268,000 and $155,000, respectively. For the fiscal years ended September 30, 2009, 2008 and 2007, amortization expense associated with the membership intangible asset totaled $113,000, $112,000 and $43,000, respectively. The Authority expects to incur $113,000 in amortization expense for each of the next five years related to the membership intangible asset.

NOTE 13—MOHEGAN VENTURES WISCONSIN, LLC (MENOMINEE PROJECT):

In October 2004, the Authority entered into a management agreement with the Menominee Tribe and the Menominee Kenosha Gaming Authority (“MKGA”). The terms of the management agreement grant the Authority the exclusive right and obligation to manage, operate and maintain the Menominee Project, a proposed casino and destination resort to be located in Kenosha, Wisconsin, for a period of seven years commencing with the opening of the proposed casino, in consideration of a management fee of 13.4% of Net Revenues, as defined under the management agreement, which approximates net income earned from the Menominee Project. The management agreement is subject to approval by the National Indian Gaming Commission (“NIGC”).

In March 2007, the Authority formed MVW as its wholly-owned subsidiary and one of two members in WTG. WTG was formed by the Authority to participate in the Menominee Project. MVW holds an 85.4% membership interest in WTG and MV holds the remaining 14.6% membership interest. MVW and WTG are full and unconditional guarantors of the Authority’s outstanding indebtedness under the Bank Credit Facility and senior and senior subordinated notes. Refer to Note 18 for condensed consolidating financial information of the Authority, its guarantor subsidiaries and non-guarantor entities.

In March 2007, WTG purchased the development rights for the Menominee Project under a development agreement with the Menominee Tribe and MKGA, which was executed in October 2003, along with certain other assets, and assumed certain liabilities from Kenesah Gaming Development, LLC (“KGD”). The development agreement provides for certain development fees of 13.4% of Available Revenue Flow, as defined under the development agreement, which approximates net income from the Menominee Project over a period of seven years following the opening of the proposed casino, which are to be paid to WTG and distributed to the Authority and the Mohegan Tribe, through MVW and MV, respectively. Development of the Menominee Project is subject to certain governmental and regulatory approvals, including, but not limited to, the United States Department of the Interior accepting land into trust for the Menominee Tribe’s project site in Kenosha, Wisconsin.

WTG paid $6.4 million in cash for the casino development rights and other items acquired from KGD, which was allocated among the following assets and liabilities: (1) receivables at fair value from MKGA of $4.4 million for project advances; (2) a development rights intangible asset valued at $3.7 million; (3) a note payable to MV of $1.1 million; and (4) a note payable to MKGA of $600,000. The purchase amount was contributed by MVW in return for its initial membership interest in WTG, and MV converted the $1.1 million receivable from WTG into capital in return for its initial membership interest in WTG.

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Pursuant to the development agreement described above, the receivables from MKGA and amounts advanced by WTG on behalf of the Menominee Tribe related to the development of the Menominee Project are reimbursable to WTG by the Menominee Tribe, subject to appropriate approvals defined under the development agreement. Reimbursements are contingent and are to be distributed upon the receipt of necessary financing for the development of the proposed casino. The WTG receivables have a stated interest at a rate of 17.0%, with the ultimate rate to be set upon the receipt of necessary financing for the Menominee Project.

In January 2009, the Bureau of Indian Affairs (“BIA”) informed the Menominee Tribe of the decision by the United States Secretary of the Interior to decline to take the Menominee Project site in Kenosha into trust for the Menominee Tribe. The rejection of the application to take the Kenosha site into trust was based on a policy for reviewing trust land acquisitions for off-reservation gaming projects adopted by the BIA in January 2008 in a guidance memorandum and contradicted an earlier recommendation from the BIA’s Regional Director. In March 2009, the Menominee Tribe withdrew a related lawsuit against the federal government while reserving its right to re-file in the event the January 2008 guidance memorandum is not withdrawn and the decision on the Menominee Project site is not reconsidered and reversed by the Secretary of the Interior. The United States Supreme Court’s Carcieri v. Salazar, 555 U.S.              (2009) decision, discussed below, is not expected to affect the Menominee Project. While the Authority expects to continue to support and pursue the Menominee Project, it believes, the rejection of the land into trust application for the Kenosha site announced in January 2009 decreased the probability that the Menominee Tribe will obtain the necessary regulatory approvals in order to proceed with the Menominee Project, and officials appointed by the new presidential administration have not yet taken a position on reversal of the January 2008 guidance memorandum or the January 2009 rejection of the Kenosha application. As a result, as of September 30, 2008, the Authority had fully reserved the WTG receivables and had written-off the development rights intangible asset. As of September 30, 2009, the WTG receivables remain fully reserved.

Pursuant to an option agreement, as amended, which was assigned to WTG upon its purchase of the development rights for the Menominee Project, for the purchase of Dairyland Greyhound Park in Kenosha, the proposed site for the Menominee Project, in November 2009, WTG consented to the cessation of operations at the Dairyland Greyhound Park and the option payments were accordingly adjusted, subject to various conditions. The current operators of the Dairyland Greyhound Park have announced that the facility will be closed in January 2010.

NOTE 14—MOHEGAN VENTURES-NORTHWEST, LLC (COWLITZ PROJECT):

In July 2004, the Authority formed Mohegan Ventures-NW as its wholly-owned subsidiary and one of three current members in Salishan-Mohegan. Salishan-Mohegan was formed to participate in the Cowlitz Project, a proposed development and management of a casino to be located in Clark County, Washington. Mohegan Ventures-NW holds a 49.15% membership interest, the Mohegan Tribe holds a 7.85% membership interest and Salishan Company holds a 43% membership interest in Salishan-Mohegan. Mohegan Ventures-NW and the Mohegan Tribe each hold one of four seats on the Board of Managers of Salishan-Mohegan. Salishan-Mohegan is not a restricted entity of the Authority and therefore is not required to be a guarantor of the Authority’s debt obligations. Refer to Note 18 for condensed consolidating financial information of the Authority, its guarantor subsidiaries and non-guarantor entities.

In September 2004, Salishan-Mohegan entered into development and management agreements with the Cowlitz Tribe regarding the Cowlitz Project, which agreements have been amended from time to time. Under the terms of the development agreement, Salishan-Mohegan administers and oversees the planning, designing, development, construction and furnishing, and provides assistance with the securing of financing, of the Cowlitz Project. The development agreement provides for certain development fees of 3% of total Project Costs, as defined under the

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MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

development agreement, which are to be distributed to Mohegan Ventures-NW pursuant to the Salishan-Mohegan operating agreement. As of April 2006, Salishan-Mohegan purchased the land to be used as the site for the proposed casino, which will be transferred to the Cowlitz Tribe or the United States under certain conditions in the development agreement. The management agreement is for a period of seven years commencing with the opening of the proposed casino, during which Salishan-Mohegan will manage, operate and maintain the proposed casino. The management agreement provides for a management fee of 24% of Net Revenues, as defined under the management agreement, which approximates net income from the Cowlitz Project. Pursuant to the operating agreement, management fees will be allocated to the members of Salishan-Mohegan based on their respective membership interest percentages. Development of the Cowlitz Project is subject to certain governmental and regulatory approvals, including, but not limited to, negotiation of a gaming compact with the State of Washington and acceptance by the United States Department of the Interior of land into trust on behalf of the Cowlitz Tribe. The development agreement provides for termination of Salishan-Mohegan’s exclusive development rights if the land is not taken into trust by a certain date. In July 2009, the development agreement was amended to extend that date from December 31, 2010 to December 31, 2015. The management agreement is subject to approval by the NIGC.

Pursuant to the development agreement described above, certain receivables contributed to Salishan-Mohegan and amounts advanced by Salishan-Mohegan on behalf of the Cowlitz Tribe related to the development of the Cowlitz Project are reimbursable to Salishan-Mohegan by the Cowlitz Tribe, subject to appropriate approvals defined under the development agreement. Reimbursements are contingent and are to be distributed upon: (1) the receipt of necessary financing for the development of the proposed casino, and (2) the related property being taken into trust by the United States Department of the Interior. The Authority accrues interest on the Salishan-Mohegan receivables at a rate of Bank of America’s announced Prime Rate plus 2.0%, compounded monthly.

In May 2008, the BIA published a final rule relating to gaming on trust lands acquired after October 17, 1988. The new rule addresses, among other things, the process used by the BIA to determine what lands should be taken into trust for an initial reservation or restored lands for a tribe, such as the Cowlitz Tribe, seeking its initial or restored reservation. The new rule also expressly provides that a tribe may rely on earlier final agency decisions, including decisions of the NIGC, regarding lands to be taken into trust In November 2005, the Cowlitz Tribe received an opinion from the NIGC determining that if the Secretary of the Interior takes the Cowlitz Project site into trust, the land will constitute restored lands of the Cowlitz Tribe. Based on this opinion by the NIGC, the additional analysis called for under the May 2008 rule is not expected to apply to the BIA’s decision in connection with the Cowlitz Tribe. In May 2008, the BIA published a Final Environmental Impact Statement (“Final EIS”) for the Cowlitz Project site.

In February 2009, the United States Supreme Court issued a decision in a case involving the State of Rhode Island and the Narragansett Indian Tribe, which held that the Secretary of the Interior may exercise his authority to acquire trust title to land for an Indian tribe under the Indian Reorganization Act only if the tribe was “under federal jurisdiction” when the Indian Reorganization Act was enacted on June 18, 1934 (Carcieri v. Salazar, 555 U.S.             (2009) (the “Carcieri decision”)). Since the trust land application for the Cowlitz Project requires action by the Secretary of the Interior under the Indian Reorganization Act, the Carcieri decision may delay action on that application until the BIA and the United States Department of the Interior determine whether the Cowlitz Tribe was under federal jurisdiction at that time, and an adverse decision may lead to a rejection of the trust land application. The Cowlitz Tribe did not receive federal recognition until 2000, so, based on the Carcieri decision, it must establish that it was under federal jurisdiction in 1934 by separate means. In September 2009, following earlier congressional hearings on the Carcieri decision, the Chairman of the Senate Indian Affairs Committee introduced legislation to reverse the impact of the decision and reaffirm the authority of the Secretary of the Interior to take land into trust for Indian tribes regardless of when the tribe was recognized by the federal

F-39

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

government. On December 17, 2009, the full Senate Indian Affairs Committee passed the bill. The Authority believes that the Cowlitz Tribe, as a federally-recognized but landless tribe, will ultimately be able to establish its reservation and that casino gaming will be permitted on such lands; however, the Authority can provide no assurance in this regard.

In light of the aforementioned and the inherent uncertainty in the development of the Cowlitz Project, the Authority maintains a reserve for doubtful collection of the Salishan-Mohegan receivables, which is based on the Authority’s estimate of the probability that the receivables will be collected. As of September 30, 2009 and 2008, receivables, including accrued interest, from the Cowlitz Tribe totaled $28.7 million and $25.0 million, respectively, offset by reserves for doubtful collection of $8.6 million and $7.5 million, respectively, which are included in other assets, net, in the accompanying consolidated balance sheets.

While certain events described above, including the publication of the Final EIS for the Cowlitz Project site, are generally positive steps in furtherance of the project, other events, including the Carcieri decision, may ultimately delay or prevent the completion of the project. However, considered collectively, these events have not materially changed the Authority’s current interest in or assessment of the Cowlitz Project, nor do such events affect the extent to which the Authority plans to continue its involvement in the Cowlitz Project.

NOTE 15—INVESTMENT IN WNBA FRANCHISE:

In January 2003, the Authority formed MBC as its wholly-owned subsidiary for the purpose of owning and operating a professional basketball team in the WNBA. In January 2003, the Authority and MBC entered into a Membership Agreement with WNBA, LLC. The Membership Agreement sets forth the terms and conditions pursuant to which MBC acquired its membership in the WNBA and the right to own and operate a professional basketball team in the WNBA. The Authority guaranteed the obligations of MBC under the Membership Agreement. MBC is a full and unconditional guarantor of the Authority’s outstanding indebtedness under the Bank Credit Facility and senior and senior subordinated notes. Refer to Note 18 for condensed consolidating financial information of the Authority, its guarantor subsidiaries and non-guarantor entities.

As part of the acquisition, the Authority, with assistance from an independent valuation firm, estimated the fair value of the initial player roster to be $4.8 million, and the remaining $5.5 million of MBC’s aggregate investment was recognized as a franchise value, both of which are included in intangible assets, net, in the accompanying consolidated balance sheets. The player roster value is being amortized over seven years, and the franchise value is being amortized over thirty years. Since the date of acquisition to September 30, 2009, write-offs of player contracts included on the initial player roster value totaled $3.6 million. As of September 30, 2009 and 2008, accumulated amortization on the player roster value was $1.1 million and $1.0 million, respectively. As of September 30, 2009 and 2008, accumulated amortization on the franchise value was $1.2 million and $1.0 million, respectively. For the fiscal years ended September 30, 2009, 2008 and 2007, amortization expense associated with these intangible assets totaled $371,000, $598,000 and $531,000, respectively, including charges totaling $13,000, $192,000 and $58,000 related to net write-offs of certain player contracts included on the initial player roster value for the fiscal years ended September 30, 2009, 2008 and 2007, respectively. The Authority expects to incur amortization expense of $237,000 for fiscal 2010 and $183,000 for each of the next four fiscal years, related to these assets.

In connection with its acquisition of its membership in the WNBA, MBC owns approximately 3.6% of the membership interest in WNBA, LLC, which is accounted for under the Cost Method. Under the Limited Liability Company Agreement of WNBA, LLC, if at any time WNBA, LLC’s Board of Governors determines that additional funds are needed for WNBA, LLC’s or any league entity’s general business, the Board of Governors

F-40

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

may require additional cash capital contributions. In such circumstance, each member shall be obligated to contribute to WNBA, LLC an amount of cash equal to that member’s proportionate share of ownership. Pursuant to the WNBA Note, the principal payment due on the WNBA Note after any such contribution made by MBC will be reduced by the contribution amount. Since the date of acquisition to September 30, 2009, no such cash capital contributions were required by WNBA, LLC.

NOTE 16—DISCONTINUED OPERATIONS:

Prior to the Authority’s acquisition of the Pocono Downs Entities, Penn National, the former owner of the Pocono Downs Entities, entered into an agreement to sell all of the assets associated with the OTW facility located in Erie, Pennsylvania to MTR Gaming Group, Inc. and Presque Isle Downs, Inc. (collectively “Presque Isle”), for $7.0 million upon the occurrence of either of the following two conditions: (1) the commencement by any of the Presque Isle entities of pari-mutuel wagering in Erie, Pennsylvania; or (2) the receipt by any Presque Isle entity of revenue from slot machine operations in Erie, Pennsylvania. Penn National assigned its rights to proceeds under this agreement to Downs Racing upon its acquisition by the Authority.

In July 2007, Presque Isle commenced pari-mutuel wagering at Presque Isle Downs and paid Downs Racing $7.0 million in return for the conveyance of the Erie OTW facility, pursuant to the terms of the agreement. The Authority has accordingly reported the results of operations and sale of the Erie OTW facility from its Pocono Downs operating segment as income from discontinued operations and loss on sale of discontinued operations, respectively, in the accompanying consolidated statement of income for the fiscal year ended September 30, 2007, which includes total net revenues from the Erie OTW facility of $2.6 million.

NOTE 17—SEGMENT REPORTING:

As of September 30, 2009, the Authority owns and operates Mohegan Sun, the Connecticut Sun WNBA franchise and the Mohegan Sun Country Club (collectively, the “Connecticut Entities”), and the Pocono Downs Entities. All of the Authority’s revenues are derived from these operations. The Connecticut Sun WNBA franchise and the Mohegan Sun Country Club are aggregated with the Mohegan Sun operating segment because these operations all share similar economic characteristics. The Authority’s executive officers review and assess the performance and operating results and determine the proper allocation of resources to the Connecticut Entities and the Pocono Downs Entities on a separate basis. The Authority, therefore, believes that it has two

F-41

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

separate reportable segments due to the differing nature of their operations: (1) Mohegan Sun, which includes the operations of the Connecticut Entities, and (2) Pocono Downs, which is comprised of the operations of the Pocono Downs Entities. The following tables provide financial information on each segment (in thousands):

	For the Fiscal Years Ended September 30,
	2009			2008 (1)			2007 (2)
Net revenues:
Mohegan Sun	$	1,203,765		$	1,362,945		$	1,430,560
Pocono Downs		251,352			209,238			189,506
Total		1,455,117			1,572,183			1,620,066
Income (loss) from operations:
Mohegan Sun		247,678			280,232			287,017
Pocono Downs		12,378			12,093			16,137
Corporate		(17,310	)		(28,959	)		(10,586	)
Total		242,746			263,366			292,568
Accretion of discount to the relinquishment liability		(20,425	)		(27,085	)		(29,794	)
Interest income		3,912			3,795			3,695
Interest expense, net of capitalized interest		(109,689	)		(93,793	)		(94,363	)
Write-off of debt issuance costs		-			-			(71	)
Gain on early extinguishment of debt		8,466			-			-
Other income (expense), net		(7,658	)		248			(137	)
Income from continuing operations before minority interests		117,352			146,531			171,898
Minority interests		1,992			2,729			648
Income from continuing operations		119,344			149,260			172,546
Total income from discontinued operations		-			-			21
Net income	$	119,344		$	149,260		$	172,567
	For the Fiscal Years Ended September 30,
	2009			2008			2007
Capital expenditures:
Mohegan Sun	$	90,691		$	210,482		$	103,742
Pocono Downs		2,841			173,184			58,449
Corporate		-			22			4
Total	$	93,532		$	383,688		$	162,195
	September 30, 2009			September 30, 2008
Total assets:
Mohegan Sun	$	1,636,007		$	1,654,704
Pocono Downs		587,860			619,712
Corporate		71,216			88,489
Total	$	2,295,083		$	2,362,905

(1) Includes operating results of Project Sunrise from opening date of July 17, 2008 to September 30, 2008 and Casino of the Wind from opening date of August 29, 2008 to September 30, 2008.

(2) Includes operating results of Phase I slot facility at Mohegan Sun at Pocono Downs from opening date of November 14, 2006 to September 30, 2007.

F-42

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 18—SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENT INFORMATION:

As of September 30, 2009, substantially all of the Authority’s outstanding public debt, including its 2005 Senior Unsecured Notes, 2002 Senior Subordinated Notes, 2004 Senior Subordinated Notes and 2005 Senior Subordinated Notes, is fully and unconditionally guaranteed, on a joint and several basis, by the following subsidiaries of the Authority: MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW, MTGA Gaming and WTG. The 2001 Senior Subordinated Notes are fully and unconditionally guaranteed by MBC, a wholly-owned subsidiary. Separate financial statements and other disclosures concerning MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW and MTGA Gaming are not presented below because the Authority believes that the summarized financial information provided below and in Note 17 is adequate for investor analysis of these subsidiaries. Separate financial statements for WTG are provided as it is a non wholly-owned guarantor subsidiary. Condensed consolidating financial statement information for the Authority, its wholly-owned guarantor subsidiary, MBC, its other wholly-owned guarantor subsidiaries, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW and MTGA Gaming, its non wholly-owned guarantor subsidiary, WTG, and its non-guarantor entities, Salishan-Mohegan, MG&H and Mohegan Resorts and subsidiaries, as of September 30, 2009 and September 30, 2008 and for the fiscal years ended September 30, 2009, 2008 and 2007 is as follows (in thousands):

CONDENSED CONSOLIDATING BALANCE SHEETS

	September 30, 2009
	Authority		Wholly- Owned Guarantor Subsidiary- MBC		Other Wholly- Owned Guarantor Subsidiaries		Non Wholly- Owned Guarantor Subsidiary- WTG			Total Guarantor Subsidiaries		Total Non- Guarantor Entities		Consolidating/ Eliminating Adjustments			Consolidated
ASSETS
Property and equipment, net	$	1,401,886	$	73	$	254,853	$	-		$	254,926	$	19,951	$	-		$	1,676,763
Intercompany receivables		446,321		-		16,080		-			16,080		-		(462,401	)		-
Investment in subsidiaries		138,607		-		10,070		-			10,070		-		(148,677	)		-
Other intangible assets, net		120,168		4,323		265,423		-			269,746		-		-			389,914
Other assets, net		130,141		214		74,497		196			74,907		23,358		-			228,406
Total assets	$	2,237,123	$	4,610	$	620,923	$	196		$	625,729	$	43,309	$	(611,078	)	$	2,295,083
LIABILITIES AND CAPITAL
Total current liabilities	$	236,464	$	1,878	$	26,812	$	35		$	28,725	$	14,121	$	-		$	279,310
Long-term debt and capital leases, net of current portion		1,597,615		1,000		-		600			1,600		-		-			1,599,215
Long-term debt, due to Mohegan Tribe		-		-		-		-			-		10,000		-			10,000
Relinquishment liability, net of current portion		226,511		-		-		-			-		-		-			226,511
Intercompany payables		-		-		446,321		4,411			450,732		11,669		(462,401	)		-
Other long-term liabilities		362		-		-		-			-		-		-			362
Total liabilities		2,060,952		2,878		473,133		5,046			481,057		35,790		(462,401	)		2,115,398
Minority interests in subsidiaries		-		-		-		-			-		-		3,830			3,830
Total capital		176,171		1,732		147,790		(4,850	)		144,672		7,519		(152,507	)		175,855
Total liabilities and capital	$	2,237,123	$	4,610	$	620,923	$	196		$	625,729	$	43,309	$	(611,078	)	$	2,295,083

F-43

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

	September 30, 2008
	Authority		Wholly- Owned Guarantor Subsidiary- MBC		Other Wholly- Owned Guarantor Subsidiaries		Non Wholly- Owned Guarantor Subsidiary- WTG			Total Guarantor Subsidiaries		Total Non- Guarantor Entities		Consolidating/ Eliminating Adjustments			Consolidated
ASSETS
Property and equipment, net	$	1,393,035	$	94	$	280,322	$	-		$	280,416	$	19,951	$	-		$	1,693,402
Intercompany receivables		416,132		-		15,047		-			15,047		-		(431,179	)		-
Investment in subsidiaries		176,266		-		9,521		-			9,521		-		(185,787	)		-
Other intangible assets, net		119,827		4,694		265,536		-			270,230		-		-			390,057
Other assets, net		177,712		389		81,098		172			81,659		20,075		-			279,446
Total assets	$	2,282,972	$	5,177	$	651,524	$	172		$	656,873	$	40,026	$	(616,966	)	$	2,362,905
LIABILITIES AND CAPITAL
Total current liabilities	$	323,697	$	2,355	$	50,318	$	143		$	52,816	$	21,575	$	-		$	398,088
Long-term debt, net of current portion		1,519,714		2,000		-		600			2,600		-		-			1,522,314
Relinquishment liability, net of current portion		304,031		-		-		-			-		-		-			304,031
Intercompany payables		-		-		416,132		2,995			419,127		12,052		(431,179	)		-
Other long-term liabilities		7,203		-		-		-			-		-		-			7,203
Total liabilities		2,154,645		4,355		466,450		3,738			474,543		33,627		(431,179	)		2,231,636
Minority interests in subsidiaries		-		-		-		-			-		-		3,258			3,258
Total capital		128,327		822		185,074		(3,566	)		182,330		6,399		(189,045	)		128,011
Total liabilities and capital	$	2,282,972	$	5,177	$	651,524	$	172		$	656,873	$	40,026	$	(616,966	)	$	2,362,905

F-44

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

CONDENSED CONSOLIDATING STATEMENTS OF INCOME

	For the Fiscal Year Ended September 30, 2009
	Authority			Wholly- Owned Guarantor Subsidiary- MBC			Other Wholly- Owned Guarantor Subsidiaries			Non Wholly- Owned Guarantor Subsidiary- WTG			Total Guarantor Subsidiaries			Total Non- Guarantor Entities			Consolidating/ Eliminating Adjustments			Consolidated
Net revenues	$	1,199,565		$	4,558		$	252,691		$	-		$	257,249		$	(12	)	$	(1,685	)	$	1,455,117
Operating costs and expenses:
Gaming and other operations		742,648			3,418			187,230			-			190,648			-			(1,685	)		931,611
Advertising, general and administrative		186,764			1,498			28,504			1,360			31,362			4,751			-			222,877
Pre-opening costs and expenses		58			-			224			-			224			-			-			282
Depreciation and amortization		76,743			392			26,144			-			26,536			-			-			103,279
Relinquishment liability reassessment		(45,678	)		-			-			-			-			-			-			(45,678	)
Total operating costs and expenses		960,535			5,308			242,102			1,360			248,770			4,751			(1,685	)		1,212,371
Income (loss) from operations		239,030			(750	)		10,589			(1,360	)		8,479			(4,763	)		-			242,746
Accretion of discount to the relinquishment liability		(20,425	)		-			-			-			-			-			-			(20,425	)
Interest expense, net of capitalized interest		(61,171	)		(81	)		(47,589	)		(645	)		(48,315	)		(1,459	)		1,256			(109,689	)
Gain on early extinguishment of debt		8,466			-			-			-			-			-			-			8,466
Loss on interests in subsidiaries		(39,403	)		-			(1,901	)		-			(1,901	)		-			41,304			-
Other income (expense), net		(7,153	)		-			1,613			721			2,334			2,329			(1,256	)		(3,746	)
Income (loss) from operations before minority interests		119,344			(831	)		(37,288	)		(1,284	)		(39,403	)		(3,893	)		41,304			117,352
Minority interests		-			-			-			-			-			14			1,978			1,992
Net income (loss)	$	119,344		$	(831	)	$	(37,288	)	$	(1,284	)	$	(39,403	)	$	(3,879	)	$	43,282		$	119,344

F-45

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

	For the Fiscal Year Ended September 30, 2008
	Authority			Wholly- Owned Guarantor Subsidiary- MBC			Other Wholly- Owned Guarantor Subsidiaries			Non Wholly- Owned Guarantor Subsidiary- WTG			Total Guarantor Subsidiaries			Total Non- Guarantor Entities			Consolidating/ Eliminating Adjustments			Consolidated
Net revenues	$	1,358,388		$	4,813		$	210,765		$	-		$	215,578		$	-		$	(1,783	)	$	1,572,183
Operating costs and expenses:
Gaming and other operations		855,268			3,919			158,743			-			162,662			-			(1,783	)		1,016,147
Advertising, general and administrative		219,179			1,877			23,408			7,416			32,701			2,715			-			254,595
Pre-opening costs and expenses		1,204			-			3,448			-			3,448			-			-			4,652
Depreciation and amortization		83,528			639			14,514			3,689			18,842			-			-			102,370
Relinquishment liability reassessment		(68,947	)		-			-			-			-			-			-			(68,947	)
Total operating costs and expenses		1,090,232			6,435			200,113			11,105			217,653			2,715			(1,783	)		1,308,817
Income (loss) from operations		268,156			(1,622	)		10,652			(11,105	)		(2,075	)		(2,715	)		-			263,366
Accretion of discount to the relinquishment liability		(27,085	)		-			-			-			-			-			-			(27,085	)
Interest expense, net of capitalized interest		(52,718	)		(181	)		(39,152	)		(338	)		(39,671	)		(2,586	)		1,182			(93,793	)
Loss on interests in subsidiaries		(39,734	)		-			(1,361	)		-			(1,361	)		-			41,095			-
Other income, net		641			-			1,580			750			2,330			2,254			(1,182	)		4,043
Income (loss) from operations before minority interests		149,260			(1,803	)		(28,281	)		(10,693	)		(40,777	)		(3,047	)		41,095			146,531
Minority interests		-			-			1,043			-			1,043			269			1,417			2,729
Net income (loss)	$	149,260		$	(1,803	)	$	(27,238	)	$	(10,693	)	$	(39,734	)	$	(2,778	)	$	42,512		$	149,260

F-46

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

	For the Fiscal Year Ended September 30, 2007
	Authority			Wholly- Owned Guarantor Subsidiary- MBC			Other Wholly- Owned Guarantor Subsidiaries			Non Wholly- Owned Guarantor Subsidiary- WTG			Total Guarantor Subsidiaries			Total Non- Guarantor Entity			Consolidating/ Eliminating Adjustments			Consolidated
Net revenues	$	1,426,401		$	4,655		$	190,512		$	-		$	195,167		$	-		$	(1,502	)	$	1,620,066
Operating costs and expenses:
Gaming and other operations		842,843			3,802			140,083			-			143,885			-			(1,502	)		985,226
Advertising, general and administrative		216,737			2,223			20,435			693			23,351			2,004			-			242,092
Pre-opening costs and expenses		445			-			3,391			-			3,391			-			-			3,836
Depreciation and amortization		81,950			578			10,819			-			11,397			-			-			93,347
Relinquishment liability reassessment		2,997			-			-			-			-			-			-			2,997
Total operating costs and expenses		1,144,972			6,603			174,728			693			182,024			2,004			(1,502	)		1,327,498
Income (loss) from operations		281,429			(1,948	)		15,784			(693	)		13,143			(2,004	)		-			292,568
Accretion of discount to the relinquishment liability		(29,794	)		-			-			-			-			-			-			(29,794	)
Interest expense, net of capitalized interest		(56,843	)		(301	)		(35,931	)		(46	)		(36,278	)		(2,324	)		1,082			(94,363	)
Loss on interests in subsidiaries		(22,139	)		-			(570	)		-			(570	)		-			22,709			-
Other income, net		(86	)		-			1,142			346			1,488			3,167			(1,082	)		3,487
Income (loss) from continuing operations before minority interests		172,567			(2,249	)		(19,575	)		(393	)		(22,217	)		(1,161	)		22,709			171,898
Minority interests		-			-			57			-			57			-			591			648
Income (loss) from continuing operations		172,567			(2,249	)		(19,518	)		(393	)		(22,160	)		(1,161	)		23,300			172,546
Income from discontinued operations		-			-			21			-			21			-			-			21
Net income (loss)	$	172,567		$	(2,249	)	$	(19,497	)	$	(393	)	$	(22,139	)	$	(1,161	)	$	23,300		$	172,567

F-47

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

	For the Fiscal Year Ended September 30, 2009
	Authority			Wholly- Owned Guarantor Subsidiary- MBC			Other Wholly- Owned Guarantor Subsidiaries			Non Wholly- Owned Guarantor Subsidiary- WTG			Total Guarantor Subsidiaries			Total Non- Guarantor Entities			Consolidating/ Eliminating Adjustments			Consolidated
Net cash flows provided by (used in) operating activities	$	142,635		$	(803	)	$	36,561		$	(2	)	$	35,756		$	(6,580	)	$	-		$	171,811
Cash flows provided by (used in) investing activities:
Purchases of property and equipment		(141,043	)		-			(36,191	)		-			(36,191	)		-			-			(177,234	)
Proceeds from amendment to the purchase agreement for Pocono Downs		20,063			-			-			-			-			-			-			20,063
Other cash flows provided by (used in) investing activities		5,851			-			770			(745	)		25			(1,056	)		(6,617	)		(1,797	)
Net cash flows used in investing activities		(115,129	)		-			(35,421	)		(745	)		(36,166	)		(1,056	)		(6,617	)		(158,968	)
Cash flows provided by (used in) financing activities:
Bank Credit Facility borrowings - revolving loan		1,052,000			-			-			-			-			-			-			1,052,000
Bank Credit Facility repayments - revolving loan		(486,000	)		-			-			-			-			-			-			(486,000	)
Bank Credit Facility borrowings - term loan		(153,000	)		-			-			-			-			-			-			(153,000	)
Line of Credit borrowings		547,230			-			-			-			-			-			-			547,230
Line of Credit repayments		(537,987	)		-			-			-			-			-			-			(537,987	)
Payments on long-tem debt		(335,806	)		(1,000	)		-			-			(1,000	)		-			-			(336,806	)
Salishan Credit Facility borrowings - revolving loan		-			-			-			-			-			2,250			-			2,250
Salishan Credit Facility repayments - revolving loan		-			-			-			-			-			(10,000	)		-			(10,000	)
Borrowings from Mohegan Tribe		-			-			-			-			-			10,000			-			10,000
Principal portion of relinquishment liability payments		(39,602	)		-			-			-			-			-			-			(39,602	)
Distributions to Tribe		(71,500	)		-			-			-			-			-			-			(71,500	)
Capitalized debt issuance costs		(9,810	)		-			-			-			-			-			-			(9,810	)
Other cash flows provided by (used in) financing activities		(2,459	)		1,741			(8,782	)		771			(6,270	)		3,958			6,617			1,846
Net cash flows provided by (used in) financing activities		(36,934	)		741			(8,782	)		771			(7,270	)		6,208			6,617			(31,379	)
Net increase (decrease) in cash and cash equivalents		(9,428	)		(62	)		(7,642	)		24			(7,680	)		(1,428	)		-			(18,536	)
Cash and cash equivalents at beginning of year		54,730			(13	)		26,322			172			26,481			1,989			-			83,200
Cash and cash equivalents at end of year	$	45,302		$	(75	)	$	18,680		$	196		$	18,801		$	561		$	-		$	64,664

F-48

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

	For the Fiscal Year Ended September 30, 2008
	Authority			Wholly- Owned Guarantor Subsidiary- MBC			Other Wholly- Owned Guarantor Subsidiaries			Non Wholly- Owned Guarantor Subsidiary- WTG			Total Guarantor Subsidiaries			Total Non- Guarantor Entities			Consolidating/ Eliminating Adjustments			Consolidated
Net cash flows provided by (used in) operating activities	$	148,484		$	(916	)	$	26,252		$	(1	)	$	25,335		$	(3,503	)	$	-		$	170,316
Cash flows used in investing activities:
Purchases of property and equipment		(161,321	)		(6	)		(156,102	)		-			(156,108	)		-			-			(317,429	)
Proceeds from amendment to the purchase agreement for Pocono Downs		7,000			-			-			-			-			-			-			7,000
Other cash flows used in investing activities		(149,650	)		-			(8,285	)		(1,547	)		(9,832	)		(2,602	)		152,819			(9,265	)
Net cash flows used in investing activities		(303,971	)		(6	)		(164,387	)		(1,547	)		(165,940	)		(2,602	)		152,819			(319,694	)
Cash flows provided by (used in) financing activities:
Bank Credit Facility borrowings - revolving loan		575,000			-			-			-			-			-			-			575,000
Bank Credit Facility repayments - revolving loan		(608,000	)		-			-			-			-			-			-			(608,000	)
Bank Credit Facility borrowings - term loan		300,000			-			-			-			-			-			-			300,000
Line of Credit borrowings		565,746			-			-			-			-			-			-			565,746
Line of Credit repayments		(579,399	)		-			-			-			-			-			-			(579,399	)
Principal portion of relinquishment liability payments		(48,352	)		-			-			-			-			-			-			(48,352	)
Distributions to Tribe		(80,000	)		-			-			-			-			-			-			(80,000	)
Other cash flows provided by (used in) financing activities		(4,060	)		977			147,947			1,720			150,644			8,087			(152,819	)		1,852
Net cash flows provided by financing activities		120,935			977			147,947			1,720			150,644			8,087			(152,819	)		126,847
Net (decrease) increase in cash and cash equivalents		(34,552	)		55			9,812			172			10,039			1,982			-			(22,531	)
Cash and cash equivalents at beginning of year		89,282			(68	)		16,510			-			16,442			7			-			105,731
Cash and cash equivalents at end of year	$	54,730		$	(13	)	$	26,322		$	172		$	26,481		$	1,989		$	-		$	83,200

F-49

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

	For the Fiscal Year Ended September 30, 2007
	Authority			Wholly- Owned Guarantor Subsidiary- MBC			Other Wholly- Owned Guarantor Subsidiaries			Non Wholly- Owned Guarantor Subsidiary- WTG			Total Guarantor Subsidiaries			Total Non- Guarantor Entity			Consolidating/ Eliminating Adjustments			Consolidated
Net cash flows provided by (used in) operating activities	$	248,548		$	(1,779	)	$	38,775		$	-		$	36,996		$	(1,141	)	$	-		$	284,403
Cash flows used in investing activities:
Purchases of property and equipment		(86,405	)		-			(45,773	)		-			(45,773	)		-			-			(132,178	)
Payment of Category One slot machine license fee		-			-			(50,000	)		-			(50,000	)		-			-			(50,000	)
Other cash flows used in investing activities		(69,169	)		-			11,574			(7,273	)		4,301			(3,444	)		63,044			(5,268	)
Net cash flows used in investing activities		(155,574	)		-			(84,199	)		(7,273	)		(91,472	)		(3,444	)		63,044			(187,446	)
Cash flows provided by (used in) financing activities:
Prior Bank Credit Facility borrowings - revolving loan		278,000			-			-			-			-			-			-			278,000
Prior Bank Credit Facility repayments - revolving loan		(278,000	)		-			-			-			-			-			-			(278,000	)
New Bank Bank Credit Facility borrowings - revolving loan		206,000			-			-			-			-			-			-			206,000
New Bank Credit Facility repayments - revolving loan		(173,000	)		-			-			-			-			-			-			(173,000	)
Line of Credit borrowings		524,313			-			-			-			-			-			-			524,313
Line of Credit repayments		(507,722	)		-			-			-			-			-			-			(507,722	)
Principal portion of relinquishment liability payments		(47,399	)		-			-			-			-			-			-			(47,399	)
Distributions to Tribe		(75,000	)		-			-			-			-			-			-			(75,000	)
Other cash flows provided by (used in) financing activities		(6,678	)		1,940			62,502			7,273			71,715			4,592			(63,044	)		6,585
Net cash flows provided by (used in) financing activities		(79,486	)		1,940			62,502			7,273			71,715			4,592			(63,044	)		(66,223	)
Net increase in cash and cash equivalents		13,488			161			17,078			-			17,239			7			-			30,734
Cash and cash equivalents at beginning of year		75,794			(229	)		(568	)		-			(797	)		-			-			74,997
Cash and cash equivalents at end of year	$	89,282		$	(68	)	$	16,510		$	-		$	16,442		$	7		$	-		$	105,731

NOTE 19—SUBSEQUENT EVENTS:

Second Lien Senior Secured Notes

On October 26, 2009, the Authority issued $200.0 million Second Lien Senior Secured Notes with fixed interest payable at a rate of 11 ¹/2% per annum (the “2009 Second Lien Senior Secured Notes”). The net proceeds from this financing were used to repay the Authority’s then existing term loan under the Bank Credit Facility in the aggregate principal amount of $147.0 million, to repay $41.0 million of revolving loans under the Bank Credit Facility (including a $25.0 million permanent reduction in the revolving commitments), and to pay related transaction costs and expenses associated with the issuance. The 2009 Second Lien Senior Secured Notes mature on November 1, 2017. The first call date for the 2009 Second Lien Senior Secured Notes is November 1, 2013. Interest on the 2009 Second Lien Senior Secured Notes is payable semi-annually on May 1^st and November 1^st, commencing May 1, 2010. The 2009 Second Lien Senior Secured Notes are collateralized by a second lien on substantially all of the Authority’s property and assets, and that of its existing and future guarantor subsidiaries, and are effectively subordinated to all of the Authority’s first lien secured debt,

F-50

MOHEGAN TRIBAL GAMING AUTHORITY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

including the borrowings under the Bank Credit Facility, to the extent of the collateral securing such debt. The 2009 Second Lien Senior Secured Notes rank equally in right of payment with all of the Authority’s and its existing and future guarantor subsidiaries’ senior indebtedness and with the Authority’s Senior Relinquishment Payment obligations under the Relinquishment Agreement that are then due and owing, but, to the extent of the value of the collateral, rank effectively senior to all of the Authority’s unsecured senior indebtedness, including the 2005 Senior Unsecured Notes and payment obligations under the Relinquishment Agreement. The 2009 Second Lien Senior Secured Notes rank senior to all of the Authority’s and its existing and future guarantor subsidiaries’ subordinated indebtedness, including the 2001 Senior Subordinated Notes, the 2002 Senior Subordinated Notes, the 2004 Senior Subordinated Notes and the 2005 Senior Subordinated Notes. The 2009 Second Lien Senior Secured Notes are fully guaranteed, jointly and severally, on a second lien senior secured basis, by MBC, Mohegan Ventures-NW, MCV-PA, the Pocono Downs Entities, Mohegan Golf, MVW, WTG and MTGA Gaming.

The 2009 Second Lien Senior Secured Notes and guarantees have not been and will not be registered under the Securities Act of 1933 or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements.

Amendment No. 1 to the Bank Credit Facility

On October 26, 2009, concurrently with the issuance of the 2009 Second Lien Senior Secured Notes, the Authority entered into an amendment to the terms of the Bank Credit Facility. Among other things, the amendment: (1) modified the terms of the Authority’s maximum total leverage ratio covenant to increase the covenant by 25 basis points for the quarterly periods ending March 31, 2010, June 30, 2010, June 30, 2011, September 30, 2011 and December 31, 2011, and by 50 basis points for the quarterly periods ending September 30, 2010, December 31, 2010 and March 31, 2011; (2) modified the terms of the Authority’s maximum senior leverage ratio covenant to increase the covenant by 25 basis points for the quarterly periods ending March 31, 2010 and continuing through December 31, 2011; (3) provided the ability to obtain a release from liens securing the Bank Credit Facility of a portion of the land on which Pocono Downs is sited to permit its sale or lease to a third-party in connection with the development of a potential hotel project, consisting of a minimum of 200 rooms, subject to the satisfaction of customary conditions; (4) modified the terms of the Authority’s covenant relating to the incurrence of permitted indebtedness to allow the Authority or its subsidiaries to incur additional debt (which may consist of capital lease obligations) in an aggregate amount not to exceed $55.0 million, at any one time outstanding, in connection with the development of the potential hotel project at Pocono Downs; (5) modified the terms of the Authority’s permitted capital expenditures covenant to affirmatively allow for the existing $125.0 million of permitted capital expenditures to be utilized for Pocono Downs in addition to Mohegan Sun and related businesses, including the payment of licensing fees associated with those operations; (6) permanently reduced the revolving commitments by $25.0 million; and (7) modified the applicable pricing rates as follows: (a) the Applicable Rate for Base Rate loans will be between 1.25% and 2.75%, and (b) the Applicable Rate for Eurodollar Rate loans will be between 2.50% and 4.00%.

Upon repayment of the term loan under the Bank Credit Facility and the $25.0 million permanent reduction in revolving commitments in connection with the transactions, as discussed above, the total commitment of the Bank Credit Facility was reduced from $850.0 million to $675.0 million.

F-51

NON WHOLLY-OWNED GUARANTOR SUBSIDIARY FINANCIAL STATEMENTS

The Mohegan Tribal Gaming Authority (the “Authority”) is required to provide stand-alone financial statements for its non wholly-owned guarantor subsidiary, Wisconsin Tribal Gaming, LLC (“WTG”), pursuant to Rule 3-10 of Regulation S-X. WTG, along with substantially all of the Authority’s wholly-owned subsidiaries, guarantee certain of its outstanding debt obligations. In Note 18 of the accompanying consolidated financial statements, included under Item 15(a)(1) of this Annual Report on Form 10-K, the Authority has provided condensed consolidating financial information for WTG and its other subsidiaries that serve as guarantors. Stand-alone financial statements for WTG are as follows:

WISCONSIN TRIBAL GAMING, LLC (A DEVELOPMENT STAGE COMPANY)

INDEX TO FINANCIAL STATEMENTS

	Page Number
Report of Independent Registered Public Accounting Firm	F-53
Balance Sheets as of September 30, 2009 and 2008	F-54
Statements of Income for the Fiscal Years Ended September  30, 2009 and 2008, for the Period from Inception (February 27, 2007) through September 30, 2007, and for the Period from Inception (February 27, 2007) through September 30, 2009	F-55
Statements of Changes in Members’ Equity (Deficit) for the Fiscal Years Ended September  30, 2009 and 2008 and for the Period from Inception (February 27, 2007) through September 30, 2007	F-56
Statements of Cash Flows for the Fiscal Years Ended September  30, 2009 and 2008, for the Period from Inception (February 27, 2007) through September 30, 2007, and for the Period from Inception (February 27, 2007) through September 30, 2009	F-57
Notes to Financial Statements	F-58

F-52

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Management Board

of Wisconsin Tribal Gaming, LLC:

In our opinion, the accompanying balance sheets and the related statements of operations, changes in members’ equity and cash flows present fairly, in all material respects, the financial position of Wisconsin Tribal Gaming, LLC (a development stage enterprise) at September 30, 2009 and 2008, and the results of its operations and its cash flows for each of the two years in the period ended September 30, 2009, the period from February 27, 2007 (date of inception) to September 30, 2007 and, cumulatively, for the period from February 27, 2007 (date of inception) to September 30, 2009 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 1 to the financial statements, the Company has received a commitment from Mohegan Ventures-Wisconsin that it will not demand repayment of any amounts then due and owing prior to October 1, 2010.

/s/ PricewaterhouseCoopers LLP

Hartford, Connecticut

December 28, 2009

F-53

WISCONSIN TRIBAL GAMING, LLC (A DEVELOPMENT STAGE COMPANY)

BALANCE SHEETS

	September 30, 2009			September 30, 2008
ASSETS
Cash and cash equivalents	$	196,050		$	171,787
Total assets	$	196,050		$	171,787
LIABILITIES AND MEMBERS’ DEFICIT
Liabilities:
Trade payables and accrued expenses	$	34,360		$	142,942
Due to member - Mohegan Ventures Wisconsin, LLC		4,411,460			2,994,949
Note Payable to Menominee Kenosha Gaming Authority		600,000			600,000
Total liabilities		5,045,820			3,737,891
Commitments and Contingencies
Members’ deficit:
Deficit accumulated during the development stage		(12,370,056	)		(11,086,390	)
Member capital - Mohegan Ventures Wisconsin, LLC		6,419,316			6,419,316
Member capital - Mohegan Ventures, LLC		1,100,970			1,100,970
Total members’ deficit		(4,849,770	)		(3,566,104	)
Total liabilities and members’ deficit	$	196,050		$	171,787

The accompanying notes are an integral part of these financial statements.

F-54

WISCONSIN TRIBAL GAMING, LLC (A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF INCOME

	For the Fiscal Year Ended September 30, 2009			For the Fiscal Year Ended September 30, 2008			For the Period from Inception (February 27, 2007) through September 30, 2007			For the Period from Inception (February 27, 2007) through September 30, 2009
Operating costs and expenses:
Provision for loss on receivables	$	1,358,781		$	7,415,999		$	691,565		$	9,466,345
Amortization of development rights		-			3,689,287			-			3,689,287
Other operating costs and expenses		1,478			155			455			2,088
Total operating costs and expenses		1,360,259			11,105,441			692,020			13,157,720
Loss from operations		(1,360,259	)		(11,105,441	)		(692,020	)		(13,157,720	)
Other income (expense):
Interest income		721,515			749,551			345,416			1,816,482
Interest expense		(644,922	)		(337,497	)		(46,399	)		(1,028,818	)
Total other income		76,593			412,054			299,017			787,664
Net loss	$	(1,283,666	)	$	(10,693,387	)	$	(393,003	)	$	(12,370,056	)

The accompanying notes are an integral part of these financial statements.

F-55

WISCONSIN TRIBAL GAMING, LLC (A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CHANGES IN MEMBERS’ EQUITY (DEFICIT)

	Mohegan Ventures Wisconsin, LLC			Mohegan Ventures, LLC			Total Members’ Equity (Deficit)
Balances at inception (February 27, 2007)	$	-		$	-		$	-
Member capital contributions		6,380,771			1,139,515			7,520,286
Member capital adjustments		38,545			(38,545	)		-
Net loss		(335,467	)		(57,536	)		(393,003	)
Balances at September 30, 2007		6,083,849			1,043,434			7,127,283
Net loss		(9,127,875	)		(1,565,512	)		(10,693,387	)
Balances at September 30, 2008		(3,044,026	)		(522,078	)		(3,566,104	)
Net loss		(1,095,737	)		(187,929	)		(1,283,666	)
Balances at September 30, 2009	$	(4,139,763	)	$	(710,007	)	$	(4,849,770	)

The accompanying notes are an integral part of these financial statements.

F-56

WISCONSIN TRIBAL GAMING, LLC (A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

	For the Fiscal Year Ended September 30, 2009			For the Fiscal Year Ended September 30, 2008			For the Period from Inception (February 27, 2007) through September 30, 2007			For the Period from Inception (February 27, 2007) through September 30, 2009
Cash flows provided by (used in) operating activities:
Net loss	$	(1,283,666	)	$	(10,693,387	)	$	(393,003	)	$	(12,370,056	)
Adjustments to reconcile net loss to net cash flows used in operating activities:
Provision for loss on receivables from Menominee Indian Tribe of Wisconsin		1,358,781			7,415,999			691,565			9,466,345
Amortization of development rights		-			3,689,287			-			3,689,287
Changes in operating assets and liabilities:
Increase in interest receivables from Menominee Indian Tribe of Wisconsin		(721,515	)		(749,551	)		(345,416	)		(1,816,482	)
Increase in interest due to member - Mohegan Ventures Wisconsin, LLC		644,922			337,497			46,399			1,028,818
Net cash flows used in operating activities		(1,478	)		(155	)		(455	)		(2,088	)
Cash flows used in investing activities:
Acquisition of Menominee Project development rights and other related assets		-			-			(6,380,771	)		(6,380,771	)
Increase in receivables from Menominee Indian Tribe of Wisconsin		(745,848	)		(1,547,344	)		(891,312	)		(3,184,504	)
Net cash flows used in investing activities		(745,848	)		(1,547,344	)		(7,272,083	)		(9,565,275	)
Cash flows provided by financing activities:
Advances from member - Mohegan Ventures Wisconsin, LLC		771,589			1,719,286			891,767			3,382,642
Member contributions - Mohegan Ventures Wisconsin, LLC		-			-			6,380,771			6,380,771
Net cash flows provided by financing activities		771,589			1,719,286			7,272,538			9,763,413
Net increase in cash and cash equivalents		24,263			171,787			-			196,050
Cash and cash equivalents at beginning of period		171,787			-			-			-
Cash and cash equivalents at end of period	$	196,050		$	171,787		$	-		$	196,050
Supplemental disclosure:
Non-cash member contributions - Wisconsin Tribal Gaming, LLC
Mohegan Ventures, LLC forgiveness of debt	$	-		$	-		$	1,139,515		$	1,139,515
Total non-cash member contributions	$	-		$	-		$	1,139,515		$	1,139,515

The accompanying notes are an integral part of these financial statements.

F-57

WISCONSIN TRIBAL GAMING, LLC (A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

NOTE 1—FORMATION AND NATURE OF BUSINESS

In March 2007, Wisconsin Tribal Gaming, LLC (“WTG”) was formed to participate in a proposed development of a casino (“Menominee Project”) to be owned by the federally-recognized Menominee Indian Tribe of Wisconsin (“Menominee Tribe”). WTG consists of two members, a wholly-owned subsidiary of Mohegan Tribal Gaming Authority (the “Authority”), Mohegan Ventures Wisconsin, LLC (“MVW”), which holds an 85.4% membership interest in WTG, and a wholly-owned subsidiary of the Mohegan Tribe, Mohegan Ventures, LLC (“MV”), which holds the remaining 14.6% membership interest. The Authority has designated WTG as a restricted subsidiary, and therefore, WTG is a guarantor of the Authority’s debt obligations under its bank credit facility and certain of its note indentures (refer to Note 6).

In March 2007, WTG purchased the development rights for the Menominee Project under a development agreement with the Menominee Tribe and Menominee Kenosha Gaming Authority (“MKGA”), which was executed in October 2003, along with certain other assets, and assumed certain liabilities from Kenesah Gaming Development, LLC (“KGD”), for consideration of $6,380,771. As a result of the purchase, the Authority and the Mohegan Tribe, through MVW and MV, respectively, will receive development fees payable to WTG of 13.4% of Available Revenue Flow, as defined under the development agreement, which approximates net income from the Menominee Project over a period of seven years following the opening of the casino. Development of the Menominee Project is subject to certain governmental and regulatory approvals, including but not limited to, the United States Department of the Interior accepting land into trust for the Menominee Tribe’s project site in Kenosha, Wisconsin.

WTG paid $6,380,771 in cash for the casino development rights and other items acquired from KGD, which was allocated among the following assets and liabilities: (1) receivables at fair value from MKGA of $4,430,999 for project advances; (2) a development rights intangible asset valued at $3,689,287; (3) a note payable to MV of $1,139,515; and (4) a note payable to MKGA of $600,000. The purchase amount was contributed by MVW in return for its initial membership interest in WTG, and MV converted the $1.1 million receivable from WTG to capital in return for its initial membership interest in WTG. Pursuant to the development agreement, the receivables from MKGA and other advances for the project, and related accrued interest, generally are reimbursable to WTG upon receipt of necessary financing for the development of the proposed casino.

In January 2008, the U.S. Department of the Interior’s Bureau of Indian Affairs (“BIA”) rejected 11 applications from tribes with existing reservations to take new off-reservation land into trust in connection with gaming projects. While no decision was issued on the Menominee application at that time, the BIA did issue a memorandum addressing its policy on applications for off-reservation gaming projects in January 2008, which stated that the greater the distance between a proposed project and the tribe’s existing reservation, the greater the scrutiny that would be applied to the application, weighing the potential benefits to the tribe against concern for the commuting distance from the existing reservation, among other factors. In November 2008, the United States Department of the Interior rejected the Menominee Tribe’s request to suspend review of the Menominee Tribe’s application to take off-reservation land into trust in connection with the Menominee Project and a federal court subsequently refused to issue a temporary restraining order to prevent the United States Department of the Interior from taking further action on the application. WTG determined that those actions decreased the probability that the Menominee Tribe will obtain the necessary regulatory approvals in order to proceed with the Menominee Project. As a result of those developments, WTG fully reserved the WTG receivables pertaining to reimbursable development costs and expenses in connection with the Menominee Project and wrote-off the remaining related development rights intangible asset as of September 30, 2008.

In January 2009, the BIA informed the Menominee Tribe of the decision by the United States Secretary of the Interior to decline to take the Menominee Project site in Kenosha into trust for the tribe, based on the January

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NOTES TO FINANCIAL STATEMENTS—(Continued)

2008 guidance memorandum. In May 2009, the Menominee Tribe filed a lawsuit against the federal government in United States District Court in Green Bay, Wisconsin, challenging that rejection. As of September 30, 2009, that lawsuit remains pending and the WTG receivables remain fully reserved.

WTG is considered a development stage company as defined in the authoritative guidance issued by the Financial Accounting Standard Board (“FASB”). Since inception, WTG’s sole purpose has been the development of the proposed casino described above. WTG has incurred losses since inception and has an accumulated deficit of $12,370,056 at September 30, 2009. If WTG incurs additional expenditures in the future in connection with the development of the Menominee Project, such expenditures are funded through capital contributions of MVW and MV. WTG has received a commitment from MVW that it will not demand repayment of any amounts then due and owing prior to October 1, 2010.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying financial statements have been prepared on the accrual basis of accounting.

Management’s Use of Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the Unites States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and accompanying notes and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

WTG classifies deposits that can be redeemed on demand and investments with an original maturity of three months or less when purchased as cash and cash equivalents. Cash equivalents are carried at cost, which approximates market value.

Receivables from the Menominee Indian Tribe of Wisconsin

Receivables from the Menominee Tribe, net of allowances, in the accompanying balance sheets, consist primarily of reimbursable costs and expenses advanced by WTG on behalf of the Menominee Tribe for the Menominee Project. The WTG receivables are payable upon receipt of necessary financing for the development of the proposed casino. As of September 2008, the Authority had fully reserved the WTG receivables, and as of September 30, 2009, the WTG receivables remain fully reserved.

As of September 30, 2009 and 2008, the reserve for doubtful accounts was $9,492,426 and $8,133,644, respectively. WTG accrues interest on optional advances, as defined under the development agreement, to the Menominee Tribe at a rate of 17% with the ultimate rate to be set upon financing of the project. On July 1, 2009, WTG suspended the accrual of interest income on the optional advances to the Menominee Tribe and will recognize interest income on a cash basis for future periods. As of September 30, 2009 and 2008, receivables from the Menominee Tribe totaled $9,492,426 and $8,133,644, respectively, including accrued interest of $1,816,481 and $1,094,967, respectively.

Intangible Assets

In March 2007, WTG purchased the development rights for the Menominee Project, along with certain other assets, and assumed certain liabilities from KGD. The development rights were determined by management to be

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NOTES TO FINANCIAL STATEMENTS—(Continued)

an intangible asset with an estimated fair value of $3.7 million. At acquisition, the development rights intangible asset was determined to be amortized on a straight line basis over its estimated useful life of seven years, which was anticipated to commence upon the opening of the proposed casino. However, during 2008, an impairment charge was recorded to reduce the development rights intangible asset to $0 following the issuance of new guidance in January 2008 from the BIA on its policy for taking off-reservation land into trust for gaming purposes and a related unfavorable decision by the United States Department of the Interior and federal court decision concerning the Menominee Tribe’s application to take off-reservation land into trust in connection with the Menominee Project. While WTG continues to pursue the Menominee Project, it believes, these actions and the subsequent rejection of the Menominee Tribe’s application in January 2009 decreased the probability that the Menominee Tribe will obtain the necessary regulatory approvals in order to proceed with the Menominee Project. The $3.7 million loss associated with the write-off is reflected in the accompanying statement of income for the fiscal year ended September 30, 2008 under amortization of development rights.

Income Taxes

WTG has been treated as a partnership for federal and state income tax purposes and, accordingly, WTG’s income taxes or credits resulting from losses were payable by, or accrued to, its members.

Subsequent Events

WTG has evaluated events subsequent to September 30, 2009 through the issuance of the financial statements on December 28, 2009 and has not identified any events for disclosure.

NOTE 3—MENOMINEE KENOSHA GAMING AUTHORITY NOTE PAYABLE

Upon formation, WTG assumed a note payable in the amount of $600,000. The note payable does not accrue interest until a gaming facility is opened, if not repaid earlier, and the note does not become due until the advances to the Menominee Tribe are repaid. Based on the unfavorable events that took place in connection with the Menominee Project as discussed in Note 1, the estimated fair value of the note payable is $0 compared to a carrying value of $600,000 for the fiscal years ended September 30, 2009 and 2008.

NOTE 4—DUE TO MOHEGAN VENTURES WISCONSIN, LLC

WTG has recorded a payable of $4,411,460 and $2,994,949 due to MVW at September 30, 2009 and 2008, respectively, which primarily includes a loan in connection with the funding of development costs incurred for the Menominee Project. WTG accrues interest on its outstanding payables balance to MVW at a rate of 17%, compounded monthly, with the ultimate rate to be set upon financing of the project. Total interest expense charged to WTG from MVW was $644,922, $337,497, $46,399, and $1,028,818 for the fiscal year ended September 30, 2009 and 2008, for the period from February 27, 2007 (date of inception) to September 30, 2007, and for the period from February 27, 2007 (date of inception) to September 30, 2009, respectively. The outstanding payables balance, including accrued interest, is due on demand; however WTG has received a commitment from MVW that it will not demand repayment of any amounts then due and owing prior to October 1, 2010.

NOTE 5—MATERIAL AGREEMENTS

In November 2006, KGD amended an option agreement (“Option Agreement”) with the owners of Dairyland Greyhound Park (“Dairyland”) that originally was scheduled to expire on December 31, 2006. The Option

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NOTES TO FINANCIAL STATEMENTS—(Continued)

Agreement permitted the option period to be extended for up to seventeen additional three month periods, ending March 31, 2011 (“Additional Option Periods”). The Option Agreement was assigned to WTG in connection with the March 2007 purchase (refer to Note 1). Under the Option Agreement, as amended, WTG assumed the right to extend the option for the Dairyland property upon payment to Dairyland of (1) $100,000, for each of the first five Additional Option Periods, (2) $200,000 payable on the first day of the sixth through ninth Additional Option Periods, (3) $225,000 payable on the first day of the tenth through thirteenth Additional Option Periods, (4) $250,000 payable on the first day of the fourteenth through seventeenth Additional Option Periods requested by WTG. Such options payments are nonrefundable unless the facility is purchased, in which case, option payments for periods prior to April 1, 2009 will be fully credited against the purchase price and option payments for periods on or after April 1, 2009 will be partially credited against the purchase price. In June 2009, the Option Agreement was amended a second time to allow for extension and payment of the option fee on a monthly basis. Since WTG has already made all required pre-financing advances for the project under the development agreement, WTG and the Menominee Tribe have made separate arrangements regarding the reimbursement from the Menominee Tribe to WTG for all or one-half of the option payments made to date in 2009 as optional advances by WTG. The Menominee Tribe fully reimbursed WTG for the January 2009 and April 2009 quarterly option payments and has reimbursed or prefunded one-half of the monthly option payments for the months of July, August and September 2009. Option payment amounts not reimbursed are recorded as receivables from the Menominee Tribe, to be reimbursed upon financing of the project. In November 2009, the Option Agreement was amended a third time and the Option payments were adjusted, subject to various conditions. Pursuant to that third amendment, WTG consented also to the cessation of operations at Dairyland Greyhound Park, and the current operators have announced the closing of the facility in January 2010.

NOTE 6—COMMITMENTS AND CONTINGENCIES

As of September 30, 2009, WTG has provided a full and unconditional guarantee of certain debt issued by the Authority, including the Authority’s $250.0 million 2005 6 ¹/8% senior notes due 2013, $250.0 million 2002 8% senior subordinated notes due 2012, $225.0 million 2004 7 ¹/8% senior subordinated notes due 2014 and $150.0 million 2005 6 ⁷/8% senior subordinated notes due 2015, as well as the Authority’s $850.0 million bank credit facility. Based on the current financial condition of the Authority, WTG considers the likelihood of it incurring a liability resulting from the guarantee to be remote. The total amount of the Authority’s debt guaranteed by WTG is $1.6 billion and $1.5 billion as of September 30, 2009 and 2008, respectively. On October 26, 2009, the Authority issued $200.0 million 11¹/2% second lien senior secured notes due 2017 which are also fully guaranteed, on a second lien senior secured basis, by WTG. The Authority used the net proceeds from the issuance to, among other things, repay its existing term loan under its bank credit facility in the aggregate principal amount of $147 million and to repay $41 million of revolving loans under its bank credit facility, including a $25 million permanent reduction in the commitment. Subsequent to this transaction, the total amount of the Authority’s debt guaranteed by WTG is $1.6 billion.

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MOHEGAN TRIBAL GAMING AUTHORITY

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS AND RESERVES

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2009, 2008 and 2007

(in thousands)

	Column A		Column B		Column C		Column D
	Balances at Beginning of Year		Charges to Costs and Expenses		Deductions from Reserves (1)		Balances at End of Year
Description:
Fiscal Year Ended September 30, 2009
Reserves and allowances deducted from asset accounts:
Reserves for uncollectible accounts:	$	28,566	$	9,937	$	623	$	37,880
Fiscal Year Ended September 30, 2008
Reserves and allowances deducted from asset accounts:
Reserves for uncollectible accounts:	$	11,214	$	18,338	$	986	$	28,566
Fiscal Year Ended September 30, 2007
Reserves and allowances deducted from asset accounts:
Reserves for uncollectible accounts:	$	8,116	$	3,396	$	298	$	11,214

(1) Deductions from reserves include write-off of uncollectible accounts, net of recoveries of accounts previously written-off.

S-1

EXHIBIT INDEX

Exhibit No.	Description
3.1	Constitution of the Mohegan Tribe of Indians of Connecticut, as amended (filed as Exhibit 3.1 to the Authority’s Registration Statement on Form S-4, filed with the SEC on November 1, 2004 (the “2004 Form S-4”), and incorporated by reference herein).
3.2	Ordinance No. 95-2 of the Tribe for Gaming on Tribal Lands, enacted on July 15, 1995 (filed as Exhibit 3.2 to the Authority’s Amendment No. 1 to the Authority’s Registration Statement on Form S-1, filed with the SEC on February 29, 1996 (the “1996 Form S-1”), and incorporated by reference herein).
3.3	Articles of Organization of Mohegan Basketball Club LLC, dated as of January 27, 2003 (filed as Exhibit 3.3 to the Authority’s Registration Statement on Form S-4, filed with the SEC on September 23, 2003 (the “2003 Form S-4”), and incorporated by reference herein).
3.4	Operating Agreement of Mohegan Basketball Club LLC, a Mohegan Tribe of Indians of Connecticut limited liability company, dated as of January 24, 2003 (filed as Exhibit 3.4 to the 2003 Form S-4, and incorporated by reference herein).
3.5	Certificate of Organization of Mohegan Commercial Ventures PA, LLC, dated as of January 6, 2005, as amended (filed as Exhibit 3.5 to the Authority’s Registration Statement on Form S-4, filed with the SEC on June 7, 2005 (the “2005 Senior Subordinated Form S-4”), and incorporated by reference herein).
3.6	Operating Agreement of Mohegan Commercial Ventures PA, LLC, a Commonwealth of Pennsylvania limited liability company, dated as of December 15, 2004 (filed as Exhibit 3.6 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).
3.7	Certificate of Limited Partnership of Downs Racing, L.P., dated as of January 7, 2005, as amended (filed as Exhibit 3.7 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).
3.8	Amended and Restated Limited Partnership Agreement of Downs Racing, L.P., dated as of January 25, 2005 (filed as Exhibit 3.8 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).
3.9	Certificate of Limited Partnership of Backside, L.P., dated as of January 7, 2005, as amended (filed as Exhibit 3.9 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).
3.10	Amended and Restated Limited Partnership Agreement of Backside, L.P., dated as of January 25, 2005 (filed as Exhibit 3.10 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).
3.11	Certificate of Limited Partnership of Mill Creek Land, L.P., dated as of January 7, 2005, as amended (filed as Exhibit 3.11 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).
3.12	Amended and Restated Limited Partnership Agreement of Mill Creek Land, L.P., dated as of January 25, 2005 (filed as Exhibit 3.12 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).
3.13	Certificate of Limited Partnership of Northeast Concessions, L.P., dated as of January 7, 2005, as amended (filed as Exhibit 3.13 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).
3.14	Amended and Restated Limited Partnership Agreement of Northeast Concessions, L.P., dated as of January 25, 2005 (filed as Exhibit 3.14 to the 2005 Senior Subordinated Form S-4, and incorporated by reference herein).

Exhibit No.	Description
3.15	Articles of Organization of Mohegan Ventures-Northwest, LLC, dated as of July 23, 2004 (filed as Exhibit 3.15 to the Authority’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the SEC on August 10, 2006 (the “June 2006 10-Q”), and incorporated by reference herein).
3.16	Operating Agreement of Mohegan Ventures-Northwest, LLC, a Mohegan Tribe of Indians of Connecticut limited liability company, dated as of July 23, 2004 (filed as Exhibit 3.16 to the June 2006 10-Q and incorporated by reference herein).
3.17	Articles of Organization of Mohegan Golf, LLC, dated as of November 20, 2006 (filed as Exhibit 3.17 to the Authority’s Annual Report on Form 10-K for the fiscal year ended September 30, 2006, filed with the SEC on December 21, 2006 (the “2006 10-K”), and incorporated by reference herein).
3.18	Certificate of Formation of Wisconsin Tribal Gaming, LLC, dated as of February 27, 2007 (filed as Exhibit 3.18 to the Authority’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2007, filed with the SEC on May 15, 2007 (the “March 2007 10-Q”), and incorporated by reference herein).
3.19	Articles of Organization of Mohegan Ventures Wisconsin, LLC, dated as of March 1, 2007 (filed as Exhibit 3.19 to the March 2007 10-Q, and incorporated by reference herein).
3.20	Certificate of Formation of MTGA Gaming, LLC, dated as of July 27, 2007 (filed as Exhibit 3.20 to the Authority’s Annual Report on Form 10-K for the fiscal year ended September 30, 2007, filed with the SEC on December 21, 2007 (the “2007 10-K”), and incorporated by reference herein).
3.21	Articles of Amendment of Mohegan Golf, LLC, dated as of April 8, 2008 (filed as Exhibit 3.18 to the Authority’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2008, filed with the SEC on May 15, 2008, and incorporated by reference herein).
4.1	Relinquishment Agreement, dated February 7, 1998, by and among the Mohegan Tribal Gaming Authority, The Mohegan Tribe of Indians of Connecticut and Trading Cove Associates (filed as Exhibit 10.14 to the Authority’s Form 10-K405 for the fiscal year ended September 30, 1998, filed with the SEC on December 29, 1998, and incorporated by reference herein).
4.2	Indenture, dated as of July 26, 2001, among the Mohegan Tribal Gaming Authority, the Mohegan Tribe of Indians of Connecticut and State Street Bank and Trust Company, as Trustee, relating to the 83/8% Senior Subordinated Notes Due 2011 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.9 to the Authority’s Registration Statement on Form S-4, File No. 333-69472, filed with the SEC on September 14, 2001 (the “2001 Form S-4”), and incorporated by reference herein).
4.3	Supplemental Indenture, dated as of January 27, 2003, among the Mohegan Tribal Gaming Authority, the Mohegan Basketball Club LLC, the other Subsidiary Guarantors (as defined in the Indenture) and the State Street Bank and Trust Company, as Trustee, relating to the 83/8% Senior Subordinated Notes Due 2011 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.12 to the Authority’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2003, filed with the SEC on August 7, 2003 (the “June 2003 10-Q”), and incorporated by reference herein).
4.4	Second Supplemental Indenture, dated as of July 28, 2004, among the Mohegan Tribal Gaming Authority, the Mohegan Basketball Club LLC and U.S. Bank National Association (as successor to State Street Bank and Trust Company), as Trustee, relating to the 83/8% Senior Subordinated Notes Due 2011 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.9 to the Authority’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2004, filed with the SEC on August 16, 2004 (the “June 2004 10-Q”), and incorporated by reference herein).
4.5	Form of Global 83/8% Senior Subordinated Notes Due 2011 of the Mohegan Tribal Gaming Authority (contained in the Indenture filed as Exhibit 4.9 to the 2001 Form S-4, and incorporated by reference herein).

Exhibit No.	Description
4.6	Indenture, dated as of February 20, 2002, among the Mohegan Tribal Gaming Authority, the Mohegan Tribe of Indians of Connecticut and State Street Bank and Trust Company, as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.12 to the Authority’s Registration Statement on Form S-4, filed with the SEC on March 27, 2002 (the “2002 Form S-4”), and incorporated by reference herein).
4.7	Supplemental Indenture, dated as of January 27, 2003, among the Mohegan Tribal Gaming Authority, the Mohegan Basketball Club LLC, the other Subsidiary Guarantors (as defined in the Indenture) and the State Street Bank and Trust Company, as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.16 to the June 2003 10-Q, and incorporated by reference herein).
4.8	Amended and Restated Supplemental Indenture, dated as of January 25, 2005, among the Mohegan Tribal Gaming Authority, Mohegan Basketball Club LLC and U.S. Bank National Association (as successor to State Street Bank and Trust Company), as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.14 to the Authority’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2004, filed with the SEC on February 14, 2005 (the “December 2004 10-Q”), and incorporated by reference herein).
4.9	Supplemental Indenture No. 2, dated as of January 25, 2005, among the Mohegan Tribal Gaming Authority, Mohegan Basketball Club LLC and U.S. Bank National Association (as successor to State Street Bank and Trust Company), as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.15 to the December 2004 10-Q, and incorporated by reference herein).
4.10	Supplemental Indenture No. 3, dated as of January 25, 2005, among the Mohegan Tribal Gaming Authority, the Subsidiary Guarantors (as defined in the Indenture), and U.S. Bank National Association (as successor to State Street Bank and Trust Company), as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.16 to the December 2004 10-Q, and incorporated by reference herein).
4.11	Supplemental Indenture No. 4, dated as of August 4, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Ventures-Northwest, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association (as successor to State Street Bank and Trust Company), as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.11 to the June 2006 10-Q and incorporated by reference herein).
4.12	Supplemental Indenture No. 5, dated as of December 18, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Golf, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association (as successor to State Street Bank and Trust Company), as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.12 to the 2006 10-K, and incorporated by reference herein).
4.13	Supplemental Indenture No. 6, dated as of March 28, 2007, among the Mohegan Tribal Gaming Authority, Wisconsin Tribal Gaming, LLC and Mohegan Ventures Wisconsin, LLC (each a Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association (as successor to State Street Bank and Trust Company), as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.13 to the March 2007 10-Q, and incorporated by reference herein).
4.14	Supplemental Indenture No. 7, dated as of August 27, 2007, among the Mohegan Tribal Gaming Authority, MTGA Gaming, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association (as successor to State Street Bank and Trust Company), as Trustee, relating to the 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.14 to the 2007 10-K, and incorporated by reference herein).

Exhibit No.	Description
4.15	Form of Global 8% Senior Subordinated Notes Due 2012 of the Mohegan Tribal Gaming Authority (contained in the Indenture filed as Exhibit 4.12 to the 2002 Form S-4, and incorporated by reference herein).
4.16	Indenture, dated as of July 9, 2003, among the Mohegan Tribal Gaming Authority, the Mohegan Tribe of Indians of Connecticut, Mohegan Basketball Club LLC and U.S. Bank National Association, as Trustee, relating to the 63/8% Senior Subordinated Notes Due 2009 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.19 to the June 2003 10-Q, and incorporated by reference herein).
4.17	Supplemental Indenture No. 1, dated as of January 25, 2005, among the Mohegan Tribal Gaming Authority, Mohegan Basketball Club LLC and U.S. Bank National Association, as Trustee, relating to the 63/8% Senior Subordinated Notes Due 2009 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.20 to the December 2004 10-Q, and incorporated by reference herein).
4.18	Supplemental Indenture No. 2, dated as of January 25, 2005, among the Mohegan Tribal Gaming Authority, the Subsidiary Guarantors (as defined in the Indenture), and U.S. Bank National Association, as Trustee, relating to the 63/8% Senior Subordinated Notes Due 2009 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.21 to the December 2004 10-Q, and incorporated by reference herein).
4.19	Supplemental Indenture No. 3, dated as of August 4, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Ventures-Northwest, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 63/8% Senior Subordinated Notes Due 2009 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.16 to the June 2006 10-Q, and incorporated by reference herein).
4.20	Supplemental Indenture No. 4, dated as of December 18, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Golf, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 63/8% Senior Subordinated Notes Due 2009 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.18 to the 2006 10-K, and incorporated by reference herein).
4.21	Supplemental Indenture No. 5, dated as of March 28, 2007, among the Mohegan Tribal Gaming Authority, Wisconsin Tribal Gaming, LLC and Mohegan Ventures Wisconsin, LLC (each a Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 63/8% Senior Subordinated Notes Due 2009 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.20 to the March 2007 10-Q, and incorporated by reference herein).
4.22	Supplemental Indenture No. 6, dated as of August 27, 2007, among the Mohegan Tribal Gaming Authority, MTGA Gaming, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 63/8% Senior Subordinated Notes Due 2009 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.22 to the 2007 10-K, and incorporated by reference herein).
4.23	Form of Global 63/8% Senior Subordinated Notes Due 2009 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.20 to the June 2003 10-Q, and incorporated by reference herein).
4.24	Indenture, dated as of August 3, 2004, among the Mohegan Tribal Gaming Authority, the Mohegan Tribe of Indians of Connecticut, Mohegan Basketball Club LLC and U.S. Bank National Association, as Trustee, relating to the 71/8% Senior Subordinated Notes Due 2014 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.19 to the June 2004 10-Q, and incorporated by reference herein).
4.25	Supplemental Indenture No. 1, dated as of January 25, 2005, among the Mohegan Tribal Gaming Authority, the Subsidiary Guarantors (as defined in the Indenture), and U.S. Bank National Association, as Trustee, relating to the 71/8% Senior Subordinated Notes Due 2014 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.25 to the December 2004 10-Q, and incorporated by reference herein).

Exhibit No.	Description
4.26	Supplemental Indenture No. 2, dated as of August 4, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Ventures-Northwest, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 71/8% Senior Subordinated Notes Due 2014 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.20 to the June 2006 10-Q and incorporated by reference herein).
4.27	Supplemental Indenture No. 3, dated as of December 18, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Golf, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 71/8% Senior Subordinated Notes Due 2014 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.23 to the 2006 10-K, filed with the SEC on December 21, 2006, and incorporated by reference herein).
4.28	Supplemental Indenture No. 4, dated as of March 28, 2007, among the Mohegan Tribal Gaming Authority, Wisconsin Tribal Gaming, LLC and Mohegan Ventures Wisconsin, LLC (each a Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 71/8% Senior Subordinated Notes Due 2014 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.26 to the March 2007 10-Q, and incorporated by reference herein).
4.29	Supplemental Indenture No. 5, dated as of August 27, 2007, among the Mohegan Tribal Gaming Authority, MTGA Gaming, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 71/8% Senior Subordinated Notes Due 2014 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.29 to the 2007 10-K, and incorporated by reference herein).
4.30	Form of Global 71/8% Senior Subordinated Notes Due 2014 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.20 to the June 2004 10-Q, and incorporated by reference herein).
4.31	Indenture, dated as of February 8, 2005, among the Mohegan Tribal Gaming Authority, the Mohegan Tribe of Indians of Connecticut, the Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 67/8% Senior Subordinated Notes Due 2015 (filed as Exhibit 4.28 to the December 2004 10-Q, and incorporated by reference herein).
4.32	Supplemental Indenture No. 1, dated as of August 4, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Ventures-Northwest, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 67/8% Senior Subordinated Notes Due 2015 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.23 to the June 2006 10-Q, and incorporated by reference herein)
4.33	Supplemental Indenture No. 2, dated as of December 18, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Golf, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 67/8% Senior Subordinated Notes Due 2015 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.27 to the 2006 10-K, filed with the SEC on December 21, 2006, and incorporated by reference herein).
4.34	Supplemental Indenture No. 3, dated as of March 28, 2007, among the Mohegan Tribal Gaming Authority, Wisconsin Tribal Gaming, LLC and Mohegan Ventures Wisconsin, LLC (each a Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 67/8% Senior Subordinated Notes Due 2015 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.31 to the March 2007 10-Q, and incorporated by reference herein).

Exhibit No.	Description
4.35	Supplemental Indenture No. 4, dated as of August 27, 2007, among the Mohegan Tribal Gaming Authority, MTGA Gaming, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 67/8% Senior Subordinated Notes Due 2015 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.35 to the 2007 10-K, and incorporated by reference herein).
4.36	Form of Global 67/8% Senior Subordinated Notes Due 2015 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.29 to the December 2004 10-Q, and incorporated by reference herein).
4.37	Indenture, dated as of February 8, 2005, among the Mohegan Tribal Gaming Authority, The Mohegan Tribe of Indians of Connecticut, the Subsidiary Guarantors (as defined in the Indenture) and Wachovia Bank, National Association, as Trustee, relating to the 61/8% Senior Notes Due 2013 (filed as Exhibit 4.31 to the December 2004 10-Q, and incorporated by reference herein).
4.38	Supplemental Indenture No. 1, dated as of August 4, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Ventures-Northwest, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association (as successor to Wachovia Bank, National Association), as Trustee, relating to the 61/8% Senior Notes Due 2013 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.26 to the June 2006 10-Q and incorporated by reference herein).
4.39	Supplemental Indenture No. 2, dated as of December 18, 2006, among the Mohegan Tribal Gaming Authority, Mohegan Golf, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association (as successor to Wachovia Bank, National Association), as Trustee, relating to the 61/8% Senior Notes Due 2013 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.31 to the 2006 10-K, and incorporated by reference herein).
4.40	Supplemental Indenture No. 3, dated as of March 28, 2007, among the Mohegan Tribal Gaming Authority, Wisconsin Tribal Gaming, LLC and Mohegan Ventures Wisconsin, LLC (each a Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association (as successor to Wachovia Bank, National Association), as Trustee, relating to the 61/ 8% Senior Notes Due 2013 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.36 to the March 2007 10-Q, and incorporated by reference herein).
4.41	Supplemental Indenture No. 4, dated as of August 27, 2007, among the Mohegan Tribal Gaming Authority, MTGA Gaming, LLC (as the Subsidiary Guarantor), the other Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to 61/8% Senior Notes Due 2013 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.41 to the 2007 10-K, and incorporated by reference herein).
4.42	Form of Global 61/8% Senior Notes Due 2013 of the Mohegan Tribal Gaming Authority (filed as Exhibit 4.32 to the December 2004 10-Q, and incorporated by reference herein).
4.43	Indenture, dated as of October 26, 2009, among the Mohegan Tribal Gaming Authority, The Mohegan Tribe of Indians of Connecticut, the Subsidiary Guarantors (as defined in the Indenture) and U.S. Bank National Association, as Trustee, relating to the 11 1/2% Second Lien Senior Secured Notes Due 2017 (filed herewith).
4.44	Form of Global 11 1/2% Second Lien Senior Secured Notes Due 2017 of the Mohegan Tribal Gaming Authority (filed herewith).
10.1	The Mohegan Tribe—State of Connecticut Gaming Compact between the Mohegan Tribe of Indians of Connecticut and the State of Connecticut (filed as Exhibit 10.1 to the 1996 Form S-1, and incorporated by reference herein).

Exhibit No.	Description
10.2	Agreement, dated April 25, 1994, between the Mohegan Tribe of Indians of Connecticut and the State of Connecticut resolving certain land claims (filed as Exhibit 10.2 to the 1996 Form S-1, and incorporated by reference herein).
10.3	Memorandum of Understanding, dated April 25, 1994, between the Mohegan Tribe of Indians of Connecticut and the State of Connecticut regarding implementation of the Compact and the Resolution Agreement (filed as Exhibit 10.3 to the 1996 Form S-1, and incorporated by reference herein).
10.4	Agreement, dated June 16, 1994, between the Mohegan Tribe of Indians of Connecticut and the Town of Montville, Connecticut (filed as Exhibit 10.4 to the 1996 Form S-1, and incorporated by reference herein).
10.5	Land Lease, dated September 29, 1995, between the Mohegan Tribe of Indians of Connecticut and the Mohegan Tribal Gaming Authority (filed as Exhibit 10.5 to the 1996 Form S-1, and incorporated by reference herein).
10.6	Amendment to the Land Lease, dated February 19, 1999, between the Mohegan Tribe of Indians of Connecticut and the Mohegan Tribal Gaming Authority (filed as Exhibit 10.6 to the Authority’s Registration Statement on Form S-4, filed with the SEC on April 21, 1999 (the “1999 Form S-4”), and incorporated by reference herein).
10.7	Amendment to the Land Lease, dated March 6, 2007, between the Mohegan Tribe of Indians of Connecticut and the Mohegan Tribal Gaming Authority (filed as Exhibit 10.1 to the Authority’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2007, filed with the SEC on August 13, 2007, and incorporated by reference herein).
10.8	The Merrill Lynch Non-Qualified Deferred Compensation Plan Trust Agreement, dated September 1, 1998, between the Mohegan Tribal Gaming Authority and Merrill Lynch Trust (filed as Exhibit 10.16 to the Authority’s Annual Report on Form 10-K for the fiscal year ended September 30, 1998, filed with the SEC on December 29, 1998, and incorporated by reference herein).*
10.9	Priority Distribution Agreement between the Mohegan Tribal Gaming Authority and the Mohegan Tribe of Indians of Connecticut, dated August 1, 2001 (filed as Exhibit 10.1 to the Authority’s Quarterly Report on Form 10-Q for the period ended June 30, 2001, and incorporated by reference herein).
10.10	Employment Agreement, dated October 4, 2001, by and between the Mohegan Tribal Gaming Authority and Robert Soper (filed as Exhibit 10.23 to Amendment No. 1 to the Authority’s Annual Report on Form 10-K for the fiscal year ended September 30, 2001, filed with the SEC on November 12, 2002, and incorporated by reference herein).*
10.11	Membership Agreement, dated January 28, 2003, by and among WNBA, LLC, the Mohegan Basketball Club LLC, the Mohegan Tribal Gaming Authority and the Mohegan Tribe of Indians of Connecticut (filed as Exhibit 10.1 to the Form 8-K filed with the SEC on January 30, 2003, and incorporated by reference herein).
10.12	Loan Agreement, dated June 27, 2003, between Mohegan Tribal Gaming Authority and Fleet National Bank (filed as Exhibit 10.2 to the June 2003 10-Q, and incorporated by reference herein).
10.13	Revolving Loan Note, dated June 27, 2003, between Mohegan Tribal Gaming Authority and Fleet National Bank (filed as Exhibit 10.3 to the June 2003 10-Q, and incorporated by reference herein).
10.14	First Amendment to Loan Agreement, dated June 11, 2004, between Mohegan Tribal Gaming Authority and Fleet National Bank (filed as Exhibit 10.1 to the June 2004 10-Q, and incorporated by reference herein).
10.15	Second Amendment to Loan Agreement, dated June 22, 2004, between Mohegan Tribal Gaming Authority and Fleet National Bank (filed as Exhibit 10.2 to the June 2004 10-Q, and incorporated by reference herein).

Exhibit No.	Description
10.16	Management Agreement between The Cowlitz Indian Tribe and Salishan-Mohegan, LLC, dated September 21, 2004 (filed as Exhibit 10.30 to the 2004 Form S-4, and incorporated by reference herein).
10.17	Development Agreement between The Cowlitz Indian Tribe and Salishan-Mohegan, LLC, dated September 21, 2004 (filed as Exhibit 10.31 to the 2004 Form S-4, and incorporated by reference herein).
10.18	Purchase Agreement by and among PNGI Pocono Corp., PNGI, LLC, and Mohegan Tribal Gaming Authority as of October 14, 2004 (filed as Exhibit 10.2 to the Form 8-K filed with the SEC on October 18, 2004, and incorporated by reference herein).
10.19	Third Amendment to Loan Agreement, dated August 31, 2004, between Mohegan Tribal Gaming Authority and Fleet National Bank (filed as Exhibit 10.34 to the 2004 Form S-4, and incorporated by reference herein).
10.20	Management Agreement by and among the Menominee Indian Tribe of Wisconsin, the Menominee Kenosha Gaming Authority and the Mohegan Tribal Gaming Authority, dated October 21, 2004 (filed as Exhibit 10.35 to the 2004 Form S-4, and incorporated by reference herein).
10.21	Trust Agreement under The Mohegan Retirement and 401(k) Plan dated July 1, 2005 between the Mohegan Tribe of Indians of Connecticut and Merrill Lynch Trust Company, FSB (filed as Exhibit 10.30 to the Authority’s Annual Report on Form 10-K for the fiscal year ended September 30, 2005, filed with the SEC on December 9, 2005, and incorporated by reference herein).*
10.22	Employment Agreement, executed July 28, 2006, by and between the Mohegan Tribal Gaming Authority and Mitchell Grossinger Etess (filed as Exhibit 10.1 to the Form 8-K filed with the SEC on August 3, 2006, and incorporated by reference herein).*
10.23	Employment Agreement, executed July 28, 2006, by and between the Mohegan Tribal Gaming Authority and Jeffrey E. Hartmann (filed as Exhibit 10.2 to the Form 8-K filed with the SEC on August 3, 2006, and incorporated by reference herein).*
10.24	Employment Agreement, executed July 28, 2006, by and between the Mohegan Tribal Gaming Authority and Leo M. Chupaska (filed as Exhibit 10.3 to the Form 8-K filed with the SEC on August 3, 2006, and incorporated by reference herein).*
10.25	Second Amendment to Purchase Agreement and Release of Claims dated as of August 7, 2006 by and among PNGI Pocono, Inc. (as successor to PNGI Pocono, Corp. and PNGI, LLC) and the Mohegan Tribal Gaming Authority, and is joined in by Penn National Gaming, Inc. for limited purposes described in the agreement (filed as Exhibit 10.4 to the June 2006 10-Q, and incorporated by reference herein).
10.26	Employment Agreement, executed December 20, 2006, by and between the Mohegan Tribal Gaming Authority and Anthony Patrone (filed as Exhibit 10.32 to the 2006 10-K, and incorporated by reference herein).*
10.27	Second Amended and Restated Loan Agreement, dated as of March 9, 2007, by and among the Mohegan Tribe of Indians of Connecticut, the Mohegan Tribal Gaming Authority, the Lenders named therein and Bank of America, N.A., as Administrative Agent (filed as Exhibit 10.1 to the Authority’s Form 8-K filed with the SEC on March 15, 2007, and incorporated by reference herein).
10.28	Amendment No. 1 to the Second Amended and Restated Loan Agreement, dated as of February 13, 2008, by and among the Mohegan Tribe of Indians of Connecticut, the Mohegan Tribal Gaming Authority, the Lenders named therein and Bank of America, N.A., as Administrative Agent (filed as Exhibit 10.1 to the Authority’s Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2007, filed with the SEC on February 14, 2008, and incorporated by reference herein).

Exhibit No.	Description
10.29	Amendment to Employment Agreement, dated February 4, 2008, by and between the Mohegan Tribal Gaming Authority and Leo M. Chupaska (filed as Exhibit 10.1 to the Authority’s Form 8-K filed with the SEC on February 8, 2008, and incorporated by reference herein).*
10.30	Third Amended and Restated Loan Agreement, dated as of December 10, 2008, by and among the Mohegan Tribal Gaming Authority, the Mohegan Tribe of Indians of Connecticut, the Lenders named therein and Bank of America, N.A., as Administrative Agent (filed as Exhibit 10.1 to the Form 8-K filed with the SEC on December 15, 2008, and incorporated by reference herein).
10.31	Amended Employment Agreement, executed February 23, 2009, by and between the Mohegan Tribal Gaming Authority and Mitchell Grossinger Etess (filed as Exhibit 10.1 to the Form 8-K filed with the SEC on February 27, 2009).*
10.32	Amended Employment Agreement, executed February 23, 2009, by and between the Mohegan Tribal Gaming Authority and Jeffrey E. Hartmann (filed as Exhibit 10.2 to the Form 8-K filed with the SEC on February 27, 2009).*
10.33	Amended Employment Agreement, executed February 23, 2009, by and between the Mohegan Tribal Gaming Authority and Leo M. Chupaska (filed as Exhibit 10.3 to the Form 8-K filed with the SEC on February 27, 2009).*
10.34	Employment Agreement, dated April 2, 2009, by and between Downs Racing, L.P. and Robert Soper (filed as Exhibit 10.4 to the Authority’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2009, filed with the SEC on May 15, 2009).*
10.35	Collateral Agency and Intercreditor Agreement, dated as of October 26, 2009, by and among the Mohegan Tribal Gaming Authority, the Guarantors (as defined therein), Bank of America, N.A., as administrative agent for the first lien secured parties, U.S. Bank National Association, as trustee under the Indenture and U.S. Bank National Association, as collateral agent for the second lien secured parties (filed herewith).
10.36	Amendment No. 1 to the Third Amended and Restated Loan Agreement, dated as of October 26, 2009, by and among the Mohegan Tribal Gaming Authority, the Mohegan Tribe of Indians of Connecticut, the Lenders named therein and Bank of America, N.A., as Administrative Agent (filed herewith).
10.37	Employment Agreement, dated as of April 28, 2008, by and between the Mohegan Tribal Gaming Authority and Toby A. Arnheim (filed herewith).*
10.38	Amendment to Employment Agreement, dated as of April 9, 2009, by and between the Mohegan Tribal Gaming Authority and Toby A. Arnheim (filed herewith).*
12.1	Statement regarding computation of ratio of earnings to fixed charges (filed herewith).
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer (filed herewith).
31.2	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer (filed herewith).
32.1	Section 1350 Certification of Chief Executive Officer (filed herewith).
32.2	Section 1350 Certification of Chief Financial Officer (filed herewith).

* Management contract or compensatory plan or arrangement.

EX-4.43

Exhibit 4.43

EXECUTION COPY

MOHEGAN TRIBAL GAMING AUTHORITY

ISSUER

11 ¹/2% SECOND LIEN SENIOR SECURED NOTES DUE 2017

INDENTURE

Dated as of October 26, 2009

Mohegan Tribal Gaming Authority of The Mohegan Tribe of Indians of Connecticut

The Mohegan Tribe of Indians of Connecticut

the Subsidiary Guarantors

U.S. Bank National Association

Trustee

TABLE OF CONTENTS

		Page
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01.	Definitions	1
Section 1.02.	Other Definitions	32
Section 1.03.	Rules of Construction	33
ARTICLE 2
THE NOTES
Section 2.01.	Form and Dating	34
Section 2.02.	Execution and Authentication	35
Section 2.03.	Registrar and Paying Agent	35
Section 2.04.	Paying Agent to Hold Money in Trust	36
Section 2.05.	Holder Lists	36
Section 2.06.	Transfer and Exchange	36
Section 2.07.	Replacement Notes	47
Section 2.08.	Outstanding Notes	47
Section 2.09.	Treasury Notes	48
Section 2.10.	Temporary Notes	48
Section 2.11.	Cancellation	48
Section 2.12.	Defaulted Interest	48
Section 2.13.	CUSIP Numbers	49
Section 2.14.	Ranking	49
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01.	Notices to Trustee	49
Section 3.02.	Selection of Notes to Be Redeemed	49
Section 3.03.	Notice of Redemption	50
Section 3.04.	Effect of Notice of Redemption	51
Section 3.05.	Deposit of Redemption Price	51
Section 3.06.	Notes Redeemed in Part	51
Section 3.07.	Optional Redemption	51
Section 3.08.	Redemption Pursuant to Gaming Law	52
Section 3.09.	Mandatory Redemption	52
Section 3.10.	Offer to Purchase by Application of Excess Proceeds	52

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		Page
ARTICLE 4
COVENANTS
Section 4.01.	Payment of Notes	54
Section 4.02.	Maintenance of Office or Agency	55
Section 4.03.	Reports	55
Section 4.04.	Compliance Certificate	56
Section 4.05.	Taxes	57
Section 4.06.	Stay, Extension and Usury Laws	57
Section 4.07.	Restricted Payments	57
Section 4.08.	Dividend and Other Payment Restrictions Affecting Subsidiaries	60
Section 4.09.	Incurrence of Indebtedness and Issuance of Preferred Stock	61
Section 4.10.	Asset Sales	63
Section 4.11.	Transactions with Affiliates	66
Section 4.12.	Liens	66
Section 4.13.	Line of Business	67
Section 4.14.	Existence of the Authority and Maintenance of the Lease	67
Section 4.15.	Offer to Repurchase at the Option of Holders upon Change of Control	67
Section 4.16.	[Intentionally Omitted]	68
Section 4.17.	Sale and Leaseback Transactions	68
Section 4.18.	Limitation on Issuances and Sales of Equity Interests in Wholly Owned Restricted Subsidiaries	68
Section 4.19.	Payments for Consent	69
Section 4.20.	Subsidiary Guarantees	69
Section 4.21.	Ownership Interests in the Authority	69
Section 4.22.	Subordination of Junior Payments Under the Relinquishment Agreement	69
Section 4.23.	[Intentionally Omitted]	70
Section 4.24.	Restrictions on Leasing and Dedication of Property	70
Section 4.25.	Maintenance of Insurance	70
Section 4.26.	Gaming Licenses	71
Section 4.27.	[Intentionally Omitted]	72
Section 4.28.	Suspension of Covenants	72
Section 4.29.	Maintenance of Properties	72
ARTICLE 5
SUCCESSORS
Section 5.01.	Liquidation or Dissolution	73

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		Page
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01.	Events of Default	74
Section 6.02.	Acceleration	76
Section 6.03.	Other Remedies	76
Section 6.04.	Waiver of Past Defaults	77
Section 6.05.	Control by Majority	77
Section 6.06.	Limitation on Suits	77
Section 6.07.	Rights of Holders of Notes to Receive Payment	78
Section 6.08.	Collection Suit by Trustee	78
Section 6.09.	Trustee May File Proofs of Claim	78
Section 6.10.	Priorities	79
Section 6.11.	Undertaking for Costs	79
ARTICLE 7
TRUSTEE
Section 7.01.	Duties of Trustee	79
Section 7.02.	Rights of Trustee	81
Section 7.03.	Individual Rights of Trustee	82
Section 7.04.	Trustee’s Disclaimer	82
Section 7.05.	Notice of Defaults	82
Section 7.06.	Reports by Trustee to Holders of the Notes	82
Section 7.07.	Compensation and Indemnity	83
Section 7.08.	Replacement of Trustee	84
Section 7.09.	Successor Trustee by Merger, etc.	85
Section 7.10.	Eligibility; Disqualification	85
ARTICLE 8
SATISFACTION AND DISCHARGE; LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01.	Satisfaction and Discharge	86
Section 8.02.	Option to Effect Legal Defeasance or Covenant Defeasance	87
Section 8.03.	Legal Defeasance and Discharge	87
Section 8.04.	Covenant Defeasance	87
Section 8.05.	Conditions to Legal or Covenant Defeasance	88
Section 8.06.	Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions	89
Section 8.07.	Repayment to Authority	90
Section 8.08.	Reinstatement	90

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		Page
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01.	Without Consent of Holders of Notes	90
Section 9.02.	With Consent of Holders of Notes	92
Section 9.03.	[Intentionally Omitted]	93
Section 9.04.	Revocation and Effect of Consents	93
Section 9.05.	Notation on or Exchange of Notes	94
Section 9.06.	Trustee to Sign Amendments, etc.	94
ARTICLE 10
GUARANTEES
Section 10.01.	Unconditional Guarantee	94
Section 10.02.	Severability	96
Section 10.03.	Release of Guarantor	96
Section 10.04.	Limitation on Amount Guaranteed	96
Section 10.05.	Waiver of Subrogation	96
Section 10.06.	Execution of Guarantee	97
Section 10.07.	Waiver of Stay, Extension or Usury Laws	97
ARTICLE 11
COLLATERAL AND SECURITY
Section 11.01.	The Collateral	98
Section 11.02.	Further Assurances	99
Section 11.03.	Impairment of Security Interest	99
Section 11.04.	After-Acquired Property	100
Section 11.05.	Post-Closing Actions Relating to Collateral	100
Section 11.06.	Release of Liens on the Collateral	103
Section 11.07.	Authorization of Actions to Be Taken by the Trustee or the Collateral Agent Under the Security Documents	105
Section 11.08.	Collateral Accounts	106
Section 11.09.	Insurance	106
Section 11.10.	Relative Rights	107
Section 11.11.	Amendments to the Security Documents	108
Section 11.12.	Additional Parity Lien Debt	109
Section 11.13.	Additional Permitted Priority Lien Debt	109
Section 11.14.	Application of Proceeds from Sale of Collateral	109

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		Page
ARTICLE 12
COVENANTS OF THE TRIBE
Section 12.01.	Covenants of the Tribe	110
Section 12.02.	Additional Covenants of the Tribe	112
ARTICLE 13
MISCELLANEOUS
Section 13.01.	Limitations on Management Activities	113
Section 13.02.	Notices	114
Section 13.03.	[Intentionally Omitted]	115
Section 13.04.	Certificate and Opinion as to Conditions Precedent	115
Section 13.05.	Statements Required in Certificate or Opinion	116
Section 13.06.	Rules by Trustee and Agents	116
Section 13.07.	Dispute Resolution and Consent to Suit	116
Section 13.08.	No Personal Liability of Directors, Officers, Employees and Stockholders	117
Section 13.09.	Governing Law	118
Section 13.10.	No Adverse Interpretation of Other Agreements	118
Section 13.11.	Successors	118
Section 13.12.	Severability	118
Section 13.13.	Counterpart Originals	118
Section 13.14.	Table of Contents, Headings, etc.	118
SCHEDULES
Schedule I	Mortgaged Property
EXHIBITS
Exhibit A	FORM OF NOTE
Exhibit B	FORM OF CERTIFICATE OF TRANSFER
Exhibit C	FORM OF CERTIFICATE OF EXCHANGE
Exhibit D	FORM OF NOTATION OF SUBSIDIARY GUARANTEE ON NOTE
Exhibit E	FORM OF SUPPLEMENTAL INDENTURE TO BE DELIVERED BY SUBSEQUENT SUBSIDIARY GUARANTORS

-v-

INDENTURE dated as of October 26, 2009 by and among the Mohegan Tribal Gaming Authority of The Mohegan Tribe of Indians of Connecticut (the “Authority”), The Mohegan Tribe of Indians of Connecticut (the “Tribe”), the Subsidiary Guarantors (as defined below) and U.S. Bank National Association, as trustee (the “Trustee”).

The Authority, the Subsidiary Guarantors, the Tribe and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders of the 11 ¹/2% Second Lien Senior Secured Notes due 2017:

ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE

Section 1.01. Definitions.

“144A Global Note” means a global note substantially in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of, and registered in the name of, the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the Notes sold in reliance on Rule 144A.

“Acquired Indebtedness” means, with respect to any specified Person: (i) Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Subsidiary of such specified Person, including, without limitation, Indebtedness incurred in connection with, or in contemplation of, such other Person merging with or into or becoming a Subsidiary of such specified Person; and (ii) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

“Additional Notes” means the Authority’s 11 ¹/2% Second Lien Senior Secured Notes due 2017 issued under this Indenture other than Initial Notes.

“Adjusted Net Assets” of a Subsidiary Guarantor at any date shall mean the lesser of the amount by which (x) the fair value of the property of such Subsidiary Guarantor exceeds the total amount of liabilities, including, without limitation, contingent liabilities (after giving effect to all other fixed and contingent liabilities), but excluding liabilities under the Subsidiary Guarantee, of such Subsidiary Guarantor at such date and (y) the present fair salable value of the assets of such Subsidiary Guarantor at such date exceeds the amount that will be required to pay the probable liability of such Subsidiary Guarantor on its debts (after giving effect to all other fixed and contingent liabilities and after giving effect to any collection from any Subsidiary of such Subsidiary Guarantor in respect of the obligations of such Subsidiary under the Subsidiary Guarantee), excluding Indebtedness in respect of the Subsidiary Guarantee, as they become absolute and matured.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control,” as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise. For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” shall have correlative meanings.

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“Agent” means any Registrar, Paying Agent or co-registrar.

“Applicable Procedures” means, with respect to any transfer or exchange of or for beneficial interests in any Global Note, the rules and procedures of the Depositary, Euroclear and Cedel that apply to such transfer or exchange.

“Asset Sale” means: (i) the sale, lease, conveyance or other disposition of any assets or rights (including, without limitation, by way of a sale and leaseback) other than sales of inventory in the ordinary course of business consistent with past practices; provided that the sale, lease, conveyance or other disposition of all or substantially all of the assets of the Authority and its Restricted Subsidiaries taken as a whole will be governed by Sections 4.15 and 5.01 and not by Section 4.10 hereof; and (ii) the issuance by the Authority or any of its Restricted Subsidiaries of Equity Interests of any of the Authority’s or its Restricted Subsidiaries’ Restricted Subsidiaries or the sale by the Authority or any of its Subsidiaries of any Equity Interests in any of their respective Subsidiaries.

Notwithstanding the preceding, the following items shall not be deemed to be Asset Sales: (i) any single transaction or series of related transactions that: (a) involves assets having a fair market value of less than $1.0 million; or (b) results in net proceeds to the Authority and its Restricted Subsidiaries of less than $1.0 million; (ii) a transfer of assets between or among the Authority and its Wholly Owned Restricted Subsidiaries; (iii) an issuance of Equity Interests by a Wholly Owned Restricted Subsidiary to the Authority or to another Wholly Owned Restricted Subsidiary; (iv) a Restricted Payment or Permitted Investment that is permitted by Section 4.07 hereof; (v) any Event of Loss, whether involving Collateral or not; (vi) the Permitted Pocono Transaction; and (vii) any lease or sublease permitted by Section 4.24 hereof.

“Attributable Debt” in respect of a sale and leaseback transaction means, at the time of determination, the present value of the obligation of the lessee for net rental payments during the remaining term of the lease included in such sale and leaseback transaction including any period for which such lease has been extended (or may, at the option of the lessor, be extended). Such present value shall be calculated using a discount rate equal to the rate of interest implicit in such transaction, determined in accordance with GAAP.

“Authority” means the Mohegan Tribal Gaming Authority together with any subdivision, agency or subunit that has no separate legal existence from the Mohegan Tribal Gaming Authority, and any successor and assignee thereto.

“Bank Credit Facility” means that certain Third Amended and Restated Loan Agreement, dated as of December 10, 2008, by and among the Authority, the Tribe, the lenders thereunder, Bank of America, N.A. as Administrative Agent and L/C Issuer, RBS Citizens N.A. and Calyon New York Branch as Co-Syndication Agents and Citicorp North America, Inc. and Wells Fargo Bank, N.A. as Co-Documentation Agents referred to therein, including any related notes, guarantees, instruments and agreements executed in connection therewith, and in each case as amended, restated, modified, renewed, refunded, replaced or refinanced from time to time.

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“Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy,” as now and hereafter in effect, or any successor statute.

“Bankruptcy Law” means the Bankruptcy Code and any similar federal, state or foreign law for the relief of debtors.

“BIA” means the Bureau of Indian Affairs.

“Business Day” means any day other than a Legal Holiday.

“Capital Lease Obligation” means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized on a balance sheet in accordance with GAAP.

“Capital Stock” means: (i) in the case of a corporation, corporate stock; (ii) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; (iii) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and (iv) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person; but excluding any interest under the Relinquishment Agreement.

“Cash Equivalents” means: (i) United States dollars; (ii) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than six months from the date of acquisition; (iii) certificates of deposit and eurodollar time deposits with maturities of six months or less from the date of acquisition, bankers’ acceptances with maturities not exceeding six months and overnight bank deposits, in each case with any lender party to the Credit Facilities or with any domestic commercial bank having capital and surplus in excess of $500 million and a Thomson BankWatch Rating of “B” or better; (iv) repurchase obligations with a term of not more than seven days for underlying securities of the types described in clauses (ii) and (iii) above entered into with any financial institution meeting the qualifications specified in clause (iii) above; (v) commercial paper having one of the two highest ratings obtainable from Moody’s Investors Service, Inc. or Standard & Poor’s Ratings Group and in each case maturing within six months after the date of acquisition; and (vi) money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (i)-(v) of this definition.

“Cedel” means Cedel Bank, SA.

“Change of Control” means the occurrence of any of the following: (i) the Authority ceases to be a wholly owned unit, instrumentality or subdivision of the government of the Tribe; (ii) the Authority ceases to have the exclusive legal right to operate the Resort; (iii) the Authority fails to remain in full force and effect at all times all material governmental consents,

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permits or legal rights necessary for the operation of the Resort and such failure continues for a period of 90 consecutive days; or (iv) the Authority sells, assigns, transfers, leases, conveys or otherwise disposes of all or substantially all of its assets to, or consolidates or merges with or into, any other Person.

“Collateral” means and includes all present and future right, title and interest of the Authority or any Guarantor in or to any property whatsoever, and all rights and powers of the Authority or any Guarantor to transfer any interest in or to any property whatsoever, including, without limitation, any and all of the following property:

(i) all present and future accounts, accounts receivable, agreements, contracts, leases, contract rights, payment intangibles, rights to payment, instruments, documents, chattel paper (whether tangible or electronic), security agreements, guaranties, letter-of-credit rights, undertakings, surety bonds, insurance policies, notes and drafts, and all forms of obligations owing to the Authority or any Guarantor or in which the Authority or any Guarantor may have any interest, however created or arising;

(ii) all present and future general intangibles, all tax refunds of every kind and nature to which the Authority or any Guarantor now or hereafter may become entitled, however arising, all other refunds, and all deposits, goodwill, choses in action, trade secrets, computer programs, software, customer lists, trademarks (including any applications therefor), trade names, service marks, patents, licenses, copyrights (including any applications therefor), technology, processes, proprietary information and insurance proceeds;

(iii) all present and future Operating Accounts of the Authority or any Guarantor, and all money, cash and Cash Equivalents of the Authority or any Guarantor, whether or not deposited in any such Operating Accounts;

(iv) all present and future books and records, including, without limitation, books of account and ledgers of every kind and nature, all electronically recorded data relating to the Authority or any Guarantor or their business, all receptacles and containers for such records, and all files and correspondence (the “Books and Records”);

(v) all present and future goods, including, without limitation, all consumer goods, farm products, inventory, equipment, gaming devices and associated equipment, machinery, tools, molds, dies, furniture, furnishings, trade fixtures, motor vehicles and all other goods used in connection with or in the conduct of the Authority or any Guarantor’s business;

(vi) all present and future inventory and merchandise, including, without limitation, all present and future goods held for sale or lease or to be furnished under a contract of service, all raw materials, work in process and finished goods, all packing materials, supplies and containers relating to or used in connection with any of the foregoing, and all bills of lading, warehouse receipts or documents of title relating to any of the foregoing;

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(vii) all present and future investment property, stocks, bonds, debentures, securities (whether certificated or uncertificated), security entitlements, securities accounts, commodity contracts, commodity accounts, subscription rights, options, warrants, puts, calls, certificates, partnership interests, limited liability company membership or other interests, joint venture interests, certificates of deposit, Investments and/or brokerage accounts and all rights, preferences, privileges, dividends, distributions, redemption payments or liquidation payments with respect thereto;

(viii) all right, title and interest, including without limitation all fee and leasehold interests of the Authority or any Guarantor, in any and all parcels of real property, together with all improvements, fixtures, easements, hereditaments and appurtenances relating thereto and all leases, rents, royalties and other income, issues or profits derived therefrom or relating thereto;

(ix) all present and future accessions, appurtenances, components, repairs, repair parts, spare parts, replacements, substitutions, additions, issues and/or improvements to or of or with respect to any of the foregoing;

(x) all other tangible and intangible personal property of the Authority or any Guarantor;

(xi) all rights, remedies, powers and/or privileges of the Authority or any Guarantor with respect to any of the foregoing; and

(xii) any and all proceeds and products of any of the foregoing, including, without limitation, all money, accounts, payment intangibles, general intangibles, deposit accounts, promissory notes, documents, instruments, certificates of deposit, chattel paper, investment property, letter-of-credit rights, goods, insurance proceeds, and any other tangible or intangible property received upon the sale or disposition of any of the foregoing.

Notwithstanding the foregoing, the term “Collateral” shall not include Excluded Assets.

“Collateral Account” means any segregated account under the sole control of the Collateral Agent that is free from all other Liens, and includes all cash and Cash Equivalents received by the Trustee or the Collateral Agent from Asset Sales, Net Proceeds from an Event of Loss, foreclosures on or sales of Collateral, any issuance of Additional Notes or any other awards or proceeds pursuant to the Security Documents, including earnings, revenues, rents, issues, profits and income from the Collateral received pursuant to the Security Documents, and interest earned thereon.

“Collateral Agent” means U.S. Bank National Association, in its capacity as collateral agent pursuant to the Intercreditor Agreement.

“Compact” means the tribal-state Compact entered into between the Tribe and the State of Connecticut pursuant to the Indian Gaming Regulatory Act of 1988, P.L. 100-497, 25 U.S.C. 2701 et seq., as the same may, from time to time, be amended or supplemented, or such other Compact as may be substituted therefor.

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“Comparable Treasury Issue” means the fixed rate United States Treasury security selected by an Independent Investment Banker as having a maturity most comparable to the remaining term of the Notes (and which is not callable prior to maturity) to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practices, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Notes to be redeemed.

“Comparable Treasury Price” means:

(i) the average of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) on the third Business Day preceding a Redemption Date, as set forth in the daily statistical release (or any successor release) published by the Federal Reserve Bank of New York and designated “Composite 3:30 p.m. Quotations for U.S. Government Securities”; or

(ii) if such release (or any successor release) is not published or does not contain such prices on such Business Day, (A) the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest or lowest of such Reference Treasury Dealer Quotations, or (B) if the Trustee obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.

“Completion Guarantee and Keep-Well Agreement” means (i) the guarantee by the Authority or a Restricted Subsidiary of the completion of the development, construction and opening of a new gaming facility by an Affiliate of the Authority, (ii) the agreement by the Authority or a Restricted Subsidiary to advance funds, property or services on behalf of an Affiliate of the Authority in order to maintain the financial condition of such Affiliate in connection with the development, construction and opening of a new gaming facility by such Affiliate and (iii) performance bonds incurred in the ordinary course of business; provided that, in the case of clauses (i) and (ii) above, such guarantee or agreement is entered into in connection with obtaining financing for such gaming facility or is required by a Gaming Regulatory Authority.

“Consolidated Cash Flow” means, with respect to any Person for any period, the Consolidated Net Income of such Person for such period plus:

(i) an amount equal to any extraordinary loss (including, without limitation, any non-cash charges or losses arising from adjustments relating to the Relinquishment Agreement) plus any net loss realized in connection with an Asset Sale, to the extent such losses were deducted in computing such Consolidated Net Income; plus

(ii) provision for taxes based on the income or profits of such Person and its Subsidiaries for such period, to the extent that such provision for taxes was included in computing such Consolidated Net Income; plus

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(iii) consolidated interest expense of such Person and its Subsidiaries for such period, whether paid or accrued (including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers’ acceptance financings, and net payments, if any, pursuant to Hedging and Swap Obligations); plus

(iv) depreciation, amortization (including amortization of goodwill and other intangibles, but excluding amortization of prepaid cash expenses that were paid in a prior period), non-cash charges associated with equity option plans and other non-cash expenses (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense that was paid in a prior period) of such Person and its Subsidiaries for such period to the extent that such depreciation, amortization and other non-cash expenses were deducted in computing such Consolidated Net Income; minus

(v) non-cash items increasing such Consolidated Net Income for such period (including, without limitation, any non-cash items arising from adjustments relating to the Relinquishment Agreement); minus

(vi) to the extent not included in computing such Consolidated Net Income, any revenues received or accrued by the Authority or any of its Subsidiaries from any Person (other than the Authority or any of its Subsidiaries) in respect of any Investment for such period,

all determined on a consolidated basis and in accordance with GAAP.

Notwithstanding the preceding, the provision for taxes based on the income or profits of, and the depreciation and amortization and other non-cash charges of, a Subsidiary of a Person shall be added to Consolidated Net Income to compute Consolidated Cash Flow only to the extent (and in the same proportion) that the Net Income of such Subsidiary was included in calculating the Consolidated Net Income of such Person and only if a corresponding amount would be permitted at the date of determination to be dividended to such Person by such Subsidiary without prior approval (that has not been obtained), pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to that Subsidiary or its stockholders.

“Consolidated Net Income” means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person and its Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided that:

(i) the Net Income of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting shall be included only to the extent of the amount of dividends or distributions paid in cash to the specified Person or a Wholly Owned Restricted Subsidiary thereof;

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(ii) the Net Income of any Restricted Subsidiary shall be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted without any prior governmental approval (that has not been obtained) or, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders;

(iii) the Net Income of any Person acquired in a pooling of interests transaction for any period prior to the date of such acquisition shall be excluded;

(iv) the cumulative effect of a change in accounting principles shall be excluded; and

(v) the Net Income shall be reduced by the amount of payments pursuant to the Relinquishment Agreement, paid or payable, for such period based on 5% of the revenues (as defined in the Relinquishment Agreement) generated in such period.

“Consolidated Secured Leverage Ratio” means, as of any date of determination, the ratio of total consolidated secured Indebtedness of the Authority and its Subsidiaries as of such date to Consolidated Cash Flow of the Authority and its Subsidiaries for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date of determination, with such adjustments as are consistent with the adjustment provisions set forth in the definition of “Fixed Charge Coverage Ratio.”

“Consumer Price Index” means The Consumer Price Index for All Urban Consumers (CPI-U) for the U.S. City Average for All Items, 1982-1984=100, as compiled and released by the Bureau of Labor Statistics.

“Corporate Trust Office of the Trustee” shall be at the address of the Trustee specified in Section 13.02 hereof or such other address as to which the Trustee may give notice to the Authority.

“Credit Facilities” means, with respect to the Authority or any Restricted Subsidiary, one or more debt facilities (including, without limitation, the Bank Credit Facility as in effect on the date hereof) or commercial paper facilities with banks or other institutional lenders providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables) or letters of credit, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time. Indebtedness under Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by Section 4.09(b)(i) hereof.

“Custodian” means the Trustee, as custodian with respect to the Global Notes, or any successor entity thereto.

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“Default” means any event that is or with the passage of time or the giving of notice or both would be an Event of Default.

“Definitive Note” means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 hereof, substantially in the form of Exhibit A hereto except that such Note shall not bear the Global Note Legend and shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.

“Depositary” means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03 hereof as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provision of this Indenture.

“Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, at the option of the holder thereof), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that is after the date on which the Notes mature; provided, however, that any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Authority to repurchase such Capital Stock upon the occurrence of a Change of Control or an Asset Sale shall not constitute Disqualified Stock if the terms of such Capital Stock provide that the Authority may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with Section 4.07 hereof.

“Distribution Compliance Period” has the same meaning as defined in Regulation S.

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).

“Euroclear “ means Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euroclear system.

“Event of Loss” means, with respect to any property or asset (tangible or intangible, real or personal) constituting Collateral, any of the following: (i) any loss, destruction or damage of such property or asset; (ii) any institution of any proceedings for the condemnation or seizure of such property or asset or for the exercise of any right of eminent domain; (iii) any actual condemnation, seizure or taking by exercise of the power of eminent domain or otherwise of such property or asset, or confiscation of such property or asset or the requisition of the use of such property or asset; or (iv) any settlement in lieu of clause (ii) or (iii) above.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

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“Excluded Assets” means the following:

(a) any Books and Records or customer lists relating to any gaming operations being conducted at the Resort, or any gaming or racing operations conducted at Pocono Downs or any other location of the Authority or any Guarantor, in each case which cannot be mortgaged, pledged or assigned as security for the Obligations in accordance with applicable Laws;

(b) the name “Mohegan,” “Mohegan Tribe” or any other name, logo or design used by the Tribe to designate itself or its tribal heritage, customs or government (other than the name “Mohegan Sun”);

(c) any right, title or interest of the Authority or any Guarantor in Mohegan Basketball Club, LLC, any other Persons described in the last sentence of Section 9.02 of the Bank Credit Facility or the Persons referred to in the proviso to Section 9.02(f) of the Bank Credit Facility conducting non-gaming activities, to the extent the same is excluded from Collateral securing the Bank Credit Facility;

(d) the Pennsylvania Tax Revenues (as defined in the Bank Credit Facility);

(e) except to the extent pledged to secure the obligations of the Authority or any Guarantor under any Permitted Priority Lien Debt or Parity Lien Debt, any permit or license issued by a Governmental Authority or Gaming Regulatory Authority, any agreement or any gaming equipment, in each case, only to the extent and for so long as the terms of such permit, license or agreement or any law, rule or regulation applicable to any permit, license, agreement or gaming equipment prohibits the creation of a security interest in such permit, license, agreement or gaming equipment (after giving effect to Sections 9-406(d), 9-407(a), 9-408(a) or 9-409 of the Uniform Commercial Code of any applicable jurisdiction (or any successor provision or provisions) or any other applicable Law (including the Bankruptcy Code) or principles of equity);

(f) except to the extent pledged to secure the obligations of the Authority or any Guarantor under any Permitted Priority Lien Debt or Parity Lien Debt, any contract, lease, license or other agreement to the extent that the grant of a security interest therein would result in the invalidation thereof or provide any party thereto with a right of termination with respect thereto or requires the consent thereto by any other Person not obtained (in each case, after giving effect to the applicable provisions of the Uniform Commercial Code of any applicable jurisdiction);

(g) except to the extent pledged to secure the obligations of the Authority or any Subsidiary Guarantor under any Permitted Priority Lien Debt or Parity Lien Debt, any motor vehicles, vessels and aircraft, or other property subject to a certificate of title statute of any jurisdiction;

(h) except to the extent pledged to secure the obligations of the Authority or any Guarantor under any Permitted Priority Lien Debt or Parity Lien Debt, assets or property subject to purchase money Liens or Capital Leases Obligations permitted to be incurred under this Indenture, the Security Documents and the Permitted Priority Lien Debt Documents, to the extent a Lien on such assets or property hereunder is not permitted under the terms of the documents governing such purchase money Liens, purchase money indebtedness or Capital Lease Obligations to be created to secure any Obligations;

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(i) except to the extent pledged to secure the obligations of the Authority or any Guarantor under any Permitted Priority Lien Debt or Parity Lien Debt, Equity Interests in any joint venture with a third party, to the extent a pledge of such Equity Interests is prohibited by the documents governing such joint venture;

(j) except to the extent pledged to secure the obligations of the Authority or any Guarantor under any Permitted Priority Lien Debt or Parity Lien Debt, any intent-to-use trademark application to the extent and for so long as creation of a security interest therein would result in the loss of any material rights therein;

(k) any license, franchise or other authorization to own, lease or operate or otherwise conduct casino gaming at the Resort, or to own, lease or operate or otherwise conduct casino gaming and racing at Pocono Downs or any other location of the Authority or any Guarantor, in each case which cannot be mortgaged, pledged or assigned as security for the Obligations in accordance with applicable Laws;

(l) the Compact and any interest therein, including the slot contribution payable to the State of Connecticut;

(m) except to the extent pledged to secure obligations of the Authority or any Guarantor under any Permitted Priority Lien Debt or Parity Lien Debt, any deposit, savings, brokerage or similar account now or hereafter existing for the purpose of collecting or disbursing funds for the payment of payroll, medical insurance and workmen’s compensation claims, tip money belonging to employees, money belonging to patrons and other disbursements of a similar nature, or accounts for the short-term investment of such funds pending their disbursement;

(n) any right or interest in the real estate leased by the Authority from the Tribe underlying a portion of the Resort, until the Authority obtains necessary governmental approvals in accordance with the provisions of this Indenture; or

(o) any right, title or interest of the Authority or any Guarantor in the Lahaniatis Property and a parcel contiguous to the Lahaniatis Property comprising a parking lot or any other right, title or interest in real property acquired by the Authority or any Guarantor after the Issue Date, in each case, to the extent such property is not encumbered by a Lien to secure any Permitted Priority Lien Debt Obligation.

“Existing Indebtedness” means Indebtedness of the Authority and the Restricted Subsidiaries in existence on the date of this Indenture (other than Indebtedness under the Bank Credit Facility and Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations), until such amounts are repaid.

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“Existing Senior Subordinated Notes” means, collectively, the Authority’s 8 ³/8% Senior Subordinated Notes due 2011, the 8% Senior Subordinated Notes due 2012, the 7 ¹/8% Senior Subordinated Notes due 2014 and the 6  ⁷/8% Senior Subordinated Notes due 2015.

“Fixed Charge Coverage Ratio” means, with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of such Person for such period to the Fixed Charges of such Person for such period. In the event that the specified Person or any of its Restricted Subsidiaries incurs, assumes, guarantees, repays or redeems any Indebtedness (other than revolving credit borrowings) or issues or redeems preferred stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to the date on which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the “Calculation Date”), then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, guarantee, repayment or redemption of Indebtedness, or such issuance or redemption of preferred stock, as if the same had occurred at the beginning of the applicable four-quarter reference period.

In addition, for purposes of calculating the Fixed Charge Coverage Ratio:

(i) acquisitions that have been made by the specified Person or any of its Restricted Subsidiaries, including through mergers or consolidations and including any related financing transactions, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date shall be deemed to have occurred on the first day of the four-quarter reference period and Consolidated Cash Flow for such reference period shall be calculated without giving effect to clause (iii) of the proviso set forth in the definition of “Consolidated Net Income”;

(ii) the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, shall be excluded; and

(iii) the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, shall be excluded, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the specified Person or any of its Restricted Subsidiaries following the Calculation Date.

“Fixed Charges” means, with respect to any Person for any period, the sum, without duplication, of:

(i) the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers’ acceptance financings, and net payments, if any, pursuant to Hedging and Swap Obligations; plus

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(ii) the consolidated interest of such Person and its Restricted Subsidiaries that was capitalized during such period; plus

(iii) any interest expense on Indebtedness of another Person that is guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries, whether or not such guarantee or Lien is called upon; plus

(iv) the product of (a) all cash dividend payments or other distributions (and non-cash dividend payments in the case of a Person that is a Restricted Subsidiary) on any series of preferred equity of such Person, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory tax rate of such Person, expressed as a decimal,

in each case, on a consolidated basis and in accordance with GAAP.

“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board (“FASB”) or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which are in effect on the date of this Indenture.

“Gaming” means any and all activities defined as Class II or Class III Gaming under IGRA or authorized under the Compact.

“Gaming License” means every license, franchise or other authorization required to own, lease, operate or otherwise conduct gaming activities of the Tribe or the Authority, including, without limitation, all such licenses granted under the Tribal Gaming Ordinance, and the regulations promulgated pursuant thereto, and other applicable federal, state, foreign or local laws.

“Gaming Regulatory Authority” means any agency, authority, board, bureau, commission, department, office or instrumentality of any nature whatsoever of the United States or any foreign government, any state, province or any city or other political subdivision, whether now or hereafter existing, or any officer or official thereof, including, without limitation, any division of the Authority or any other agency with authority to regulate any gaming operation (or proposed gaming operation) owned, managed or operated by the Tribe or the Authority.

“Global Note Legend” means the legend set forth in Section 2.06(g)(ii) hereof, which is required to be placed on all Global Notes issued under this Indenture.

“Global Notes” means, individually and collectively, each of the Restricted Global Notes and the Unrestricted Global Notes, substantially in the form of Exhibit A hereto, issued in accordance with Section 2.01, 2.06(b)(iv), 2.06(d)(ii) or 2.06(f) hereof.

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“Government Securities” means direct obligations of, or obligations guaranteed by, the United States of America, and for the payment of which the United States pledges its full faith and credit.

“Government Service Payments” means: (i) monthly payments to the Tribe by the Authority pursuant to the terms of that certain Priority Distribution Agreement between the Authority and the Tribe dated August 31, 2001 in an annual amount of $14.0 million (as of March 1999), which amount has been and shall be adjusted annually on the last day of each calendar year commencing with the year 2000 by the Consumer Price Index as published for the applicable year; and (ii) amounts equal to those reflected on each annual audited income statement of the Authority as prepared in accordance with GAAP relating to payment for governmental services (including charges for utilities, police and fire department services, health and emergency medical services, the pro rata portion of Tribal Council costs and salaries attributable to the operations of the Authority, and similar pro rata costs of other tribal departments, in each case, to the extent that the costs of such departments are attributable to the operations of the Authority) by the Authority to the Tribe or any of its representatives, political subunits, councils, agencies or instrumentalities.

“Governmental Authority” means the government of the United States, the Tribe or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“Guarantee” means a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof), of all or any part of any Indebtedness.

“Guarantor” means Pocono Downs Subsidiaries, the WNBA Subsidiary, Mohegan Ventures-Northwest, LLC, Mohegan Golf, LLC, Mohegan Ventures Wisconsin, LLC, Wisconsin Tribal Gaming, LLC, MTGA Gaming, LLC and each other Restricted Subsidiary of the Authority that becomes a Guarantor in accordance with the terms of this Indenture.

“Hedging and Swap Obligations” means, with respect to any Person: (i) the obligations of such Person under interest rate swap agreements, interest rate cap agreements and interest rate collar agreements; and (ii) the obligations of such Person under other agreements or arrangements relating to, or the value of which is dependent upon, interest rates, or currency exchange rates or indices.

“Holder” means a Person in whose name a Note is registered.

“IGRA” means the Indian Gaming Regulatory Act of 1988, P.L. 100-497, U.S.C. 2701 et seq., as the same may, from time to time, be amended.

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“Indebtedness” means, with respect to any specified Person, any indebtedness of such Person, whether or not contingent, in respect of: (i) borrowed money; (ii) bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof); (iii) bankers’ acceptances; (iv) Capital Lease Obligations; (v) the balance, deferred and unpaid, of the purchase price of any property, except any such balance that constitutes an accrued expense or trade payable; or (vi) any Hedging and Swap Obligations, if and to the extent any of the preceding items (other than letters of credit and Hedging and Swap Obligations) would appear as a liability upon a balance sheet of the specified Person prepared in accordance with GAAP. In addition, the term “Indebtedness” includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by such Person of any Indebtedness of any other Person.

The amount of any Indebtedness outstanding as of any date shall be: (i) the accreted value thereof, in the case of any Indebtedness issued with original issue discount; and (ii) the principal amount thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Indebtedness.

“Indenture” means this Indenture, as amended or supplemented from time to time.

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Authority.

“Indirect Participant” means a Person who holds a beneficial interest in a Global Note through a Participant.

“Initial Notes” means the $200,000,000 aggregate principal amount of Notes issued under this Indenture on the date hereof.

“Initial Purchasers” means, collectively, Deutsche Bank Securities Inc., Goldman, Sachs & Co., Banc of America Securities LLC, Wells Fargo Securities, LLC, Citigroup Global Markets Inc., Calyon Securities (USA) Inc., RBS Securities Inc., KeyBanc Capital Markets and Comerica Securities, Inc. All rights of the Initial Purchasers under this Indenture shall be exercised by the Representatives, acting on behalf of Initial Purchasers.

“Insolvency or Liquidation Proceeding” means:

(i) any voluntary or involuntary case or proceeding under the Bankruptcy Code with respect to the Authority or any Restricted Subsidiary;

(ii) any other voluntary or involuntary insolvency, reorganization or bankruptcy case or proceeding, or any receivership, liquidation, reorganization or other similar case or proceeding, with respect to the Authority or any Restricted Subsidiary or with respect to a material portion of the Authority’s or any Restricted Subsidiary’s assets;

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(iii) any liquidation, dissolution, reorganization or winding up of the Authority or any Restricted Subsidiary whether voluntary or involuntary and whether or not involving insolvency or bankruptcy; or

(iv) any assignment for the benefit of creditors or any other marshalling of assets and liabilities of the Authority or any Restricted Subsidiary.

“Intercreditor Agreement” means the collateral agency and intercreditor agreement, dated October 26, 2009, among the Authority, the Guarantors, the Permitted Priority Lien Debt Collateral Agent, on behalf of the holders of Permitted Priority Lien Debt Obligations, the Collateral Agent, on behalf of the Holders, and the Trustee.

“Investments” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the forms of direct or indirect loans (including guarantees of Indebtedness or other obligations), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. If the Authority or any Subsidiary of the Authority sells or otherwise disposes of any Equity Interests of any direct or indirect Subsidiary of the Authority such that, after giving effect to any such sale or disposition, such Person is no longer a Subsidiary of the Authority, the Authority shall be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Equity Interests of such Subsidiary not sold or disposed of in an amount determined as provided in Section 4.07(d) hereof.

“Issue Date” means the date of first issuance of the Notes under this Indenture.

“Key Project Assets” means: (i) the Lease and any real property or interest in real property comprising the Resort held in trust for the Tribe by the United States; (ii) any improvements (including, without limitation, the Resort) to the leasehold estate under the Lease or such real property comprising the Resort (but excluding any obsolete personal property or real property improvements determined by the Authority to be no longer useful to the operations of the Resort); and (iii) any business records of the Authority or the Tribe relating to the operation of the Resort.

“Lahaniatis Property” means the property identified as such on Schedule 5.07 to the Bank Credit Facility.

“Laws” means, collectively, (a) all international, foreign, Federal, tribal, state and local statutes, treaties, rules, regulations, ordinances, codes and administrative or judicial precedents or authorities, in each case to the extent binding upon any relevant Person, (b) any interpretation or administration of the items described in clause (a) by any Governmental Authority which has the binding force of law, and (c) all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority which any relevant Person is obligated to conform to as a matter of law.

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“Lease” means the Land Lease between the Tribe and the Authority dated September 29, 1995 and recorded on September 29, 1995 in Volume 281 at Page 837 of the Montville Land Records, as amended on September 29, 1995, February 18, 1999 and on March 6, 2007, and as the same may be subsequently amended in accordance with the terms thereof and of this Indenture.

“Leased Property” means that certain land and improvements thereon located in the Town of Montville, County of New London and State of Connecticut and owned by the United States of America, in trust for the Tribe and leased to the Authority pursuant to the Lease.

“Legal Holiday” means a Saturday, a Sunday or a day on which banking institutions in the City of New York or at a place of payment are authorized by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue on such payment for the intervening period.

“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).

“Management Board” means the Management Board of the Authority or any authorized committee of the Management Board of the Authority, as applicable.

“Maximum Foreseeable Loss” means the maximum foreseeable casualty loss associated with the Resort determined from time to time by AON Risk Services or another professional insurance consultant retained by the Authority; provided that the amount thereof shall be not less than $750,000,000.

“Mortgaged Property” means the real property described in Schedule I hereto and each other real property hereafter encumbered by a Mortgage pursuant to the provisions of this Indenture or the Security Documents.

“Net Income” means, with respect to any Person for any period, the net income (loss) of such Person for such period, determined in accordance with GAAP and before any reduction in respect of dividends on preferred interests, excluding, however:

(i) any gain or loss, together with any related provision for taxes on such gain or loss, realized in connection with (A) any Asset Sale (including, without limitation, dispositions pursuant to sale leaseback transactions) or (B) the disposition of any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries; and

(ii) any extraordinary or nonrecurring gain or loss, together with any related provision for taxes on such extraordinary or nonrecurring gain or loss; less

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(iii) in the case of any Person that is a partnership or a limited liability company, the amount of withholding for tax purposes of such Person for such period.

“Net Proceeds” means the aggregate cash proceeds received by the Authority or any of its Restricted Subsidiaries in respect of any (i) Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of the direct costs relating to such Asset Sale including, without limitation, legal, accounting and investment banking fees, and sales commissions and any relocation expenses incurred as a result thereof, taxes paid or payable as a result thereof, in each case after taking into account any available tax credits or deductions and any tax sharing arrangements, and amounts required to be applied to the repayment of Indebtedness, secured by a Lien on the asset or assets that were the subject of such Asset Sale, and any reserve for adjustment in respect of the sale price of such asset or assets established in accordance with GAAP, or (ii) Event of Loss, including, without limitation, all insurance or condemnation proceeds and damages awarded by judgment, net of all payments, fees and commissions and reasonable and customary expenses (including legal and accounting fees) relating to such Event of Loss.

“NIGC” means the National Indian Gaming Commission.

“Non-U.S. Person” means a Person who is not a U.S. Person.

“Note Obligations” means the Notes and any Obligations under the Notes, this Indenture and the Security Documents.

“Notes” means, collectively, the Initial Notes and any Additional Notes, treated as a single class of securities as amended or supplemented from time to time in accordance with the terms hereof, in each case as issued pursuant to this Indenture.

“Obligations” means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.

“Officer” means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the Secretary or any Vice President of such Person and, in the case of the Authority, shall include members of the Management Board.

“Officers’ Certificate” means a certificate signed on behalf of the Authority by two Officers of the Authority, one of whom must be the principal executive officer, the principal financial officer, the Treasurer or the principal accounting officer of the Authority, that meets the requirements of Section 13.05 hereof.

“Operating Accounts” has the meaning given to such term in the Bank Credit Facility.

“Opinion of Counsel” means an opinion from legal counsel who is reasonably acceptable to the Trustee that meets the requirements of Section 13.05 hereof. The counsel may be an employee of or counsel to the Authority, the Tribe or any Subsidiary of the Authority or the Trustee.

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“Ownership Interest” means, with respect to any Person, Capital Stock of such Person or any interest which carries the right to elect or appoint any members of the Management Board or the Board of Directors or other executive office of such Person.

“Parity Lien Debt” means:

(a) the Initial Notes; and

(b) additional Indebtedness (including letters of credit and reimbursement obligations with respect thereto) of the Authority or any Restricted Subsidiary secured by Liens on Collateral that was permitted to be incurred and so secured under this Indenture; provided that in the case of additional Indebtedness referred to in this clause (b):

(i) on or before the date on which such Indebtedness is incurred by the Authority or such Restricted Subsidiary, as applicable, such Indebtedness is designated by the Authority, in an Officers’ Certificate delivered to the Collateral Agent, as “Parity Lien Debt”; provided that no Indebtedness may be designated as both Parity Lien Debt and Permitted Priority Lien Debt; and

(ii) the agent or other representative with respect to such Indebtedness, has duly executed and delivered a joinder to the Security Documents and, if required under the lntercreditor Agreement, a joinder to the Intercreditor Agreement.

“Parity Lien Debt Documents” means, collectively, with respect to any Parity Lien Debt, the agreements, documents and instruments providing for or evidencing any Parity Lien Debt Obligations, including the definitive documentation in respect of such Parity Lien Debt, the security documents and any intercreditor or joinder agreement among any holders of Parity Lien Debt Obligations with respect to such Parity Lien Debt (or binding upon one or more of them through their representatives), to the extent such are effective at the relevant time, as each may be amended, restated, supplemented, modified, renewed or extended from time to time in accordance with the provisions of the Intercreditor Agreement.

“Parity Lien Debt Obligations” means Parity Lien Debt and all other Obligations in respect thereof.

“Parity Lien Debt Representative” means the administrative agent, trustee or similar entity for the lenders or holders of obligations, as applicable, under any Parity Lien Debt of a Series, together with its successors and permitted assigns.

“Parity Lien Debt Secured Parties” means, at any relevant time, (a) the Collateral Agent, (b) the Trustee and (c) the holders of Parity Lien Debt Obligations.

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“Participant” means, with respect to the Depositary, Euroclear or Cedel, a Person who has an account with the Depositary, Euroclear or Cedel, respectively (and, with respect to DTC, shall include Euroclear and Cedel).

“Permitted Asset Swap” means the exchange by the Authority or any Restricted Subsidiary of any assets for other assets from a Person; provided that the assets received in such exchange are believed by the Authority in good faith to be of substantially equivalent value and substantially all of which are either (i) long term assets that are used or useful in the Principal Business, (ii) cash or (iii) any combination of the foregoing clauses (i) and (ii).

“Permitted Encumbrances” means:

(i) inchoate Liens incident to construction or maintenance of real property, or Liens incident to construction or maintenance of real property, now or hereafter filed of record for which adequate accounting reserves have been set aside and which are being contested in good faith by appropriate proceedings and have not proceeded to judgment; provided that, by reason of nonpayment of the obligations secured by such Liens, no such real property is subject to a material risk of loss or forfeiture;

(ii) Liens for taxes and assessments on Property which are not yet past due, or Liens for taxes and assessments on Property for which adequate reserves have been set aside and are being contested in good faith by appropriate proceedings and have not proceeded to judgment; provided that, by reason of nonpayment of the obligations secured by such Liens, no such Property is subject to a material risk of loss or forfeiture;

(iii) minor defects and irregularities in title to any real property which in the aggregate do not materially impair the fair market value or use of the real property for the purposes for which it is or may reasonably be expected to be held;

(iv) easements, exceptions, reservations, or other agreements granted or entered into after the date hereof for the purpose of pipelines, conduits, cables, wire communication lines, power lines and substations, streets, trails, walkways, drainage, irrigation, water, and sewerage purposes, dikes, canals, ditches, the removal of oil, gas, coal, or other minerals, and other like purposes affecting real property which in the aggregate do not materially burden or impair the fair market value or use of such real property for the purposes for which it is or may reasonably be expected to be held;

(v) rights reserved to or vested in any Governmental Authority by Law to control or regulate, or obligations or duties under Law to any Governmental Authority with respect to, the use of any real property;

(vi) rights reserved to or vested in any Governmental Authority by Law to control or regulate, or obligations or duties under Law to any Governmental Authority with respect to, any right, power, franchise, grant, license or permit;

(vii) present or future zoning laws and ordinances or other laws and ordinances restricting the occupancy, use or enjoyment of real property;

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(viii) statutory Liens, other than those described in clauses (i) or (ii) above, arising in the ordinary course of business with respect to obligations which are not delinquent or are being contested in good faith by appropriate proceedings; provided that, if delinquent, adequate reserves have been set aside with respect thereto and, by reason of nonpayment, no Property is subject to a material risk of loss or forfeiture;

(ix) Liens consisting of pledges or deposits made in connection with obligations under workers’ compensation laws, unemployment insurance or similar legislation, including Liens of judgments thereunder which are not currently dischargeable;

(x) Liens consisting of pledges or deposits of Property to secure performance in connection with operating leases made in the ordinary course of business to which the Authority or any Restricted Subsidiary is a party as lessee; provided the aggregate value of all such pledges and deposits in connection with any such lease does not at any time exceed 10% of the annual fixed rentals payable under such lease;

(xi) Liens consisting of deposits of Property to secure statutory obligations of the Authority or any Restricted Subsidiary in the ordinary course of its business;

(xii) Liens consisting of deposits of Property to secure (or in lieu of) surety, appeal or customs bonds in proceedings to which the Authority or any Restricted Subsidiary is a party in the ordinary course of its business;

(xiii) Liens created by or resulting from any litigation or legal proceeding involving the Authority or a Restricted Subsidiary in the ordinary course of its business which is currently being contested in good faith by appropriate proceedings; provided that adequate reserves have been set aside with respect thereto, and such Liens are discharged or stayed within 60 days of creation and no Property is subject to a material risk of loss or forfeiture;

(xiv) encumbrances consisting of the rights of tenants under retail, restaurant or other commercial leases at the Resort, Pocono Downs or any other property owned by the Authority or any Restricted Subsidiary and associated rights of such tenants under SNDAs; and

(xv) the Lien of mortgages upon the Lahaniatis Property existing as of the date of this Indenture.

“Permitted Investments” means:

(i) any Investment in the Authority or in a Restricted Subsidiary of the Authority that is engaged in a Principal Business or a Related Business;

(ii) any Investment in cash or Cash Equivalents;

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(iii) any Investment by the Authority or any Restricted Subsidiary of the Authority in a Person, if as a result of such Investment such Person (a) becomes a Restricted Subsidiary of the Authority and a Subsidiary Guarantor, and is engaged in a Principal Business or a Related Business or (b) is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, a Restricted Subsidiary of the Authority;

(iv) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with Section 4.10 hereof;

(v) any Investment in any Persons having an aggregate fair market value (as determined in good faith by the Management Board and measured as of the date of such Investment, without giving effect to any subsequent increases or decreases in value) not to exceed the sum of (i) $125.0 million, plus (ii) twenty-five percent (25%) of Consolidated Cash Flow for the twelve (12) calendar months preceding the date of any such Investment, at any one time outstanding;

(vi) Government Service Payments;

(vii) payroll advances to employees of the Authority or its Restricted Subsidiaries for travel, entertainment and relocation expenses in the ordinary course of business in an aggregate amount not to exceed $250,000 at any one time outstanding;

(viii) accounts and notes receivable if created or acquired in the ordinary course of business and which are payable or dischargeable in accordance with customary trade terms; and

(ix) Investments related to Hedging and Swap Obligations, so long as such Hedging and Swap Obligations are not used for speculative purposes.

“Permitted Liens” means:

(i) Liens securing Indebtedness that was permitted by the terms of this Indenture to be incurred under clauses (iv) (provided that such Liens do not extend to any property owned by the Authority or a Restricted Subsidiary other than the property being financed), (v) (provided that such new Liens shall be limited to all or part of the property that secured the original Liens (plus improvements on such property)), (vi), (x) and (xi) of Section 4.09(b) hereof;

(ii) Liens held by the Collateral Agent securing the Notes and the Guarantees issued on the Issue Date;

(iii) Liens securing (a) Permitted Priority Lien Debt in an aggregate principal amount not to exceed the Permitted Priority Lien Debt Cap and (b) all related Permitted Priority Lien Debt Obligations;

(iv) Liens in favor of the Authority or a Restricted Subsidiary;

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(v) Liens existing on the date of this Indenture (other than Liens permitted by clause (i) and clause (iii) of this definition of “Permitted Liens”);

(vi) Permitted Encumbrances and Permitted Rights of Others;

(vii) Liens in favor of the Tribe representing the ground lessor’s interest under the Lease;

(viii) Liens on property existing at the time of acquisition thereof by the Authority or a Restricted Subsidiary; provided that such Liens were in existence prior to the contemplation of such acquisition; provided, further, that such Liens do not extend to any other property owned by the Authority or a Restricted Subsidiary;

(ix) Liens incurred in the ordinary course of business of the Authority or a Restricted Subsidiary with respect to obligations that do not exceed $500,000 at any one time outstanding and that (a) are not incurred in connection with the borrowing of money or the obtaining of advances or credit (other than trade credit in the ordinary course of business) and (b) do not in the aggregate materially detract from the value of the property and materially impair the use thereof in the operation of business by the Authority; provided, however, it is acknowledged that Permitted Liens will not include any Lien on the land held in trust for the Tribe by the United States or any real property interest therein, including the buildings, improvements and fixtures, other than the leasehold interest pursuant to the Lease, or which will give the holder thereof a proprietary interest in any gaming activity as prohibited by Section 11(b)(2)(A) of IGRA;

(x) Liens created by or resulting from any legal proceeding with respect to which the Authority or a Restricted Subsidiary is prosecuting an appeal proceeding for review; provided, however, that any reserve or other appropriate provision as shall be required in conformity with GAAP shall have been made therefor and such legal proceedings have the effect of preventing the forfeiture or sale of the property or assets subject to any such Lien;

(xi) Liens securing Indebtedness permitted under Section 4.09 hereof in an amount not to exceed $50.0 million in the aggregate at any one time outstanding;

(xii) Liens on Collateral securing an aggregate principal amount of Parity Lien Debt Obligations up to an amount that will not cause the Consolidated Secured Leverage Ratio to exceed 3.25 to 1.00, giving pro forma effect to such incurrence;

(xiii) Liens in respect of assets of the WNBA Subsidiary in favor of WNBA, LLC or its designees to secure obligations of the WNBA Subsidiary under the WNBA Agreements;

(xiv) Rights of Others granted pursuant to the WNBA Agreements consisting of the right to use the Mohegan Sun Arena for scheduled home games of the Connecticut Sun and related basketball activities; and

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(xv) Liens on the Lahaniatis Property securing the obligations of the Tribe to the sellers thereof existing as of the date hereof.

“Permitted Pocono Transaction” means the transaction pursuant to which the applicable Pocono Downs Subsidiary or Pocono Downs Subsidiaries, as the case may be, sells or leases a portion of the Pocono Downs property to a third-party purchaser or lessee, as applicable, which purchaser or lessee shall be not be an Affiliate of the Authority, subject to certain conditions of the Bank Credit Facility.

“Permitted Prior Liens” means:

(1) Liens described in clauses (iii), (v), (vi), (vii), (viii), (ix), (xiv) and (xv) of the definition of “Permitted Liens” and Liens securing Indebtedness that was permitted by Section 4.09(b)(iv) and (xi) hereof; provided that such Liens do not extent to any property owned by the Authority or a Restricted Subsidiary other than the property being financed, and in each case, to the extent such Liens by law have priority over the Liens created by the Security Documents; and

(2) Permitted Liens that arise by operation of law and are not voluntarily granted, to the extent they by law have priority over the Liens created by the Security Documents.

“Permitted Priority Lien Debt” means Indebtedness for borrowed money incurred by the Authority or any Restricted Subsidiary under the Bank Credit Facility, which was permitted Section 4.09(b)(i) hereof and permitted to be secured by a Permitted Priority Lien pursuant to clause (iii) of the definition of “Permitted Liens.”

“Permitted Priority Lien Debt Cap” means $700 million, minus the amount of any Permitted Priority Lien Debt (1) retired with the Net Proceeds from any Asset Sale or Event of Loss applied to permanently reduce the outstanding amounts and the commitments with respect to such Indebtedness pursuant to Section 4.10 hereof or (2) assumed by a transferee in an Asset Sale.

“Permitted Priority Lien Debt Collateral Agent” means any collateral agent under a Permitted Priority Lien Debt facility, and its successor and assigns.

“Permitted Priority Lien Debt Documents” means the Bank Credit Facility and the other Loan Documents (as defined in the Bank Credit Facility), and each of the other agreements, documents and instruments providing for or evidencing any other Permitted Priority Lien Debt Obligation, and any other document or instrument executed or delivered at any time in connection with any Permitted Priority Lien Debt Obligations, including any intercreditor or joinder agreement among holders of Permitted Priority Lien Debt Obligations (or binding upon one or more of them through their representatives), to the extent such are effective at the relevant time, as each may be amended, restated, supplemented, replaced or otherwise modified from time to time.

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“Permitted Priority Lien Debt Obligations” means Permitted Priority Lien Debt and all other Obligations in respect thereof, including Hedging and Swap Obligations of the Authority or any Restricted Subsidiary incurred pursuant to arrangements provided by the holders or agents of Permitted Priority Lien Debt to hedge or manage interest rate risk with respect to such Permitted Priority Lien Debt; provided that, pursuant to the terms of the documents governing the Permitted Priority Lien Debt Obligations, such Hedging and Swap Obligations are secured equally and ratably by a Permitted Priority Lien on all of the assets and properties that secure the Indebtedness in respect of which such Hedging and Swap Obligations are incurred.

“Permitted Priority Liens” means Liens granted to the Permitted Priority Lien Debt Collateral Agent, at any time, upon the Collateral to secure Permitted Priority Lien Debt Obligations.

“Permitted Refinancing Indebtedness” means any Indebtedness of the Authority or any of its Restricted Subsidiaries issued in exchange for or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, other Indebtedness of the Authority or any of its Restricted Subsidiaries; provided that:

(i) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of, plus accrued interest on, the Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded (plus the amount of prepayment premiums, consent fees and reasonable expenses incurred in connection therewith);

(ii) such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded; provided that if the original maturity date of such Indebtedness is after the Stated Maturity of the Notes, then such Permitted Refinancing Indebtedness shall have a maturity at least 180 days after the Notes;

(iii) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the Notes, such Permitted Refinancing Indebtedness is subordinated in right of payment to the Notes on terms at least as favorable to the Holders as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded; and

(iv) such Indebtedness is incurred either by the Authority or by the Restricted Subsidiary who is the obligor on the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded.

“Permitted Right of Others” means a Right of Others consisting of (a) an interest (other than a legal or equitable co-ownership interest, an option or right to acquire a legal or equitable co-ownership interest and any interest of a ground lessor under a ground lease) that does not materially impair the value or use of property for the purposes for which it is or may reasonably be expected to be held, (b) an option or right to acquire a Lien that would be a Permitted Encumbrance, and (c) the reversionary interest of a landlord under a lease of Property.

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“Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or agency or political subdivision thereof (including any subdivision or ongoing business of any such entity or substantially all of the assets of any such entity, subdivision or business).

“Pocono Downs” means the harness racetrack and casino known as Mohegan Sun at Pocono Downs, located in Plains Township, Pennsylvania, and related assets.

“Pocono Downs Phase II” means the expansion of Pocono Downs which opened on July 17, 2008.

“Pocono Downs Subsidiaries” means, collectively, (a) Downs Racing, L.P., a Pennsylvania limited partnership, Backside, L.P., a Pennsylvania limited partnership, Mill Creek Land, L.P., a Pennsylvania limited partnership, Northeast Concessions, L.P., a Pennsylvania limited partnership, and Mohegan Commercial Ventures PA, LLC, a Pennsylvania limited liability company, and their respective successors, and (b) any other Persons formed as Restricted Subsidiaries of the Authority for the purpose of owning or operating Pocono Downs and the businesses related thereto.

“Principal Business” means the (i) (a) Gaming and (b) hotel and resort businesses and any activity or business incidental, directly or indirectly related, or similar thereto, or any business or activity that is a reasonable extension, development or expansion thereof or ancillary thereto, including, without limitation, any golf, entertainment, transportation, recreation or other activity or business designed to promote, market, support, develop, construct or enhance the Gaming and other businesses, in either case operated by the Authority at the Resort, and (ii) casino gaming and related businesses (including, without limitation, those described in clause (i)(b) above) located outside the State of Connecticut.

“Private Placement Legend” means the legend set forth in Section 2.06(g)(i) hereof to be placed on all Notes issued under this Indenture except where otherwise permitted by the provisions of this Indenture.

“Property” means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.

“QIB” means a “qualified institutional buyer” as defined in Rule 144A.

“Redemption Date” means, when used with respect to any Note to be redeemed, in whole or in part, the date fixed for such redemption by or pursuant to this Indenture.

“Reference Treasury Dealer” means Deutsche Bank Securities Inc. and its successors. If any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Authority will appoint in its place another nationally recognized investment banking firm that is a Primary Treasury Dealer.

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“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by such Reference Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day preceding such Redemption Date.

“Regulation S” means Regulation S promulgated under the Securities Act.

“Regulation S Global Note” means a Global Note in substantially the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of, and registered in the name of, the Depositary or its nominee, that will be issued in a denomination equal to the outstanding principal amount of the Notes sold in reliance on Rule 903 of Regulation S.

“Related Business” means any business related to the Principal Business.

“Relinquishment Agreement” means the Relinquishment Agreement dated February 7, 1998 between the Authority and TCA.

“Remaining Scheduled Payments” means, with respect to each Note to be redeemed, the remaining scheduled payments of the principal thereof and interest thereon that would be due after the related Redemption Date if such Note were not redeemed. However, if such Redemption Date is not an interest payment date with respect to such Note, the amount of the next succeeding scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to such Redemption Date.

“Representatives” means, collectively, Deutsche Bank Securities Inc., Goldman, Sachs & Co. and Banc of America Securities LLC.

“Required Parity Lien Debt Secured Parties” means:

(a) Parity Lien Debt Secured Parties owed more than 50% of the aggregate principal amount of Note Obligations, or such other requisite percentage or number of holders of Note Obligations (or the Trustee, on behalf of the holders of Note Obligations) as is permitted by, and in accordance with, this Indenture; or

(b) if any additional Parity Lien Debt is outstanding, Parity Lien Debt Secured Parties owed or holding more than 50% of the sum of, without duplication:

(i) the aggregate principal amount of indebtedness constituting Note Obligations;

(ii) the aggregate principal amount of the loans and other advances outstanding under each Parity Lien Debt; and

(iii) other than in connection with the exercise of remedies, the aggregate amount of all other outstanding unexpired and uncanceled commitments to extend credit (if any) under each Parity Lien Debt and outstanding at such time that, when funded, would constitute Parity Lien Debt Obligations;

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provided, however, that, in the case of clauses (ii) and (iii) above, if any holder of Parity Lien Debt Obligations shall be a “defaulting lender” (howsoever defined in the relevant Parity Lien Debt Document at such time), there shall be excluded from the determination of Required Parity Lien Debt Secured Parties (x) the aggregate principal amount of loans and other advances owing to such holder of Parity Lien Debt Obligations under such Parity Lien Debt Document at such time and (y) such holder of Parity Lien Debt Obligations’ pro rata share of the outstanding commitments to extend credit (if any) under such Parity Lien Debt Document at such time.

For purposes of this definition, (x) votes will be determined in accordance with Section 8.18 of the Intercreditor Agreement and (y) any Parity Lien Debt Obligations registered in the name of, or owned or held by, the Authority or any Restricted Subsidiary or any of their respective Affiliates shall be disregarded.

“Resort” means the multi-amenity gaming and entertainment resort on the existing reservation of the Tribe located adjacent to Uncasville, Connecticut and the convention center, retail facilities, arena, hotel and improvements constructed or proposed to be constructed adjacent thereto, as described in the Offering Memorandum dated October 21, 2009 and the documents incorporated by reference therein, but excluding (i) any obsolete personal property or real property improvement determined by the Authority to be no longer useful or necessary to the operations or support of the Resort and (ii) any equipment leased from a third party in the ordinary course of business.

“Responsible Officer” when used with respect to the Trustee, means any officer within the Corporate Trust Services department of the Trustee (or any successor group of the Trustee) or any other officer of the Trustee customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject.

“Restricted Definitive Note” means a Definitive Note bearing the Private Placement Legend.

“Restricted Global Note” means a Global Note bearing the Private Placement Legend.

“Restricted Investment” means an Investment other than a Permitted Investment.

“Restricted Subsidiary” of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary.

“Right of Others” means, as to any Property in which a Person has an interest, (a) any legal or equitable right, title or other interest (other than a Lien) held by any other Person in or with respect to that Property, and (b) any option or right held by any other Person to acquire any right, title or other interest in or with respect to that Property, including any option or right to acquire a Lien.

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“Rule 144” means Rule 144 promulgated under the Securities Act.

“Rule 144A” means Rule 144A promulgated under the Securities Act.

“Rule 903” means Rule 903 promulgated under the Securities Act.

“Rule 904” means Rule 904 promulgated under the Securities Act.

“Sale of a Guarantor” means any Asset Sale involving a sale or other disposition of Capital Stock of a Guarantor.

“Sale of Collateral” means any Asset Sale involving a sale or other disposition of Collateral.

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended.

“Security Documents” means the Intercreditor Agreement, all security agreements, pledge agreements, collateral assignments, mortgages, deeds of trust or other grants or transfers for security or agreements related thereto executed and delivered by the Authority or any Restricted Subsidiary creating or perfecting (or purporting to create or perfect) a Lien upon Collateral in favor of the Collateral Agent to secure the Note Obligations, in each case, as amended, modified, renewed, restated, amended and restated, or replaced, in whole or in part, from time to time, in accordance with its terms.

“Series” means with respect to any Parity Lien Debt, a series of such Parity Lien Debt represented by a single Parity Lien Debt Representative.

“Significant Subsidiary” means any Subsidiary that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect on the date of this Indenture.

“SNDA” means (i) a subordination, non-disturbance and attornment agreement, substantially in the form of Exhibit G to the Bank Credit Facility, or such other form of subordination, non-disturbance and attornment agreement as the Permitted Priority Lien Debt Collateral Agent may approve in its reasonable discretion, in each case executed by the Permitted Priority Lien Debt Collateral Agent and a tenant of the Authority or any of its Restricted Subsidiaries at Mohegan Sun, Pocono Downs or other venues comprising Authority Property operated by the Authority or any of its Restricted Subsidiaries, and (ii) each subordination, non-disturbance and attornment agreement substantially in the form thereof delivered to the Permitted Priority Lien Debt Collateral Agent contemplated by clause (i) of this definition, in each case executed by the Collateral Agent and the tenant of the Authority or any of its Restricted Subsidiaries that executed the comparable document in favor of the Permitted Priority Lien Debt Collateral Agent in connection with the Bank Credit Facility.

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“Stated Maturity” means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which such payment of interest or principal was scheduled to be paid including as a result of any mandatory sinking fund payment or mandatory redemption in the documentation governing such Indebtedness in effect on the date hereof or, if such Indebtedness is incurred after the date of this Indenture, in the original documentation governing such Indebtedness, and shall not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.

“Subordinated Indebtedness” means any Indebtedness that by its terms is expressly subordinated in right of payment in any respect to the payment of any obligation on the Notes.

“Subsidiary” means: (i) any instrumentality or subdivision or subunit of the Authority that has a separate legal existence or status or whose property and assets would not otherwise be bound to the terms of this Indenture; or (ii) with respect to any Person, any corporation, association or other business entity of which more than 50% of the total voting power of the shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person or a combination thereof. The Tribe and any other instrumentality of the Tribe that is not also an instrumentality of the Authority shall not be a Subsidiary of the Authority.

“Subsidiary Guarantee” means the joint and several guarantee by the Authority’s Subsidiaries of the Authority’s obligations under the Notes, in substantially the form of such Subsidiary Guarantee attached as Exhibit D to this Indenture.

“Subsidiary Guarantor” means any Subsidiary of the Authority that executes a Subsidiary Guarantee in accordance with the provisions of this Indenture.

“TCA” means Trading Cove Associates.

“TIA” means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date on which this Indenture is qualified under the TIA.

“Treasury Rate” means, for any Redemption Date, an annual rate equal to the semiannual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such Redemption Date. The semiannual equivalent yield to maturity will be computed as of the second Business Day immediately preceding such Redemption Date.

“Tribal Council” means the Tribe’s nine member elected council which exercises all the legislative and executive powers of the Tribe.

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“Tribal Gaming Ordinance” means the ordinance and any amendments thereto, and all related or implementing ordinances, including, without limitation, the Mohegan Tribal Gaming Ordinance, enacted on July 28, 1994 as Ordinance 94-1, and which are enacted by the Tribe or authorize and regulate gaming on the existing reservation of the Tribe located adjacent to Uncasville, Connecticut pursuant to IGRA.

“Tribal Tax Code” means any sales, use, room occupancy and related excise taxes, including admissions and cabaret taxes and any other tax (other than income tax) that may be imposed by the State of Connecticut that the Tribe may impose on the Authority, its patrons or operations; provided, however, that the rate and scope of such taxes shall not be more onerous than those imposed by the State of Connecticut.

“Tribe” means The Mohegan Tribe of Indians of Connecticut, a sovereign tribe recognized by the United States of America pursuant to 25 C.F.R. § 83.

“Trustee” means the party named as such above until a successor replaces it in accordance with the applicable provisions of this Indenture and thereafter means the successor serving hereunder.

“Unrestricted Definitive Note” means one or more Definitive Notes that do not bear and are not required to bear the Private Placement Legend.

“Unrestricted Global Note” means a permanent Global Note substantially in the form of Exhibit A attached hereto that bears the Global Note Legend and that has the “Schedule of Exchanges of Interests in the Global Note” attached thereto, and that is deposited with or on behalf of and registered in the name of the Depositary, representing a series of Notes that do not bear the Private Placement Legend.

“Unrestricted Subsidiary” means (i) any Subsidiary of the Authority that at the time of determination shall be designated an Unrestricted Subsidiary by the Management Board in the manner provided below and (ii) any Subsidiary of an Unrestricted Subsidiary. The Management Board may designate any Restricted Subsidiary (including any newly acquired or newly formed Subsidiary of the Authority) to be an Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or owns or holds any Lien on any property of, the Authority or any Restricted Subsidiary; provided that either (A) the Subsidiary to be so designated has total assets of $1,000 or less or (B) if such Subsidiary has assets greater than $1,000, such designation would be permitted under Section 4.07 hereof.

Any such designation by the Management Board shall be evidenced to the Trustee by filing with the Trustee a certified copy of the Board Resolution giving effect to such designation and an Officers’ Certificate certifying that such designation complied with the foregoing conditions and was permitted by Section 4.07 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Authority as of such date (and, if such Indebtedness is not permitted to be incurred as of such date under Section 4.09 hereof, the Authority shall be in default of such Section). The Authority may at any time

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designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation shall be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the Authority of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation shall only be permitted if (a) such Indebtedness is permitted by Section 4.09 hereof, calculated on a pro forma basis as if such designation had occurred at the beginning of the four-quarter reference period, and (b) no Default or Event of Default would be in existence following such designation.

“U.S. Person” means a U.S. person as defined in Rule 902(k) under the Securities Act.

“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Management Board or Board of Directors, as the case may be, of such Person.

“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing: (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by (ii) the then outstanding principal amount of such Indebtedness.

“Wholly Owned Restricted Subsidiary” of any Person means a Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares) shall at the time be owned by such Person or by one or more Wholly Owned Restricted Subsidiaries of such Person or by such Person and one or more Wholly Owned Restricted Subsidiaries of such Person.

“WNBA Subsidiary” means Mohegan Basketball Club, LLC, a limited liability company formed under the Laws of the Tribe and a wholly owned Subsidiary of the Authority, which is the owner and operator of the Women’s National Basketball Association franchise known as the Connecticut Sun.

Section 1.02. Other Definitions.

Term	Defined in Section
“Affiliate Transaction”	4.11
“Asset Sale Offer”	4.10
“Authentication Order”	2.02
“Books and Records”	1.01
“Change of Control Offer”	4.15
“Change of Control Payment”	4.15
“Change of Control Payment Date”	4.15
“Collateral Asset Sale Offer”	4.10
“Collateral Asset Sale Offer Price”	4.10
“Collateral Asset Sale Offer Period”	4.10

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Term	Defined in Section
“Collateral Excess Proceeds”	4.10
“Covenant Defeasance”	8.04
“Credit Documents”	13.01
“Creditor Parties”	13.01
“DTC”	2.03
“Event of Default”	6.01
“incur”	4.09
“Lease Transaction”	4.24
“Legal Defeasance”	8.03
“Management Activities”	13.01
“Moody’s”	4.28
“Mortgage”	11.05
“Non-Collateral Asset Sale Offer”	4.10
“Non-Collateral Asset Sale Offer Price”	4.10
“Non-Collateral Asset Sale Offer Period”	4.10
“Non-Collateral Excess Proceeds”	4.10
“Offer Amount”	3.10
“Offer Period”	4.10
“Paying Agent”	2.03
“Payment Default”	6.01
“Primary Treasury Dealer”	1.01
“Purchase Date”	3.10
“Rating Event Date”	4.28
“Reinstated Covenants”	4.28
“Reinstatement Date”	4.28
“Registrar”	2.03
“Restricted Payments”	4.07
“Suspended Covenants”	4.28
“Suspension Period”	4.28
“S&P”	4.28
“Title Authority”	11.05
“Title Policy”	11.05
“Title Policies”	11.05
“UCC”	4.03

Section 1.03. Rules of Construction.

Unless the context otherwise requires:

(a) a term has the meaning assigned to it;

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(b) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

(c) “or” is not exclusive;

(d) words in the singular include the plural, and in the plural include the singular;

(e) provisions apply to successive events and transactions; and

(f) references to sections of or rules under the Securities Act shall be deemed to include substitute, replacement of successor sections or rules adopted by the SEC from time to time.

ARTICLE 2

THE NOTES

Section 2.01. Form and Dating.

(a) General. The Notes and the Trustee’s certificate of authentication shall be substantially in the form of Exhibit A hereto. The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage. Each Note shall be dated the date of its authentication. The Notes shall be in denominations of $2,000 and integral multiples of $1,000 in excess thereof.

The terms and provisions contained in the Notes shall constitute, and are hereby expressly made, a part of this Indenture and the Authority, the Guarantors and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any Note conflicts with the express provisions of this Indenture, the provisions of this Indenture shall govern and be controlling.

(b) Global Notes. Notes issued in global form shall be substantially in the form of Exhibit A attached hereto (including the Global Note Legend thereon and the “Schedule of Exchanges of Interests in the Global Note” attached thereto). Notes issued in definitive form shall be substantially in the form of Exhibit A attached hereto (but without the Global Note Legend thereon and without the “Schedule of Exchanges of Interests in the Global Note” attached thereto). Each Global Note shall represent such of the outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate principal amount of outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby shall be made by the Trustee or the Custodian, at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.06 hereof.

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(c) Euroclear and Cedel Procedures Applicable. The provisions of the “Operating Procedures of the Euroclear System” and “Terms and Conditions Governing Use of Euroclear” and the “General Terms and Conditions of Cedel Bank” and “Customer Handbook” of Cedel Bank shall be applicable to transfers of beneficial interests in the Regulation S Global Notes that are held by Participants through Euroclear or Cedel Bank.

Section 2.02. Execution and Authentication.

Two Officers of the Authority shall sign the Notes for the Authority by manual or facsimile signature.

If an Officer whose signature is on a Note no longer holds that office at the time a Note is authenticated, the Note shall nevertheless be valid.

A Note shall not be valid until authenticated by the manual signature of the Trustee. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.

The Trustee shall, upon a written order of the Authority signed by two Officers of the Authority (an “Authentication Order”), authenticate Notes for original issue in one or more series, which order shall specify whether such notes are Initial Notes or Additional Notes. Initial Notes may be issued up to an aggregate principal amount not to exceed $200,000,000 (other than as provided in Section 2.07 hereof). Subject to compliance with Sections 4.09 and 4.12 hereof, Additional Notes may be issued in an unlimited principal amount.

The Notes shall be issued only in fully registered form, without coupons and only in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. All Notes issued under this Indenture shall vote and consent together on all matters as one class and no series of Notes will have the right to vote or consent as a separate class on any matter.

The Trustee may appoint an authenticating agent acceptable to the Authority to authenticate Notes. An authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with Holders or an Affiliate of the Authority.

Section 2.03. Registrar and Paying Agent.

The Authority shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange (“Registrar”) and an office or agency where Notes may be presented for payment (“Paying Agent”). The Registrar shall keep a register of the Notes and of their transfer and exchange. The Authority may appoint one or more co-registrars and one or more additional paying agents. The term “Registrar” includes any registrar and the term “Paying Agent” includes any additional paying agent. The Authority may change any Paying Agent or Registrar without notice to any Holder. The Authority shall notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. If the Authority fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Authority or any of its Restricted Subsidiaries may act as Paying Agent or Registrar.

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The Authority initially appoints The Depository Trust Company (“DTC”) to act as Depositary with respect to the Global Notes.

The Authority initially appoints the Trustee to act as the Registrar and Paying Agent and to act as Custodian with respect to the Global Notes.

Section 2.04. Paying Agent to Hold Money in Trust.

The Authority shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold in trust for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal, premium or interest on the Notes, and will notify the Trustee of any default by the Authority in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Authority at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Authority or a Restricted Subsidiary or an Affiliate) shall have no further liability for the money. If the Authority or a Restricted Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the Authority, the Trustee shall serve as Paying Agent for the Notes.

Section 2.05. Holder Lists.

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders. If the Trustee is not the Registrar, the Authority shall furnish to the Trustee at least seven Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of the Holders of Notes.

Section 2.06. Transfer and Exchange.

(a) Transfer and Exchange of Global Notes. A Global Note may not be transferred as a whole except by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary. All Global Notes will be exchanged by the Authority for Definitive Notes if (i) the Authority delivers to the Trustee notice from the Depositary that it is unwilling or unable to continue to act as Depositary or that it is no longer a clearing agency registered under the Exchange Act and, in either case, a successor Depositary is not appointed by the Authority within 120 days after the date of such notice from the Depositary or (ii) the Authority in its sole discretion determines that the Global Notes (in whole but not in part) should be exchanged for Definitive Notes and delivers a written notice to such effect to the Trustee. Upon the occurrence of either of the preceding events in (i) or (ii) above, Definitive Notes shall be issued in such names as the Depositary shall

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instruct the Trustee. Global Notes also may be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may not be exchanged for another Note other than as provided in this Section 2.06(a), however, beneficial interests in a Global Note may be transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.

(b) Transfer and Exchange of Beneficial Interests in the Global Notes. The transfer and exchange of beneficial interests in the Global Notes shall be effected through the Depositary, in accordance with the provisions of this Indenture and the Applicable Procedures. Beneficial interests in the Restricted Global Notes shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act. Transfers of beneficial interests in the Global Notes also shall require compliance with either subparagraph (i) or (ii) below, as applicable, as well as one or more of the other following subparagraphs, as applicable:

(i) Transfer of Beneficial Interests in the Same Global Note. Beneficial interests in any Restricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Note in accordance with the transfer restrictions set forth in the Private Placement Legend. Beneficial interests in any Unrestricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note. No written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this Section 2.06(b)(i).

(ii) All Other Transfers and Exchanges of Beneficial Interests in Global Notes. In connection with all transfers and exchanges of beneficial interests that are not subject to Section 2.06(b)(i) above, the transferor of such beneficial interest must deliver to the Registrar either (A) (1) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial interest in another Global Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase or (B) (1) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to cause to be issued a Definitive Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given by the Depositary to the Registrar containing information regarding the Person in whose name such Definitive Note shall be registered to effect the transfer or exchange referred to in (1) above. Upon satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Notes contained in this Indenture and the Notes or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Note(s) pursuant to Section 2.06(g) hereof.

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(iii) Transfer of Beneficial Interests to Another Restricted Global Note. A beneficial interest in any Restricted Global Note may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Note if the transfer complies with the requirements of Section 2.06(b)(ii) above and the Registrar receives the following:

(A) if the transferee will take delivery in the form of a beneficial interest in the 144A Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof; and

(B) if the transferee will take delivery in the form of a beneficial interest in the Regulation S Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof;

(iv) Transfer and Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in an Unrestricted Global Note. A beneficial interest in any Restricted Global Note may be exchanged by any Holder thereof for a beneficial interest in an Unrestricted Global Note or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note if the exchange or transfer complies with the requirements of Section 2.06(b)(ii) above and the Registrar receives the following:

(1) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(a) thereof; or

(2) if the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;

and if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.

If any such transfer is effected at a time when an Unrestricted Global Note has not yet been issued, the Authority shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred.

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Beneficial interests in an Unrestricted Global Note cannot be exchanged for, or transferred to Persons who take delivery thereof in the form of, a beneficial interest in a Restricted Global Note.

(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.

(i) Beneficial Interests in Restricted Global Notes to Restricted Definitive Notes. If any holder of a beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Restricted Definitive Note, then, upon receipt by the Registrar of the following documentation:

(A) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (2)(a) thereof;

(B) if such beneficial interest is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;

(C) if such beneficial interest is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof;

(D) if such beneficial interest is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof;

(E) if such beneficial interest is being transferred to the Authority or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(b) thereof; or

(F) if such beneficial interest is being transferred pursuant to an effective registration statement under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(c) thereof,

the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.06(g) hereof, and the Authority shall execute and the Trustee shall authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall deliver such Definitive Notes to the Persons

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in whose names such Notes are so registered. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein.

(ii) Beneficial Interests in Restricted Global Notes to Unrestricted Definitive Notes. A holder of a beneficial interest in a Restricted Global Note may exchange such beneficial interest for an Unrestricted Definitive Note or may transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note only if the Registrar receives the following:

(1) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Definitive Note that does not bear the Private Placement Legend, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(b) thereof; or

(2) if the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a Definitive Note that does not bear the Private Placement Legend, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;

and, in each such case, if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.

(iii) Beneficial Interests in Unrestricted Global Notes to Unrestricted Definitive Notes. If any holder of a beneficial interest in an Unrestricted Global Note proposes to exchange such beneficial interest for a Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Definitive Note, then, upon satisfaction of the conditions set forth in Section 2.06(b)(ii) hereof, the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.06(g) hereof, and the Authority shall execute and the Trustee shall authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(iii) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall deliver such Definitive Notes to the Persons in whose names such Notes are so registered. Any Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(iii) shall not bear the Private Placement Legend.

(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.

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(i) Restricted Definitive Notes to Beneficial Interests in Restricted Global Notes. If any Holder of a Restricted Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note or to transfer such Restricted Definitive Notes to a Person who takes delivery thereof in the form of a beneficial interest in a Restricted Global Note, then, upon receipt by the Registrar of the following documentation:

(A) if the Holder of such Restricted Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (2)(b) thereof;

(B) if such Restricted Definitive Note is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;

(C) if such Restricted Definitive Note is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof;

(D) if such Restricted Definitive Note is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof;

(E) if such Restricted Definitive Note is being transferred to the Authority or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(b) thereof; or

(F) if such Restricted Definitive Note is being transferred pursuant to an effective registration statement under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(c) thereof,

the Trustee shall cancel the Restricted Definitive Note, increase or cause to be increased the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Note, in the case of clause (B) above, the 144A Global Note, in the case of clause (C) above, the Regulation S Global Note.

(ii) Restricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A Holder of a Restricted Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Restricted Definitive Note to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note only if the Registrar receives the following:

(1) if the Holder of such Definitive Notes proposes to exchange such Notes for a beneficial interest in the Unrestricted Global Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (1)(c) thereof; or

(2) if the Holder of such Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the form of a beneficial interest in the Unrestricted Global Note, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;

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and, in each such case, if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.

Upon satisfaction of the conditions in this Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Note.

(iii) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Definitive Notes to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note at any time. Upon receipt of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive Note and increase or cause to be increased the aggregate principal amount of one of the Unrestricted Global Notes.

If any such exchange or transfer from a Definitive Note to a beneficial interest is effected pursuant to subparagraphs (ii) or (iii) above at a time when an Unrestricted Global Note has not yet been issued, the Authority shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the principal amount of Definitive Notes so transferred.

(e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon request by a Holder of Definitive Notes and such Holder’s compliance with the provisions of this Section 2.06(e), the Registrar shall register the transfer or exchange of Definitive Notes. Prior to such registration of transfer or exchange, the requesting Holder shall present or surrender to the Registrar the Definitive Notes duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar duly executed by such Holder or by its attorney, duly authorized in writing. In addition, the requesting Holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.06(e).

(i) Restricted Definitive Notes to Restricted Definitive Notes. Any Restricted Definitive Note may be transferred to and registered in the name of Persons who take delivery thereof in the form of a Restricted Definitive Note if the Registrar receives the following:

(A) if the transfer will be made pursuant to Rule 144A under the Securities Act, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof;

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(B) if the transfer will be made pursuant to Rule 903 or Rule 904, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof; and

(C) if the transfer will be made pursuant to any other exemption from the registration requirements of the Securities Act, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable.

(ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any Restricted Definitive Note may be exchanged by the Holder thereof for an Unrestricted Definitive Note or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Note if the Registrar receives the following:

(1) if the Holder of such Restricted Definitive Notes proposes to exchange such Notes for an Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (1)(d) thereof; or

(2) if the Holder of such Restricted Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;

and, in each such case, if the Registrar so requests, an Opinion of Counsel in form reasonably acceptable to the Authority to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.

(iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A Holder of Unrestricted Definitive Notes may transfer such Notes to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note. Upon receipt of a request to register such a transfer, the Registrar shall register the Unrestricted Definitive Notes pursuant to the instructions from the Holder thereof.

(f) Legends. The following legends shall appear on the face of all Global Notes and Definitive Notes issued under this Indenture unless specifically stated otherwise in the applicable provisions of this Indenture.

(i) Private Placement Legend.

(A) Except as permitted by subparagraph (C) below, each Global Note and each Definitive Note (and all Notes issued in exchange therefor or substitution thereof) shall bear the legend in substantially the following form:

“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED

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WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:

(1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE “SECURITIES ACT”) (A “QIB”) OR (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING THIS SECURITY FOR THE ACCOUNT OR FOR THE BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFF-SHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT,

(2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER RULE 144(d)(1) UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF THE TRANSFER OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) TO A PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QIB OR AN ACCREDITED INVESTOR PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB OR AN ACCREDITED INVESTOR, RESPECTIVELY, IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT OR AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE AND PROVIDED THAT PRIOR TO SUCH TRANSFER, THE TRUSTEE IS FURNISHED WITH AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AND

(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (2)(D) OR (2)(E) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

IN CONNECTION WITH ANY TRANSFER THIS SECURITY OR ANY INTEREST HEREIN WITHIN THE TIME PERIOD REFERRED TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE. AS USED HEREIN THE TERMS “OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S. PERSON” HAVE THE MEANING GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT.”

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(B) Any temporary Note that is a Global Note issued pursuant to Regulation S shall bear a legend (the “Regulation S Temporary Global Note Legend”) in substantially the following form:

THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE NOTES, ARE AS SPECIFIED IN THE INDENTURE. THE HOLDER OF THIS NOTE BY ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IF IT IS A PURCHASER IN A SALE THAT OCCURS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S OF THE SECURITIES ACT, IT ACKNOWLEDGES THAT, UNTIL EXPIRATION OF THE “40-DAY DISTRIBUTION COMPLIANCE PERIOD” WITHIN THE MEANING OF RULE 903 OF REGULATION S, ANY OFFER OR SALE OF THIS NOTE SHALL NOT BE MADE BY IT TO A U.S. PERSON TO OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON WITHIN THE MEANING OF RULE 902(k) UNDER THE SECURITIES ACT

(C) Notwithstanding the foregoing, any Global Note or Definitive Note issued pursuant to subparagraphs (b)(iv), (c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii) or (e)(iii) to this Section 2.06 (and all Notes issued in exchange therefor or substitution thereof) shall not bear the Private Placement Legend.

(ii) Global Note Legend. Each Global Note shall bear a legend in substantially the following form:

“THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE AUTHORITY.”

(iii) OID Legend. Each Note issued hereunder that has more than a de minimis amount of original issue discount for U.S. federal income tax purposes shall bear a legend in substantially the following form:

“THIS SECURITY IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE. A HOLDER MAY OBTAIN THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO MATURITY

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FOR SUCH SECURITY BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION TO: GENERAL COUNSEL, MOHEGAN TRIBAL GAMING AUTHORITY, ONE MOHEGAN SUN BOULEVARD, UNCASVILLE, CONNECTICUT 06382, TELEPHONE NUMBER (860) 862-5997.”

(g) Cancellation and/or Adjustment of Global Notes. At such time as all beneficial interests in a particular Global Note have been exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or canceled in whole and not in part, each such Global Note shall be returned to or retained and canceled by the Trustee in accordance with Section 2.11 hereof. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such Global Note shall be reduced accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note shall be increased accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such increase.

(h) General Provisions Relating to Transfers and Exchanges.

(i) To permit registrations of transfers and exchanges, the Authority shall execute and the Trustee shall authenticate Global Notes and Definitive Notes upon the Authority’s order or at the Registrar’s request.

(ii) No service charge shall be made to a holder of a beneficial interest in a Global Note or to a Holder of a Definitive Note for any registration of transfer or exchange, but the Authority may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 3.10, 4.10, 4.15 and 9.05 hereof).

(iii) The Registrar shall not be required to register the transfer of or exchange any Note selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part.

(iv) All Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes shall be the valid obligations of the Authority, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Global Notes or Definitive Notes surrendered upon such registration of transfer or exchange.

(v) The Authority shall not be required (A) to issue, to register the transfer of or to exchange any Notes during a period beginning at the opening of business 15 days before the day of any selection of Notes for redemption under Section 3.02 hereof and ending at the close of business on the day of selection, (B) to register the transfer of or to exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part or (C) to register the transfer of or to exchange a Note between a record date and the next succeeding interest payment date under such Note.

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(vi) Prior to due presentment for the registration of a transfer of any Note, the Trustee, any Agent and the Authority may deem and treat the Person in whose name any Note is registered as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Notes and for all other purposes, and none of the Trustee, any Agent or the Authority shall be affected by notice to the contrary.

(vii) The Trustee shall authenticate Global Notes and Definitive Notes in accordance with the provisions of Section 2.02 hereof.

(viii) All certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section 2.06 to effect a registration of transfer or exchange may be submitted by facsimile.

Section 2.07. Replacement Notes.

If any mutilated Note is surrendered to the Trustee or the Authority and the Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, the Authority shall issue and the Trustee, upon receipt of an Authentication Order, shall authenticate a replacement Note in accordance with this Indenture. If required by the Trustee or the Authority, an indemnity bond must be supplied by the Holder that is sufficient in the judgment of the Trustee and the Authority to protect the Authority, the Trustee, any Agent and any authenticating agent from any loss that any of them may suffer if a Note is replaced. The Authority may charge for its expenses in replacing a Note.

Every replacement Note is an additional obligation of the Authority and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder.

Section 2.08. Outstanding Notes.

The Notes outstanding at any time are all the Notes authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those reductions in the interest in a Global Note effected by the Trustee in accordance with the provisions hereof, and those described in this Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note does not cease to be outstanding because the Authority or an Affiliate of the Authority holds the Note.

If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.

If the principal amount of any Note is considered paid under Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.

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If the Paying Agent (other than the Authority, a Subsidiary or an Affiliate of any thereof) holds, on a Redemption Date or maturity date, money sufficient to pay Notes payable on that date, then on and after that date such Notes shall be deemed to be no longer outstanding and shall cease to accrue interest.

Section 2.09. Treasury Notes.

In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Authority, or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Authority, shall be considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that a Responsible Officer of the Trustee actually knows are so owned shall be so disregarded.

Section 2.10. Temporary Notes.

Until certificates representing Notes are ready for delivery, the Authority may prepare and the Trustee, upon receipt of an Authentication Order, shall authenticate temporary Notes. Temporary Notes shall be substantially in the form of certificated Notes but may have variations that the Authority considers appropriate for temporary Notes and as shall be reasonably acceptable to the Trustee. Without unreasonable delay, the Authority shall prepare and the Trustee shall authenticate definitive Notes in exchange for temporary Notes.

Holders of temporary Notes shall be entitled to all of the benefits of this Indenture.

Section 2.11. Cancellation.

The Authority at any time may deliver Notes to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall destroy canceled Notes (subject to the record retention requirement of the Exchange Act). Certification of the destruction of all canceled Notes shall be delivered to the Authority. The Authority may not issue new Notes to replace Notes that it has paid or that have been delivered to the Trustee for cancellation.

Section 2.12. Defaulted Interest.

If the Authority defaults in a payment of interest on the Notes, it shall pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the Notes and in Section 4.01 hereof. The Authority shall notify the Trustee in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment. The Authority shall fix or cause to be fixed each such special record date and payment date; provided that no such special record date shall be less than 10 days prior to the

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related payment date for such defaulted interest. At least 15 days before the special record date, the Authority (or, upon the written request of the Authority, the Trustee in the name and at the expense of the Authority) shall mail or cause to be mailed to Holders a notice that states the special record date, the related payment date and the amount of such interest to be paid.

Section 2.13. CUSIP Numbers.

The Authority in issuing the Notes may use “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use CUSIP numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption shall not be affected by any defect in or the omission of such numbers. The Authority will promptly notify the Trustee of any change in the CUSIP numbers.

Section 2.14. Ranking.

The Notes rank senior in right of payment to the Existing Senior Subordinated Notes.

ARTICLE 3

REDEMPTION AND PREPAYMENT

Section 3.01. Notices to Trustee.

If the Authority elects to redeem Notes pursuant to the optional redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee, at least 30 days but not more than 60 days before a Redemption Date, an Officers’ Certificate setting forth (i) the clause of this Indenture pursuant to which the redemption shall occur, (ii) the Redemption Date, (iii) the principal amount of Notes to be redeemed, (iv) the redemption price and (v) if applicable, any redemption requirements of the principal national securities exchange on which the Notes are listed.

Section 3.02. Selection of Notes to Be Redeemed.

If less than all of the Notes are to be redeemed at any time, the Trustee shall select the Notes for redemption in compliance with any requirements of the principal national securities exchange, if any, on which the Notes are listed as set forth in the Officers’ Certificate delivered pursuant to Section 3.01 hereof or, if the Notes are not so listed or if the requirements are not set forth in such Officers’ Certificate, on a pro rata basis, by lot or in accordance with any other method the Trustee considers fair and appropriate. In the event of partial redemption by lot, the particular Notes to be redeemed shall be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the Redemption Date by the Trustee from the outstanding Notes not previously called for redemption.

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The Trustee shall promptly notify the Authority in writing of the Notes selected for redemption and, in the case of any Note selected for partial redemption, the principal amount thereof to be redeemed. Notes and portions of Notes selected shall be in amounts of $1,000 or whole multiples of $1,000, except that if all of the Notes of a Holder are to be redeemed, the entire outstanding amount of Notes held by such Holder, even if not a multiple of $1,000, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption.

Section 3.03. Notice of Redemption.

Subject to the provisions of Section 3.10 hereof, at least 30 days but not more than 60 days before a Redemption Date, the Authority shall mail or cause to be mailed, by first class mail, a notice of redemption to each Holder whose Notes are to be redeemed at its registered address.

The notice shall identify the Notes to be redeemed and shall state:

(a) the Redemption Date;

(b) the redemption price;

(c) if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the Redemption Date upon surrender of such Note, a new Note in principal amount equal to the unredeemed portion shall be issued upon cancellation of the original Note;

(d) the name and address of the Paying Agent;

(e) that Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price;

(f) that, unless the Authority defaults in making such redemption payment, interest on Notes or portions of them called for redemption ceases to accrue on and after the Redemption Date;

(g) the paragraph of the Notes and/or Section of this Indenture pursuant to which the Notes called for redemption are being redeemed; and

(h) that no representation is made as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on the Notes.

At the Authority’s request, the Trustee shall give the notice of redemption in the Authority’s name and at its expense; provided, however, that the Authority shall have delivered to the Trustee, at least 45 days prior to the Redemption Date (unless a shorter period shall be satisfactory to the Trustee), an Officers’ Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the preceding paragraph.

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Section 3.04. Effect of Notice of Redemption.

Once notice of redemption is mailed in accordance with Section 3.03 hereof, Notes called for redemption become irrevocably due and payable on the Redemption Date at the redemption price. A notice of redemption may not be conditional.

Section 3.05. Deposit of Redemption Price.

One Business Day prior to the Redemption Date, the Authority shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption price of and accrued interest on all Notes to be redeemed on that date. The Trustee or the Paying Agent shall promptly return to the Authority any money deposited with the Trustee or the Paying Agent by the Authority in excess of the amounts necessary to pay the redemption price of, and accrued interest on, all Notes to be redeemed.

If the Authority complies with the provisions of the preceding paragraph, on and after the Redemption Date, interest shall cease to accrue on the Notes or the portions of Notes called for redemption. If a Note is redeemed on or after an interest record date but on or prior to the related interest payment date, then any accrued and unpaid interest shall be paid to the Person in whose name such Note was registered at the close of business on such record date. If any Note called for redemption shall not be so paid upon surrender for redemption because of the failure of the Authority to comply with the preceding paragraph, interest shall be paid on the unpaid principal, from the Redemption Date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.01 hereof.

Section 3.06. Notes Redeemed in Part.

Upon surrender of a Note that is redeemed in part, the Authority shall issue and, upon the Authority’s written request, the Trustee shall authenticate for the Holder at the expense of the Authority a new Note equal in principal amount to the unredeemed portion of the Note surrendered.

Section 3.07. Optional Redemption.

(a) At any time prior to November 1, 2013, the Notes will be redeemable, in whole at any time or in part from time to time, at the option of the Authority, at a redemption price equal to the greater of:

(i) 100% of the principal amount of the Notes to be redeemed; and

(ii) the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date, on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months), at the Treasury Rate plus 50 basis points;

plus accrued and unpaid interest thereon to the Redemption Date.

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(b) At any time or from time to time on or after November 1, 2013, the Notes will be redeemable, at the option of the Authority, in whole or in part, at the redemption prices (expressed as percentages of principal amount) set forth in the Notes, together with accrued and unpaid interest thereon, if any, to the applicable redemption date.

Section 3.08. Redemption Pursuant to Gaming Law.

(a) Notwithstanding any other provisions of this Article 3, if any Gaming Regulatory Authority requires that a Holder or beneficial owner of the Notes must be licensed, qualified or found suitable under any applicable gaming laws in order to maintain any gaming license or franchise of the Authority under any applicable gaming laws, and the Holder or beneficial owner fails to apply for a license, qualification or finding of suitability within 30 days after being requested to do so by such Gaming Regulatory Authority (or such lesser period that may be required by such Gaming Regulatory Authority) or if such Holder or beneficial owner is not so licensed, qualified or found suitable, the Authority has the right, at its option, (i) to require such Holder or beneficial owner to dispose of such Holder’s or beneficial owner’s Notes within 30 days of receipt of such finding by the applicable Gaming Regulatory Authority (or such earlier date as may be required by the applicable Gaming Regulatory Authority); or (ii) to call for redemption of the Notes of such Holder or beneficial owner at a redemption price equal to the least of (1) the principal amount thereof, (2) the price at which such Holder or beneficial owner acquired the Notes and (3) the current market price of the Notes, together with, in each case, accrued and unpaid interest to the earlier of the date of redemption or the date of the finding of unsuitability by such Gaming Regulatory Authority, which may be less than 30 days following the notice of redemption if so ordered by such Gaming Regulatory Authority.

(b) In connection with any redemption pursuant to this Section 3.08, and except as may be required by a Gaming Regulatory Authority, the Authority shall comply with Sections 3.01 through 3.06 hereof.

(c) The Authority shall not be required to pay or reimburse any Holder or beneficial owner of Notes who is required to apply for such license, qualification or finding of suitability for the costs of the licensure or investigation for such qualification or finding of suitability. Such expenses shall be the obligation of such Holder or beneficial owner.

Section 3.09. Mandatory Redemption.

The Authority shall not be required to make mandatory redemption payments with respect to the Notes.

Section 3.10. Offer to Purchase by Application of Excess Proceeds.

In the event that, pursuant to Section 4.10 hereof, the Authority shall be required to commence an Asset Sale Offer, it shall follow the procedures specified below.

The Asset Sale Offer shall remain open for the Offer Period and no longer, except to the extent that a longer period is required by applicable law. No later than five Business Days after the termination of the Offer Period (the “Purchase Date”), the Authority shall purchase the

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principal amount of Notes required to be purchased pursuant to Section 4.10 hereof (the “Offer Amount”) or, if less than the Offer Amount has been tendered, all Notes tendered in response to the Asset Sale Offer. Payment for any Notes so purchased shall be made in the same manner as interest payments are made.

If the Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Asset Sale Offer.

Upon the commencement of an Asset Sale Offer, the Authority shall send, by first class mail, a notice to the Trustee and each of the Holders. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Asset Sale Offer. The Asset Sale Offer shall be made to all Holders. The notice, which shall govern the terms of the Asset Sale Offer, shall state:

(a) that the Asset Sale Offer is being made pursuant to this Section 3.10 and Section 4.10 hereof and the length of time the Asset Sale Offer shall remain open;

(b) the Offer Amount, the purchase price and the Purchase Date;

(c) that any Note not tendered or accepted for payment shall continue to accrue interest;

(d) that, unless the Authority defaults in making such payment, any Note accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest after the Purchase Date;

(e) that Holders electing to have a Note purchased pursuant to an Asset Sale Offer may elect to have Notes purchased in integral multiples of $1,000 only; provided that no Notes of denominations less than $2,000 will be redeemed in part;

(f) that Holders electing to have a Note purchased Pursuant to any Asset Sale Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, or transfer by book-entry transfer, to the Authority, a depositary, if appointed by the Authority, or a paying agent at the address specified in the notice at least three days before the Purchase Date;

(g) that Holders shall be entitled to withdraw their election if the Authority, the depositary or the paying agent, as the case may be, receives, not later than the expiration of the Offer Period, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;

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(h) that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Offer Amount, the Authority shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Authority so that only Notes in denominations of $2,000, or integral multiples of $1,000 in excess thereof, shall be purchased); and

(i) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer).

On or before the Purchase Date, the Authority shall, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer, or if less than the Offer Amount has been tendered, all Notes tendered, and shall deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Authority in accordance with the terms of this Section 3.10. The Authority, the Depositary or the Paying Agent, as the case may be, shall promptly (but in any case not later than five Business Days after the Purchase Date) mail or deliver to each tendering Holder an amount equal to the purchase price of the Notes tendered by such Holder and accepted by the Authority for purchase, and the Authority shall promptly issue a new Note, and the Trustee, upon written request from the Authority shall authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered. Any Note not so accepted shall be promptly mailed or delivered by the Authority to the Holder thereof. The Authority shall publicly announce the results of the Asset Sale Offer on the Purchase Date.

Other than as specifically provided in this Section 3.10, any purchase pursuant to this Section 3.10 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof.

ARTICLE 4

COVENANTS

Section 4.01. Payment of Notes.

(a) The Authority shall pay or cause to be paid the principal of, premium, if any, and interest on the Notes on the dates and in the manner provided in the Notes. Principal, premium, if any, and interest shall be considered paid on the date due if the Paying Agent, if other than the Authority or a Subsidiary thereof, holds as of 10:00 a.m. Eastern Time on the due date money deposited by the Authority in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest then due.

(b) The Authority shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at the rate equal to 1% per annum in excess of the then applicable interest rate on the Notes to the extent lawful; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace period) at the same rate to the extent lawful.

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Section 4.02. Maintenance of Office or Agency.

(a) The Authority shall maintain in the Borough of Manhattan, the City of New York, an office or agency (which may be an office of the Trustee or an Affiliate of the Trustee, Registrar or coregistrar) where Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Authority in respect of the Notes and this Indenture may be served. The Authority shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Authority shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee.

(b) The Authority may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Authority of its obligation to maintain an office or agency in the Borough of Manhattan, the City of New York for such purposes. The Authority shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

(c) The Authority hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Authority in accordance with Section 2.03 hereof.

Section 4.03. Reports.

(a) Whether or not required by the SEC, so long as any Notes are outstanding, the Authority will furnish to the Holders (which may be deemed to be accomplished by electronic transmission via the SEC’s EDGAR system) and the Trustee within 15 days after the end of the time periods specified in the SEC’s rules and regulations for filings of current, quarterly and annual reports:

(i) all quarterly and annual financial information that would be required to be contained in a filing with the SEC on Forms 10-Q and 10-K if the Authority were required to file such Forms, including a “Management’s Discussion and Analysis of Financial Condition and Results of Operations” that describes the financial condition and results of operations of the Authority and its consolidated Subsidiaries (showing in reasonable detail, either on the face of the consolidated financial statements or in the footnotes thereto and in Management’s Discussion and Analysis of Financial Condition and Results of Operations, the financial condition and results of operations of the Authority and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Authority, to the extent that would be required by the rules, regulations or interpretive positions of the SEC) and, with respect to the annual information only, a report thereon by the Authority’s independent registered public accounting firm; and

(ii) all current reports that would be required to be filed with the SEC on Form 8-K if the Authority were required to file such reports.

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(b) The Authority has agreed that, for so long as any Notes remain outstanding, it will furnish to the Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

(c) The Authority shall file with the Trustee and provide to Holders, within 15 days after it files them with the NIGC, copies of all reports which the Authority is required to file with the NIGC pursuant to 25 C.F.R. Part 514.

(d) The Authority and each Restricted Subsidiary shall furnish to the Collateral Agent prompt notice (but in any event not more than thirty (30) days after any change referred to herein) of any change in: (i) the Authority or any Restricted Subsidiary’s legal name; (ii) the location of the Authority’s or any Restricted Subsidiary’s chief executive office or its principal place of business; (iii) the Authority’s or any Restricted Subsidiary’s jurisdiction of incorporation or formation (in each case, including by merging with or into any other entity, reorganizing, dissolving, liquidating, reorganizing or organizing in any other jurisdiction); or (iv) the Authority’s or any Restricted Subsidiary’s Federal Taxpayer Identification Number or organizational identification number assigned to it by its state of organization. The Authority and each Restricted Subsidiary agree (A) not to effect or permit any such change unless all filings have been made under the Uniform Commercial Code (the “UCC”) or otherwise that are required in order for Collateral Agent to continue at all times following such change to have a valid, legal and perfected security interest in all the Collateral (subject to Permitted Liens) and (B) to take all action required to maintain the perfection and priority of the security interest of Collateral Agent for the benefit of the Secured Parties in the Collateral intended to be granted hereunder. The Authority and each Restricted Subsidiary agrees to promptly provide Collateral Agent with certified organizational documents reflecting any of the changes described in the preceding sentence. Collateral Agent may rely on opinions of counsel as to whether any or all UCC financing statements of the Authority or any Restricted Subsidiary need to be amended as a result of any of the changes described in this Section 4.3(a). Collateral Agent shall have no duty to inquire about such changes.

Section 4.04. Compliance Certificate.

(a) The Authority shall deliver to the Trustee, within 90 days after the end of each fiscal year, an Officers’ Certificate stating that a review of the activities of the Authority and its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Authority has kept, observed, performed and fulfilled its obligations under this Indenture, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge the Authority has kept, observed, performed and fulfilled each and every covenant contained in this Indenture and is not in default in the performance or observance of any of the terms, provisions and conditions of this Indenture (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Authority is taking or proposes to take with respect thereto) and that to the best of his or her knowledge no event has occurred and remains in existence by reason of which payments on account of the principal of or interest, if any, on the Notes is prohibited or if such event has occurred, a description of the event and what action the Authority is taking or proposes to take with respect thereto.

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(b) So long as not contrary to the then current recommendations of the American Institute of Certified Public Accountants, the year-end financial statements delivered pursuant to Section 4.03(a) above shall be accompanied by a written statement of the Authority’s independent public accountants (who shall be a firm of established national reputation) that in making the examination necessary for certification of such financial statements, nothing has come to their attention that would lead them to believe that the Authority has violated any provisions of this Article 4 or Article 5 hereof or, if any such violation has occurred, specifying the nature and period of existence thereof, it being understood that such accountants shall not be liable directly or indirectly to any Person for any failure to obtain knowledge of any such violation.

(c) The Authority shall, so long as any of the Notes are outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware of any Default or Event of Default, an Officers’ Certificate specifying such Default or Event of Default and what action the Authority is taking or proposes to take with respect thereto.

Section 4.05. Taxes.

The Authority shall pay, and shall cause each of its Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and governmental levies except such as are contested in good faith and by appropriate proceedings or where the failure to effect such payment is not adverse in any material respect to the Holders of the Notes.

Section 4.06. Stay, Extension and Usury Laws.

The Authority covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Authority (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it shall not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law has been enacted.

Section 4.07. Restricted Payments.

(a) The Authority will not, and the Authority will not permit any of its Restricted Subsidiaries, directly or indirectly, to: (i) make any payment on or with respect to any of the Authority’s or any of its Restricted Subsidiaries’ Equity Interests; (ii) purchase, redeem, defease or otherwise acquire or retire for value any Equity Interest in the Authority held by the Tribe or any Affiliate of the Tribe; (iii) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Indebtedness, except a payment of interest or principal up to 90 days prior to the Stated Maturity thereof; (iv) make any payment or distribution to the Tribe (or any other agency, instrumentality or political subunit

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thereof) or make any general distribution to the members of the Tribe (other than Government Service Payments); or (v) make any Restricted Investment (all such payments and other actions set forth in clauses (i) through (v) are collectively referred to as “Restricted Payments”) unless, at the time of and after giving effect to such Restricted Payment:

(A) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof;

(B) the Authority would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 4.09(a) hereof; and

(C) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Authority and its Restricted Subsidiaries after the date of this Indenture (excluding Restricted Payments permitted by clauses (ii), (iii), (iv), (v), (vi) and (vii) of Section 4.07(b) hereof), is less than the sum, without duplication, of (1) 50% of the Consolidated Net Income of the Authority for the period (taken as one accounting period) from the beginning of the first fiscal quarter commencing after December 31, 2009 to the end of the Authority’s most recently ended fiscal quarter for which internal consolidated financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for such period is a deficit, less 100% of such deficit), plus (2) 100% of the aggregate net cash proceeds or fair market value (as determined in good faith by the Management Board and evidenced by a resolution set forth in an Officers’ Certificate delivered to the Trustee) of assets or property (other than cash) received by the Authority after December 31, 2009 from capital contributions from the Tribe that bear no mandatory obligation to repay the Tribe, plus (3) to the extent that any Restricted Investment that was made after December 31, 2009 is sold, liquidated or otherwise disposed of for cash or an amount equal to the fair market value thereof (as determined in good faith by the Management Board and evidenced by a resolution set forth in an Officers’ Certificate delivered to the Trustee), the lesser of (I) the cash return of capital or fair market value amount, as the case may be, with respect to such Restricted Investment (less the cost of disposition, if any) and (II) the initial amount of such Restricted Investment, plus (4) to the extent that any Unrestricted Subsidiary is redesignated as a Restricted Subsidiary after December 31, 2009, the lesser of (I) the fair market value of the Authority’s Investment in such Subsidiary as of the date of such redesignation and (II) such fair market value as of the date on which such Subsidiary was originally designated as an Unrestricted Subsidiary.

(b) So long as no Default has occurred and is continuing or would be caused thereby, the preceding provisions will not prohibit: (i) the defeasance, redemption, repurchase or other acquisition of Subordinated Indebtedness with the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness; (ii) the payment of any dividend by a Restricted Subsidiary of the Authority to the holders of its common Equity Interests on a pro rata basis; (iii) the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of any

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Restricted Subsidiary of the Authority held by any member of the Authority’s (or any of its Restricted Subsidiaries’) management pursuant to any management equity subscription agreement or stock option agreement in effect as of the date of this Indenture; provided that (a) the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests shall not exceed $1.0 million in any 12-month period and (b) the aggregate amount of all such repurchased, redeemed, acquired or retired Equity Interests shall not in the aggregate exceed $3.0 million; (iv) the redemption or purchase of Subordinated Indebtedness of the Authority in the event that the holder of such Subordinated Indebtedness has failed to qualify or be found suitable or otherwise be eligible by any Gaming Regulatory Authority to remain a holder of such Subordinated Indebtedness; (v) the redemption, defeasance, repurchase or other acquisition or retirement of Subordinated Indebtedness with the net cash proceeds from a substantially concurrent capital contribution from the Tribe (provided that such capital contribution is not counted for purposes of Section 4.07(a)(C)(2) hereof); (vi) the redemption, defeasance, repurchase or other acquisition or retirement of the Existing Senior Subordinated Notes; (vii) the redemption, defeasance, repurchase or other acquisition or retirement of the Existing Senior Subordinated Notes in connection with any repurchase offer related to an Asset Sale but only if the Authority shall have complied with Section 4.10 hereof and purchased all Notes validly tendered in such offer prior to the redemption of such other notes; and (viii) any other Restricted Payments in an amount not to exceed $75.0 million at any one time outstanding.

(c) The Authority may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if such designation would not cause a Default; provided that in no event shall any Key Project Assets or Gaming Licenses be transferred to an Unrestricted Subsidiary; provided further that Gaming Licenses unrelated to the Resort may be transferred to an Unrestricted Subsidiary, so long as at the time and after giving effect to such transfer (i) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; and (ii) the Authority would, at the time of such transfer and after giving pro forma effect thereto, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 4.09(a) hereof. In the event of such designation, all outstanding Investments owned by the Authority and its Restricted Subsidiaries in the Subsidiary so designated will be deemed to be an Investment made as of the time of such designation and will reduce the amount available for Restricted Payments under Section 4.07(a) hereof unless the Investment constitutes a Permitted Investment. All such outstanding Investments will be deemed to constitute Restricted Payments in an amount equal to the fair market value of such Investments at the time of such designation. Such designation will only be permitted if such Restricted Payment would be permitted at such time and if such Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. The Authority may redesignate an Unrestricted Subsidiary to be a Restricted Subsidiary if such redesignation would not otherwise cause a Default.

(d) The amount of all Restricted Payments (other than cash) shall be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Authority or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any assets or securities that are required to be valued by this Section 4.07 shall be determined by the Management Board whose resolution with respect thereto shall be delivered to the Trustee.

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Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries.

(a) Except as set forth in Section 4.08(b) hereof, the Authority will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become effective any encumbrance or restriction on the ability of any Restricted Subsidiary to: (i) pay dividends or make any other distributions on its Capital Stock to the Authority or any of the Authority’s Restricted Subsidiaries, or with respect to any other interest or participation in, or measured by, its profits, or pay any indebtedness owed to the Authority or any of the Authority’s Restricted Subsidiaries; (ii) make loans or advances to the Authority or any of the Authority’s Restricted Subsidiaries; or (iii) transfer any of its properties or assets to the Authority or any of the Authority’s Restricted Subsidiaries.

(b) The provisions of Section 4.08(a) hereof will not apply to encumbrances or restrictions existing under or by reason of:

(i) Existing Indebtedness as in effect on the date of this Indenture and any amendments, modifications, restatements, renewals, extensions, increases, supplements, refundings, replacements or refinancings thereof; provided that such amendments, modifications, restatements, renewals, extensions, increases, supplements, refundings, replacements or refinancings are no more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in such Existing Indebtedness, as in effect on the date of this Indenture;

(ii) this Indenture and the Notes;

(iii) the Credit Facilities;

(iv) applicable law;

(v) any instrument governing Indebtedness or Capital Stock of a Person acquired by the Authority or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired; provided that, in the case of Indebtedness, such Indebtedness was permitted by the terms of this Indenture to be incurred;

(vi) customary non-assignment provisions in leases or other contracts entered into in the ordinary course of business and consistent with past practices;

(vii) purchase money obligations (including, without limitation, Capital Lease Obligations) for property acquired in the ordinary course of business that impose restrictions on the property so acquired of the nature described in Section 4.08(a)(iii) hereof;

(viii) any agreement for the sale or other disposition of a Restricted Subsidiary that restricts distributions by such Restricted Subsidiary pending its sale or other disposition;

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(ix) Permitted Refinancing Indebtedness; provided that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are no more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced;

(x) Liens securing Indebtedness otherwise permitted to be incurred pursuant to Section 4.12 hereof that limit the right of the Authority or any of its Restricted Subsidiaries to dispose of the assets subject to such Lien;

(xi) provisions with respect to the disposition or distribution of assets or property in joint venture agreements and other similar agreements entered into in the ordinary course of business; and

(xii) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business.

Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock.

(a) The Authority will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness (including Acquired Indebtedness) and the Authority will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Authority may incur Indebtedness (including Acquired Indebtedness) or issue shares of Disqualified Stock and the Authority’s Restricted Subsidiaries may incur Indebtedness or issue preferred stock if the Fixed Charge Coverage Ratio for the Authority’s most recently ended four full fiscal quarters for which internal consolidated financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been at least 2.0 to 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred at the beginning of such four-quarter period. Notwithstanding the foregoing, the Authority will not issue any Disqualified Stock or any type of Capital Stock that would violate IGRA.

(b) So long as no Default or Event of Default shall have occurred and be continuing, or would be caused thereby, Section 4.09(a) hereof will not prohibit the incurrence of any of the following items of Indebtedness:

(i) the incurrence by the Authority or its Restricted Subsidiaries of Indebtedness and letters of credit pursuant to Credit Facilities; provided that the aggregate principal amount of all such Indebtedness and letters of credit outstanding under all Credit Facilities, after giving effect to such incurrence (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Authority thereunder), does not exceed $700.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Authority or any of its Restricted Subsidiaries since the Issue Date to repay Indebtedness and permanently reduce the commitments under Credit Facilities permitted under Section 4.10 hereof;

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(ii) the incurrence by the Authority and its Restricted Subsidiaries of the Existing Indebtedness;

(iii) the incurrence by the Authority of Indebtedness represented by the Initial Notes in an aggregate principal amount of $200.0 million;

(iv) the incurrence by the Authority or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case incurred for the purpose of financing all or any part of the purchase price of furniture, fixtures, equipment or similar assets used or useful in the business of the Authority or such Restricted Subsidiary not to exceed 100% of the lesser of cost and fair market value of the assets financed and, in an aggregate principal amount under this clause (iv) not to exceed $75.0 million at any time outstanding;

(v) the incurrence by the Authority or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance, renew, extend, defease or replace Indebtedness that was permitted by this Indenture to be incurred under Section 4.09(a) hereof or clause (ii) or (iii) of this Section 4.09(b) or this clause (v);

(vi) the incurrence by the Authority or any of its Restricted Subsidiaries of Hedging and Swap Obligations that are incurred with respect to any Indebtedness that is permitted by the terms of this Indenture to be outstanding;

(vii) the guarantee by the Authority or any of its Restricted Subsidiaries of any Indebtedness of the Authority or any of its Restricted Subsidiaries that was permitted to be incurred by another provision of this Section 4.09;

(viii) the incurrence by a Wholly Owned Restricted Subsidiary of Indebtedness owed to another Wholly Owned Restricted Subsidiary or to the Authority; provided that if at any time any such Wholly Owned Restricted Subsidiary ceases to be a Wholly Owned Restricted Subsidiary, any such Indebtedness shall be deemed to be an incurrence of Indebtedness for the purposes of this Section 4.09;

(ix) the incurrence by the Authority or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (ix), not to exceed $50.0 million;

(x) the incurrence by the Authority or any of its Restricted Subsidiaries of Indebtedness (which may consist of Capital Lease Obligations), and any amendments, modifications, restatements, renewals, extensions, increases, supplements, refundings, replacements or refinancings thereof, in an aggregate principal amount not to exceed $55.0 million at any time outstanding in connection with the development of the expansion project of a hotel with a minimum of 200 rooms located at Mohegan Sun at Pocono Downs in Plains Township, Pennsylvania; provided, however, that such Indebtedness shall not encumber any real estate Collateral other than the real estate Collateral comprising such expansion project; and

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(xi) to the extent that such incurrence does not result in the incurrence by the Authority or any Restricted Subsidiary of any obligation for the payment of borrowed money of others and does not result in an encumbrance of any real property Collateral, Indebtedness incurred solely as a result of the execution by the Authority or its Restricted Subsidiaries of a Completion Guarantee and Keep-Well Agreement.

For purposes of determining compliance with this Section 4.09 in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Indebtedness described in clauses (i) through (xi) above or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Authority shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence in any manner that complies with this Section 4.09.

Section 4.10. Asset Sales.

(a) The Authority will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless: (i) the Authority (or its Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Sale at least equal to the fair market value (as determined in good faith by the Management Board and evidenced by a resolution set forth in an Officers’ Certificate delivered to the Trustee) of the assets sold or otherwise disposed of; and (ii) except in the case of a Permitted Asset Swap, at least 75% of the consideration therefor received by the Authority or such Restricted Subsidiary is in the form of cash. For purposes of this provision, each of the following shall be deemed to be cash: (A) any liabilities that would appear on the Authority’s or such Restricted Subsidiary’s balance sheet prepared in accordance with GAAP (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any guarantee thereof) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Authority or such Restricted Subsidiary from further liability; and (B) any securities, notes or other obligations received by the Authority or any such Restricted Subsidiary from such transferee that are converted by the Authority or such Restricted Subsidiary into cash (to the extent of the cash received) within 30 days of the receipt thereof; provided, however, that the Authority will not be permitted to make any Asset Sale of Key Project Assets.

(b) Within 360 days after the receipt of any Net Proceeds from an Asset Sale, the Authority may apply such Net Proceeds, at its option, to (i) (1) retire Indebtedness secured by the asset which was the subject of the Asset Sale, (2) retire, pay and permanently reduce Permitted Priority Lien Debt or the Notes; provided that in the case of a revolver or similar arrangement that makes credit available, such commitment is permanently reduced by such amount, or (3) retire, repay and permanently reduce other senior secured Indebtedness; provided that the Notes are retired or repaid on a pro rata basis; (ii) acquire a majority of the assets of, or a majority of the Voting Stock of, an entity engaged in the Principal Business or a Related Business; (iii) make capital expenditures or acquire other long-term assets that are used or useful in the Principal Business or a Related Business; (iv) make an investment in the Principal Business or a Related Business or in tangible long-term assets used or useful in the Principal Business or a Related Business; or (v) reduce permanently Indebtedness that is not Subordinated Indebtedness.

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(c) Within 360 days following an Asset Sale that constitutes a Sale of Collateral or the Sale of a Guarantor, Net Proceeds therefrom shall be (A) applied to purchase assets and property, which in the good faith judgment of the Management Board will immediately constitute Collateral and be made subject to the Lien of the Security Documents, (B) applied to purchase Excluded Assets constituting any gaming license, authorization or permit and related Books and Records so long as such assets are held by the Authority or a Subsidiary Guarantor, (C) applied to purchase assets as defined under clauses (viii) and (x) of the definition of “Excluded Assets” herein; provided that Net Proceeds from any such Asset Sale so applied shall not exceed $75 million in the aggregate; and provided, further, that after giving effect to such transaction the Consolidated Secured Leverage Ratio shall be no worse than the Consolidated Secured Leverage Ratio on the Issue Date, (D) applied to purchase assets that constitute Excluded Assets under clauses (i)-(vii), (ix) and (xi)-(xiii) of the definition of “Excluded Assets”; provided that such Net Proceeds so applied shall not exceed $15 million in the aggregate, (E) used to purchase Capital Stock of a Related Business if, after giving effect to such purchase, the Related Business becomes a Guarantor or is merged into or consolidated with the Authority or a Guarantor, or (F) used to retire, prepay and permanently reduce Indebtedness secured by the asset which was the subject of the Asset Sale or to repay and permanently reduce Permitted Priority Lien Debt or the notes; provided that in the case of a revolver or similar arrangement that makes credit available, such commitment is permanently reduced by such amount.

(d) All Net Proceeds from an Event of Loss shall be used as follows: (1) first, the Authority shall use such Net Proceeds to the extent deemed necessary or appropriate to rebuild, repair, replace or restore the assets subject to such Event of Loss with comparable assets and, in the event the property or assets affected by such Event of Loss constitute Collateral, such comparable assets will immediately constitute Collateral and be made subject to the Lien of the Security Documents and (2) then, to the extent any Net Proceeds from an Event of Loss are not used as described in the preceding clause (1), all such remaining Net Proceeds shall be reinvested or used as provided in clause (A) or (D) of the immediately preceding paragraph.

Pending the final application of any such Net Proceeds, the Authority may temporarily reduce revolving credit borrowings or otherwise invest such Net Proceeds in any manner that is not prohibited by this Indenture. At any time during such 360-day period, the Authority may elect to treat all or any portion of such Net Proceeds as “Collateral Excess Proceeds” or “Non-Collateral Excess Proceeds,” as applicable, and make an Asset Sale Offer to the Holders as set forth in Sections 3.10, 4.10(e) and (f) hereof in satisfaction of the obligation to make such offer as set forth in Sections 4.10(e) and (f) hereof, as applicable.

(e) Any Net Proceeds from Asset Sales of Collateral that are not applied or invested as provided in the preceding paragraphs will be deemed to constitute “Collateral Excess Proceeds.” When the aggregate amount of Collateral Excess Proceeds exceeds $15.0 million, the Authority will make an offer to repurchase the Notes, together with any senior secured Indebtedness ranking pari passu with the Notes and containing similar provisions requiring the Authority to make an offer to purchase such pari passu senior secured Indebtedness with the proceeds from such Asset Sale pursuant to a cash offer (subject only to conditions required by applicable law, if any), pro rata in proportion to the respective principal amounts of such pari passu senior secured Indebtedness (or accreted values in the case of Indebtedness issued with an original

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issue discount) and the Notes (the “Collateral Asset Sale Offer”) at a purchase price of 100% of the principal amount (or accreted value in the case of Indebtedness issued with an original issue discount) (the “Collateral Asset Sale Offer Price”). The Collateral Asset Sale Offer shall remain open for at least 20 Business Days following its commencement (the “Collateral Asset Sale Offer Period”). The offer price in any Collateral Asset Sale Offer will be equal to 100% of the principal amount plus accrued and unpaid interest to the date of purchase and will be payable in cash, in accordance with the procedures set forth in this Indenture and such other pari passu senior secured Indebtedness. To the extent that any Collateral Excess Proceeds remain after consummation of an Collateral Asset Sale Offer, the Authority may use such Collateral Excess Proceeds for any purpose not otherwise prohibited by this Indenture and the Security Documents. If the aggregate principal amount of Notes and such other pari passu senior secured Indebtedness tendered into such Collateral Asset Sale Offer surrendered by holders thereof exceeds the amount of Collateral Excess Proceeds, the Trustee shall select the Notes and such other pari passu senior secured Indebtedness (to the extent that such other senior secured Indebtedness permits such selection) to be purchased on a pro rata basis. Upon completion of such Collateral Asset Sale Offer, the amount of Collateral Excess Proceeds shall be reset at zero.

(f) Any Net Proceeds from Asset Sales of non-Collateral that are not applied or invested as provided in the preceding paragraphs will be deemed to constitute “Non-Collateral Excess Proceeds.” When the aggregate amount of Non-Collateral Excess Proceeds exceeds $15.0 million, the Authority will make an offer to repurchase the Notes, together with any senior Indebtedness ranking pari passu with the Notes and containing similar provisions requiring the Authority to make an offer to purchase such pari passu senior Indebtedness with the proceeds from such Asset Sale pursuant to a cash offer (subject only to conditions required by applicable law, if any), pro rata in proportion to the respective principal amounts of such pari passu senior Indebtedness (or accreted values in the case of Indebtedness issued with an original issue discount) and the Notes (the “Non-Collateral Asset Sale Offer” and, together with the Collateral Asset Sale Offer, each an “Asset Sale Offer”) at a purchase price of 100% of the principal amount (or accreted value in the case of Indebtedness issued with an original issue discount) (the “Non-Collateral Asset Sale Offer Price”). The Non-Collateral Asset Sale Offer shall remain open for at least 20 Business Days following its commencement (the “Non-Collateral Asset Sale Offer Period” and, together with the Collateral Asset Sale Offer Period, each an “Offer Period”). The offer price in any Non-Collateral Asset Sale Offer will be equal to 100% of the principal amount plus accrued and unpaid interest to the date of purchase and will be payable in cash, in accordance with the procedures set forth in this Indenture and such other pari passu senior Indebtedness. To the extent that any Non-Collateral Excess Proceeds remain after consummation of a Non-Collateral Asset Sale Offer, the Authority may use such Non-Collateral Excess Proceeds for any purpose not otherwise prohibited by this Indenture and the Security Documents. If the aggregate principal amount of Notes and such other pari passu senior Indebtedness tendered into such Non-Collateral Asset Sale Offer surrendered by holders thereof exceeds the amount of Non-Collateral Excess Proceeds, the Trustee shall select the Notes and such other pari passu senior Indebtedness (to the extent that such other senior Indebtedness permits such selection) to be purchased on a pro rata basis. Upon completion of such Non-Collateral Asset Sale Offer, the amount of Non-Collateral Excess Proceeds shall be reset at zero. Notwithstanding anything to the contrary set forth in this paragraph, the Authority may elect to make an Asset Sale Offer with respect to any Non-Collateral Excess Proceeds in accordance with the preceding paragraph in lieu of complying with the provisions set forth in this paragraph.

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Section 4.11. Transactions with Affiliates.

(a) The Authority will not, and the Authority will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with or for the benefit of, any Affiliate (each of the foregoing, an “Affiliate Transaction”), unless: (i) such Affiliate Transaction is on terms that are no less favorable to the Authority or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Authority or such Restricted Subsidiary with an unrelated Person; and (ii) the Authority delivers to the Trustee: (A) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $5.0 million, a resolution of the Management Board set forth in an Officers’ Certificate certifying that such Affiliate Transaction complies with this Section 4.11and that such Affiliate Transaction has been approved by a majority of the disinterested members of the Management Board; and (B) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $10.0 million, an opinion as to the fairness to the Authority or such Restricted Subsidiary of such Affiliate Transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing.

(b) The following items shall not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of Section 4.1l(a) hereof: (i) any employment agreement or arrangement entered into by the Authority or any of its Restricted Subsidiaries in the ordinary course of business and consistent with the past practice of the Authority or such Restricted Subsidiary; (ii) transactions between or among the Authority and/or its Restricted Subsidiaries; (iii) payment of reasonable Management Board fees to members of the Management Board; (iv) transactions with Persons in whom the Authority owns any Equity Interests, so long as the remaining equity holders of such Person are not Affiliates of the Authority or any of its Subsidiaries; (v) Government Service Payments; (vi) transactions pursuant to the Relinquishment Agreement; (vii) Restricted Payments or Permitted Investments that are made in compliance with the provisions of Section 4.07 hereof; (viii) contractual arrangements existing on the date of this Indenture and any renewals, extensions and modifications thereof that are not materially adverse to Holders; and (ix) provision by the Authority or any of its Restricted Subsidiaries of development or management services to an Unrestricted Subsidiary engaged in a Principal Business or Related Business; provided that the Authority or such Restricted Subsidiary, as the case may be, is reimbursed by the Unrestricted Subsidiary for all costs and expenses (including without limitation payroll) it incurs in providing such services.

Section 4.12. Liens.

The Authority will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or otherwise cause or suffer to exist or become effective any Lien of any kind (other than Permitted Liens) upon any of its property or assets, or any proceeds therefrom.

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Section 4.13. Line of Business.

The Authority shall not, and shall not permit any of its Restricted Subsidiaries to, engage in any business other than the Principal Business or a Related Business.

Section 4.14. Existence of the Authority and Maintenance of the Lease.

(a) The Authority shall, and shall cause each of its Restricted Subsidiaries to, do or cause to be done all things necessary to preserve and keep in full force and effect their respective existence, in accordance with their respective organizational documents and their respective rights (contractual, charter and statutory), licenses and franchises; provided, however, that neither the Authority nor any Restricted Subsidiary shall be required to preserve, with respect to itself, any license, right or franchise and, with respect to its Restricted Subsidiaries, any such existence, license, right or franchise, if its Management Board or Board of Directors, or other governing body or officers authorized to make such determination, as the case may be, shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Authority or any Restricted Subsidiary, and that the loss thereof is not adverse in any material respect to the Holders.

(b) The Authority shall do, or cause to be done, all things necessary to perform any material covenants set forth in the Lease in order to keep the Lease in full force and effect.

Section 4.15. Offer to Repurchase at the Option of Holders upon Change of Control.

(a) If a Change of Control occurs, each Holder will have the right to require the Authority to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of that Holder’s Notes pursuant to a change of control offer (a “Change of Control Offer”). In the Change of Control Offer, the Authority will offer a payment (the “Change of Control Payment”) in cash equal to 101% of the aggregate principal amount of Notes repurchased plus accrued and unpaid interest thereon, to the date of purchase.

(b) Within 20 Business Days following any Change of Control, the Authority will mail a notice to each Holder (and, unless the Trustee makes the mailing on behalf of the Authority, to the Trustee) describing the transaction or transactions that constitute the Change of Control and offering to repurchase Notes on the date specified in such notice (the “Change of Control Payment Date”), pursuant to the procedures required by this Indenture and described in such notice. If the Authority wishes the Trustee to do the mailing, it will give the Trustee adequate prior notice so that the Trustee may do so. The Authority will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control.

(c) On the Change of Control Payment Date, the Authority will, to the extent lawful: (i) accept for payment all Notes or portions thereof properly tendered pursuant to the Change of Control Offer; (ii) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions thereof so tendered; and (iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Authority.

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(d) The Paying Agent will promptly mail to each Holder of Notes so tendered the Change of Control Payment for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. The Authority will notify the Trustee and will instruct the Trustee to notify the Holders of the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

(e) Notwithstanding anything to the contrary in this Section 4.15, the Authority shall not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Section 4.15 and Section 3.10 hereof and all other provisions of this Indenture applicable to a Change of Control Offer made by the Authority and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer.

Section 4.16. [Intentionally Omitted]

Section 4.17. Sale and Leaseback Transactions.

The Authority will not, and will not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction involving the Resort; provided that the Authority or any of its Restricted Subsidiaries may enter into such a sale and leaseback transaction if: (i) the Authority or such Restricted Subsidiary, as applicable, could have (a) incurred Indebtedness in an amount equal to the Attributable Debt relating to such sale and leaseback transaction pursuant to the Fixed Charge Coverage Ratio test set forth in Section 4.09(a) hereof and (b) incurred a Lien to secure such Indebtedness pursuant to Section 4.12 hereof; (ii) the gross cash proceeds of such sale and leaseback transaction are at least equal to the fair market value, as determined in good faith by the Management Board and set forth in an Officers’ Certificate delivered to the Trustee, of the property that is subject of such sale and leaseback transaction; and (iii) the transfer of assets in such sale and leaseback transaction is permitted by, and the Authority applies the proceeds of such transaction in compliance with Section 4.10 hereof.

Section 4.18. Limitation on Issuances and Sales of Equity Interests in Wholly Owned Restricted Subsidiaries.

The Authority (i) will not, and will not permit any Wholly Owned Restricted Subsidiary of the Authority to, transfer, convey, sell, lease or otherwise dispose of any Equity Interests in any Wholly Owned Restricted Subsidiary of the Authority to any Person (other than the Authority or another Wholly Owned Restricted Subsidiary of the Authority), unless (a) such transfer, conveyance, sale, lease or other disposition is of all the Equity Interests in such Wholly Owned Restricted Subsidiary and (b) the cash Net Proceeds from such transfer, conveyance, sale, lease or other disposition are applied in accordance with Section 4.10 hereof, and (ii) will not permit any Wholly Owned Restricted Subsidiary of the Authority to issue any of its Equity Interests

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(other than, if necessary, shares of its Capital Stock constituting directors’ qualifying shares) to any Person other than to the Authority or a Wholly Owned Restricted Subsidiary of the Authority unless upon such issuance, the Authority’s investment in any such formerly Wholly Owned Restricted Subsidiary would otherwise qualify as a Permitted Investment.

Section 4.19. Payments for Consent.

The Authority will not, and will not permit any of its Restricted Subsidiaries to directly or indirectly, pay or cause to be paid any consideration to or for the benefit of any Holder for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes, as the case may be, unless such consideration is offered to be paid or is paid to all Holders that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement.

Section 4.20. Subsidiary Guarantees.

The Pocono Downs Subsidiaries, the WNBA Subsidiary, Mohegan Ventures-Northwest, LLC, Mohegan Golf, LLC, Mohegan Ventures Wisconsin, LLC, Wisconsin Tribal Gaming, LLC, MTGA Gaming, LLC and each other Restricted Subsidiary of the Authority will be Subsidiary Guarantors. If the Authority acquires or creates any Restricted Subsidiary after the date of this Indenture that guarantees other debt of the Authority or which is obligated on other debt in excess of $50.0 million (as measured with respect to each such Restricted Subsidiary) then that newly acquired or created Restricted Subsidiary must become a Subsidiary Guarantor on a second priority senior secured basis, execute a supplemental indenture and security documents satisfactory to the Trustee and the Collateral Agent, take all actions required hereunder and by the Security Documents to perfect, assure and confirm the Liens intended to be conferred hereunder and thereunder and deliver an Opinion of Counsel to the Trustee within 20 Business Days of the date on which it is acquired or created.

Section 4.21. Ownership Interests in the Authority.

The Authority shall not permit any Person other than the Tribe to acquire any Ownership Interest whatsoever in the Authority.

Section 4.22. Subordination of Junior Payments Under the Relinquishment Agreement.

All Obligations under the Notes shall be “Senior Obligations” as defined in the Relinquishment Agreement and will not be on parity with, or subordinated in right of payment to, the Junior Relinquishment Payments (as defined in the Relinquishment Agreement) and the Authority will not amend Section 6.2 of the Relinquishment Agreement in a manner adverse to the Holders of the Notes.

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Section 4.23. [Intentionally Omitted].

Section 4.24. Restrictions on Leasing and Dedication of Property.

(a) Except as provided in Section 4.24(b) hereof, the Authority will not lease, sublease, or grant a license, concession or other agreement to occupy, manage or use any material portion of the Authority’s property and assets owned or leased by the Authority and located on the Resort (each, a “Lease Transaction”).

(b) Section 4.24(a) hereof will not prohibit any of the following Lease Transactions:

(i) the Authority may enter into a Lease Transaction with respect to any space with any Person (including, without limitation, a lease for the purpose of developing, constructing, operating and managing retail establishments within the Resort); provided that: (A) such Lease Transaction will not materially interfere with, impair or detract from the operations of the Resort; (B) such Lease Transaction contains rent and such other terms such that the Lease Transaction, taken as a whole, is commercially reasonable in light of prevailing or comparable transactions in other casinos, hotels, attractions or shopping venues; and (C) such Lease Transaction complies with all applicable law, including obtaining any consent of the BIA, if required;

(ii) the Lease and any amendments, extensions, modifications or renewals thereof which are not materially adverse to the Holders;

(iii) the Authority may enter into a management or operating agreement with respect to any of the Authority’s property and assets with any Person; provided that: (A) the manager or operator has experience in managing or operating similar operations; and (B) such management or operating agreement is on commercially reasonable and fair terms to the Authority; and

(iv) the Relinquishment Agreement and any amendments, extensions, modifications or renewals thereof which are not materially adverse to the Holders.

(c) No Lease Transaction may provide that the Authority may subordinate its leasehold or fee interest to any lessee or any financing party of any lessee, and no person other than the Authority may conduct gaming or casino operations on any property that is the subject of a Lease Transaction.

Section 4.25. Maintenance of Insurance.

Until the Notes have been paid in full, the Authority shall maintain insurance with responsible carriers against such risks and in such amounts as is customarily carried by similar businesses with such deductibles, retentions, self-insured amounts and coinsurance provisions as are customarily carried by similar businesses of similar size, including, without limitation, liability, property and casualty.

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Customary insurance coverage shall be deemed to include the following:

(a) workers’ compensation insurance to the extent required to comply with all applicable state, territorial, or United States laws and regulations, or the laws and regulations of any other applicable jurisdiction;

(b) comprehensive general liability insurance with minimum limits of $2.0 million;

(c) umbrella or bumbershoot liability insurance providing excess liability coverages over and above the foregoing underlying insurance policies up to a minimum limit of $100.0 million;

(d) property insurance protecting the Resort and Pocono Downs against loss or damage by fire, lightning, windstorm, tornado, water damage, vandalism, riot, earthquake, civil commotion, malicious mischief, hurricane, and such other risks and hazards as are from time to time covered by an “all-risk” policy or a property policy covering “special” causes of loss (such insurance shall provide coverage of not less than (i) the Maximum Foreseeable Loss (as determined from time to time) in respect of the Resort and related improvements and (ii) $1,500,000,000 in the aggregate in respect of the Resort and Pocono Downs and all related improvements and other property with a deductible no greater than $500,000 (other than earthquake insurance, for which the deductible may be up to 10% of the Maximum Foreseeable Loss); and

(e) to the extent that any construction having an overall project budget in excess of $10,000,000 is contemplated by the Authority or any of its Subsidiaries for any of their respective properties, the Authority shall provide the Trustee with not less than thirty days prior written notice thereof, and the Authority and the Guarantors shall maintain and keep in force, at all times during the period of construction, and with respect to any property affected by such construction, a policy or policies of builder’s “all risk” insurance in non-reporting form in an amount not less than the full insurable completed value of such portion of the affected property on a replacement cost basis. All such insurance shall be carried through sound and reputable insurance companies.

Each policy of insurance shall otherwise be in form and substance required by this Indenture and the Security Documents.

Section 4.26. Gaming Licenses.

The Authority will use its commercially reasonable best efforts to obtain and retain in full force and effect at all times all Gaming Licenses necessary for the operation of the Resort; provided that, if in the course of the exercise of its governmental or regulatory functions the Authority is required to suspend or revoke any consent, permit or license or close or suspend any operation or any part of the Resort as a result of any noncompliance with the law, the Authority will use its commercially reasonable best efforts to promptly and diligently correct such noncompliance or replace any personnel causing such noncompliance so that the Resort will be open and fully operating.

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The Authority shall file with the Trustee and provide Holders any Notice of Violation, Order of Temporary Closure, or Assessment of Civil Fines from the NIGC pursuant to 25 C.F.R. Part 573 or 575 or any successor provision, and any Notice of Non-Compliance issued by, or cause of action commenced by, the State of Connecticut under Section 13 of the Compact, or any successor provision.

Section 4.27. [Intentionally Omitted].

Section 4.28. Suspension of Covenants.

Following the first date upon which the Notes are rated Baa3 or better by Moody’s Investors Service, Inc. (“Moody’s”) and BBB- or better by Standard & Poor’s Ratings Group (“S&P”) (or, in either case, if such person ceases to rate the Notes for reasons outside of the control of the Authority, the equivalent investment grade credit rating from any other “nationally recognized statistical rating organization” (within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act) selected by the Authority as a replacement agency) (the “Rating Event Date”) and provided no Event of Default or event that with notice or the passage of time would constitute an Event of Default shall exist on the Rating Event Date, the covenants specifically listed under Section 4.07, Section 4.08, Section 4.09, Section 4.10, Section 4.11, Section 4.18, Section 4.24 and Section 4.25 hereof (collectively, the “Suspended Covenants”) will no longer be applicable to the Notes; provided, however, that in the event that at any time after a Rating Event Date, the Notes shall be rated lower than Baa3 by Moody’s or lower than BBB- by S&P, or any equivalent rating by a successor agency to Moody’s or S&P, the Suspended Covenants shall be automatically reinstated (the “Reinstated Covenants”) and all transactions by the Authority that occurred during the time that such covenants were suspended (the “Suspension Period”) and that would have violated such covenants had such covenants been in effect at the time shall be deemed not to constitute a Default or Event of Default, as the case may be, and shall be deemed to have been in compliance with such covenants for all purposes; provided further that thereafter all transactions by the Authority occurring on or after the date on which the Suspended Covenants have been reinstated (such date, the “Reinstatement Date”) shall be required to be in compliance with the Reinstated Covenants. For purposes of interpreting the definition of “Permitted Liens” during the time any Suspended Covenants are suspended, the definition should be read as if the Suspended Covenants were not so suspended. Calculations made after the Reinstatement Date of the amount available to be made as Restricted Payments under Section 4.07 hereof will be made as though such covenant had been in effect from the Issue Date and throughout the Suspension Period. Accordingly, Restricted Payments made during the Suspension Period will reduce the amount available to be made as Restricted Payments under Section 4.07(a) hereof to the extend provided therein.

Section 4.29. Maintenance of Properties.

Subject to, and in compliance with, the provisions of the applicable Security Documents, the Authority shall cause all material properties used or useful in the conduct of its business or the business of any of the Guarantors to be maintained and kept in good operating condition, repair and working order (ordinary wear and tear and casualty loss excepted) and shall

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cause to be made all necessary repairs, renewals, replacements, betterments and improvements thereto; provided that the Authority shall not be obligated to make such repairs, renewals, replacements, betterments and improvements or maintain such properties if the failure to do so would not result in a material adverse effect on the ability of the Authority and the Guarantors to satisfy their obligations under the Notes, the Guarantees, this Indenture and the Security Documents.

ARTICLE 5

SUCCESSORS

Section 5.01. Liquidation or Dissolution.

(a) The Authority shall not sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more transactions. The Authority shall not consolidate or merge with or into any other Person.

(b)

(i) No Subsidiary Guarantor may consolidate with or merge with or into (whether or not such Subsidiary Guarantor is the surviving Person) another corporation, Person or entity whether or not affiliated with such Subsidiary Guarantor unless, subject to the provisions of the following clauses (ii) and (iii): (i) the Person formed by or surviving any such consolidation or merger (if other than such Subsidiary Guarantor) assumes all the obligations of such Subsidiary Guarantor including obligations under the Security Documents pursuant to a supplemental indenture and security documents in form and substance reasonably satisfactory to the Trustee, and takes all actions required by the Security Documents to perfect, assure and confirm the Liens intended to be conferred thereunder; and (ii) immediately after giving effect to such transaction, no Default or Event of Default exists.

(ii) One or more Subsidiary Guarantors may merge with or into another Subsidiary Guarantor or with or into the Authority; provided that in the case of a merger with or into the Authority, the Authority is the surviving entity and all actions required by the Security Documents are taken to perfect, assure and confirm the Liens intended to be conferred thereunder.

(iii) In the event of a sale or other disposition of all of the assets of any Subsidiary Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the capital stock of any Subsidiary Guarantor (other than to any other Subsidiary Guarantor or the Authority) or if a Subsidiary Guarantor is designated as an Unrestricted Subsidiary, then such Subsidiary Guarantor (in the event of a sale or other disposition, by way of such a merger, consolidation or otherwise, of all of the capital stock or a redesignation of such Subsidiary Guarantor) or the entity acquiring the property (in the event of a sale or other disposition of all of the assets of such Subsidiary Guarantor) will be released and relieved of any obligations under its Subsidiary Guarantee pursuant to Section 10.03 hereof; provided that the Net Proceeds of such sale or other disposition are applied in accordance with or the redesignation is accomplished in accordance with Section 4.10 hereof.

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ARTICLE 6

DEFAULTS AND REMEDIES

Section 6.01. Events of Default.

An Event of Default (“Event of Default”) occurs if:

(a) the Authority defaults for 30 days in the payment when due of interest on the Notes;

(b) the Authority defaults in payment when due of the principal of or premium, if any, on the Notes;

(c) the Authority or any of its Restricted Subsidiaries fails to comply with any of the provisions of Section 4.10 or 5.01 hereof;

(d) the Authority or any of its Restricted Subsidiaries fails for (i) 30 days after the notice to the Authority by the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes voting as a single class to comply with any of the provisions of the Security Documents or the provisions of Section 4.07 or 4.09 hereof or (ii) for 60 days after notice to the Authority by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class to comply with any other covenant, representation, warranty or other agreement in this Indenture or the Notes;

(e) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Authority or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Authority or any of its Restricted Subsidiaries), whether such Indebtedness or guarantee now exists or is created after the date of this Indenture, if that default (i) is caused by a failure to pay principal of or premium, if any, or interest on such Indebtedness prior to the expiration of the grace period provided in such Indebtedness on the date of such default (a “Payment Default”); or (ii) results in the acceleration of such Indebtedness prior to its express maturity; and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $50.0 million or more;

(f) the Authority or any of its Restricted Subsidiaries fails to pay final judgments in amounts not covered by insurance or not adequately reserved for in accordance with GAAP aggregating in excess of $50.0 million, which judgments are not paid, discharged or stayed (by reason of pending appeal or otherwise) for a period of 60 days;

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(g) the Authority or any of its Restricted Subsidiaries pursuant to or within the meaning of the Bankruptcy Law:

(i) commences a voluntary case,

(ii) consents to the entry of an order for relief against it in an involuntary case,

(iii) consents to the appointment of a custodian of it or for all or substantially all of its property,

(iv) makes a general assignment for the benefit of its creditors, or

(v) generally is not paying its debts as they become due; or

(h) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

(i) is for relief against the Authority or any of its Restricted Subsidiaries in an involuntary case;

(ii) appoints a custodian of the Authority or any of its Restricted Subsidiaries for all or substantially all of the property of the Authority or any of its Restricted Subsidiaries; or

(iii) orders the liquidation of the Authority or any of its Restricted Subsidiaries;

and the order or decree remains unstayed and in effect for 60 consecutive days;

(i) revocation, termination, suspension or other cessation of effectiveness of any Gaming License which results in the cessation or suspension of gaming operations for a period of more than 90 consecutive days at the Resort;

(j) cessation of gaming operations for a period of more than 90 consecutive days at the Resort (other than as a result of a casualty loss);

(k) the Lease ceases to be in full force and effect;

(l) failure by the Tribe to comply with the provisions of Article 12 hereof for 30 days after notice to the Authority and the Tribe by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class; or

(m) the occurrence of any of the following:

(i) any Security Document is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full force and effect or is declared null and void, other than in accordance with the terms of the relevant Security Document; or

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(ii) except as permitted by this Indenture, any Lien purported to be granted under any Security Document on Collateral, individually or in the aggregate, having a fair market value in excess of $25.0 million ceases to be an enforceable and perfected first-priority Lien, subject only to Permitted Prior Liens; or

(iii) the Authority or any Restricted Subsidiary, or any Person acting on behalf of any of them, denies or disaffirms, in writing, any obligation of the Authority or any Restricted Subsidiary set forth in or arising under any Security Document.

Section 6.02. Acceleration.

If any Event of Default (other than an Event of Default specified in clause (g) or (h) of Section 6.01 hereof with respect to the Authority, any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary) occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable immediately. Upon any such declaration, the Notes shall become due and payable immediately. Notwithstanding the foregoing, if an Event of Default specified in clause (g) or (h) of Section 6.01 hereof occurs with respect to the Authority, any of its Restricted Subsidiaries that are Significant Subsidiaries or any group of Restricted Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary, all outstanding Notes shall be due and payable immediately without further action or notice. The Holders of a majority in aggregate principal amount of the then outstanding Notes by written notice to the Trustee may on behalf of all of the Holders rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing Events of Default (except nonpayment of principal, interest or premium that has become due solely because of the acceleration) have been cured or waived.

If an Event of Default occurs by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Authority with the intention of avoiding payment of the premium that the Authority would have to pay if the Authority had elected to redeem the Notes pursuant to Section 3.07 hereof, then, upon acceleration of the Notes, an equivalent premium shall also become and be immediately due and payable, to the extent permitted by law, anything in this Indenture or in the Notes to the contrary notwithstanding.

Section 6.03. Other Remedies.

If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium, if any, and interest on the Notes or to enforce the performance of any provision of the Notes, this Indenture, or the Security Documents.

The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of a Note in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.

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Section 6.04. Waiver of Past Defaults.

Holders of not less than a majority in aggregate principal amount of the then outstanding Notes by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences hereunder, except a continuing Default or Event of Default in the payment of interest on or principal of, the Notes (including in connection with an offer to purchase) (provided, however, that the Holders of a majority in aggregate principal amount of the then outstanding Notes may rescind an acceleration and its consequences, including any related payment default that resulted from such acceleration). Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.

Section 6.05. Control by Majority.

Subject to the terms of the Security Documents, Holders of a majority in principal amount of the then outstanding Notes may direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the Trustee determines may be unduly prejudicial to the rights of other Holders of Notes or that may involve the Trustee in personal liability.

Section 6.06. Limitation on Suits.

A Holder of a Note may pursue a remedy with respect to this Indenture or the Notes only if:

(a) the Holder of a Note gives to the Trustee written notice of a continuing Event of Default;

(b) the Holders of at least 25% in principal amount of the then outstanding Notes make a written request to the Trustee to pursue the remedy;

(c) such Holder of a Note or Holders of Notes offer and, if requested, provide to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense;

(d) the Trustee does not comply with the request within 60 days after receipt of the request and the offer and, if requested, the provision of indemnity; and

(e) during such 60-day period the Holders of a majority in principal amount of the then outstanding Notes do not give the Trustee a direction inconsistent with the request.

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A Holder of a Note may not use this Indenture to prejudice the rights of another Holder of a Note or to obtain a preference or priority over another Holder of a Note.

Section 6.07. Rights of Holders of Notes to Receive Payment.

Notwithstanding any other provision of this Indenture, the right of any Holder of a Note to receive payment of principal, premium and interest on the Note, on or after the respective due dates expressed in the Note (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.

Section 6.08. Collection Suit by Trustee.

If an Event of Default specified in Section 6.01(a) or (b) hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Authority for the whole amount of principal of, premium and interest remaining unpaid on the Notes and interest on overdue principal and, to the extent lawful, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

Section 6.09. Trustee May File Proofs of Claim.

The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders of the Notes allowed in any judicial proceedings relative to the Authority (or any other obligor upon the Notes), its creditors or its property and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

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Section 6.10. Priorities.

If the Trustee collects any money pursuant to this Article, it shall pay out the money in the following order:

First: to the Trustee, its agents and attorneys for amounts due under Section 7.07 hereof, including payment of all compensation, expense and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection;

Second: to Holders of Notes for amounts due and unpaid on the Notes for principal, premium and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium and interest, respectively; and

Third: to the Authority or to such party as a court of competent jurisdiction shall direct.

The Trustee may fix a record date and payment date for any payment to Holders of Notes pursuant to this Section 6.10.

Section 6.11. Undertaking for Costs.

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section does not apply to a suit by the Trustee, a suit by a Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in principal amount of the then outstanding Notes.

ARTICLE 7

TRUSTEE

Section 7.01. Duties of Trustee.

(a) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.

(b) Except during the continuance of an Event of Default:

(i) the duties of the Trustee shall be determined solely by the express provisions of this Indenture and the Trustee need perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

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(ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture.

(c) The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

(i) this paragraph does not limit the effect of paragraph (b) of this Section 7.01;

(ii) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and

(iii) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05 hereof.

(d) Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), and (c) of this Section 7.01.

(e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or incur any liability. The Trustee shall be under no obligation to exercise any of its rights and powers under this Indenture at the request of any Holders, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.

(f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Authority. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

(g) Delivery of reports, information and documents to the Trustee under Section 4.03 hereof is for informational purposes only and the Trustee’s receipt of the foregoing shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Authority’s compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).

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Section 7.02. Rights of Trustee.

(a) The Trustee may conclusively rely upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the document.

(b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an Opinion of Counsel or both. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or Opinion of Counsel. The Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.

(c) The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.

(d) The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Indenture.

(e) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Authority shall be sufficient if signed by an Officer of the Authority.

(f) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction.

(g) Except with respect to Section 7.01 hereof, the Trustee shall have no duty to inquire as to the performance of the Authority’s covenants in Article 4 or Article 12 hereof. In addition, the Trustee shall not be deemed to have knowledge of any Default or Event of Default except (i) any Event of Default occurring pursuant to Sections 6.01(a) or (b) or Section 4.01 hereof or (ii) any Default or Event of Default of which a Responsible Officer of the Trustee shall have received written notification or obtained actual knowledge.

(h) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee may, in its discretion, make such further inquiry or investigation into such facts or matters as it may see fit and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Authority personally or by agent or attorney during regular business hours.

(i) In the absence of a written direction to do so received by the Trustee pursuant to Section 6.05 hereof from Holders of a majority in principal amount of the then outstanding Notes and indemnification from such Holders for any costs incurred by the Trustee in acting pursuant to such direction, the Trustee shall be under no duty to inquire into or to determine whether the Authority has taken any “willful action” under Section 6.02 hereof.

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Section 7.03. Individual Rights of Trustee.

The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Authority or any Affiliate of the Authority with the same rights it would have if it were not Trustee. The Trustee is also subject to Section 7.10 hereof.

Section 7.04. Trustee’s Disclaimer.

The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not be accountable for the Authority’s use of the proceeds from the Notes or any money paid to the Authority or upon the Authority’s direction under any provision of this Indenture, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication.

Section 7.05. Notice of Defaults.

If a Default or Event of Default occurs and is continuing, the Trustee shall mail to Holders of Notes a notice of the Default or Event of Default within 90 days after a Responsible Officer of the Trustee has knowledge thereof. Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest on any Note, the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders of the Notes.

Section 7.06. Reports by Trustee to Holders of the Notes.

Within 60 days after each May 15 beginning with the May 15 following the date of this Indenture, and for so long as Notes remain outstanding, the Trustee shall mail to the Holders of the Notes a brief report dated as of such reporting date that complies with TIA § 313(a) (but if no event described in TIA § 313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA § 313(b)(2). The Trustee shall also transmit by mail all reports as required by TIA § 313(c).

A copy of each report at the time of its mailing to the Holders of Notes shall be mailed to the Authority and filed with the SEC and each stock exchange on which the Notes are listed in accordance with TIA § 313(d). The Authority shall promptly notify the Trustee when the Notes are listed on any stock exchange.

At the expense of the Authority, the Trustee or, if the Trustee is not the Registrar, the Registrar, shall report the names of record Holders of the Notes to any Gaming Regulatory Authority when requested to do so by the Authority.

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At the express direction of the Authority and at the Authority’s expense, the Trustee will provide any Gaming Regulatory Authority with:

(i) copies of all notices, reports and other written communications which the Trustee gives to Holders;

(ii) a list of all of the Holders promptly after the original issuance of the Notes and periodically thereafter if the Authority so directs;

(iii) notice of any Default under this Indenture, any acceleration of the Indebtedness evidenced hereby, the institution of any legal actions or proceedings before any court or governmental authority in respect of a Default or Event of Default hereunder;

(iv) notice of the removal or resignation of the Trustee within five Business Days of the effectiveness thereof;

(v) notice of any transfer or assignment of rights under this Indenture known to the Trustee within five Business Days thereof; and

(vi) a copy of any amendment to the Notes or this Indenture within five Business Days of the effectiveness thereof.

To the extent requested by the Authority and at the Authority’s expense, the Trustee shall cooperate with any Gaming Regulatory Authority in order to provide such Gaming Regulatory Authority with the information and documentation requested and as otherwise required by applicable law.

Section 7.07. Compensation and Indemnity.

The Authority shall pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Authority shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee’s agents and counsel.

The Authority shall indemnify the Trustee and its directors, officers, employees and agents against any and all losses, liabilities or expenses incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture, including the costs and expenses of enforcing this Indenture against the Authority (including this Section 7.07) and defending itself against any claim (whether asserted by the Authority or any Holder or any other person) or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the extent any such loss, liability or expense is attributable to its negligence or bad faith. The Trustee shall notify the Authority promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Authority shall not relieve the Authority of its obligations hereunder. The Authority shall defend the claim and the Trustee shall cooperate in the defense. The Trustee may have separate counsel and the Authority shall pay the reasonable fees and expenses of such counsel. The Authority need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld.

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The obligations of the Authority under this Section 7.07 shall survive the satisfaction and discharge of this Indenture.

To secure the Authority’s payment obligations in this Section 7.07, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of this Indenture.

When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(g) or (h) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law.

Section 7.08. Replacement of Trustee.

A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section.

The Trustee may resign in writing at any time and be discharged from the trust hereby created by so notifying the Authority. The Holders of a majority in principal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and the Authority in writing. The Authority may remove the Trustee if:

(a) the Trustee fails to comply with Section 7.10 hereof;

(b) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;

(c) a custodian or public officer takes charge of the Trustee or its property; or

(d) the Trustee becomes incapable of acting.

If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Authority shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Authority.

If any Gaming Regulatory Authority requires a Trustee to be approved, licensed or qualified and the Trustee fails or declines to do so, such approval, license or qualification shall be obtained upon the request of, and at the expense of, the Authority unless the Trustee declines to do so, or, if the Trustee’s relationship with either the Authority may, in the Authority’s discretion, jeopardize any material gaming license or franchise or right or approval granted thereto, the Trustee shall resign, and, in addition, the Trustee may at its option resign if the Trustee in its sole discretion determines not to be so approved, licensed or qualified.

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If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Authority, or the Holders of at least a majority in principal amount of the then outstanding Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee.

If the Trustee, after written request by the Holders of a majority in principal amount of the then outstanding Notes, fails to comply with Section 7.10 hereof, such Holders may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Authority. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee; provided all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Authority’s obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee.

Section 7.09. Successor Trustee by Merger, etc.

If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business (including the trust created by this Indenture) to, another corporation, the successor corporation without any further act shall be the successor Trustee.

Section 7.10. Eligibility; Disqualification.

There shall at all times be a Trustee hereunder that is a corporation organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has, or together with all of its Subsidiaries and parent entities has, a combined capital and surplus of at least $100 million as set forth in its most recent published annual report of condition.

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ARTICLE 8

SATISFACTION AND DISCHARGE; LEGAL DEFEASANCE

AND COVENANT DEFEASANCE

Section 8.01. Satisfaction and Discharge.

This Indenture will be discharged and will cease to be of further effect as to all Notes when:

(1) either:

(a) all Notes that have been authenticated (except lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has theretofore been deposited in trust and thereafter repaid to the Authority) have been delivered to the Trustee for cancellation; or

(b) all Notes that have not been delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and the Authority has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the holders, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in amounts sufficient, without consideration of any reinvestment of interest, to pay and discharge the entire indebtedness on the Notes not delivered to the Trustee for cancellation for principal, premium and accrued interest to the date of maturity or redemption;

(2) no Default or Event of Default has occurred and is continuing on the date of any such deposit or shall occur as a result of any such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Authority is a party or by which it is bound;

(3) the Authority has paid or caused to be paid all sums payable by it under this Indenture; and

(4) the Authority has delivered irrevocable instructions to the Trustee under this Indenture to apply any deposited money toward the payment of the Notes at maturity or the Redemption Date, as the case may be.

In addition, the Authority must deliver an Officers’ Certificate and an Opinion of Counsel to the Trustee stating that all conditions precedent to satisfaction and discharge have been satisfied.

Notwithstanding the foregoing paragraphs, the Authority’s Obligations in Article 2 hereof and in Sections 4.01, 4.02, 7.07, 7.08, 8.07 and 8.08 hereof shall survive until the Notes are no longer outstanding. After the Notes are no longer outstanding, the Authority’s Obligations in Sections 7.07, 8.07 and 8.08 hereof shall survive.

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After such delivery or irrevocable deposit, the Trustee upon request shall acknowledge in writing the discharge of the Authority’s Obligations under the Notes, the Subsidiary Guarantors’ obligations under the Subsidiary Guarantees and this Indenture except for those surviving Obligations specified above.

Section 8.02. Option to Effect Legal Defeasance or Covenant Defeasance.

The Authority may, at the option of its Management Board evidenced by a resolution set forth in an Officers’ Certificate, at any time, elect to have either Section 8.03 or 8.04 hereof be applied to all outstanding Notes upon compliance with the conditions set forth below in this Article 8.

Section 8.03. Legal Defeasance and Discharge.

Upon the Authority’s exercise under Section 8.02 hereof of the option applicable to this Section 8.03, the Authority shall, subject to the satisfaction of the conditions set forth in Section 8.05 hereof, be deemed to have been discharged from its obligations with respect to all outstanding Notes on the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means that the Authority shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes, which shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.06 hereof and the other Sections of this Indenture referred to in (a) and (b) below, and to have satisfied all its other obligations under such Notes and this Indenture (and the Trustee, on demand of and at the expense of the Authority, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive solely from the trust fund described in Section 8.05 hereof, and as more fully set forth in such Section, payments in respect of the principal of, premium, if any, and interest on such Notes when such payments are due, (b) the Authority’s obligations with respect to such Notes under Article 2 and Section 4.02 hereof, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Authority’s obligations in connection therewith and (d) this Article 8. Subject to compliance with this Article 8, the Authority may exercise its option under this Section 8.03 notwithstanding the prior exercise of its option under Section 8.04 hereof.

Section 8.04. Covenant Defeasance.

Upon the Authority’s exercise under Section 8.02 hereof of the option applicable to this Section 8.04, the Authority shall, subject to the satisfaction of the conditions set forth in Section 8.05 hereof, be released from its obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14(b), 4.15, 4.17, 4.18, 4.20, 4.21, 4.22, 4.24, 4.25 and 4.29 hereof and Section 5.01 hereof with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.05 hereof are satisfied (hereinafter, “Covenant Defeasance”), and the Notes shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding

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Notes, the Authority may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby. In addition, upon the Authority’s exercise under Section 8.02 hereof of the option applicable to this Section 8.04 hereof, subject to the satisfaction of the conditions set forth in Section 8.05 hereof, Sections 6.01(c) through 6.01(f) and Sections 6.01 (i) through 6.01 (m) hereof shall not constitute Events of Default.

Section 8.05. Conditions to Legal or Covenant Defeasance.

The following shall be the conditions to the application of either Section 8.03 or 8.04 hereof to the outstanding Notes:

In order to exercise either Legal Defeasance or Covenant Defeasance:

(a) the Authority must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders, cash in United States dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, premium and interest on the outstanding Notes on the stated date for payment thereof or on the applicable Redemption Date, as the case may be;

(b) in the case of an election under Section 8.02 hereof, the Authority shall have delivered to the Trustee an Opinion of Counsel in the United States reasonably acceptable to the Trustee confirming that (A) the Authority has received from, or there has been published by, the Internal Revenue Service a ruling or (B) since the date of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

(c) in the case of an election under Section 8.04 hereof, the Authority shall have delivered to the Trustee an Opinion of Counsel in the United States reasonably acceptable to the Trustee confirming that the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;

(d) no Default or Event of Default shall have occurred and be continuing on the date of such deposit (other than a Default or Event of Default resulting from the incurrence of Indebtedness all or a portion of the proceeds of which will be used to defease the Notes pursuant to this Article 8 concurrently with such incurrence) or insofar as Sections 6.01(g) or 6.01(h) hereof is concerned, at any time in the period ending on the 91st day after the date of deposit;

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(e) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any material agreement or instrument (other than this Indenture) to which the Authority or any of its Restricted Subsidiaries is a party or by which the Authority or any of its Restricted Subsidiaries is bound;

(f) the Authority must have delivered to the Trustee an Opinion of Counsel (which may be subject to customary exceptions) to the effect that after the 91st day following the deposit, the trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally;

(g) the Authority shall have delivered to the Trustee an Officers’ Certificate stating that the deposit was not made by the Authority with the intent of preferring the Holders over any other creditors of the Authority or with the intent of defeating, hindering, delaying or defrauding any creditors of the Authority or others; and

(h) the Authority shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for or relating to the Legal Defeasance or the Covenant Defeasance have been complied with.

Section 8.06. Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions.

Subject to Section 8.07 hereof, all money and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.06, the “Trustee”) pursuant to Section 8.05 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Authority acting as Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and interest, but such money need not be segregated from other funds except to the extent required by law.

The Authority shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable Government Securities deposited pursuant to Section 8.05 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes.

Anything in this Article 8 to the contrary notwithstanding, the Trustee shall deliver or pay to the Authority from time to time upon the request of the Authority any money or non-callable Government Securities held by it as provided in Section 8.05 hereof which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.05(a) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

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Section 8.07. Repayment to Authority.

Any money deposited with the Trustee or any Paying Agent, or then held by the Authority, in trust for the payment of the principal of, premium, if any, or interest on any Note and remaining unclaimed for two years after such principal, and premium, if any, or interest has become due and payable shall be paid to the Authority on its request or (if then held by the Authority) shall be discharged from such trust; and the Holder of such Note shall thereafter look only to the Authority for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Authority as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Authority cause to be published once, in The New York Times and The Wall Street Journal (national edition), notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining will be repaid to the Authority.

Section 8.08. Reinstatement.

If the Trustee or Paying Agent is unable to apply any United States dollars or non-callable Government Securities in accordance with Section 8.03 or 8.04 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Authority’s obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.03 or 8.04 hereof until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.03 or 8.04 hereof, as the case may be; provided, however, that, if the Authority makes any payment of principal of, premium, if any, or interest on any Note following the reinstatement of its obligations, the Authority shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money held by the Trustee or Paying Agent.

ARTICLE 9

AMENDMENT, SUPPLEMENT AND WAIVER

Section 9.01. Without Consent of Holders of Notes.

Notwithstanding Section 9.02 of this Indenture, the Authority, the Subsidiary Guarantors, if any, the Tribe and the Trustee may amend or supplement this Indenture, the Subsidiary Guarantees, if any, or the Notes without the consent of any Holder of a Note to:

(a) cure any ambiguity, defect or inconsistency;

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(b) provide for uncertificated Notes in addition to or in place of certificated Notes or to alter the provisions of Article 2 hereof (including the related definitions) in a manner that does not materially adversely affect any Holder;

(c) provide for the assumption of the Authority’s obligations to the Holders of the Notes in the case of a merger, consolidation or sale of all or substantially all of the Authority’s assets;

(d) make any change that would provide any additional rights or benefits to the Holders of the Notes or that does not adversely affect the legal rights hereunder of such Holder;

(e) comply with requirements of the SEC in order to effect or maintain the qualification of this Indenture under the TIA;

(f) allow any Subsidiary to execute a supplemental indenture substantially in the form of such supplemental indenture attached as Exhibit E to this Indenture and a Subsidiary Guarantee substantially in the form of such Subsidiary Guarantee attached as Exhibit D to this Indenture;

(g) release Collateral in accordance with the terms of this Indenture, the Intercreditor Agreement and the Security Documents;

(h) mortgage, pledge, hypothecate or grant any additional Lien in favor of the Collateral Agent for the benefit of the Holders, as additional security for the payment and performance of all Obligations with respect to the Notes;

(i) evidence and provide for the acceptance by appointment of a successor Collateral Agent so long as (a) such successor Collateral Agent is reasonably acceptable to the Trustee and (b) is otherwise qualified and eligible to serve as Collateral Agent;

(j) amend the Security Documents in accordance with the Intercreditor Agreement; or

(k) add any Parity Lien Debt Obligations to the Obligations secured by the Security Documents on the terms permitted thereunder.

Upon the request of the Authority accompanied by a resolution of its Management Board authorizing the execution of any such amended or supplemental Indenture, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee shall join with the Authority and the Subsidiary Guarantors, if any, in the execution of any amended or supplemental Indenture authorized or permitted by the terms of this Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to enter into such amended or supplemental Indenture that affects its own rights, duties or immunities under this Indenture or otherwise.

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Section 9.02. With Consent of Holders of Notes.

(a) Except as provided below in this Section 9.02, the Authority, the Subsidiary Guarantors, if any, the Tribe and the Trustee may amend or supplement this Indenture (including Sections 3.10 and 4.10 hereof), the Subsidiary Guarantees, if any, and the Notes:

(i) with the consent of the Holders of at least a majority in principal amount of the Notes then outstanding voting as a single class (including consents obtained in connection with a tender offer or exchange offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium, if any, or interest on the Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of this Indenture, the Subsidiary Guarantees or the Notes may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes voting as a single class (including consents obtained in connection with a tender offer or exchange offer for, or purchase of, the Notes); and

(ii) with the consent of the Holders of at least 66 2/3% of the aggregate principal amount of Notes then outstanding (including consents obtained in connection with a tender offer or exchange offer for, or purchase of, such Notes) in order to make a change in the provisions of Section 4.15 hereof that adversely affects the rights of any Holder of Notes.

(b) Section 2.08 hereof shall determine which Notes are considered to be “outstanding” for purposes of this Section 9.02.

(c) Upon the request of the Authority accompanied by a resolution of its Management Board authorizing the execution of any such amended or supplemental Indenture, and upon the filing with the Trustee of evidence satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee shall join with the Authority in the execution of such amended or supplemental Indenture unless such amended or supplemental Indenture directly affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such amended or supplemental Indenture.

(d) It shall not be necessary for the consent of the Holders of Notes under this Section 9.02 to approve the particular form of any proposed amendment or waiver, but it shall be sufficient if such consent approves the substance thereof.

(e) After an amendment, supplement or waiver under this Section becomes effective, the Authority shall mail to the Holders of Notes affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Authority to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amended or supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a majority in aggregate principal amount of the Notes then outstanding voting as a

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single class may waive compliance in a particular instance by the Authority with any provision of this Indenture or the Notes. However, without the consent of each Holder affected, an amendment or waiver under this Section 9.02 may not (with respect to any Notes held by a nonconsenting Holder):

(i) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver;

(ii) reduce the principal of or change the fixed maturity of any Note or alter the provisions with respect to the redemption of the Notes except as provided above with respect to Sections 3.10, 4.10 and 4.15 hereof;

(iii) reduce the rate of or change the time for payment of interest on any Note;

(iv) waive a Default or Event of Default in the payment of principal of or premium, if any, or interest on the Notes (except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the then outstanding Notes and a waiver of the payment default that resulted from such acceleration);

(v) make any Note payable in money other than that stated in the Notes;

(vi) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights Holders to receive payments of principal of or premium, if any, or interest on the Notes;

(vii) waive a redemption payment with respect to any Note (other than a payment required by 3.10, 4.10 and 4.15 hereof);

(viii) make any change in the foregoing amendment and waiver provisions; or

(ix) release any Subsidiary Guarantor from any of its obligations under its Subsidiary Guarantee or this Indenture, except in accordance with the terms of its Subsidiary Guarantee.

In additon, any amendment to, or waiver of, the provisions of this Indenture or any Security Document that has the effect of releasing all or substantially all of the Collateral from the Liens securing the Notes will require the consent of Holders of at least 66 ²/3% in aggregate principal amount of the Notes then outstanding (but only to the extent any such consent is required under the Intercreditor Agreement and the Security Documents).

Section 9.03. [Intentionally Omitted]

Section 9.04. Revocation and Effect of Consents.

Until an amendment, supplement or waiver becomes effective (as determined by the Authority and which may be prior to any such amendment, supplement or waiver becoming operative), a consent to it by a Holder of a Note is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or portion of a Note that evidences the same Indebtedness

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as the consenting Holder’s Note, even if notation of the consent is not made on any Note. However, any such Holder of a Note or subsequent Holder of a Note may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date of the waiver, supplement or amendment becomes effective (as determined by the Authority and which may be prior to any such amendment, supplement or waiver becoming operative). After an amendment, supplement or waiver becomes effective, it shall bind every Holder.

The Authority may, and shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment, supplement or waiver, which record date shall be the date so fixed by the Authority. If a record date is fixed, then notwithstanding the last sentence of the immediately preceding paragraph, those Persons who were Holders at such record date, and only those Persons (or their duly designated proxies), shall be entitled to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date.

Section 9.05. Notation on or Exchange of Notes.

The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Authority in exchange for all Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate new Notes that reflect the amendment, supplement or waiver.

Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver.

Section 9.06. Trustee to Sign Amendments, etc.

The Trustee shall sign any amended or supplemental Indenture authorized pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. The Authority may not sign an amendment or supplemental Indenture until the Management Board approves it. In executing any amended or supplemental indenture, the Trustee shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully protected in relying upon, in addition to the documents required by Section 13.04 hereof, an Officers’ Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Indenture.

ARTICLE 10

GUARANTEES

Section 10.01. Unconditional Guarantee.

Each Guarantor shall unconditionally, jointly and severally guarantee to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns that: (i) the principal of and interest on the Notes will be promptly paid in full when due, subject to any applicable grace period, whether at Stated Maturity, by acceleration or otherwise and interest on the over-due principal, if any, and interest on any interest, to the extent lawful,

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of the Notes and all other Obligations of the Authority to the Holders or the Trustee under this Indenture or the Notes will be promptly paid in full or performed, all in accordance with the terms hereof and thereof and (ii) in case of any extension of time of payment or renewal of any Notes or of any such other Obligations, the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, subject to any applicable grace period, whether at Stated Maturity, by acceleration or otherwise.

Each Guarantor agrees that, as between such Guarantor on the one hand, and the Holders and the Trustee on the other hand, (x) the maturity of the Obligations Guaranteed hereby may be accelerated as provided in Article 6 hereof for the purposes of the Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Obligations Guaranteed hereby, and (y) in the event of any acceleration of such Obligations as provided in Article 6 hereof, such Obligations (whether or not due and payable) shall forthwith become due and payable by such Guarantor for the purposes of the Guarantee in each case to the extent lawful.

Each Guarantor agrees that its obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder with respect to any provisions hereof or thereof, the recovery of any judgment against the Authority, any action to enforce the same or any other circumstance (other than payment in full) which might otherwise constitute a legal or equitable discharge or defense of a Guarantor in each case to the extent lawful. Each Guarantor waives, to the extent lawful, diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Authority, any right to require a proceeding first against the Authority, protest, notice and all demands whatsoever and covenants that the Guarantee will not be discharged except by complete performance of the obligations contained in the Notes, this Indenture and in the Guarantee. If any Holder or the Trustee is required by any court or otherwise to return to the Authority, any Guarantor, or any Custodian acting in relation to the Authority or any Guarantor, any amount paid by the Authority or such Guarantor to the Trustee or such Holder, the Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect. Each Guarantor agrees that, in the event of Default in the payment of principal (or premium, if any) or interest on such Notes, whether at their Stated Maturity, by acceleration, upon redemption, purchase or otherwise, legal proceedings may be instituted by the Trustee on behalf of, or by, the Holder, subject to the terms and conditions set forth in this Indenture, directly against each of the Guarantors to enforce the Guarantee without first proceeding against the Authority. Each Guarantor agrees that if, after the occurrence and during the continuance of an Event of Default, the Trustee or any Holders are prevented by applicable law from exercising their respective rights to accelerate the maturity of the Notes, to collect interest on the Notes, or to enforce any other right or remedy with respect to the Notes, the Guarantors, to the extent lawful, will pay to the Trustee for the account of the Holders, upon demand therefor, the amount that would otherwise have been due and payable had such rights and remedies been permitted to be exercised by the Trustee or any of the Holders. The Guarantors will agree to pay, in addition to the amount stated above, any and all out of pocket reasonable expenses (including reasonable counsel fees and expenses) incurred by the Trustee and the Holders in enforcing any rights under the Guarantees with respect to the Guarantors.

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Section 10.02. Severability.

In case any provision of the Guarantee shall be invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

Section 10.03. Release of Guarantor.

A Guarantor may, by execution and delivery to the Trustee of a supplemental indenture satisfactory to the Trustee, be automatically and unconditionally released from its Guarantee upon either of the following:

(x) any sale, exchange or transfer by the Authority or any Restricted Subsidiary that is a Guarantor to any Person that is not required to become a Guarantor of all of the Capital Stock of, or all or substantially all the assets of, such Restricted Subsidiary that is a Guarantor, which sale, exchange or transfer is made in accordance with the provisions of this Indenture; or

(y) the designation of such Restricted Subsidiary as an Unrestricted Subsidiary in accordance with the provisions of this Indenture;

provided, in each such case, the Authority has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for in this Indenture relating to such transactions have been complied with and that such release is authorized and permitted under this Indenture.

Section 10.04. Limitation on Amount Guaranteed.

The obligations of each Guarantor are limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Guarantor and after giving effect to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under its Guarantee or pursuant to its contribution Obligations under this Indenture, result in the Obligations of such Guarantor under the Guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal or state law. Each Guarantor that makes a payment or distribution under a Guarantee shall be entitled to a contribution from each other Guarantor in a pro rata amount based on the Adjusted Net Assets of each Guarantor.

Section 10.05. Waiver of Subrogation.

Until payment in full is made on the Notes and all other Obligations of the Authority to the Holders or the Trustee hereunder and under the Notes, each Guarantor irrevocably waives any claim or other rights it acquires against the Authority that arise from the existence, payment, performance or enforcement of such Guarantor’s obligations under the Guarantee and this Indenture, including without limitation, any right of subrogation, reimbursement, exoneration, indemnification, and any right to participate in any claim or remedy of any Holder against the Authority, whether or not such claim, remedy or right arises in equity, or under contract, statute

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or common law, including, without limitation, the right to take or receive from the Authority, directly or indirectly, in cash or other property or by set-off or any other manner, payment or security on account of such claim or other rights. If any amount shall be paid to any Guarantor in violation of the preceding sentence and the Notes shall not have been paid in full, such amount shall have been deemed to have been paid to such Guarantor for the benefit of, and held in trust for the benefit of, the Holders of the Notes, and shall forthwith be paid to the Trustee for the benefit of such Holders to be credited and applied upon the Notes, whether matured or unmatured, in accordance with the terms of this Indenture. Each Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and that the waiver set forth in this Section 10.05 is knowingly made in contemplation of such benefits.

Section 10.06. Execution of Guarantee.

To evidence its Guarantee to the Holders set forth in this Article 10, each Guarantor will execute the Guarantee in substantially the form attached to this Indenture as Exhibit D, which shall be endorsed on each Note ordered to be authenticated and delivered by the Trustee. Each Guarantor agrees that the Guarantee set forth in this Article 10 shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of the Guarantee. The Guarantee shall be signed on behalf of each Guarantor by one Officer of such Guarantor (each of whom shall, in each case, have been duly authorized by all requisite corporate actions), and the delivery of such Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Guarantee on behalf of such Guarantor. Such signatures upon the Guarantee may be by manual or facsimile signature of such officers and may be imprinted or otherwise reproduced on the Guarantee, and in case any such Officer who shall have signed the Guarantee shall cease to be such officer before the Note on which the Guarantee is endorsed shall have been authenticated and delivered by the Trustee or disposed of by the Authority, such Note nevertheless may be authenticated and delivered or disposed of as though the person who signed the Guarantee had not ceased to be such Officer of such Guarantor.

Section 10.07. Waiver of Stay, Extension or Usury Laws.

Each Guarantor covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law that would prohibit or forgive such Guarantor from performing the Guarantee as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Indenture; and (to the extent that it may lawfully do so) each Guarantor expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

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ARTICLE 11

COLLATERAL AND SECURITY

Section 11.01. The Collateral.

(a) The due and punctual payment of the principal of, premium, if any, and interest on the Notes and the Guarantees thereof when and as the same shall be due and payable, whether on an interest payment date, at maturity, by acceleration, repurchase, redemption or otherwise, interest on the overdue principal of and interest (to the extent lawful), if any, on the Notes and the Guarantees thereof and performance of all other obligations under this Indenture, including, without limitation, the obligations of the Authority set forth in Section 7.07 and Section 8.08 hereof, and the Notes and the Guarantees thereof and the Security Documents, shall be secured by, in favor of the Collateral Agent for the benefit of the Trustee and of the Holders, second-priority Liens and security interests in the Collateral, in each case subject in priority to Permitted Prior Liens only and subject to the Liens securing any Permitted Priority Lien Debt Obligations and Permitted Liens, as provided in the Security Documents which the Authority and the Guarantors, as the case may be, have entered into simultaneously with the execution of this Indenture (or in accordance with the provisions of Sections 11.04 and 11.05 hereof shall enter into) and will be secured by all Security Documents hereafter delivered as required or permitted by this Indenture, the Security Documents and the Intercreditor Agreement.

(b) The Authority and the Guarantors hereby agree that the Collateral Agent shall hold the Collateral in trust for its benefit and for the benefit of the Trustee, the Holders and the holders of Parity Lien Debt Obligations, in each case pursuant to the terms of the Security Documents and the Intercreditor Agreement, and the Collateral Agent is hereby authorized to execute and deliver the Security Documents and the Intercreditor Agreement.

(c) Each Holder, by its acceptance of any Notes and the Guarantees thereof, consents and agrees to the terms of the Security Documents and the Intercreditor Agreement (including, without limitation, the provisions providing for foreclosure) as the same may be in effect or may be amended from time to time in accordance with their terms and authorizes and directs the Collateral Agent to perform its obligations and exercise its rights under the Security Documents and the Intercreditor Agreement in accordance therewith.

(d) The Trustee and each Holder, by accepting the Notes and the Guarantees thereof, acknowledges that, as more fully set forth in the Security Documents and the Intercreditor Agreement, the Collateral as now or hereafter constituted shall be held for the benefit of the Collateral Agent, and for the benefit of the Trustee, the Holders and the holders of Parity Lien Debt Obligations, and that the Lien of this Indenture and the Security Documents in favor of the Collateral Agent, the Trustee, and the Holders and the holders of Parity Lien Debt Obligations is subject to and qualified and limited in all respects by the Intercreditor Agreement and actions that may be taken thereunder.

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Section 11.02. Further Assurances.

Subject to the Intercreditor Agreement, the Authority and each of the Guarantors shall do or cause to be done all acts and things that may be required (including the filing of financing statements, amendments thereto and continuation statements), or that the Collateral Agent from time to time may reasonably request, to assure and confirm that the Collateral Agent holds, for the benefit of the Holders and the holders of Parity Lien Debt Obligations, duly created and enforceable and perfected Liens upon the Collateral (including any property or assets that are acquired or otherwise become Collateral after the Notes are issued in accordance with Sections 11.04 and 11.05 hereof), in each case, as contemplated by, and with the Lien priority required under, this Indenture and the Security Documents. In addition, the Authority and each of the Guarantors shall simultaneously deliver to the Collateral Agent notices (of which copies shall be acceptable) and other documents in substantially the same form as those delivered to the Permitted Priority Lien Debt Collateral Agent in connection with any construction or development, including without limitation the Mohegan Sun Phase III project and the Pocono Downs Phase II Project and the Permitted Pocono Transaction and shall take such action in favor of the Collateral Agent in connection therewith as they take in favor of the Permitted Priority Lien Debt Collateral Agent.

Subject to the Intercreditor Agreement, upon the reasonable request of the Collateral Agent at any time and from time to time, the Authority and each of the Guarantors (including any future Subsidiaries that become Guarantors in accordance with Section 4.20 hereof) will promptly execute, acknowledge and deliver such security documents, instruments, certificates, notices and other documents, and take such other actions as may be reasonably required, or that the Collateral Agent may reasonably request, to create, perfect, protect, assure or enforce the Liens and benefits intended to be conferred, in each case as contemplated by this Indenture and the Security Documents for its benefit and for the benefit of the Trustee, the Holders and the holders of the Parity Lien Debt Obligations.

Section 11.03. Impairment of Security Interest.

Neither the Authority nor any of its Restricted Subsidiaries shall take or omit to take any action not otherwise permitted by this Indenture, the Intercreditor Agreement or any other Security Documents which would materially adversely affect or impair the Liens on the Collateral in favor of the Collateral Agent, the Trustee, and the Holders and the holders of the Parity Lien Debt Obligations with respect thereto. Subject to any Permitted Liens and the Intercreditor Agreement, the Authority shall, and shall cause its Restricted Subsidiaries to, take in favor of the Collateral Agent any and all actions which the Authority and/or Restricted Subsidiary take in favor of the Permitted Priority Lien Debt Collateral Agent with respect to the Collateral and/or the Liens thereon. Neither the Authority nor any of its Restricted Subsidiaries shall grant to any Person, or permit any Person to retain (other than the Collateral Agent), any interest whatsoever in the Collateral, other than Permitted Prior Liens, Permitted Liens and the Liens securing any Permitted Parity Lien Debt Obligations. Neither the Authority nor any of its Restricted Subsidiaries shall enter into any agreement that requires the proceeds received from any sale of Collateral to be applied to repay, redeem, defease or otherwise acquire or retire any Indebtedness of any Person, other than as permitted by this Indenture, the Notes, the Subsidiary Guarantees, the Security Documents and the Intercreditor Agreement.

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Section 11.04. After-Acquired Property.

Subject to certain limitations and exceptions set forth in this Indenture, the Intercreditor Agreement and the Security Documents, if the Authority or any Guarantor creates any additional security interest in or lien upon any property or asset to secure any Permitted Priority Lien Debt Obligations, and takes any other actions in favor of the Permitted Priority Lien Debt Collateral Agent in connection therewith it must concurrently grant a second priority security interest or Lien, in each case subject in priority only to Permitted Prior Liens and subject to the Liens securing any Permitted Priority Lien Debt Obligations and Permitted Liens, upon such property or assets as security for the Note Obligations and take such other actions in favor of the Collateral Agent in connection therewith.

Section 11.05. Post-Closing Actions Relating to Collateral.

(a) Notwithstanding anything to the contrary contained in this Indenture or the Security Documents, the parties hereto acknowledge and agree that the Authority and its subsidiaries shall be required to, (I) in the case of the Leased Property, no later than the later to occur of (a) the date that is 30 days after the Issue Date or (b) within 5 Business Days after obtaining the approval of the Bureau of Indian Affairs required for the execution and delivery of a leasehold mortgage encumbering the Leased Property, which approval the Authority shall use diligent efforts to obtain at the earliest reasonably practicable date or (II) with respect to all other real property and clauses (ix) and (x) below, within 30 days of the Issue Date, deliver to the Collateral Agent the following, in each case, in form and substance as shall be reasonably satisfactory to the Initial Purchasers and Collateral Agent and their respective counsel, as appropriate:

(i) a mortgage or mortgage deed, assignment of leases and rents and security agreement (each, a “Mortgage”) granted by the owner or lessee, as applicable, of the applicable interest listed opposite each Mortgaged Property as set forth on Schedule I hereto in favor of the Collateral Agent for its benefit and for the benefit of the Trustee and the Holders encumbering each such party’s fee or leasehold interest in such Mortgaged Property, duly executed and acknowledged by such party in form for recording in the appropriate recording office of the political subdivision where such Mortgaged Property is situated (and, in the case of the Mortgage encumbering the Leased Property, upon approval, in the Land Title and Records Office of the Bureau of Indian Affairs and with the Town of Montville, Connecticut), together with such certificates, affidavits, questionnaires or returns as shall be required in connection with the recording or filing thereof and such financing statements and other similar statements in respect of each such Mortgage, and any other instruments necessary to grant the interests purported to be granted by each such Mortgage (and to record such Mortgage in the appropriate recording offices) under the laws of any applicable jurisdiction, which Mortgage and financing statements and other instruments shall be effective to create a valid and enforceable second priority lien on such Mortgaged Property in favor of the Collateral Agent for its benefit and for the benefit of the Trustee and the Holders, subject to no liens other than Permitted Prior Liens, the Liens securing any Permitted Priority Lien Debt Obligations and Permitted Liens;

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(ii) with respect to each Mortgage encumbering any Mortgaged Property (other than the Mohegan Golf Property), a policy of title insurance (or irrevocable commitment to issue such a policy) insuring (or irrevocably committing to insure) the lien of such Mortgage as a valid and enforceable second priority mortgage or mortgage deed lien, as applicable, on the real property and fixtures described therein, in favor of the Collateral Agent for its benefit and for the benefit of the Trustee, securing the obligations of the Issuers under this Indenture, the Notes, the Security Documents and the Intercreditor Agreement, in an amount equal to the proportionate amount allocated to such Mortgaged Property in connection with the mortgagee’s policy of title insurance covering the mortgage lien securing the obligations under the Bank Credit Facility and which policy (or irrevocable commitment) shall (a) be issued by Chicago Title Insurance Authority (the “Title Authority”), (b) include re-insurance arrangements, (c) have been supplemented by endorsements reasonably requested by the Initial Purchasers and available at commercially reasonable costs (including, without limitation, endorsements on matters relating to usury, first loss, last dollar, non-imputation, public road access, doing business, variable rate, contiguity (where appropriate), “tie-in” or “cluster”, environmental lien, address, subdivision, survey, any special use of the Mortgaged Property or improvements or equipment related thereto, and so-called comprehensive coverage over covenants and restrictions); it being understood that where such endorsements are not available at commercially reasonable costs and rates, the Authority will obtain a PZR report or letters from the appropriate governmental authorities or other evidence as to zoning and from local or special counsel opinions relating to usury, in each case to the extent the same were delivered to the Administrative Agent under the Bank Credit Facility and (d) contain no defects, liens or encumbrances other than Permitted Encumbrances (individually, a “Title Policy”, and, collectively, “Title Policies”);

(iii) with respect to each Mortgaged Property, a survey of the Mortgaged Property in such form as shall (x) be required by the Title Authority to issue the so-called comprehensive and other survey related endorsements required under paragraph (ii) hereof and to remove the standard survey exceptions from the Title Policy with respect to such Mortgaged Property, (y) comply with the minimum detail requirements of the American Land Title Association and such additional Table A items as were delivered to the Administrative Agent under the Bank Credit Facility (as such requirements and items are in effect on the date of delivery of such survey), which survey shall locate all improvements, public streets and recorded easements affecting such Mortgaged Property, and (z) be accompanied by an Officers’ Certificate stating that there have been no material changes to the applicable Mortgaged Property since the date of the survey, unless there shall have occurred any material exterior change in the property affected thereby during such period, in which event such survey shall be dated or redated to a date after the completion of such change and certified to the Collateral Agent;

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(iv) policies or certificates of insurance covering the Mortgaged Properties, and any other assets of the Issuers as required by this Indenture and the Security Documents, which policies or certificates name the Collateral Agent, for its benefit and the benefit of the Trustee and the holders of the Securities, as additional insured and loss payee and mortgagee, as applicable and appropriate, and shall otherwise bear endorsements of the character required pursuant to this Indenture and the Security Documents;

(v) such affidavits, certificates and instruments of indemnification and other items (including a so-called “gap” indemnification) as shall be reasonably required to induce the Title Authority to issue the Title Policies with respect to each Mortgaged Property;

(vi) checks or wire transfers to the Title Authority in respect of amounts in payment of required recording cost and taxes due in respect of the execution, delivery or recording of the Mortgages, fixture filings and related documents, together with a check or wire transfer for the Title Authority in payment of its premium, search and examination charges, applicable survey costs and any other amounts then due in connection with the issuance of the Title Policies;

(vii) with respect to each Mortgaged Property, a completed FEMA Standard Flood Hazard Determination and if the area in which any improvements located on the Mortgaged Property is designated a “flood hazard area” in any Flood Insurance Rate Map published by FEMA (or successor agency), a signed notice by the Authority or a Restricted Subsidiary, as applicable, with respect to such Flood Hazard Determination, and flood insurance in favor of Collateral Agent, for its benefit and the benefit of the Trustee and the Holders, as loss payee and mortgagee, and shall otherwise bear endorsements of the character required pursuant to the Security Documents;

(viii) with respect to each Mortgaged Property, opinions, addressed to the Collateral Agent and the Trustee, of Rosenn, Jenkins & Greenwald, LLP with respect to Mortgaged Property located in Pennsylvania and of such other local counsel in each other jurisdictions where Mortgaged Property is located as to the enforceability of the Mortgages under applicable law and other matters reasonably requested by the Initial Purchasers;

(ix) with respect to that certain Deposit Account Agreement dated as of March 9, 2007 entered into among Downs Racing, L.P., First National Community Bank, as despositary, and Bank of America, N.A., as administrative agent, an amendment or amendment and restatement to such Deposit Account Agreement and, if applicable, execution of a separate control agreement, in each case in form satisfactory to the Initial Purchasers, evidencing a second lien security interest in the Deposit Accounts (as defined in such Deposit Account Agreement) in favor of the Collateral Agent for its benefit and for the benefit of the Trustee and the holders of the Notes;

(x) with respect to the deposit accounts constituting Collateral held by the Authority with Bank of America, N.A. or its Affiliates, execution of a separate control agreement, in form reasonably satisfactory to the Collateral Agent, evidencing a second lien security interest in such deposit accounts in favor of the Collateral Agent for its benefit and for the benefit of the Trustee and the holders of the Notes; and

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(xi) such further information, certificates and documents evidencing or relating to the Collateral or required to effect the foregoing as the Initial Purchasers may reasonably request including, without limitation, such information, certificates and documents substantially similar in form and substance to those delivered to the Administrative Agent under the Bank Credit Facility;

provided that to the extent any information, certificates and documents delivered to the Collateral Agent are substantially similar in form and substance to those delivered to the Administrative Agent under the Bank Credit Facility (other than the subordination provisions contained therein), such information, certificates and documents shall be deemed to be reasonably satisfactory to the Collateral Agent and its counsel.

(b) All conditions precedent, representations and covenants contained in this Indenture, the Purchase Agreement and the Security Documents shall be deemed modified to the extent necessary to effect the foregoing (and to permit the taking of the actions described above within the time periods required above, rather than as elsewhere provided in any of the above-referenced agreements); provided that (x) to the extent any representation and warranty would not be true because the foregoing actions were not taken on the Issue Date, the respective representation and warranty shall be required to be true and correct in all material respects at the time the respective action is taken in accordance with the provisions of this Section 11.05, and (y) all representations and warranties relating to the Security Documents and the Mortgages shall be required to be true immediately after the actions required to be taken by this Section 11.05 have been taken.

Section 11.06. Release of Liens on the Collateral.

(a) Subject to the terms of the Intercreditor Agreement, if applicable, the Liens on the Collateral will terminate and be discharged with respect to the Note Obligations:

(i) subject to Article 12, in whole or in part, as applicable, as to all or any portion of the Collateral subject to the Collateral Agent’s Liens which has been taken by eminent domain, condemnation or other similar circumstances;

(ii) in whole, upon payment in full and discharge of all outstanding Notes except for indemnity obligations; provided that the Authority has delivered an Officers’ Certificate to the Collateral Agent certifying that the conditions described in this paragraph (ii) have been met and that such release of the Collateral does not violate the terms of this Indenture or the Security Documents;

(iii) as to any Collateral that is sold, transferred or otherwise disposed of by the Authority or any Guarantor to a Person that is not (either before or after such sale, transfer or disposition) the Authority or a Guarantor in a transaction or other circumstance that is not prohibited by the terms of the Indenture, at the time of such sale, transfer or other disposition or to the extent of the interest sold, transferred or otherwise disposed of;

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(iv) as provided in the Intercreditor Agreement and the Security Documents, as applicable;

(v) as to any other release of the Collateral, if the Authority has delivered an Officers’ Certificate to the Collateral Agent certifying that any necessary consents have been obtained and that such release of the Collateral does not violate the terms of this Indenture or the Security Documents;

(vi) upon satisfaction and discharge of this Indenture as set forth under Section 8.01 hereof; and

(vii) upon a Legal Defeasance or Covenant Defeasance of the Notes as set forth under Article 8 hereof;

provided that in the case of any release in whole pursuant to this Section 11.06(a), all amounts owing to the Trustee under this Indenture, the Notes, the Subsidiary Guarantees, the Security Documents and the Intercreditor Agreement will have been paid.

(b) In the event the Authority requests the Collateral Agent to evidence in writing a release of any assets permitted hereunder, the Authority and each Guarantor will furnish to the Trustee, prior to each proposed release of such Collateral pursuant to the Security Documents and this Indenture an Officers’ Certificate (i) requesting such release and (ii) to the effect that all conditions precedent provided for in this Indenture and the Security Documents to such release have been complied with.

(c) Upon compliance by the Authority or the Guarantors, as the case may be, with the conditions precedent set forth above, the Trustee or the Collateral Agent shall promptly cause to be released and reconveyed to the Authority, or its Guarantors, as the case may be, the released Collateral.

(d) The release of any Collateral from the terms of the Security Documents will not be deemed to impair the security under this Indenture in contravention of the provisions hereof or affect the Lien of this Indenture or the Security Documents if and to the extent the Collateral is released pursuant to this Indenture, the Security Documents or the Intercreditor Agreement or upon the termination of this Indenture.

(e) Notwithstanding any provision to the contrary herein, as and when requested by the Authority, the Trustee shall instruct the Collateral Agent to execute and deliver Uniform Commercial Code financing statement amendments or releases solely to the extent necessary to delete properties and assets required to be released pursuant to Section 11.06(a) hereof from the description of assets in any previously filed financing statements. If requested in writing by the Authority, the Trustee shall instruct the Collateral Agent to execute and deliver such documents, instruments or statements and to take such other action as the Authority may request to evidence or confirm that properties and assets required to be released pursuant to Section 11.06(a) hereof described in the immediately preceding sentence have been released from the Liens of each of the Security Documents. The Collateral Agent shall execute and deliver such documents, instruments and statements and shall take all such actions promptly upon receipt of such instructions from the Trustee.

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Section 11.07. Authorization of Actions to Be Taken by the Trustee or the Collateral Agent Under the Security Documents.

(a) Subject to the provisions of the Security Documents and the Intercreditor Agreement, each of the Trustee or the Collateral Agent may, but shall not be obligated to, on behalf of the Holders, take all actions it deems necessary or appropriate in order to (i) enforce any of its rights or any of the rights of the Holders under the Security Documents and the Intercreditor Agreement and (ii) collect and receive any and all amounts payable in respect of the Collateral in respect of the obligations of the Authority and the Subsidiaries hereunder and thereunder. Subject to the provisions of the Security Documents and the Intercreditor Agreement, the Trustee or the Collateral Agent shall have the power (but not the obligation) to institute and to maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Collateral by any acts that may be unlawful or in violation of the Security Documents, the Intercreditor Agreement or this Indenture, and such suits and proceedings as the Trustee or the Collateral Agent may deem expedient to preserve or protect its interest and the interests of the Holders in the Collateral (including power to institute and maintain suits or proceedings to restrain the enforcement of or compliance with any legislative or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid if the enforcement of, or compliance with, such enactment, rule or order would impair the security interest hereunder or be prejudicial to the interests of the Holders or the Trustee).

(b) The Trustee or the Collateral Agent shall not be responsible for the existence, genuineness or value of any of the Collateral or for the validity, perfection, priority or enforceability of the Liens in any of the Collateral, whether impaired by operation of law or by reason of any action or omission to act on its part hereunder, except to the extent such action or omission constitutes negligence, bad faith or willful misconduct on the part of the Trustee or the Collateral Agent, for the validity or sufficiency of the Collateral or any agreement or assignment contained therein, for the validity of the title of the Authority to the Collateral, for insuring the Collateral or for the payment of taxes, charges, assessments or Liens upon the Collateral or otherwise as to the maintenance of the Collateral. The Trustee or the Collateral Agent shall have no responsibility for recording, filing, re-recording or refiling any financing statement, continuation statement, document, instrument or other notice in any public office at any time or times or to otherwise take any action to perfect or maintain the perfection of any security interest granted to it under the Security Documents or otherwise.

(c) The Trustee or the Collateral Agent, in giving any consent or approval under the Security Documents or the Intercreditor Agreement, shall be entitled to receive, as a condition to such consent or approval, an Officers’ Certificate to the effect that the action or omission for which consent or approval is to be given does not adversely affect the interests of the Holders or impair the security of the Holders in contravention of the provisions of this Indenture, the Security Documents or the Intercreditor Agreement, and the Trustee or the Collateral Agent shall be fully protected in giving such consent or approval on the basis of such Officers’ Certificate.

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Section 11.08. Collateral Accounts.

(a) Subject to the terms of the Intercreditor Agreement, the Trustee and Collateral Agent, as applicable, are authorized to receive any funds for the benefit of the Holders distributed under, and in accordance with, the Security Documents, and to make further distributions of such funds to the Holders according to the provisions of this Indenture, the Security Documents and the Intercreditor Agreement.

(b) Subject to the terms of the Intercreditor Agreement, the Collateral Agent shall establish the Collateral Account when and as needed. Such Collateral Account shall at all times thereafter until this Indenture shall have terminated, be maintained with, and under the sole control of, the Collateral Agent. The Collateral Account shall be a trust account and shall be established and maintained by the Collateral Agent at one of its corporate trust offices (which may include the New York corporate trust office) as required by this Indenture and subject to the Intercreditor Agreement. Subject to the Intercreditor Agreement, all cash and Cash Equivalents received by the Trustee and/or Collateral Agent from any Asset Sale, Event of Loss, issuances of Additional Notes and other awards or proceeds pursuant to the Security Documents, including earnings, revenues, rents, issues, profits and income from the Collateral received pursuant to the Security Documents, shall be deposited in the Collateral Account to the extent required or permitted by this Indenture or the Security Documents, and thereafter shall be held, applied and/or disbursed by the Trustee or the Collateral Agent, as applicable, in accordance with the terms of this Indenture. In connection with any and all deposits to be made into the Collateral Account under this Indenture, the Security Documents or the Intercreditor Agreement, the Trustee and/or the Collateral Agent, as applicable, shall receive an Officers’ Certificate directing the Trustee and/or the Collateral Agent to make such deposit.

(c) Pending the distribution of funds in the Collateral Account in accordance with the provisions hereof and provided that no Event of Default shall have occurred and be continuing, the Authority may direct the Trustee and/or the Collateral Agent to invest such funds in Cash Equivalents specified in such direction, such investments to mature by the times such funds are needed hereunder and such direction to certify that such funds constitute Cash Equivalents and that no Event of Default shall have occurred and be continuing. So long as no Event of Default shall have occurred and be continuing, the Authority may direct the Trustee and/or the Collateral Agent to sell, liquidate or cause the redemption of any such investments, such direction to certify that no Event of Default shall have occurred and be continuing. Any gain or income on any investment of funds in the Collateral Account shall be credited to such Collateral Account. Neither the Trustee nor the Collateral Agent shall have any liability for any loss incurred in connection with any investment or any sale, liquidation or redemption thereof made in accordance with the provisions of this Section 11.08(c).

Section 11.09. Insurance.

(a) The Authority and the Guarantors shall keep the Collateral adequately insured at all times by financially sound and reputable insurers. Subject to the Intercreditor Agreement, the Collateral Agent will be named as an additional insured and loss payee as its interests may appear. Upon the request of the Collateral Agent, the Authority and the Guarantors will furnish to the Collateral Agent full information as to their property and liability insurance carriers and coverage.

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(b) The Authority and the Guarantors shall supply the Collateral Agent with certificates of each policy required hereunder, and, if requested, an original or underlyer of each such policy and all endorsements thereto. Prior to the expiration of any insurance policy required hereunder, the Authority and the Guarantors shall furnish the Collateral Agent with proof reasonably acceptable to the Collateral Agent that the policy has been reinstated, renewed or a new policy has been issued or is continuing in force with respect to such insurance. If the Authority and Guarantors fail to maintain such insurance, the Collateral Agent shall have the right, but not the obligation, after written notice to the Authority and the failure of the Authority to obtain within 5 Business Days of receipt by the Authority of such written notice reasonable replacement coverage, subject to the Intercreditor Agreement, to obtain reasonable replacement coverage and advance funds to pay the premiums for it on behalf of the Authority and the Guarantors. Authority shall repay the Collateral Agent immediately on demand for any advance for such premiums, which shall be considered to be an Obligation owed to the Collateral Agent hereunder bearing interest from the date of demand.

Section 11.10. Relative Rights

Nothing in this Indenture will:

(a) impair, as between the Authority and the Holders, the obligation of the Authority to pay principal of, premium and interest on the Notes in accordance with their terms or any other obligation of the Authority or any Guarantor;

(b) affect the relative rights of Holders as against any other creditors of the Authority or any Guarantor (other than holders of Permitted Priority Lien Debt Obligations or Permitted Prior Liens);

(c) restrict the right of any Holder to sue for payments that are then due and owing (but not enforce any judgment in respect thereof against any Collateral to the extent specifically prohibited by the provisions of the Intercreditor Agreement);

(d) subject to any required approval, license, permit or other restriction from a Gaming Regulatory Authority, restrict or prevent any Holder or the Collateral Agent from exercising any of its rights or remedies upon an Event of Default not specifically restricted or prohibited by the provisions of the Intercreditor Agreement; or

(e) subject to any required approval, license, permit or other restriction from a Gaming Regulatory Authority, restrict or prevent any Holder or the Collateral Agent from taking any lawful action in an Insolvency or Liquidation Proceeding not specifically restricted or prohibited by the provisions of the Intercreditor Agreement.

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Section 11.11. Amendments to the Security Documents

Subject to the terms of the Intercreditor Agreement, no amendment or supplement to the provisions of any Security Document will be effective without the approval of the Collateral Agent acting as directed by the holders of at least a majority in aggregate principal amount of all Notes and Parity Lien Debt then outstanding, except that:

(a) any amendment or supplement that has the effect solely of adding or maintaining Collateral or preserving, perfecting or establishing the priority of the Liens thereon or the rights of the Collateral Agent therein or adding Parity Lien Debt Obligations to obligations secured under the Security Documents, will become effective when executed and delivered by the Authority or any other Guarantor party thereto and the Collateral Agent;

(b) any amendment or supplement that has the effect solely of curing any ambiguity, defect or inconsistency or making any change that would provide any additional rights or benefits to the holders of Note Obligations or the Collateral Agent will, in each case, become effective when executed and delivered by the Authority and any Guarantor party thereto and the Collateral Agent;

(c) no amendment or supplement that reduces, impairs or adversely affects the right of any Holder:

(i) to vote its outstanding Notes as to any matter described as subject to direction by the holders of a majority in aggregate principal amount of all Notes then outstanding,

(ii) to share in the order of application described in Section 11.14 hereof in the proceeds of enforcement of or realization on any Collateral, or

(iii) to require that Liens securing Notes be released only as set forth in the provisions described above under Section 11.06 hereof,

will become effective without the consent of the requisite percentage or number of Holders and in the case of clause (c)(iii) above, the holders of Parity Lien Debt so affected under this Indenture and the Security Documents; and

(d) no amendment or supplement that imposes any obligation upon the Collateral Agent or adversely affects the rights of the Collateral Agent in its individual capacity as such will become effective without the consent of the Collateral Agent.

Any amendment or supplement to the provisions of the Security Documents that releases Collateral or that results in the Collateral Agent’s Liens upon the Collateral no longer securing the Notes and the other Obligations under this Indenture may only be effected in accordance with the provisions described above under Section 11.06. Notwithstanding anything to the contrary set forth in this Indenture, any amendment, supplement, change, waiver, modification or variance to the security documents securing the Permitted Priority Lien Debt Obligations shall be automatically made to the Security Documents without the need for any consent or other action on the part of the Collateral Agent, the Trustee or the Holders; provided that (a) any such amendment,

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supplement, change, waiver, modification or variance does not materially adversely affect the rights of the Holders and not the Permitted Priority Lien Debt and Parity Lien Debt in a like or similar manner, (b) no such amendment, supplement, change, waiver, modification or variance shall have the effect of removing assets subject to the Lien of any Security Document, except to the extent that a release of such Lien is permitted by the Intercreditor Agreement (other than any amendment, supplement, change, waiver, modification or variance with respect to any provision applicable to the Collateral Agent under the Security Documents shall require the written consent of the Collateral Agent), (c) notice of such amendment, supplement, change, waiver, modification or variance shall be given to the Collateral Agent no later than 30 days after its effectiveness, provided that the failure to give such notice shall not affect the effectiveness and validity thereof and (d) any such amendment, supplement, change, waiver, modification or variance to the Security Documents shall be approved by the Authority in writing.

Section 11.12. Additional Parity Lien Debt

The Authority may incur additional Parity Lien Debt by issuing additional notes under one or more additional indentures, incurring additional Indebtedness under a credit facility or otherwise issuing a new series of Parity Lien Debt, securing the obligations under the 6 ¹/8% Senior Notes due 2013 or increasing the amount of any Parity Lien Debt, in each case, secured by Liens on the Collateral. All additional Parity Lien Debt will be pari passu in right of payment with the Notes, will be guaranteed on a pari passu basis by each Guarantor and will be secured equally and ratably with the Notes by Liens on the Collateral granted under the Security Documents or otherwise granted to the Collateral Agent or other representative with respect to such Parity Lien Debt for as long as the Notes and the Guarantees are secured by the Collateral, subject to the covenants contained in the Indenture. Additional Parity Lien Debt will only be permitted to be secured by the Collateral if such Indebtedness and the related Liens are permitted to be incurred pursuant to Sections 4.09 and 4.12 hereof.

Section 11.13. Additional Permitted Priority Lien Debt

The Authority and the Guarantors may incur Permitted Priority Lien Debt in an aggregate amount up to the Permitted Priority Lien Debt Cap. Liens securing any Permitted Priority Lien Debt Obligations will have priority over the Liens securing the Note Obligations with respect to the Collateral as set forth in the Intercreditor Agreement. Any Parity Lien Debt incurred by the Authority shall be guaranteed by the Guarantors and shall be secured by the same Security Documents that secure the Note Obligations.

Section 11.14. Application of Proceeds from Sale of Collateral

Subject to the terms of the Intercreditor Agreement, if any Collateral is sold or otherwise realized upon by the Collateral Agent in connection with any foreclosure, collection or other enforcement of Liens granted to the Collateral Agent in the Security Documents, the proceeds received by the Collateral Agent from such foreclosure, collection or other enforcement will be distributed by the Collateral Agent in the following order of application:

FIRST, to the payment of all amounts payable under this Indenture and the Security Documents on account of the Collateral Agent’s and the Trustee’s fees and any reasonable fees, costs and expenses (including legal fees) or other liabilities of any kind incurred by the Collateral Agent or the Trustee or any co-trustee or agent of the Collateral Agent or the Trustee in connection with any Security Document or this Indenture;

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SECOND, to the Trustee for application to the payment of all outstanding Notes, the Parity Lien Debt and all Obligations under this Indenture and the Security Documents that are then due and payable in such order as may be provided in the Security Documents in an amount sufficient to pay in full in cash (a) all outstanding Notes that are then due and payable (including all interest accrued thereon after the commencement of any Insolvency or Liquidation Proceeding at the rate, including any applicable post-default rate, specified in this Indenture, even if such interest is not enforceable, allowable or allowed as a claim in such proceeding) and (b) all Parity Lien Debt; and

THIRD, any surplus remaining after the payment in full in cash of the amounts described in the preceding clauses will be paid to the Authority or the applicable Guarantor, as the case may be, or its successors or assigns, or as a court of competent jurisdiction may direct.

The foregoing order of application will be subject to the seniority of any Permitted Priority Liens and any Permitted Priority Lien Debt Obligations and subject to the provisions of the Intercreditor Agreement.

The provisions set forth under this Section 11.14 are intended for the benefit of, and will be enforceable as a third party beneficiary by, each present and future holder of Notes and the Collateral Agent as holder of Liens securing the Notes and the Guarantees.

ARTICLE 12

COVENANTS OF THE TRIBE

Section 12.01. Covenants of the Tribe.

The Tribe shall not, and shall not permit any of its representatives, political subunits or councils, agencies, instrumentalities, directly or indirectly, except as required by federal or state law, to do any of the following:

(a) increase or impose any tax or other payment obligation on the Authority or on any patrons of, or any activity at, the Resort other than:

(i) payments that are due under any agreement in effect on the date of this Indenture or payments that are not materially adverse to the economic interests of Holders of the Notes;

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(ii) payments that the Authority has agreed to reimburse each Holder for the economic effect thereof, if any;

(iii) payments that correspondingly reduce the Restricted Payments otherwise payable to the Tribe;

(iv) pursuant to the Tribal Tax Code; or

(v) Government Service Payments;

(b) amend the terms of the Lease in any material manner that would be materially adverse to the economic interests of Holders;

(c) amend the Tribal Gaming Ordinance in effect on the date of this Indenture (unless any such amendment is a legitimate effort to ensure that the Authority and the Resort conduct gaming operations in a manner that is consistent with applicable laws, rules and regulations or that protects the environment, the public health and safety, or the integrity of the Authority or the Resort) to restrict or eliminate the exclusive right of the Authority to conduct gaming operations on the existing reservation of the Tribe located adjacent to Uncasville, Connecticut in a manner that would be materially adverse to the economic interests of Holders;

(d) permit or incur any consensual liability of the Tribe (or of any other instrumentality, enterprise or subunit of the Tribe) that is a legal obligation of the Authority or any of its Restricted Subsidiaries or for which assets of the Authority or any of its Restricted Subsidiaries may be bound, other than a liability that the Authority or its Restricted Subsidiaries are permitted or not prohibited from incurring on their own behalf under this Indenture;

(e) exercise any power of eminent domain over the assets of the Authority or any of its Restricted Subsidiaries (other than any such exercise that would not materially adversely affect the economic rights and benefits of the Trustee or the Holders of the Notes); or

(f) take any other action, enter into any agreement, amend its constitution or enact any ordinance, law, rule or regulation that would have a material adverse effect on the economic interests of Holders; provided that, except as set forth in Section 12.01(c) hereof, nothing herein shall restrict the ability of the Tribe, directly or indirectly, to engage in any business, including a Gaming enterprise, outside of the Authority.

Moreover, except with the consent of a majority in interest of Holders or as required by federal or state law, the Tribe shall not, and shall not permit any of its representatives, political subunits or councils, agencies, instrumentalities, to, directly or indirectly impose, tax or otherwise make a charge on the Notes, this Indenture, the Security Documents or any payments or deposits to be made thereunder.

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Section 12.02. Additional Covenants of the Tribe.

(a) Any action taken by the Tribe to comply with federal or state law that would otherwise violate Section 12.01 hereof shall be taken only after prior written notice to the Trustee, accompanied with an Officers’ Certificate and Opinion of Counsel that such action is required by federal or state law. To the extent possible under the federal or state law, the Tribe shall give the Trustee at least 30 days prior written notice of any such action.

(b) The Tribe will not permit or incur any consensual liability of the Tribe (or of any other instrumentality or subunit of the Tribe) that is a legal obligation of the Authority, or for which the Authority’s assets may be bound, other than a liability that the Authority is permitted or not prohibited from incurring on its own behalf under this Indenture.

(c) In the event that the Tribe receives any payment from the Authority at a time when such payment is prohibited by the terms of this Indenture, such payment shall be held by the Tribe in trust for the benefit of, and shall be paid forthwith over and delivered, upon the written request of the Trustee or the Authority, to the Authority.

(d) The Tribe will not, pursuant to or within the meaning of Bankruptcy Law, appoint or consent to the appointment of a custodian of the Authority or for all or substantially all of the property of the Authority.

(e) The Tribe agrees that it will not enact any Bankruptcy Law or similar law for the relief of debtors that would impair, limit, restrict, delay or otherwise adversely affect any of the rights and remedies of the Trustee or the Holders provided for in this Indenture or the Notes.

(f) The Tribe agrees that it will not, and will not permit the Authority or any of the Tribe’s representatives, political subunits, agencies, instrumentalities or councils to, exercise any power of eminent domain over the property that is the subject of the Lease (other than any such exercise that would not materially adversely affect the economic rights and benefits of the Trustee or the Holders thereunder). Except as required by federal or state law, the Tribe will not enact any statute, law, ordinance or rule that would have a material adverse affect on the rights of the Trustee or the Holders under this Indenture or the Notes.

(g) The Tribe hereby agrees that, subject to the terms of the Intercreditor Agreement, upon any payment or distribution of assets upon any liquidation, dissolution, winding up, reorganization, assignment for the benefit of creditors, marshalling of assets or any bankruptcy, insolvency or similar proceedings of the Authority or the Resort, the Holders of the Notes shall be entitled to receive payment in full in respect to all principal, premium, interest and other amounts owing in respect of the Notes before any payment or any distribution to the Tribe.

(h) The Tribe agrees that the Authority shall have sole and exclusive right to operate the Resort.

(i) Any action taken in violation of this Article 12 shall be deemed in contravention of Article XIV (“Non-Impairment of Contracts”) of the Constitution of the Tribe.

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(j) The Tribe shall not permit any Person other than the Tribe to acquire any Ownership Interest whatsoever in the Authority.

ARTICLE 13

MISCELLANEOUS

Section 13.01. Limitations on Management Activities.

Notwithstanding any provision in this Indenture, the Intercreditor Agreement or any other Security Document (collectively, the “Credit Documents”), none of the Trustee, Collateral Agent or any Holder (collectively, the “Creditor Parties”) shall engage in any of the following: planning, organizing, directing, coordinating, or controlling all or any portion of the Authority’s gaming operations (collectively, “Management Activities”), including, but not limited to:

(a) the training, supervision, direction, hiring, firing, retention, compensation (including benefits) of any employee (whether or not a management employee) or contractor;

(b) any employment policies or practices;

(c) the hours or days of operation;

(d) any accounting systems or procedures;

(e) any advertising, promotions or other marketing activities;

(f) the purchase, lease, or substitution of any gaming device or related equipment or software, including player tracking equipment;

(g) the vendor, type, theme, percentage of pay-out, display or placement of any gaming device or equipment; or

(h) budgeting, allocating, or conditioning payments of the Authority’s operating expenses;

provided, however, none of the Creditor Parties will be in violation of the foregoing restriction solely because one of the Creditor Parties:

(i) exercises any Lien Enforcement Action that does not require the gaming operation to be subject to any third-party decision-making as to any Management Activities; or

(ii) requires that all or any portion of the revenues securing the notes or Parity Lien Debt Obligations be applied to satisfy valid terms of the Credit Documents or the Parity Lien Debt Documents; or

(iii) otherwise forecloses on all or any portion of the property securing the notes or any Parity Lien Debt Obligations.

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Section 13.02. Notices.

Any notice or communication by the Authority, any Subsidiary Guarantor or the Trustee to the others is duly given if in writing and delivered in Person or mailed by first class mail (registered or certified, return receipt requested), telex, telecopier or overnight air courier guaranteeing next day delivery, to the others’ address:

If to the Authority or any Subsidiary Guarantors:

Mohegan Tribal Gaming Authority

One Mohegan Sun Boulevard

Uncasville, CT 06382

Attention: Chief Executive Officer

With a copy to:

Mohegan Tribal Gaming Authority

One Mohegan Sun Boulevard

Uncasville, CT 06382

Attention: General Counsel

and

Hogan & Hartson L.L.P.

555 Thirteenth Street, NW

Washington, DC 20004

Attention: Carol Weld King, Esq.

If to the Tribe:

The Mohegan Tribe of Indians of Connecticut

One Mohegan Sun Boulevard

Uncasville, CT 06382

Attention: Chair, Tribal Council

With a copy to:

The Mohegan Tribe of Indians of Connecticut

One Mohegan Sun Boulevard

Uncasville, CT 06382

Attention: Attorney General

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If to the Trustee:

U.S. Bank National Association

225 Asylum Street - 23rd Floor

Hartford, CT, 06103

Attention: Corporate Trust/C. Silva

With a copy to:

Shipman & Goodwin LLP

One Constitution Plaza

Hartford, CT 06103

Attention: William G. Rock

The Authority or the Trustee, by notice to the others may designate additional or different addresses for subsequent notices or communications.

All notices and communications (other than those sent to Holders) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery.

Any notice or communication to a Holder shall be mailed by first class mail, certified or registered, return receipt requested, or by overnight air courier guaranteeing next day delivery to its address shown on the register kept by the Registrar. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.

If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it.

If the Authority mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time.

Section 13.03. [Intentionally Omitted].

Section 13.04. Certificate and Opinion as to Conditions Precedent.

Upon any request or application by the Authority or any Subsidiary Guarantor to the Trustee to take any action under this Indenture, the Authority shall furnish to the Trustee:

(a) an Officers’ Certificate in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 13.05 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been satisfied; and

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(b) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 13.05 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been satisfied.

Section 13.05. Statements Required in Certificate or Opinion.

Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include:

(a) a statement that the Person making such certificate or opinion has read such covenant or condition;

(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(c) a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been satisfied; and

(d) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been satisfied.

Section 13.06. Rules by Trustee and Agents.

The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions.

Section 13.07. Dispute Resolution and Consent to Suit.

The Tribe does not consent to the enforcement, levy, or other execution of any judgment for money or other damages against any assets, real or personal, of the Tribe, except that the Tribe, the Authority and each of the Guarantors, as applicable, consent to the enforcement and execution of any judgment, whether obtained as a result of judicial, administrative, or arbitrational proceedings, against any assets of the Authority and the Guarantors or to compel the Tribe to return any prohibited payment made to the Tribe as described in Section 12.02(c) hereof. Subject to the foregoing, the Tribe, the Authority and the Guarantors waive their respective sovereign immunity from unconsented suit, whether such suit be brought in law or in equity, or in administrative proceedings or proceedings in arbitration, to permit the commencement, maintenance, and enforcement of any action, by any person with standing to maintain an action,

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to interpret or enforce the terms of this Indenture, the Notes or the Security Documents, and to enforce and execute any judgment resulting therefrom against the Authority and the Guarantors or the assets of the Authority and the Guarantors. Notwithstanding any other provision of law or canon of construction, the Tribe, the Authority and the Guarantors each intend this waiver to be interpreted liberally to permit the full litigation of disputes arising under or out of this Indenture or the Notes. Without limiting the generality of the foregoing, the Tribe, the Authority and the Guarantors waive their immunity from unconsented suit to permit the maintenance of the following actions:

(a) Courts. The Tribe, the Authority and the Guarantors each waive their immunity from unconsented suit to permit any court of competent jurisdiction to (i) enforce and interpret the terms of this Indenture, the Notes and the Security Documents, and award and enforce the award of damages against the Authority or the Guarantors owing as a consequence of a breach thereof, whether such award is the product of litigation, administrative proceedings, or arbitration; (ii) determine whether any consent or approval of the Tribe, the Authority or the Guarantors has been improperly granted or unreasonably withheld; (iii) enforce any judgment prohibiting the Tribe, the Authority or the Guarantors from taking any action, or mandating or obligating the Tribe, the Authority or the Guarantors to take any action, including a judgment compelling the Tribe, the Authority or the Guarantors to submit to binding arbitration; and (iv) adjudicate any claim under the Indian Civil Rights Act of 1968, 25 U.S.C. § 1302 (or any successor statute).

(b) Arbitration. The Tribe, the Authority and the Guarantors each waive their immunity from unconsented suit to permit arbitrators, appointed and acting under the commercial arbitration rules of the American Arbitration Association, whenever and to the extent any agreement to submit a matter to arbitration is made by the Tribe or by the Authority, to (i) enforce and interpret the terms of this Indenture, the Notes and the Security Documents, and to award and enforce the award of any damages owing as a consequence thereof; (ii) determine whether any consent or approval of the Tribe, the Authority or the Guarantors has been unreasonably withheld; and (iii) enforce any judgment prohibiting the Tribe, the Authority or the Guarantors from taking any action, or mandating or obligating the Tribe, the Authority or the Guarantors to take any action, including a judgment compelling the Tribe, the Authority or the Guarantors to submit to binding arbitration.

Section 13.08. No Personal Liability of Directors, Officers, Employees and Stockholders.

Neither the Tribe nor any director, officer, office holder, employee, agent, representative or member of the Authority or the Tribe or holder of an Ownership Interest of the Authority, any Guarantor or the Tribe, as such, shall have any liability for any obligations of the Authority or such Guarantor under the Notes, the Guarantees, if any, this Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes.

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Section 13.09. Governing Law.

THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE SUBSIDIARY GUARANTEES WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PRINCIPLES THEREOF (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

Section 13.10. No Adverse Interpretation of Other Agreements.

This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Authority or its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

Section 13.11. Successors.

All agreements of the Authority in this Indenture and the Notes shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successors. All agreements of each Guarantor in this Indenture shall bind its successors.

Section 13.12. Severability.

In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

Section 13.13. Counterpart Originals.

The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

Section 13.14. Table of Contents, Headings, etc.

The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part of this Indenture and shall in no way modify or restrict any of the terms or provisions hereof.

[Signatures on following page]

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SIGNATURES

Accepted and Agreed to as of the date above written:

MOHEGAN TRIBAL GAMING AUTHORITY
By:	/S/    MARILYNN R. MALERBA
	Name: Marilynn R. Malerba
	Title:   Chairwoman
MOHEGAN BASKETBALL CLUB LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager
MOHEGAN COMMERCIAL VENTURES PA, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager
DOWNS RACING, L.P.
By Mohegan Commercial Ventures PA, LLC, its general partner
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager
BACKSIDE, L.P.
By Mohegan Commercial Ventures PA, LLC, its general partner
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager

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MILL CREEK LAND, L.P.
By Mohegan Commercial Ventures PA, LLC, its general partner
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager
NORTHEAST CONCESSIONS, L.P.
By Mohegan Commercial Ventures PA, LLC, its general partner
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager
MOHEGAN VENTURES-NORTHWEST, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager
MOHEGAN GOLF, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager
MOHEGAN VENTURES WISCONSIN, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:  Manager

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WISCONSIN TRIBAL GAMING, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager
MTGA GAMING, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess
	Title:   Manager

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THE MOHEGAN TRIBE OF INDIANS OF CONNECTICUT
(solely with respect to its obligations under Article 12 and Section 13.07 hereof)
By:	/S/    MARILYNN R. MALERBA
	Name: Marilynn R. Malerba
	Title:   Chairwoman
U.S. BANK NATIONAL ASSOCIATION,
As Trustee
By:	/S/    CAUNA M. SILVA
	Name: Cauna M. Silva
	Title:   Vice President

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SCHEDULE I

Mortgaged Property

EXHIBIT A

THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE AUTHORITY.

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE AUTHORITY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:

(1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE “SECURITIES ACT”) (A “QIB”) OR (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING THIS SECURITY FOR THE ACCOUNT OR FOR THE BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFF-SHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT,

A-1

(2) AGREES THAT IT WILL NOT, WITHIN, THE TIME PERIOD REFERRED TO UNDER RULE 144(d)(1) UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF THE TRANSFER OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) TO A PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QIB OR AN ACCREDITED INVESTOR PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB OR AN ACCREDITED INVESTOR, RESPECTIVELY, IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT OR AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE AND PROVIDED THAT PRIOR TO SUCH TRANSFER, THE TRUSTEE IS FURNISHED WITH AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AND

(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (2)(D) OR (2)(E) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

IN CONNECTION WITH ANY TRANSFER THIS SECURITY OR ANY INTEREST HEREIN WITHIN THE TIME PERIOD REFERRED TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE. AS USED HEREIN THE TERMS “OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S. PERSON” HAVE THE MEANING GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT.

[THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE NOTES, ARE AS SPECIFIED IN THE INDENTURE. THE HOLDER OF THIS NOTE BY ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IF IT IS A PURCHASER IN A SALE THAT OCCURS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S OF THE SECURITIES ACT, IT ACKNOWLEDGES THAT, UNTIL EXPIRATION OF THE “40-DAY DISTRIBUTION COMPLIANCE PERIOD” WITHIN THE MEANING OF RULE 903 OF REGULATION S, ANY OFFER OR SALE OF THIS NOTE SHALL NOT BE MADE BY IT TO A U.S. PERSON TO OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON WITHIN THE MEANING OF RULE 902(k) UNDER THE SECURITIES ACT.]

[THIS SECURITY IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE. A HOLDER MAY OBTAIN THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO MATURITY FOR SUCH SECURITY BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION TO: GENERAL COUNSEL, MOHEGAN TRIBAL GAMING AUTHORITY, ONE MOHEGAN SUN BOULEVARD, UNCASVILLE, CONNECTICUT 06382, TELEPHONE NUMBER (860) 862-5997.]

A-2

[Face of Note]

11 ¹/2% Second Lien Senior Secured Note due 2017

CUSIP [            ]

No.             $                    

MOHEGAN TRIBAL GAMING AUTHORITY

promises to pay to                                                                                                                                                    

or registered assigns,

the principal sum of                                                                                                                                                  

Dollars on November 1, 2017

Interest Payment Dates: May 1 and November 1,

Record Dates: April 15 and October 15

Dated:

MOHEGAN TRIBAL GAMING AUTHORITY
By:
	Name:
	Title:
By:
	Name:
	Title:

This is one of the Notes referred to in the within-mentioned Indenture:
U.S. BANK NATIONAL ASSOCIATION, as Trustee
By:
	Authorized Signatory

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[Back of Note]

Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.

1. INTEREST. The Mohegan Tribal Gaming Authority (the “Authority”) promises to pay interest on the principal amount of this Note at 11 ¹/2% per annum from October 26, 2009 until maturity. The Authority will pay interest semi-annually in arrears on May 1 and November 1 each year, or if any such day is not a Business Day, on the next succeeding Business Day (each an “Interest Payment Date”) to the holders of record on the preceding April 15 and October 15, respectively. Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of original issuance; provided that, if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided, further, that the first Interest Payment Date shall be May 1, 2010. The Authority shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2. METHOD OF PAYMENT. The Authority will pay interest on the Notes (except defaulted interest) to the Persons who are registered Holders of Notes at the close of business on the May 1 or November 1 next preceding the Interest Payment Date, even if such Notes are canceled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes will be payable as to principal, premium and interest at the office or agency of the Authority maintained for such purpose within or without the City and State of New York, or, at the option of the Authority, payment of interest may be made by check mailed to the Holders at their addresses set forth in the register of Holders, and provided that payment by wire transfer of immediately available funds will be required with respect to principal of and interest and premium on, all Global Notes and all other Notes the Holders of which shall hold at least $1.0 million in principal amount of Notes and have provided wire transfer instructions to the Authority and the Paying Agent. Such payment shall be made in accordance with those instructions.

3. PAYING AGENT AND REGISTRAR. Initially, the Trustee under the Indenture, will act as Paying Agent and Registrar. The Authority may change any Paying Agent or Registrar without notice to any Holder. The Authority may act as Paying Agent or Registrar.

4. INDENTURE. The Authority issued the Notes under an Indenture dated as of October 26, 2009 (“Indenture”) among the Authority, The Mohegan Tribe of Indians of Connecticut (the “Tribe”), the Subsidiary Guarantors and the Trustee. The terms of the Notes include those stated in the Indenture. The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.

A-2

5. OPTIONAL REDEMPTION.

(a) At any time prior to November 1, 2013, the Authority shall have the option to redeem the Notes, in whole or in part, at a redemption price equal to the greater of:

(1) 100% of the principal amount of the Notes to be redeemed; and

(2) the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date, on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months), at the Treasury Rate plus 50 basis points;

plus accrued and unpaid interest thereon to the Redemption Date.

(b) At any time or from time to time on or after November 1, 2013, the Authority shall have the option to redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount) set forth below, together with accrued and unpaid interest thereon, if any, to the applicable redemption date, if redeemed during the 12-month period beginning on November 1 of the years indicated below:

Year	Percentage
2013	105.750	%
2014	102.875	%
2015 and thereafter	100.000	%

(c) Notwithstanding any other provisions of Article 3 of the Indenture, if any Gaming Regulatory Authority requires that a Holder or beneficial owner of the Notes be licensed, qualified or found suitable under any applicable gaming laws in order to maintain any gaming license or franchise of the Authority under any applicable gaming laws, and the Holder or beneficial owner fails to apply for a license, qualification or finding of suitability within 30 days after being requested to do so by such Gaming Regulatory Authority (or such lesser period that may be required by such Gaming Regulatory Authority) or if such Holder or beneficial owner is not so licensed, qualified or found suitable, the Authority has the right, at its option, (i) to require such Holder or beneficial owner to dispose of such Holder’s or beneficial owner’s Notes within 30 days of receipt of such notice of such finding by the applicable Gaming Regulatory Authority (or such earlier date as may be required by the applicable Gaming Regulatory Authority); or (ii) to call for redemption of the Notes of such Holder or beneficial owner at a redemption price equal to the least of (1) the principal amount thereof, (2) the price at which such Holder or beneficial owner acquired the Notes and (3) the current market price of the Notes, together with, in either case, accrued and unpaid interest to the earlier of the date of redemption or the date of the finding of unsuitability by such Gaming Regulatory Authority, which may be less than 30 days following the notice of redemption if so ordered by such Gaming Regulatory Authority. The Authority shall not be required to pay or reimburse any Holder or beneficial owner of Notes who is required to apply for any such license, qualification or finding of suitability for the costs of the licensure or investigation for such qualification or finding of suitability. Such expenses shall be the obligation of such Holder or beneficial owner.

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6. MANDATORY REDEMPTION.

Except as set forth in paragraph 7 below, the Authority shall not be required to make mandatory redemption payments with respect to the Notes.

7. REPURCHASE AT OPTION HOLDER.

(a) If there is a Change of Control, the Authority shall be required to make an offer (a “Change of Control Offer”) to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of each Holder’s Notes at a purchase price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest to the date of purchase (the “Change of Control Payment”). Within 20 Business Days following any Change of Control, the Authority shall mail a notice to each Holder setting forth the procedures governing the Change of Control Offer as required by the Indenture.

(b) If the Authority or a Restricted Subsidiary consummates any Asset Sales of Collateral, within five Business Days of each date on which the aggregate amount of Collateral Excess Proceeds exceeds $15.0 million, the Authority will make an offer to repurchase the Notes, together with any senior secured Indebtedness ranking pari passu with the Notes and containing similar provisions requiring the Authority to make an offer to purchase such pari passu senior secured Indebtedness with the proceeds from such Asset Sale pursuant to a cash offer (subject only to conditions required by applicable law, if any), pro rata in proportion to the respective principal amounts of such pari passu senior secured Indebtedness (or accreted values in the case of Indebtedness issued with an original issue discount) and the Notes (the “Collateral Asset Sale Offer”) at a purchase price of 100% of the principal amount (or accreted value in the case of Indebtedness issued with an original issue discount) (the “Collateral Asset Sale Offer Price”). The offer price in any Collateral Asset Sale Offer will be equal to 100% of the principal amount plus accrued and unpaid interest to the date of purchase and will be payable in cash, in accordance with the procedures set forth in this Indenture and such other pari passu senior secured Indebtedness. To the extent that any Collateral Excess Proceeds remain after consummation of an Collateral Asset Sale Offer, the Authority may use such Collateral Excess Proceeds for any purpose not otherwise prohibited by the Indenture and the Security Documents. If the aggregate principal amount of Notes and such other pari passu senior secured Indebtedness tendered into such Collateral Asset Sale Offer surrendered by holders thereof exceeds the amount of Collateral Excess Proceeds, the Trustee shall select the Notes and such other pari passu senior secured Indebtedness (to the extent that such other senior secured Indebtedness permits such selection) to be purchased on a pro rata basis. Upon completion of such Collateral Asset Sale Offer, the amount of Collateral Excess Proceeds shall be reset at zero.

(c) If the Authority or a Restricted Subsidiary consummates any Asset Sales of non-Collateral, within five Business Days of each date on which the aggregate amount of Collateral Excess Proceeds exceeds $15.0 million, the Authority will make an offer to repurchase the Notes, together with any senior Indebtedness ranking pari passu with the Notes and containing similar provisions requiring the Authority to make an offer to purchase such pari passu senior

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Indebtedness with the proceeds from such Asset Sale pursuant to a cash offer (subject only to conditions required by applicable law, if any), pro rata in proportion to the respective principal amounts of such pari passu senior Indebtedness (or accreted values in the case of Indebtedness issued with an original issue discount) and the Notes (the “Non-Collateral Asset Sale Offer”) at a purchase price of 100% of the principal amount (or accreted value in the case of Indebtedness issued with an original issue discount) (the “Non-Collateral Asset Sale Offer Price”). The offer price in any Non-Collateral Asset Sale Offer will be equal to 100% of the principal amount plus accrued and unpaid interest to the date of purchase and will be payable in cash, in accordance with the procedures set forth in the Indenture and such other pari passu senior Indebtedness. To the extent that any Non-Collateral Excess Proceeds remain after consummation of a Non-Collateral Asset Sale Offer, the Authority may use such Non-Collateral Excess Proceeds for any purpose not otherwise prohibited by the Indenture and the Security Documents. If the aggregate principal amount of Notes and such other pari passu senior Indebtedness tendered into such Non-Collateral Asset Sale Offer surrendered by holders thereof exceeds the amount of Non-Collateral Excess Proceeds, the Trustee shall select the Notes and such other pari passu senior Indebtedness (to the extent that such other senior Indebtedness permits such selection) to be purchased on a pro rata basis. Upon completion of such Non-Collateral Asset Sale Offer, the amount of Non-Collateral Excess Proceeds shall be reset at zero.

8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30 days but not more than 60 days before the Redemption Date to each Holder whose Notes are to be redeemed at its registered address. Notes in denominations larger than $2,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the Redemption Date interest ceases to accrue on Notes or portions thereof called for redemption.

9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in denominations of $2,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Authority may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Authority need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Authority need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date.

10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner for all purposes.

11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Indenture, the Subsidiary Guarantees or the Notes may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the then outstanding Notes, voting as a single class, and any existing default or compliance with any provision of the Indenture, the Subsidiary Guarantees or the Notes may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes, voting as a single class. Without the

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consent of any Holder of a Note, the Indenture, the Subsidiary Guarantees or the Notes may be amended or supplemented to cure any ambiguity, defect or inconsistency, to provide for uncertificated Notes in addition to or in place of certificated Notes, to provide for the assumption of the Authority’s or Subsidiary Guarantor’s obligations to Holders of the Notes by a successor to the Authority or such Subsidiary Guarantor in the case of a merger, consolidation or sale of all or substantially all of the Authority’s assets, to make any change that would provide any additional rights or benefits to the Holders of the Notes or that does not adversely affect the legal rights under the Indenture of any such Holder or to allow any Subsidiary to execute a supplemental indenture relating to a Subsidiary Guarantee and to execute a Subsidiary Guarantee.

12. DEFAULTS AND REMEDIES. Events of Default include: (i) default for 30 days in the payment when due of interest on the Notes; (ii) default in payment when due of principal of or premium, if any, on the Notes; (iii) failure by the Authority or any of its Restricted Subsidiaries to comply with Section 4.10 or 5.01 of the Indenture; (iv) failure by the Authority or any of its Restricted Subsidiaries to observe or perform (A) the provisions of the Security Documents and the provisions of any covenant described in Section 4.07 or 4.09 of the Indenture for 30 days after notice to the Authority by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class or (B) any other covenant, representation, warranty or other agreement in the Indenture or the Notes for 60 days after notice to the Authority by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class; (v) default under certain other agreements relating to Indebtedness of the Authority or any of its Restricted Subsidiaries which default (A) is caused by a Payment Default or (B) results in the acceleration of such Indebtedness prior to its express maturity; and in each case, the principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $50.0 million or more; (vi) certain final judgments for the payment of money in excess of $50.0 million that remain undischarged for a period of 60 days; (vii) certain events of bankruptcy or insolvency with respect to the Authority or any of its Restricted Subsidiaries; (viii) revocation, termination, suspension or other cessation of effectiveness of any Gaming License which results in the cessation or suspension of gaming operations for a period of more than 90 consecutive days at the Resort; (ix) cessation of gaming operations for a period of more than 90 consecutive days at the Resort (other than as a result of a casualty loss); (x) the Lease ceases to be in full force and effect; (xi) except as permitted by the Indenture, any Subsidiary Guarantee shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect or any Subsidiary Guarantor or any Person acting on its behalf shall deny or disaffirm its obligations under such Subsidiary Guarantor’s Subsidiary Guarantee; (xii) failure by the Tribe to comply with the provisions of Article 12 for 30 days after notice to the Authority and the Tribe by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class; and (x) (a) any Security Document is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full force and effect or is declared null and void, other than in accordance with the terms of the relevant Security Document; or (b) except as permitted by the Indenture, any Lien purported to be granted under any Security Document on Collateral, individually or in the aggregate, having a fair market value in excess of $25.0 million ceases to be an enforceable and perfected first-priority Lien, subject only to Permitted Prior Liens; or (c) the Authority or any Restricted Subsidiary, or any Person acting

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on behalf of any of them, denies or disaffirms, in writing, any obligation of the Authority or any Restricted Subsidiary set forth in or arising under any Security Document. If any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency, all outstanding Notes will become due and payable without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest) if it determines that withholding notice is in their interest. The Holders of not less than a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest on, or the principal of, the Notes. The Authority is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Authority is required upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default.

13. TRUSTEE DEALINGS WITH AUTHORITY. Subject to Section 7.03 of the Indenture, the Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Authority or its Affiliates, and may otherwise deal with the Authority or its Affiliates, as if it were not the Trustee.

14. NO RECOURSE AGAINST OTHERS. A controlling person, director, officer, employee or holder of an Ownership Interest of the Authority, as such, shall not have any liability for any obligations of the Authority under the Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for the issuance of the Notes.

15. AUTHENTICATION. This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.

16. ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

17. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Authority has caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.

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The Authority will furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:

Mohegan Tribal Gaming Authority

One Mohegan Sun Boulevard

Uncasville, CT 06382

Attention: General Counsel

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ASSIGNMENT FORM

To assign this Note, fill in the form below:

(I) or (we) assign and transfer this Note to:                                                                                                           

            (Insert assignee’s legal name)

(Insert assignee’s soc. sec. or tax I.D. no.)

(Print or type assignee’s name, address and zip code)

and irrevocably appoint                                                                                                                                                                

to transfer this Note on the books of the Authority. The agent may substitute another to act for him.

Date:                                                  

Your Signature:                                                                                   

(Sign exactly as your name appears on the face of this Note)

Signature Guarantee*:                                                 

* Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

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OPTION OF HOLDER TO ELECT PURCHASE

If you want to elect to have this Note purchased by the Authority pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box below:

¨     Section 4.10                                         ¨     Section 4.15

If you want to elect to have only part of the Note purchased by the Authority pursuant to Section 4.10 or Section 4.15 of the Indenture, state the amount you elect to have purchased:

$                                             

Date:                                         

Your Signature:                                                                                   

(Sign exactly as your name appears on the face of this Note)

Tax Identification No.:                                                                      

Signature Guarantee*:                                                 

* Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made:

Date of Exchange Amount of decrease in
Principal Amount of
this Global Note Amount of increase in
Principal Amount of
this Global Note Principal Amount of
this Global Note
following such decrease
(or increase) Signature of
authorized officer of
Trustee or Note
Custodian

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EXHIBIT B

FORM OF CERTIFICATE OF TRANSFER

Mohegan Tribal Gaming Authority

One Mohegan Sun Boulevard

Uncasville, CT 06382

U.S. Bank National Association

225 Asylum Street - 23rd Floor

Hartford, CT, 06103

Re: 11 ¹/2 % Second Lien Senior Secured Notes due 2017

Reference is hereby made to the Indenture, dated as of October 26, 2009 (the “Indenture”), among the Mohegan Tribal Gaming Authority, as issuer (the “Authority”), The Mohegan Tribe of Indians of Connecticut (the “Tribe”), Downs Racing, L.P., Backside, L.P., Mill Creek Land, L.P., Northeast Concessions, L.P., Mohegan Commercial Ventures PA, LLC, Mohegan Basketball Club, LLC, Mohegan Ventures-Northwest, LLC, Mohegan Golf, LLC, Mohegan Ventures Wisconsin, LLC, Wisconsin Tribal Gaming, LLC and MTGA Gaming, LLC, as guarantors (the “Subsidiary Guarantors”) and U.S. Bank National Association, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.

                     (the “Transferor”) owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $              in such Note[s] or interests (the “Transfer”), to              (the “Transferee”), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that:

[CHECK ALL THAT APPLY]

1. ¨ Check if Transferee will take delivery of a beneficial interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Note and/or the Definitive Note and in the Indenture and the Securities Act.

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2. ¨ Check if Transferee will take delivery of a beneficial interest in the Regulation S Global Note. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act; (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Distribution Compliance Period, the transfer is not being made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Global Note and/or the Definitive Note and in the Indenture and the Securities Act.

3. ¨ Check and complete if Transferee will take delivery of a beneficial interest in the Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one):

(a) ¨ such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act;

or

(b) ¨ such Transfer is being effected to the Authority or a subsidiary thereof;

or

(c) ¨ such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act;

or

4. ¨ Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Note or of an Unrestricted Definitive Note.

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(a) ¨ Check if Transfer is pursuant to Rule 144. (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture.

(b) ¨ Check if Transfer is Pursuant to Regulation S. (i) The Transfer is being effected and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture.

(c) ¨ Check if Transfer is Pursuant to Other Exemption. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture.

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This certificate and the statements contained herein are made for your benefit and the benefit of the Authority.

[Insert Name of Transferor]
By:
	Name:
	Title:

Dated:                                         

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ANNEX A TO CERTIFICATE OF TRANSFER

1.	The Transferor owns and proposes to transfer the following:
	[CHECK ONE OF (a) OR (b)]
	(a)	¨	a beneficial interest in the:
		(i)	¨ 144A Global Note (CUSIP                     ), or
		(ii)	¨ Regulation S Global Note (CUSIP                     ), or
	(b)	¨	a Restricted Definitive Note.
2.	After the Transfer the Transferee will hold:
[CHECK ONE]
	(a)	¨	a beneficial interest in the:
		(i)	¨ 144A Global Note (CUSIP                     ), or
		(ii)	¨ Regulation S Global Note (CUSIP                     ), or
		(iii)	¨ Unrestricted Global Note (CUSIP ); or
	(b)	¨	a Restricted Definitive Note; or
	(c)	¨	an Unrestricted Definitive Note,

in accordance with the terms of the Indenture.

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EXHIBIT C

FORM OF CERTIFICATE OF EXCHANGE

Mohegan Tribal Gaming Authority

One Mohegan Sun Boulevard

Uncasville, CT 06382

U.S. Bank National Association

225 Asylum Street - 23rd Floor

Hartford, CT, 06103

Re: 11 ¹/2 % Second Lien Senior Secured Notes due 2017

(CUSIP                     )

Reference is hereby made to the Indenture, dated as of October 26, 2009 (the “Indenture”) among the Mohegan Tribal Gaming Authority, as issuer (the “Authority”), The Mohegan Tribe of Indians of Connecticut (the “Tribe”), Downs Racing, L.P., Backside, L.P., Mill Creek Land, L.P., Northeast Concessions, L.P., Mohegan Commercial Ventures PA, LLC, Mohegan Basketball Club, LLC, Mohegan Ventures-Northwest, LLC, Mohegan Golf, LLC, Mohegan Ventures Wisconsin, LLC, Wisconsin Tribal Gaming, LLC and MTGA Gaming, LLC, as guarantors (the “Subsidiary Guarantors”), and U.S. Bank National Association, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.

             (the “Owner”) owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of $              in such Note[s] or interests (the “Exchange”). In connection with the Exchange, the Owner hereby certifies that:

1. Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note.

(a) ¨ Check if Exchange is from beneficial interest in a Restricted Global Note to beneficial interest in an Unrestricted Global Note. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Global Notes and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the “Securities Act”), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

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(b) ¨ Check if Exchange is from beneficial interest in a Restricted Global Note to Unrestricted Definitive Note. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

(c) ¨ Check if Exchange is from Restricted Definitive Note to beneficial interest in an Unrestricted Global Note. In connection with the Owner’s Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

(d) ¨ Check if Exchange is from Restricted Definitive Note to Unrestricted Definitive Note. In connection with the Owner’s Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

2. Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes.

(a) ¨ Check if Exchange is from beneficial interest in a Restricted Global Note to Restricted Definitive Note. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owner’s own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act.

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(b) ¨ Check if Exchange is from Restricted Definitive Note to beneficial interest in a Restricted Global Note. In connection with the Exchange of the Owner’s Restricted Definitive Note for a beneficial interest in the [CHECK ONE] ¨ 144A Global Note, ¨ Regulation S Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act.

This certificate and the statements contained herein are made for your benefit and the benefit of the Authority.

[Insert Name of Transferor]
By:
	Name:
	Title:

Dated:                    

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EXHIBIT D

FORM OF NOTATION OF SUBSIDIARY GUARANTEE ON NOTE

Each Subsidiary Guarantor (as defined in the Indenture) has jointly and severally unconditionally guaranteed on a senior basis (a) the due and punctual payment of the principal of, premium, if any, and interest on the Notes, whether at maturity or an Interest Payment Date, by acceleration, call for redemption or otherwise, (b) the due and punctual payment of interest on the overdue principal and premium of, and interest, to the extent lawful, on the Notes and (c) that in case of any extension of time of payment or renewal of any Notes or any of such other obligations, the same will be promptly paid in full when due in accordance with the terms of the extension of renewal, whether at stated maturity, by acceleration or otherwise.

Notwithstanding the foregoing, in the event that a Subsidiary Guarantor’s Subsidiary Guarantee would constitute or result in a violation of any applicable fraudulent conveyance or similar law of any relevant jurisdiction, the liability of such Subsidiary Guarantor under its Subsidiary Guarantee shall be limited to such amount as will not, after giving effect thereto, and to all other liabilities of such Subsidiary Guarantor, result in such amount constituting a fraudulent transfer or conveyance.

The Subsidiary Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication on the Note upon which the Subsidiary Guarantee is noted shall have been executed by the Trustee under the Indenture by the manual or facsimile signature of one of its authorized officers.

Dated: ____________

DOWNS RACING, L.P.
By:
	Name: Title:
BACKSIDE, L.P.
By:
	Name: Title:

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MILL CREEK LAND, L.P.
By:
	Name: Title:
NORTHEAST CONCESSIONS, L.P.
By:
	Name: Title:
MOHEGAN COMMERCIAL VENTURES PA, LLC
By:
	Name: Title:
MOHEGAN BASKETBALL CLUB, LLC
By:
	Name: Title:
MOHEGAN VENTURES-NORTHWEST, LLC
By:
	Name: Title:

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MOHEGAN GOLF, LLC
By:
	Name: Title:
MOHEGAN VENTURES WISCONSIN, LLC
By:
	Name: Title:
WISCONSIN TRIBAL GAMING, LLC
By:
	Name: Title:
MTGA GAMING, LLC
By:
	Name: Title:

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EXHIBIT E

FORM OF SUPPLEMENTAL INDENTURE

TO BE DELIVERED BY SUBSEQUENT SUBSIDIARY GUARANTORS

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of             , among              (the “Subsidiary Guarantor”), a subsidiary of the Mohegan Tribal Gaming Authority (or its permitted successor), (the “Authority”), the Authority, the other Subsidiary Guarantors (as defined in the Indenture referred to herein) and U.S. Bank National Association, as trustee under the Indenture referred to below (the “Trustee”).

W I T N E S S E T H:

WHEREAS the Authority has heretofore executed and delivered to the Trustee an indenture (the “Indenture”), dated as of October 26, 2009 providing for the issuance of an aggregate principal amount of up to $200,000,000 of 11 ¹ /2% Second Lien Senior Secured Notes due 2017 (the “Notes”);

WHEREAS, the Indenture provides that under certain circumstances the Subsidiary Guarantor shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Subsidiary Guarantor shall unconditionally guarantee all of the Authority’s Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the “Subsidiary Guarantee”); and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Subsidiary Guarantor and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows:

1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.

2. INDENTURE PROVISION PURSUANT TO WHICH GUARANTEE IS GIVEN. This Supplemental Indenture is being executed and delivered pursuant to Section 4.20 of the Indenture.

3. AGREEMENT TO GUARANTEE. The Subsidiary Guarantor hereby agrees as follows:

(a) The Subsidiary Guarantor, jointly and severally with all other Subsidiary Guarantors, if any, unconditionally guarantee to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, the Notes or the obligations of the Authority hereunder or thereunder, that:

(i) the principal of and interest on the Notes will be promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of and interest on the Notes, if any, if lawful, and all other obligations of the Authority to the Holders or the Trustee hereunder or thereunder will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and

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(ii) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Subsidiary Guarantors shall be jointly and severally obligated to pay the same immediately, in each case to the extent lawful.

Notwithstanding the foregoing, in the event that this Subsidiary Guarantee would constitute or result in a violation of any applicable fraudulent conveyance or similar law of any relevant jurisdiction, the liability of the Subsidiary Guarantor under this Supplemental Indenture and its Subsidiary Guarantee shall be limited to such amount as will not, after giving effect thereto, and to all other liabilities of the Subsidiary Guarantor, result in such amount constituting a fraudulent transfer or conveyance.

4. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEES.

(a) To evidence its Subsidiary Guarantee set forth in this Supplemental Indenture, the Subsidiary Guarantor hereby agrees that a notation of such Subsidiary Guarantee shall be endorsed by an officer of such Subsidiary Guarantor on each Note authenticated and delivered by the Trustee after the date hereof.

(b) Notwithstanding the foregoing, the Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee set forth herein shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee.

(c) If an officer whose signature is on this Supplemental Indenture or on the Subsidiary Guarantee no longer holds that office at the time the Trustee authenticates the Note on which a Subsidiary Guarantee is endorsed, the Subsidiary Guarantee shall be valid nevertheless.

(d) The delivery of the Note by the Trustee, after the authentication thereof under the Indenture, shall constitute due delivery of the Subsidiary Guarantee set forth in this Supplemental Indenture on behalf of the Subsidiary Guarantor.

(e) The Subsidiary Guarantor hereby agrees that its obligations hereunder shall be unconditional, regardless of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Authority, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor in each case to the extent lawful.

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(f) The Subsidiary Guarantor hereby waives, to the extent lawful, diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Authority, any right to require a proceeding first against the Authority, protest, notice and all demands whatsoever and covenants that its Subsidiary Guarantee made pursuant to this Supplemental Indenture will not be discharged except by complete performance of the obligations contained in the Notes and the Indenture or pursuant to Section 5(b) of this Supplemental Indenture.

(g) If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Supplemental Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then, and in every such case, subject to any determination in such proceeding, the Subsidiary Guarantor, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Subsidiary Guarantor, the Trustee and the Holders shall continue as though no such proceeding had been instituted.

(h) The Subsidiary Guarantor hereby waives and will not in any manner whatsoever claim or take the benefit or advantage of, any rights of reimbursement, indemnity or subrogation or any other rights against the Authority or any other Subsidiary Guarantor as a result of any payment by such Subsidiary Guarantor under its Subsidiary Guarantee. The Subsidiary Guarantor further agrees that, as between the Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the other hand:

(i) in each case, to the extent lawful, the maturity of the obligations guaranteed hereby may be accelerated as provided in Article 6 of the Indenture for the purposes of the Subsidiary Guarantee made pursuant to this Supplemental Indenture, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby; and

(ii) in the event of any declaration of acceleration of such obligations as provided in Article 6, such obligations (whether or not due and payable) shall forthwith become due and payable by the Subsidiary Guarantor for the purpose of the Subsidiary Guarantee made pursuant to this Supplemental Indenture, in each case to the extent lawful.

(i) The Subsidiary Guarantor shall have the right to seek contribution from any other nonpaying Subsidiary Guarantor, if any, so long as the exercise of such right does not impair the rights of the Holders under the Subsidiary Guarantee made pursuant to this Supplemental Indenture.

(j) The Subsidiary Guarantor covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of the Indenture or

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this Subsidiary Guarantee; and the Subsidiary Guarantor (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

5. SUBSIDIARY GUARANTOR MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.

(a) Nothing contained in the Indenture, this Supplemental Indenture or in the Notes shall prevent any consolidation or merger of the Subsidiary Guarantor with or into the Authority or any other Subsidiary Guarantor or shall prevent any transfer, sale or conveyance of the property of the Subsidiary Guarantor as an entirety or substantially as an entirety, to the Authority or any other Subsidiary Guarantor.

(b) Except as set forth in Article 5 of the Indenture, upon the sale or disposition of all of the Capital Stock of the Subsidiary Guarantor by the Authority or a Subsidiary of the Authority, or upon the consolidation or merger of the Subsidiary Guarantor with or into any Person, or if a Subsidiary Guarantor is designated as an Unrestricted Subsidiary, or the sale of all or substantially all of the assets of the Subsidiary Guarantor (in each case, other than with or to an Affiliate of the Authority), or upon a legal defeasance or covenant defeasance of the Notes, such Subsidiary Guarantor shall be deemed automatically and unconditionally released and discharged from all obligations under this Subsidiary Guarantee without any further action required on the part of the Trustee or any Holder if no Default shall have occurred and be continuing; provided that in the event of an Asset Sale, the Net Cash Proceeds therefrom are treated in accordance with Section 4.10 of the Indenture and provided further that in the event of a redesignation of a Subsidiary, the transaction is in compliance with Section 4.07 of the Indenture. Except with respect to transactions set forth in the preceding sentence, the Authority and the Subsidiary Guarantor covenant and agree that upon any such consolidation, merger or transfer of assets, the performance of all covenants and conditions of this Supplemental Indenture to be performed by such Subsidiary Guarantor shall be expressly assumed by supplemental indenture satisfactory in form to the Trustee, by the corporation formed by such consolidation, or into which the Subsidiary Guarantor shall have merged, or by the corporation which shall have acquired such property. Upon receipt of an Officers’ Certificate of the Authority or the Subsidiary Guarantor, as the case may be, to the effect that the Authority or such Subsidiary Guarantor has complied with the first sentence of this Section 5(b), the Trustee shall execute any documents reasonably requested by the Authority or the Subsidiary Guarantor, at the cost of the Authority or such Subsidiary Guarantor, as the case may be, in order to evidence the release of such Subsidiary Guarantor from its obligations under its Senior Subsidiary Guarantee endorsed on the Notes and under the Indenture and this Supplemental Indenture.

6. NEW YORK LAW TO GOVERN. The internal law of the State of New York shall govern and be used to construe this Supplemental Indenture.

7. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

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8. EFFECT OF READINGS. The Section headings herein are for convenience only and shall not effect the construction hereof.

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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.

Dated: ___________________, ___

[SUBSIDIARY GUARANTOR]
By:
	Name: Title:
MOHEGAN TRIBAL GAMING AUTHORITY
By:
	Name: Title:
[SUBSIDIARY GUARANTORS]
U.S. BANK NATIONAL ASSOCIATION, as Trustee
By:
	Authorized Signatory

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EX-4.44

Exhibit 4.44

THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE AUTHORITY.

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE AUTHORITY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:

(1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE “SECURITIES ACT”) (A “QIB”) OR (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING THIS SECURITY FOR THE ACCOUNT OR FOR THE BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFF-SHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT,

(2) AGREES THAT IT WILL NOT, WITHIN, THE TIME PERIOD REFERRED TO UNDER RULE 144(d)(1) UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF THE TRANSFER OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) TO

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A PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A QIB OR AN ACCREDITED INVESTOR PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB OR AN ACCREDITED INVESTOR, RESPECTIVELY, IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT OR AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE AND PROVIDED THAT PRIOR TO SUCH TRANSFER, THE TRUSTEE IS FURNISHED WITH AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AND

(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (2)(D) OR (2)(E) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

IN CONNECTION WITH ANY TRANSFER THIS SECURITY OR ANY INTEREST HEREIN WITHIN THE TIME PERIOD REFERRED TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE. AS USED HEREIN THE TERMS “OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S. PERSON” HAVE THE MEANING GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT.

[THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE NOTES, ARE AS SPECIFIED IN THE INDENTURE. THE HOLDER OF THIS NOTE BY ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IF IT IS A PURCHASER IN A SALE THAT OCCURS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S OF THE SECURITIES ACT, IT ACKNOWLEDGES THAT, UNTIL EXPIRATION OF THE “40-DAY DISTRIBUTION COMPLIANCE PERIOD” WITHIN THE MEANING OF RULE 903 OF REGULATION S, ANY OFFER OR SALE OF THIS NOTE SHALL NOT BE MADE BY IT TO A U.S. PERSON TO OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON WITHIN THE MEANING OF RULE 902(k) UNDER THE SECURITIES ACT.]

[THIS SECURITY IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE. A HOLDER MAY OBTAIN THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO MATURITY FOR SUCH SECURITY BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION TO: GENERAL COUNSEL, MOHEGAN TRIBAL GAMING AUTHORITY, ONE MOHEGAN SUN BOULEVARD, UNCASVILLE, CONNECTICUT 06382, TELEPHONE NUMBER (860) 862-5997.]

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[Face of Note]

11 ¹/2% Second Lien Senior Secured Note due 2017

CUSIP [            ]

No.         $                    

MOHEGAN TRIBAL GAMING AUTHORITY

promises to pay to                                                                                                                                                                                             

or registered assigns,

the principal sum of                                                                                                                                                                                         

Dollars on November 1, 2017

Interest Payment Dates: May 1 and November 1,

Record Dates: April 15 and October 15

Dated:

MOHEGAN TRIBAL GAMING AUTHORITY

By:

Name:

Title:

By:

Name:

Title:

This is one of the Notes referred

to in the within-mentioned Indenture:

U.S. BANK NATIONAL ASSOCIATION, as Trustee
By:
	Authorized Signatory

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[Back of Note]

Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.

1. INTEREST. The Mohegan Tribal Gaming Authority (the “Authority”) promises to pay interest on the principal amount of this Note at 11 ¹/2% per annum from October 26, 2009 until maturity. The Authority will pay interest semi-annually in arrears on May 1 and November 1 each year, or if any such day is not a Business Day, on the next succeeding Business Day (each an “Interest Payment Date”) to the holders of record on the preceding April 15 and October 15, respectively. Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of original issuance; provided that, if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided, further, that the first Interest Payment Date shall be May 1, 2010. The Authority shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2. METHOD OF PAYMENT. The Authority will pay interest on the Notes (except defaulted interest) to the Persons who are registered Holders of Notes at the close of business on the May 1 or November 1 next preceding the Interest Payment Date, even if such Notes are canceled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes will be payable as to principal, premium and interest at the office or agency of the Authority maintained for such purpose within or without the City and State of New York, or, at the option of the Authority, payment of interest may be made by check mailed to the Holders at their addresses set forth in the register of Holders, and provided that payment by wire transfer of immediately available funds will be required with respect to principal of and interest and premium on, all Global Notes and all other Notes the Holders of which shall hold at least $1.0 million in principal amount of Notes and have provided wire transfer instructions to the Authority and the Paying Agent. Such payment shall be made in accordance with those instructions.

3. PAYING AGENT AND REGISTRAR. Initially, the Trustee under the Indenture, will act as Paying Agent and Registrar. The Authority may change any Paying Agent or Registrar without notice to any Holder. The Authority may act as Paying Agent or Registrar.

4. INDENTURE. The Authority issued the Notes under an Indenture dated as of October 26, 2009 (“Indenture”) among the Authority, The Mohegan Tribe of Indians of Connecticut (the “Tribe”), the Subsidiary Guarantors and the Trustee. The terms of the Notes include those stated in the Indenture. The Notes are subject to all such terms, and Holders are

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referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.

5. OPTIONAL REDEMPTION.

(a) At any time prior to November 1, 2013, the Authority shall have the option to redeem the Notes, in whole or in part, at a redemption price equal to the greater of:

(1) 100% of the principal amount of the Notes to be redeemed; and

(2) the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date, on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months), at the Treasury Rate plus 50 basis points;

plus accrued and unpaid interest thereon to the Redemption Date.

(b) At any time or from time to time on or after November 1, 2013, the Authority shall have the option to redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount) set forth below, together with accrued and unpaid interest thereon, if any, to the applicable redemption date, if redeemed during the 12-month period beginning on November 1 of the years indicated below:

Year	Percentage
2013	105.750	%
2014	102.875	%
2015 and thereafter	100.000	%

(c) Notwithstanding any other provisions of Article 3 of the Indenture, if any Gaming Regulatory Authority requires that a Holder or beneficial owner of the Notes be licensed, qualified or found suitable under any applicable gaming laws in order to maintain any gaming license or franchise of the Authority under any applicable gaming laws, and the Holder or beneficial owner fails to apply for a license, qualification or finding of suitability within 30 days after being requested to do so by such Gaming Regulatory Authority (or such lesser period that may be required by such Gaming Regulatory Authority) or if such Holder or beneficial owner is not so licensed, qualified or found suitable, the Authority has the right, at its option, (i) to require such Holder or beneficial owner to dispose of such Holder’s or beneficial owner’s Notes within 30 days of receipt of such notice of such finding by the applicable Gaming Regulatory Authority (or such earlier date as may be required by the applicable Gaming Regulatory Authority); or (ii) to call for redemption of the Notes of such Holder or beneficial owner at a redemption price equal to the least of (1) the principal amount thereof, (2) the price at which such Holder or beneficial owner acquired the Notes and (3) the current market price of the Notes, together with, in either case, accrued and unpaid interest to the earlier of the date of redemption or the date of the finding of unsuitability by such Gaming Regulatory Authority, which may be less than 30 days following the notice of redemption if so ordered by such Gaming Regulatory Authority. The Authority shall not be required to pay or reimburse any Holder or beneficial owner of Notes who is required to apply for any such license, qualification or finding of suitability for the costs of the licensure or investigation for such qualification or finding of suitability. Such expenses shall be the obligation of such Holder or beneficial owner.

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6. MANDATORY REDEMPTION.

Except as set forth in paragraph 7 below, the Authority shall not be required to make mandatory redemption payments with respect to the Notes.

7. REPURCHASE AT OPTION HOLDER.

(a) If there is a Change of Control, the Authority shall be required to make an offer (a “Change of Control Offer”) to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of each Holder’s Notes at a purchase price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest to the date of purchase (the “Change of Control Payment”). Within 20 Business Days following any Change of Control, the Authority shall mail a notice to each Holder setting forth the procedures governing the Change of Control Offer as required by the Indenture.

(b) If the Authority or a Restricted Subsidiary consummates any Asset Sales of Collateral, within five Business Days of each date on which the aggregate amount of Collateral Excess Proceeds exceeds $15.0 million, the Authority will make an offer to repurchase the Notes, together with any senior secured Indebtedness ranking pari passu with the Notes and containing similar provisions requiring the Authority to make an offer to purchase such pari passu senior secured Indebtedness with the proceeds from such Asset Sale pursuant to a cash offer (subject only to conditions required by applicable law, if any), pro rata in proportion to the respective principal amounts of such pari passu senior secured Indebtedness (or accreted values in the case of Indebtedness issued with an original issue discount) and the Notes (the “Collateral Asset Sale Offer”) at a purchase price of 100% of the principal amount (or accreted value in the case of Indebtedness issued with an original issue discount) (the “Collateral Asset Sale Offer Price”). The offer price in any Collateral Asset Sale Offer will be equal to 100% of the principal amount plus accrued and unpaid interest to the date of purchase and will be payable in cash, in accordance with the procedures set forth in this Indenture and such other pari passu senior secured Indebtedness. To the extent that any Collateral Excess Proceeds remain after consummation of an Collateral Asset Sale Offer, the Authority may use such Collateral Excess Proceeds for any purpose not otherwise prohibited by the Indenture and the Security Documents. If the aggregate principal amount of Notes and such other pari passu senior secured Indebtedness tendered into such Collateral Asset Sale Offer surrendered by holders thereof exceeds the amount of Collateral Excess Proceeds, the Trustee shall select the Notes and such other pari passu senior secured Indebtedness (to the extent that such other senior secured Indebtedness permits such selection) to be purchased on a pro rata basis. Upon completion of such Collateral Asset Sale Offer, the amount of Collateral Excess Proceeds shall be reset at zero.

(c) If the Authority or a Restricted Subsidiary consummates any Asset Sales of non-Collateral, within five Business Days of each date on which the aggregate amount of Collateral Excess Proceeds exceeds $15.0 million, the Authority will make an offer to repurchase the Notes, together with any senior Indebtedness ranking pari passu with the Notes and containing similar provisions requiring the Authority to make an offer to purchase such pari passu senior

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Indebtedness with the proceeds from such Asset Sale pursuant to a cash offer (subject only to conditions required by applicable law, if any), pro rata in proportion to the respective principal amounts of such pari passu senior Indebtedness (or accreted values in the case of Indebtedness issued with an original issue discount) and the Notes (the “Non-Collateral Asset Sale Offer”) at a purchase price of 100% of the principal amount (or accreted value in the case of Indebtedness issued with an original issue discount) (the “Non-Collateral Asset Sale Offer Price”). The offer price in any Non-Collateral Asset Sale Offer will be equal to 100% of the principal amount plus accrued and unpaid interest to the date of purchase and will be payable in cash, in accordance with the procedures set forth in the Indenture and such other pari passu senior Indebtedness. To the extent that any Non-Collateral Excess Proceeds remain after consummation of a Non-Collateral Asset Sale Offer, the Authority may use such Non-Collateral Excess Proceeds for any purpose not otherwise prohibited by the Indenture and the Security Documents. If the aggregate principal amount of Notes and such other pari passu senior Indebtedness tendered into such Non-Collateral Asset Sale Offer surrendered by holders thereof exceeds the amount of Non-Collateral Excess Proceeds, the Trustee shall select the Notes and such other pari passu senior Indebtedness (to the extent that such other senior Indebtedness permits such selection) to be purchased on a pro rata basis. Upon completion of such Non-Collateral Asset Sale Offer, the amount of Non-Collateral Excess Proceeds shall be reset at zero.

8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30 days but not more than 60 days before the Redemption Date to each Holder whose Notes are to be redeemed at its registered address. Notes in denominations larger than $2,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the Redemption Date interest ceases to accrue on Notes or portions thereof called for redemption.

9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in denominations of $2,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Authority may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Authority need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Authority need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date.

10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner for all purposes.

11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Indenture, the Subsidiary Guarantees or the Notes may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the then outstanding Notes, voting as a single class, and any existing default or compliance with any provision of the Indenture, the Subsidiary Guarantees or the Notes may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes, voting as a single class. Without the

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consent of any Holder of a Note, the Indenture, the Subsidiary Guarantees or the Notes may be amended or supplemented to cure any ambiguity, defect or inconsistency, to provide for uncertificated Notes in addition to or in place of certificated Notes, to provide for the assumption of the Authority’s or Subsidiary Guarantor’s obligations to Holders of the Notes by a successor to the Authority or such Subsidiary Guarantor in the case of a merger, consolidation or sale of all or substantially all of the Authority’s assets, to make any change that would provide any additional rights or benefits to the Holders of the Notes or that does not adversely affect the legal rights under the Indenture of any such Holder or to allow any Subsidiary to execute a supplemental indenture relating to a Subsidiary Guarantee and to execute a Subsidiary Guarantee.

12. DEFAULTS AND REMEDIES. Events of Default include: (i) default for 30 days in the payment when due of interest on the Notes; (ii) default in payment when due of principal of or premium, if any, on the Notes; (iii) failure by the Authority or any of its Restricted Subsidiaries to comply with Section 4.10 or 5.01 of the Indenture; (iv) failure by the Authority or any of its Restricted Subsidiaries to observe or perform (A) the provisions of the Security Documents and the provisions of any covenant described in Section 4.07 or 4.09 of the Indenture for 30 days after notice to the Authority by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class or (B) any other covenant, representation, warranty or other agreement in the Indenture or the Notes for 60 days after notice to the Authority by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class; (v) default under certain other agreements relating to Indebtedness of the Authority or any of its Restricted Subsidiaries which default (A) is caused by a Payment Default or (B) results in the acceleration of such Indebtedness prior to its express maturity; and in each case, the principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $50.0 million or more; (vi) certain final judgments for the payment of money in excess of $50.0 million that remain undischarged for a period of 60 days; (vii) certain events of bankruptcy or insolvency with respect to the Authority or any of its Restricted Subsidiaries; (viii) revocation, termination, suspension or other cessation of effectiveness of any Gaming License which results in the cessation or suspension of gaming operations for a period of more than 90 consecutive days at the Resort; (ix) cessation of gaming operations for a period of more than 90 consecutive days at the Resort (other than as a result of a casualty loss); (x) the Lease ceases to be in full force and effect; (xi) except as permitted by the Indenture, any Subsidiary Guarantee shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect or any Subsidiary Guarantor or any Person acting on its behalf shall deny or disaffirm its obligations under such Subsidiary Guarantor’s Subsidiary Guarantee; (xii) failure by the Tribe to comply with the provisions of Article 12 for 30 days after notice to the Authority and the Tribe by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class; and (x) (a) any Security Document is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full force and effect or is declared null and void, other than in accordance with the terms of the relevant Security Document; or (b) except as permitted by the Indenture, any Lien purported to be granted under any Security Document on Collateral, individually or in the aggregate, having a fair market value in excess of $25.0 million ceases to be an enforceable and perfected first-priority Lien, subject only to Permitted Prior Liens; or (c) the Authority or any Restricted Subsidiary, or any Person acting

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on behalf of any of them, denies or disaffirms, in writing, any obligation of the Authority or any Restricted Subsidiary set forth in or arising under any Security Document. If any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency, all outstanding Notes will become due and payable without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest) if it determines that withholding notice is in their interest. The Holders of not less than a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest on, or the principal of, the Notes. The Authority is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Authority is required upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default.

13. TRUSTEE DEALINGS WITH AUTHORITY. Subject to Section 7.03 of the Indenture, the Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Authority or its Affiliates, and may otherwise deal with the Authority or its Affiliates, as if it were not the Trustee.

14. NO RECOURSE AGAINST OTHERS. A controlling person, director, officer, employee or holder of an Ownership Interest of the Authority, as such, shall not have any liability for any obligations of the Authority under the Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for the issuance of the Notes.

15. AUTHENTICATION. This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.

16. ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

17. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Authority has caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.

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The Authority will furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:

Mohegan Tribal Gaming Authority

One Mohegan Sun Boulevard

Uncasville, CT 06382

Attention: General Counsel

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ASSIGNMENT FORM

To assign this Note, fill in the form below:

(I) or (we) assign and transfer this Note to:                                                                                                                                            

                                                                                                                      (Insert assignee’s legal name)

(Insert assignee’s soc. sec. or tax I.D. no.)

(Print or type assignee’s name, address and zip code)

and irrevocably appoint                                                                                                                                                                                     

to transfer this Note on the books of the Authority. The agent may substitute another to act for him.

Date:                     

Your Signature:

(Sign exactly as your name appears on the face of this Note)

Signature Guarantee*:                                              

* Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

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OPTION OF HOLDER TO ELECT PURCHASE

If you want to elect to have this Note purchased by the Authority pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box below:

¨  Section 4.10 ¨  Section 4.15

If you want to elect to have only part of the Note purchased by the Authority pursuant to Section 4.10 or Section 4.15 of the Indenture, state the amount you elect to have purchased:

$                    

Date:                     

Your Signature:

(Sign exactly as your name appears on the face of this Note)

Tax Identification No.:

Signature Guarantee*:                                              

* Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made:

Date of Exchange Amount of decrease in Principal Amount of this Global Note Amount of increase in Principal Amount of this Global Note Principal Amount of this Global Note following such decrease (or increase) Signature of authorized officer of Trustee or Note Custodian

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EX-10.35

Exhibit 10.35

EXECUTION COPY

COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT

This COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT is dated as of October 26, 2009 and entered into by and among MOHEGAN TRIBAL GAMING AUTHORITY (the “Authority”), an instrumentality of The Mohegan Tribe of Indians of Connecticut (the “Tribe”), MOHEGAN BASKETBALL CLUB, LLC (“MBC”), a limited liability company formed under the laws of the Tribe, MOHEGAN GOLF, LLC (“Mohegan Golf”), a limited liability company formed under the laws of the Tribe, MOHEGAN COMMERCIAL VENTURES PA, LLC (“MCV-PA”), a Pennsylvania limited liability company, MOHEGAN VENTURES-NORTHWEST, LLC (“Mohegan Ventures-NW”), a limited liability company formed under the laws of the Tribe, MOHEGAN VENTURES WISCONSIN, LLC (“MVW”), a limited liability company formed under the laws of the Tribe, MTGA GAMING, LLC (“MTGA Gaming”), a Delaware limited liability company, WISCONSIN TRIBAL GAMING, LLC (“WTG”), a Delaware limited liability company, DOWNS RACING, L.P. (“DOWNS RACING”), a Pennsylvania limited partnership, BACKSIDE, L.P. (“Backside”), a Pennsylvania limited partnership, MILL CREEK LAND, L.P., a Pennsylvania limited partnership (“Mill Creek” and together with the Authority, MBC, Mohegan Golf, MCV-PA, Mohegan Ventures-NW, MVW, MTGA Gaming, WTG, Downs Racing, Backside, and each additional Person which provides a guaranty in connection with the First Lien Loan Agreement, each, a “Guarantor”, and collectively, the “Guarantors”), each other Grantor (as hereinafter defined) party hereto from time to time, Bank of America, N.A., as administrative agent and L/C Issuer for the First Lien Secured Parties (as hereinafter defined) (in such capacity, together with its successors and assigns from time to time, the “First Lien Administrative Agent”), U.S. Bank National Association, as trustee under the Second Lien Indenture (as hereinafter defined) (in such capacity, together with its successors and assigns from time to time, the “Second Lien Trustee”), and U.S. Bank National Association, as collateral agent for the Second Lien Secured Parties (as hereinafter defined) (in such capacity, together with its successors and assigns from time to time, the “Second Lien Collateral Agent”).

RECITALS

WHEREAS, the Authority, the lenders party thereto and the First Lien Administrative Agent has entered into that certain Amendment No.1 to Third Amended and Restated Loan Agreement, dated as of October 26, 2009 (the “Amendment”), with reference to that certain Third Amended and Restated Loan Agreement dated as of December 10, 2008 by and among the Authority, the Tribe, for limited purposes therein, the lenders from time to time party thereto and the First Lien Administrative Agent (as amended through the Amendment and as it may be further amended, restated, supplemented, modified or Refinanced from time to time, the “First Lien Loan Agreement”);

WHEREAS, the Authority, as issuer, each of the Guarantors as a guarantor, the Second Lien Collateral Agent and the Second Lien Trustee have entered into that certain Indenture dated as of the date hereof providing for senior secured notes (as amended, restated, supplemented or otherwise modified or as replaced or Refinanced from time to time, the “Second Lien Indenture”);

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WHEREAS, pursuant to (i) the First Lien Loan Agreement, the Authority has agreed to cause the Guarantors and certain of their future subsidiaries to agree to guaranty the First Lien Obligations (as hereinafter defined) pursuant to a guaranty (such guaranties, as may be further amended, restated, supplemented, or modified from time to time, being collectively referred to as the “First Lien Subsidiary Guaranty”), and (ii) the Second Lien Indenture, the Authority has agreed to cause each of the Guarantors to agree to guaranty the Second Lien Obligations (as hereinafter defined) pursuant to a guaranty (such guaranties, as may be further amended, restated, supplemented, or modified from time to time, being collectively referred to as the “Second Lien Subsidiary Guaranty”);

WHEREAS, the obligations of the Authority under the First Lien Loan Agreement and the obligations of the Guarantors under the First Lien Subsidiary Guaranty are secured by liens on substantially all the assets of the Authority and the Guarantors, respectively, pursuant to the terms of the First Lien Security Documents;

WHEREAS, the obligations of the Authority under the Second Lien Indenture and the obligations of the Guarantors under the Second Lien Subsidiary Guaranty are secured by liens on certain assets of the Authority and the Guarantors, respectively, pursuant to the terms of the Second Lien Security Documents;

WHEREAS, the Authority may from time to time incur additional Indebtedness permitted to be secured on an equal and ratable basis with the obligations under the Second Lien Note Documents, which additional Indebtedness shall be incurred under a credit facility, indenture or similar debt facility subject to the terms and conditions set forth in the First Lien Loan Documents and the Second Lien Note Documents (each, an “Additional Parity Lien Facility”), in each case in accordance with this Agreement, the First Lien Loan Documents and the Second Lien Note Documents;

WHEREAS, the Liens securing the obligations of the applicable Grantors in respect of any Additional Parity Lien Facility shall be granted pursuant to the Second Lien Security Documents;

WHEREAS, subject to the terms of the First Lien Loan Documents and the Second Lien Loan Documents, the Second Lien Collateral Agent has agreed to act on behalf of all Second Lien Secured Parties with respect to the Collateral;

WHEREAS, the First Lien Loan Documents and the Second Lien Note Documents provide, among other things, that the parties thereto shall set forth in this Agreement their respective rights and remedies with respect to the Collateral; and

WHEREAS, in order to induce the First Lien Secured Parties to consent to the Grantors incurring the Second Lien Obligations and to induce the First Lien Secured Parties to continue to extend credit and other financial accommodations and lend monies to or for the benefit of the Grantors, the Second Lien Collateral Agent on behalf of the Second Lien Secured Parties has agreed to the lien subordination (including the intercreditor and other provisions set forth in this Agreement).

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NOW THEREFORE, in consideration of the foregoing, the mutual covenants and obligations herein set forth and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

ARTICLE I - DEFINED TERMS

Section 1.1 Defined Terms. As used in this Agreement, the following terms shall have the following meanings:

“Additional First Lien Indebtedness” has the meaning assigned to that term in Section 5.5(b).

“Additional Parity Lien Facility” has the meaning assigned to that term in the recitals hereto; provided that such Additional Parity Lien Facility was incurred in accordance with the terms of this Agreement and that the instruments creating the related Additional Parity Lien Facility Obligations, or pursuant to which such Additional Parity Lien Facility Obligations are outstanding, provided that such Additional Parity Lien Facility Obligations are intended to be secured on an equal and ratable basis with the Second Lien Note Obligations.

“Additional Parity Lien Facility Debt” means, with respect to any Additional Parity Lien Facility, the Indebtedness in respect of such Additional Parity Lien Facility.

“Additional Parity Lien Facility Documents” means, collectively, with respect to any Additional Parity Lien Facility, the agreements, documents and instruments providing for or evidencing any Additional Parity Lien Facility Obligations, including the definitive documentation in respect of such Additional Parity Lien Facility, the Second Lien Security Documents and any intercreditor or joinder agreement among any Additional Parity Lien Facility Secured Parties with respect to such Additional Parity Lien Facility (or binding upon them through one or more of their representatives), to the extent such are effective at the relevant time, as each may be amended, restated, supplemented, modified, renewed, Refinanced or extended from time to time in accordance with the provisions of this Agreement.

“Additional Parity Lien Facility Obligations” means the “Obligations” as defined in the applicable Additional Parity Lien Facility Documents and all other obligations of the Grantors from time to time arising under or in respect of the due and punctual payment of (a) the principal of and premium, if any, and interest (including interest accruing during the pendency of any Insolvency or Liquidation Proceeding, regardless of whether allowed or allowable in such proceeding) on the Indebtedness for borrowed money outstanding under each Additional Parity Lien Facility, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, and (b) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any Insolvency or Liquidation Proceeding, regardless of whether allowed or allowable in such proceeding), of the Grantors under the Additional Parity Lien Facility Documents owing to the Additional Parity Lien Facility Secured Parties (in their capacity as such). For the avoidance of doubt, as of the date hereof, there are no Additional Parity Lien Facility Obligations outstanding.

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“Additional Parity Lien Facility Representative” means the administrative agent, trustee or similar entity for the lenders or holders of obligations, as applicable, under the Additional Parity Lien Facility, together with its successors and permitted assigns.

“Additional Parity Lien Facility Secured Parties” means, at any relevant time, subject to Section 5.7, the holders of any Additional Parity Lien Facility Obligations at that time, including each Additional Parity Lien Facility Representative.

“Affiliate” means, with respect to any Person, each Person that controls, is controlled by or is under common control with such Person or any Affiliate of such Person; provided, however, that in no case shall the First Lien Administrative Agent, any First Lien Lender, or the Second Lien Collateral Agent or any other Second Lien Secured Party be deemed to be an Affiliate of any Grantor for purposes of this Agreement. For the purpose of this definition, “control” of a Person means the possession, directly or indirectly, of the power to direct or cause the direction of its management or policies, whether through the ownership of voting securities, by contract or otherwise.

“Agreement” means this Collateral Agency and Intercreditor Agreement, as amended, renewed, extended, supplemented or otherwise modified from time to time in accordance with the terms hereof.

“Amendment” has the meaning assigned to that term in the recitals hereto.

“Authority” has the meaning assigned to that term in the recitals hereto.

“Bankruptcy Code” means Title I of the Bankruptcy Reform Act of 1978, as amended and codified as Title 11 of the United States Code.

“Bankruptcy Law” means the Bankruptcy Code and any similar federal, state or foreign law for the relief of debtors.

“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed.

“Cap Amount” means $700 million, minus the amount of any First Lien Obligations (1) retired with the Net Proceeds from any Asset Sale or Event of Loss (as each such term is defined in the Second Lien Indenture) applied to permanently reduce the outstanding amounts and the commitments with respect to such Indebtedness or (2) assumed by a transferee in an Asset Sale.

“Collateral” means all of the assets and property of any Grantor, whether real, personal or mixed, constituting both First Lien Collateral and Second Lien Collateral.

“Debt Representative” means each of the Second Lien Trustee and each Additional Parity Lien Facility Representative.

“DIP Financing” has the meaning assigned to that term in Section 6.1.

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“Discharge of First Lien Obligations” means, except to the extent otherwise provided in Section 5.5 hereof, (a) payment in full in cash of the principal of, interest (including interest accruing on or after the commencement of any Insolvency or Liquidation Proceeding at the rate set forth in the First Lien Loan Agreement, whether or not allowed or allowable in such proceeding) and premium (if any) on all First Lien Obligations outstanding under the First Lien Loan Documents (including all reimbursement obligations in respect of letters of credit issued thereunder), (b) payment in full in cash of all other First Lien Obligations that are due and payable or otherwise accrued and owing at or prior to the time such principal and interest are paid (other than any contingent obligations for which no demand or claim has been made), (c) termination or cash collateralization of all letters of credit issued under the First Lien Loan Documents (in an amount reasonably satisfactory to the First Lien Administrative Agent; provided such cash collateralization shall not exceed 105% of the aggregate undrawn amount of such letters of credit), and (d) termination of all other commitments of the First Lien Secured Parties to extend credit under the First Lien Loan Documents.

“Disposition” has the meaning assigned to that term in Section 5.1(b).

“Excluded Assets” has the meaning assigned to that term in the Indenture.

“First Lien Administrative Agent” has the meaning assigned to that term in the preamble hereto; provided that following a Refinancing in respect of the First Lien Loan Agreement made in accordance with Section 5.5, such term shall mean the New Agent.

“First Lien Collateral” means all of the assets and property of any Grantor, whether real, personal or mixed, with respect to which a Lien is granted or purported to be granted as security for any First Lien Obligations, including, without limitation, any revenues of any Grantor, irrespective of whether such Grantor has deposited such revenues into a deposit account subject to an account control agreement.

“First Lien Joinder” means a joinder agreement substantially in the form of Exhibit B-1 hereto.

“First Lien Lenders” means the “Lenders” under and as defined in the First Lien Loan Documents. Following a Refinancing in respect of the First Lien Loan Agreement made in accordance with Section 5.5, all lenders, noteholders and other entities (other than the Grantors and their respective Affiliates) that provide Refinancing Indebtedness or otherwise provide credit support or credit products arising under or evidenced by the Refinance Documents, and that are secured by the First Lien Collateral under the Refinance Documents, shall be deemed for all purposes to be “First Lien Lenders.”

“First Lien Loan Agreement” has the meaning assigned to that term in the recitals hereto.

“First Lien Loan Documents” means the First Lien Loan Agreement and the other Loan Documents (as defined in the First Lien Loan Agreement), and each of the other agreements, documents and instruments providing for or evidencing any other First Lien Obligation, and any other document or instrument executed or delivered at any time in connection with any First Lien Obligations, including any intercreditor or joinder agreement among holders of

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First Lien Obligations (or binding upon one or more of them through their representatives), to the extent such are effective at the relevant time, as each may be amended, restated, supplemented, Refinanced or otherwise modified from time to time.

“First Lien Loans” means “Loans” under and as defined in the First Lien Loan Agreement. Following a Refinancing in respect of the First Lien Loan Agreement made in accordance with Section 5.5, all loans constituting Refinancing Indebtedness made by the First Lien Lenders under the applicable Refinance Documents shall be deemed for all purposes to be “First Lien Loans.”

“First Lien Obligations” means (a) the “Obligations” as defined in the First Lien Loan Agreement and all other obligations of the Authority and the Guarantors from time to time arising under the First Lien Loan Agreement under or in respect of the due and punctual payment of (i) the principal of, interest (including interest accruing during the pendency of any Insolvency or Liquidation Proceeding, whether or not allowed or allowable in such proceeding) and premium (if any) in respect of the First Lien Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by the Authority or any Guarantor under the First Lien Loan Documents in respect of any Letter of Credit (as defined in the First Lien Loan Agreement), when and as due, including payments in respect of reimbursement obligations, interest thereon and obligations to provide cash collateral in respect thereof and (iii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any Insolvency or Liquidation Proceeding, regardless of whether allowed or allowable in such proceeding), of the Authority or any Guarantor under the First Lien Loan Agreement or any of the other First Lien Loan Documents, and (b) the due and punctual payment and performance of all obligations in respect of overdrafts and related liabilities owed to any First Lien Lender, any Affiliate of a First Lien Lender or the First Lien Administrative Agent arising from treasury, depositary and cash management services or in connection with any automated clearinghouse transfer of funds, in the case of clause (b), to the extent such obligations are secured by the First Lien Collateral. Following a Refinancing in respect of the First Lien Loan Agreement made in accordance with Section 5.5, all obligations (including but not limited to Refinancing Indebtedness) arising under or evidenced by the Refinance Documents shall constitute for all purposes, and be determined in accordance with this definition of, “First Lien Obligations.”

Notwithstanding the foregoing, if the sum of: (1) Indebtedness for borrowed money constituting principal outstanding under the First Lien Loan Agreement and the other First Lien Loan Documents plus (2) the aggregate face amount of any letters of credit issued but not reimbursed under the First Lien Loan Agreement, is in excess of the Cap Amount, then the portion of such Indebtedness and such aggregate face amount of letters of credit in excess of the Cap Amount shall be not be included in the First Lien Obligations, and interest and reimbursement obligations related to such Indebtedness and letters of credit not included in First Lien Obligations shall not be included in the First Lien Obligations.

“First Lien Secured Parties” means, at any relevant time, the First Lien Administrative Agent and the holders of First Lien Obligations at that time, including, without limitation, the First Lien Lenders.

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“First Lien Security Documents” means the Collateral Documents (as defined in the First Lien Loan Agreement) and any other agreement, document or instrument pursuant to which a Lien is granted securing the First Lien Obligations or under which rights or remedies with respect to such Liens are governed, as each may be amended, restated, supplemented, Refinanced or otherwise modified from time to time.

“First Lien Subsidiary Guaranty” has the meaning assigned to that term in the recitals hereto.

“Governmental Authority” means the government of the United States of America, or the Tribe, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

“Grantor Joinder” means a joinder agreement substantially in the form of Exhibit A hereto.

“Grantors” means the Authority, each Guarantor, and each other Person that has or may from time to time hereafter execute and deliver a First Lien Security Document or a Second Lien Security Document as a “Grantor” (or the equivalent thereof).

“Guarantors” has the meaning assigned to that term in the recitals hereto.

“Indebtedness” means and includes all obligations that constitute “Indebtedness” within the meaning of the First Lien Loan Agreement, the Second Lien Indenture or any Additional Parity Lien Facility, as applicable.

“Indemnified Liabilities” means any and all liabilities (including all environmental liabilities), obligations, losses, damages, penalties, actions, judgments, suits, costs, taxes, expenses or disbursements of any kind or nature whatsoever with respect to the execution, delivery, performance, administration or enforcement of this Agreement or any of the Second Lien Security Documents, including any of the foregoing relating to the use of proceeds of any Second Lien Notes or any Additional Parity Lien Facility Debt or the violation of, noncompliance with or liability under, any law (including environmental laws) applicable to or enforceable against any Grantor or any of their respective subsidiaries or any of the Collateral and all reasonable costs and expenses (including reasonable fees and expenses of legal counsel selected by the Indemnitee) incurred by any Indemnitee in connection with any claim, action, investigation or proceeding in any respect relating to any of the foregoing, whether or not suit is brought.

“Indemnitee” has the meaning assigned to that term in Section 8.24(a).

“Insolvency or Liquidation Proceeding” means:

(a) any voluntary or involuntary case or proceeding under the Bankruptcy Code with respect to any Grantor;

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(b) any other voluntary or involuntary insolvency, reorganization or bankruptcy case or proceeding, or any receivership, liquidation, reorganization or other similar case or proceeding with respect to any Grantor or with respect to a material portion of any Grantor’s assets;

(c) any liquidation, dissolution, reorganization or winding up of any Grantor whether voluntary or involuntary and whether or not involving insolvency or bankruptcy; or

(d) any assignment for the benefit of creditors or any other marshalling of assets and liabilities of any Grantor.

“Lien” means any lien, mortgage, pledge, assignment, security interest, charge or encumbrance of any kind (including any agreement to give any of the foregoing, any conditional sale or other title retention agreement, and any lease in the nature thereof) and any option, trust, UCC financing statement or other preferential arrangement having the practical effect of any of the foregoing.

“Lien Enforcement Action” has the meaning assigned to that term in Section 3.1(a).

“New Agent” has the meaning assigned to that term in Section 5.5(f).

“New First Lien Debt Notice” has the meaning assigned to that term in Section 5.5(f).

“Officers’ Certificate” means a certificate with respect to compliance with a condition or covenant provided for in this Agreement, signed on behalf of the Authority by two officers of the Authority, one of whom must be the principal executive officer, the principal financial officer, the treasurer or the principal accounting officer of the Authority, including (a) a statement that the Persons executing such certificate have read such covenant or condition, (b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate are based, (c) a statement that, in the opinion of such Persons, they have made such examination or investigation as is necessary to enable them to express an informed opinion as to whether or not such covenant or condition has been satisfied, and (d) a statement as to whether or not, in the opinion of such Persons, such condition or covenant has been satisfied.

“Parity Lien Debt Default” means the occurrence of any of the following:

(a) an “Event of Default” under and as defined in the Second Lien Indenture; or

(b) any event or condition which, under the terms of any Additional Parity Lien Facility, causes, or permits holders of the Additional Parity Lien Facility Obligations with respect to such Additional Parity Lien Facility to cause, such Additional Parity Lien Facility Obligations to become immediately due and payable.

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“Parity Lien Joinder” means a joinder agreement substantially in the form of Exhibit B-2 hereto.

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Pledged Collateral” has the meaning assigned to that term in Section 5.4.

“Recovery” has the meaning assigned to that term in Section 6.5.

“Refinance” means, in respect of any Indebtedness, to refinance or replace, or to issue other indebtedness (“Refinancing Indebtedness”), in exchange or replacement for, such Indebtedness in whole or in part. “Refinanced” and “Refinancing” shall have correlative meanings.

“Refinance Agreement” means, in respect of any Refinancing Indebtedness, the definitive credit or loan agreement governing such Refinancing Indebtedness, as amended, restated, supplemented, modified or Refinanced from time to time.

“Refinance Documents” means, in respect of any Refinancing Indebtedness, the Refinance Agreement governing such Refinancing Indebtedness, together with all of the promissory notes evidencing the same, all guaranties thereof and all Refinance Security Documents, and each of the other agreements, documents and instruments providing for or evidencing any other obligation in respect of such Refinancing Indebtedness, and any other document or instrument executed or delivered at any time in connection with any Refinance Agreement, including any intercreditor or joinder agreement among holders of Refinancing Indebtedness, as each may be amended, restated, supplemented, Refinanced or otherwise modified from time to time.

“Refinance Security Documents” means, in respect of any Refinancing Indebtedness, the “Security Documents” as defined in the applicable Refinance Agreement, and any other agreement, document or instrument pursuant to which a Lien is granted securing the obligations of the Grantors in respect of such Refinancing Indebtedness or under which rights or remedies with respect to such Liens are governed, as each may be amended, restated, supplemented, Refinanced or otherwise modified from time to time.

“Refinancing Indebtedness” the meaning assigned to that term in the defined term “Refinance.”

“Required Second Lien Secured Parties” means:

(a) at any time when no Additional Parity Lien Facility Debt is outstanding, Second Lien Secured Parties owed or holding more than 50% of the aggregate principal amount of indebtedness constituting Second Lien Note Obligations, or such other requisite percentage or number of Second Lien Note Secured Parties (or the Second Lien Trustee, on behalf of the Second Lien Note Secured Parties) as is permitted by, and in accordance with, the Second Lien Indenture; or

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(b) otherwise, Second Lien Secured Parties owed or holding more than 50% of the sum of, without duplication:

(i) the aggregate principal amount of indebtedness constituting Second Lien Note Obligations;

(ii) the aggregate principal amount of the loans and other advances outstanding under each Additional Parity Lien Facility; and

(iii) other than in connection with the exercise of remedies, the aggregate amount of all other outstanding unexpired or uncanceled commitments to extend credit (if any) under each Additional Parity Lien Facility and outstanding at such time that, when funded, would constitute Additional Parity Lien Facility Obligations;

provided, however, that, in the case of clauses (ii) and (iii) above, if any Additional Parity Lien Facility Secured Party shall be a “defaulting lender” (howsoever defined in the relevant Additional Parity Lien Facility Document at such time), there shall be excluded from the determination of Required Second Lien Secured Parties: (x) the aggregate principal amount of loans and other advances owing to such Additional Parity Lien Facility Secured Party under such Additional Parity Lien Facility Document at such time, and (y) such Additional Parity Lien Facility Secured Party’s pro rata share of the outstanding commitments to extend credit (if any) under such Additional Parity Lien Facility Document at such time.

For purposes of this definition, (x) votes will be determined in accordance with the provisions of Section 8.18(a) and (y) any Second Lien Obligations registered in the name of, or owned or held by the Authority or any other Guarantor or any of their respective Affiliates shall be disregarded.

“Second Lien Collateral” means all of the assets and property of any Grantor, whether real, personal or mixed, with respect to which a Lien is granted or purported to be granted as security for any Second Lien Obligations.

“Second Lien Collateral Agent” has the meaning assigned to that term in the preamble hereto.

“Second Lien Documents” means, collectively, the Second Lien Note Documents and the Additional Parity Lien Facility Documents.

“Second Lien Indenture” has the meaning assigned to that term in the recitals hereto.

“Second Lien Note Documents” means the Second Lien Indenture, the Second Lien Notes, the Second Lien Security Documents and each of the other agreements, documents and instruments providing for or evidencing any other Second Lien Note Obligation, and any other document or instrument executed or delivered at any time in connection with any Second Lien Note Obligations, including the Second Lien Security Documents and any intercreditor or joinder agreement among holders of Second Lien Note Obligations (or binding upon one or more of them through their representatives), to the extent such are effective at the relevant time, as each may be amended, restated, supplemented, modified, renewed, Refinanced or extended from time to time.

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“Second Lien Note Obligations” means the Note Obligations (as defined in the Second Lien Indenture) and all other obligations of the Authority and the Guarantors from time to time arising under or in respect of the due and punctual payment of (a) the principal of and premium, if any, and interest (including interest accruing during the pendency of any Insolvency or Liquidation Proceeding, regardless of whether allowed or allowable in such proceeding) on the Second Lien Notes, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, and (b) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any Insolvency or Liquidation Proceeding, regardless of whether allowed or allowable in such proceeding), of the Authority and the Guarantors under the Second Lien Indenture and the other Second Lien Note Documents owing to the Second Lien Note Secured Parties (in their capacity as such).

“Second Lien Note Secured Parties” means the holders of Second Lien Notes, the Second Lien Trustee, the Second Lien Collateral Agent and any other holder of Second Lien Note Obligations.

“Second Lien Notes” means the 11 ¹/2% senior secured notes due 2017 in an aggregate principal amount of $200,000,000 issued pursuant to the Second Lien Indenture, and any other senior secured notes issued from time to time under the Second Lien Indenture.

“Second Lien Obligations” means (a) the Second Lien Note Obligations and (b) subject to Section 5.7, the Additional Parity Lien Facility Obligations.

“Second Lien Secured Parties” means, at any relevant time, (a) the Second Lien Note Secured Parties and (b) the Additional Parity Lien Facility Secured Parties.

“Second Lien Security Documents” means the Security Documents (as defined in the Second Lien Indenture), each Grantor Joinder and any other agreement, document or instrument pursuant to which a Lien is granted securing the Second Lien Obligations or under which rights or remedies with respect to such Liens are governed, as each may be amended, restated, supplemented, Refinanced or otherwise modified from time to time.

“Second Lien Subsidiary Guaranty” has the meaning assigned to that term in the recitals hereto.

“Second Lien Trustee” has the meaning assigned to that term in the preamble hereto.

“Standstill Period” has the meaning assigned to that term in Section 3.1(a).

“UCC” means the Uniform Commercial Code (or any similar or equivalent legislation) as in effect in any applicable jurisdiction.

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Section 1.2 Terms Generally. The definitions of terms in this Agreement shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise: (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented, Refinanced or otherwise modified; (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns; (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof; (d) all references herein to Sections shall be construed to refer to Sections of this Agreement; (e) any reference to any law or regulation herein shall refer to such law or regulation as amended, modified or supplemented from time to time and (f) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

Section 1.3 Interpretive Effect of Refinancing. Following a Refinancing of the First Lien Obligations made in accordance with the terms of this Agreement (including Sections 5.3 and 5.5), each reference to the First Lien Loan Agreement hereunder shall be deemed for all purposes to be a reference to the associated Refinancing Agreement, each reference to the First Lien Loan Documents hereunder shall be deemed for all purposes to be a reference to the associated Refinance Documents, each reference to First Lien Loans shall be deemed for all purposes to be a reference to the associated Refinancing Indebtedness, and each reference to First Lien Security Documents shall be deemed for all purposes to be a reference to the Refinancing Security Documents.

ARTICLE II - LIEN PRIORITIES

Section 2.1 Relative Priorities. Notwithstanding the date, time, method, manner or order of grant, attachment or perfection of any Liens securing the Second Lien Obligations granted on the Collateral or of any Liens securing the First Lien Obligations granted on the Collateral and notwithstanding any provision of the UCC, or any other applicable law or the Second Lien Note Documents or Additional Parity Lien Facility Documents or any defect or deficiencies in, or failure to perfect, the Liens securing the First Lien Obligations or any other circumstance whatsoever, the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, hereby agrees that:

(a) any Lien on the Collateral securing any First Lien Obligations now or hereafter held by or on behalf of the First Lien Administrative Agent or any First Lien Secured Parties or any agent or trustee therefor, regardless of how acquired, whether by grant, possession, statute, operation of law, subrogation or otherwise, shall be senior in all respects and prior to any Lien on the Collateral securing any Second Lien Obligations;

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(b) any Lien on the Collateral securing any Second Lien Obligations now or hereafter held by or on behalf of the Second Lien Collateral Agent or any Second Lien Secured Parties or any agent or trustee therefor regardless of how acquired, whether by grant, possession, statute, operation of law, subrogation or otherwise, shall be junior and subordinate in all respects to all Liens on the Collateral securing any First Lien Obligations; and

(c) all Liens on the Collateral securing any First Lien Obligations shall be and remain senior in all respects and prior to all Liens on the Collateral securing any Second Lien Obligations for all purposes, whether or not such Liens securing any First Lien Obligations are subordinated to any Lien securing any other obligation of any Grantor or any other Person.

Section 2.2 Prohibition on Contesting Liens. Each of the Second Lien Collateral Agent, for itself and on behalf of each Second Lien Secured Party, and the First Lien Administrative Agent, for itself and on behalf of each First Lien Secured Party, agrees that it will not (and hereby waives any right to) contest or support any other Person in contesting, in any proceeding (including any Insolvency or Liquidation Proceeding), the perfection, priority, attachment, validity or enforceability of a Lien held by or on behalf of any of the First Lien Secured Parties in the First Lien Collateral or by or on behalf of any of the Second Lien Secured Parties in the Second Lien Collateral, as the case may be, or the provisions of this Agreement; provided that nothing in this Agreement shall be construed to prevent or impair the rights of any First Lien Secured Party or any Second Lien Secured Party to enforce this Agreement, including the provisions of this Agreement relating to the priority of the Liens securing the First Lien Obligations as provided in Sections 2.1 and 3.1.

Section 2.3 No New Liens. Following the date hereof, and with respect to clauses (a) and (b) below, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any of the Grantors, the parties hereto agree that the Grantors shall not, and shall not permit any other Grantor to:

(a) grant or permit any additional Liens on any asset or property to secure any Second Lien Obligation unless it has granted or concurrently grants a Lien on such asset or property to secure the First Lien Obligations which shall be senior to the Lien securing the Second Lien Obligations as provided in this Agreement;

(b) grant or permit any additional Liens on any asset or property to secure any First Lien Obligation unless it has granted or concurrently grants a Lien on such asset or property to secure the Second Lien Obligations which shall be junior to the Lien securing the First Lien Obligations as provided in this Agreement; provided, however, that, notwithstanding anything herein to the contrary, in no event shall any Grantor be required to grant or permit any additional Liens on any Excluded Assets to secure the Second Lien Obligations (but only for so long as such asset or property constitutes Excluded Assets); or

(c) grant or permit any additional Liens on any asset or property to secure any Second Lien Obligation unless it has granted or concurrently grants an equal and ratable Lien on such asset or property to secure all other Second Lien Obligations.

To the extent that the foregoing provisions are not complied with for any reason, without limiting any other rights and remedies available to the First Lien Administrative Agent and/or the other First Lien Secured Parties, the Second Lien Collateral Agent, on behalf of the Second Lien Secured Parties, agrees that any amounts received by or distributed to any of them pursuant to or as a result of Liens granted in contravention of this Section 2.3 shall be subject to Section 4.2.

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Section 2.4 Similar Liens. The parties hereto agree that it is their intention that the First Lien Collateral and the Second Lien Collateral be substantially identical. In furtherance of the foregoing and of Section 9.10, the parties hereto agree, subject to the other provisions of this Agreement, upon reasonable request by the First Lien Administrative Agent or the Second Lien Collateral Agent, to cooperate in good faith (and to direct their respective counsel to cooperate in good faith) from time to time in order to determine the specific items included in the First Lien Collateral and the Second Lien Collateral and the steps taken to perfect their respective Liens thereon and the identity of the respective parties obligated under the First Lien Loan Documents, the Second Lien Note Documents and the Additional Parity Lien Facility Documents.

Section 2.5 Acknowledgment of Second Lien Security Interests.

(a) Each of the Second Lien Trustee, for itself and on behalf of each Second Lien Note Secured Party, and each Additional Parity Lien Facility Representative, for itself and on behalf of each Additional Parity Lien Facility Secured Party, acknowledges and agrees that, pursuant to the Second Lien Security Documents, each of the applicable Grantors has granted to the Second Lien Collateral Agent, for the benefit of the Second Lien Secured Parties, a security interest in all such Grantor’s rights, title and interest in, to and under the Second Lien Collateral to secure the payment and performance of all present and future Second Lien Obligations. Each of the Second Lien Trustee, for itself and on behalf of each Second Lien Note Secured Party, and each Additional Parity Lien Facility Representative, for itself and on behalf of each Additional Parity Lien Facility Secured Party, acknowledges and agrees that, pursuant to the Second Lien Security Documents, the aforementioned security interest granted to the Second Lien Collateral Agent, for the benefit of the Second Lien Secured Parties, shall for all purposes and at all times secure the Second Lien Note Obligations and the Additional Parity Lien Facility Obligations (if any) on an equal and ratable basis.

(b) The Second Lien Collateral Agent and its successors and assigns under this Agreement will act for the benefit solely and exclusively of all present and future Second Lien Secured Parties and will hold the Second Lien Collateral and the Liens thereon as security for the payment and performance of all present and future Second Lien Obligations, in each case, under terms and conditions of this Agreement and the Second Lien Security Documents.

ARTICLE III - ENFORCEMENT

Section 3.1 Exercise of Remedies.

(a) Until the Discharge of First Lien Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any of the Grantors, the Second Lien Secured Parties:

(1) will not exercise or seek to exercise any rights or remedies with respect to any Collateral or take possession of, sell or otherwise realize (judicially or nonjudicially) upon any of the Collateral (including, without limitation, through the notification

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of account debtors or the exercise of any right of setoff or any right under any lockbox agreement, account control agreement, landlord waiver or bailee’s letter or similar agreement or arrangement to which any Second Lien Secured Party is a party) or institute any action or proceeding with respect to such rights or remedies (including any action of foreclosure) (any such action, a “Lien Enforcement Action”); provided, however, that prior to the Discharge of First Lien Obligations with respect to the First Lien Loan Agreement as in effect on the date hereof and as it may be amended after the date hereof in accordance with the terms hereof (for the avoidance of doubt, without giving effect to Section 5.5 and subject to Section 5.3(a)(2)), whether through a Refinancing or otherwise, the Second Lien Collateral Agent may exercise any or all such rights or remedies after the passage of a period of at least 120 days has elapsed since the later of: (i) the date on which the applicable Debt Representative declares the existence of a Parity Lien Debt Default under the applicable Second Lien Documents of any Series so long as such Parity Lien Debt Default is continuing and demands the repayment of all the principal amount of the Second Lien Obligations of such Series; and (ii) the date on which the First Lien Administrative Agent receives notice from the Second Lien Collateral Agent or the applicable Debt Representative of such declaration of a Parity Lien Debt Default so long as such Parity Lien Debt Default is continuing (the “Standstill Period”); provided, further, however, that notwithstanding anything herein to the contrary, in no event shall the Second Lien Collateral Agent or any other Second Lien Secured Party exercise any rights or remedies with respect to the Collateral if, notwithstanding the expiration of the Standstill Period, the First Lien Administrative Agent or any other First Lien Secured Party shall have commenced and be diligently pursuing the exercise of their rights or remedies with respect to all or any material portion of the Collateral and shall have provided notice of such exercise to the Second Lien Collateral Agent;

(2) will not contest, protest, hinder, delay or object to any foreclosure proceeding or action brought by any First Lien Secured Party or any other exercise by any First Lien Secured Party of any rights and remedies relating to the Collateral under the First Lien Loan Documents or otherwise; and

(3) subject to their rights under Section 3.1(a)(1), except as may be permitted in Section 3.1(c), will not object to the forbearance by the First Lien Secured Parties from bringing or pursuing any foreclosure proceeding or action or any other exercise of any rights or remedies relating to the Collateral;

provided that, in the case of (1), (2) and (3) of this Section 3.1(a), the Liens granted to secure the Second Lien Obligations shall attach to any proceeds resulting from actions taken by the First Lien Administrative Agent or any other First Lien Secured Party in accordance with this Agreement subject to the relative priorities described in Section 2.

(b) Until the Discharge of First Lien Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, subject to Section 3.1(a)(1), the First Lien Secured Parties shall have the right to enforce rights, exercise remedies (including set-off and the right to credit bid their debt) and make determinations regarding the exercise of remedies or with respect to the Collateral without any consultation with or the consent of any Second Lien Secured Party; provided that, subject to Section 5.1, the Lien

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securing the Second Lien Obligations shall remain on the proceeds of such Collateral disposed of in connection with such exercise of remedies subject to the relative priorities described in Section 2 and only to the extent such proceeds were not applied to the Discharge of First Lien Obligations. In exercising rights and remedies with respect to the Collateral, the First Lien Administrative Agent and the other First Lien Secured Parties may enforce the provisions of the First Lien Loan Documents and exercise remedies thereunder, all in such order and in such manner as they may determine in the exercise of their sole discretion. Such exercise and enforcement shall include the right to an agent appointed by the First Lien Administrative Agent or any other First Lien Secured Party to sell or otherwise dispose of Collateral upon foreclosure, to incur expenses in connection with such sale or Disposition, and to exercise all the rights and remedies of a secured creditor under the UCC and of a secured creditor under Bankruptcy Laws of any applicable jurisdiction.

(c) Notwithstanding anything to the contrary in this Agreement, the Second Lien Collateral Agent and any other Second Lien Secured Party may:

(1) file a claim or statement of interest with respect to the Second Lien Obligations; provided that an Insolvency or Liquidation Proceeding has been commenced by or against any Grantor;

(2) take any action (not adverse to the priority status of the Liens on the Collateral securing the First Lien Obligations, or the rights of any of the First Lien Secured Parties to exercise remedies in respect thereof) in order to create, perfect, preserve or protect its Lien on the Collateral;

(3) file any necessary responsive or defensive pleadings in opposition to any motion, claim, adversary proceeding or other pleading made by any Person objecting to or otherwise seeking the disallowance of the claims of the Second Lien Secured Parties, including any claims secured by the Collateral, if any, or otherwise make any agreements or file any motions or objections pertaining to the claims of the Second Lien Secured Parties, in each case in accordance with and not inconsistent with the terms of this Agreement;

(4) file any pleadings, objections, motions or agreements (x) which assert rights or interests available to unsecured creditors of the Grantors or (y) in the case of a sale or other Disposition of any Collateral free and clear of its Liens or other claims under Section 363 of the Bankruptcy Code, which assert rights or interests available to secured creditors of the Grantors, in each case arising under either any Insolvency or Liquidation Proceeding or applicable non-Bankruptcy Law, in each case not inconsistent with the terms of this Agreement;

(5) vote on any plan of reorganization, file any proof of claim, make other filings and make any arguments and motions that are, in each case, in accordance with and not inconsistent with the terms of this Agreement, with respect to the Second Lien Obligations and the Collateral; and

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(6) exercise any of its rights or remedies with respect to the Collateral after the termination of the Standstill Period to the extent permitted by Section 3.1(a)(1).

Subject to Sections 3.1(a), 3.1(c) and 6.3(b), the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, agrees that it will not take or receive any Collateral or any proceeds of Collateral in connection with the exercise of any Lien Enforcement Action in its capacity as a creditor until the Discharge of First Lien Obligations shall have occurred or as otherwise expressly permitted under this Agreement. Without limiting the generality of the foregoing, unless and until the Discharge of First Lien Obligations has occurred, except as expressly provided in Section 3.1(a), this Section 3.1(c) and Section 6.3(b), the sole right of the Second Lien Secured Parties with respect to the Collateral is to hold a Lien on the Collateral pursuant to the Second Lien Security Documents for the period and to the extent granted therein and to receive a share of the proceeds thereof, if any, after the Discharge of First Lien Obligations has occurred.

(d) Subject to Sections 3.1(a), 3.1(c) and 6.3(b):

(1) the Second Lien Collateral Agent, for itself and on behalf of the Second Lien Secured Parties, agrees that the Second Lien Secured Parties will not take any action with respect to the Collateral that would hinder any exercise of remedies under the First Lien Loan Documents or is otherwise prohibited hereunder, including any sale, lease, exchange, transfer or other Disposition of the Collateral, whether by foreclosure or otherwise;

(2) the Second Lien Collateral Agent, for itself and on behalf of the Second Lien Secured Parties, hereby waives any and all rights it or the Second Lien Secured Parties may have as junior lien creditors or otherwise to object to the manner in which the First Lien Administrative Agent or any other First Lien Secured Parties seek to enforce or collect the First Lien Obligations or the Liens securing the First Lien Obligations granted in any of the First Lien Collateral undertaken in accordance with this Agreement, regardless of whether any action or failure to act by or on behalf of the First Lien Administrative Agent or the First Lien Secured Parties is adverse to the interest of the Second Lien Secured Parties; and

(3) the Second Lien Collateral Agent hereby acknowledges and agrees that no covenant, agreement or restriction contained in the Second Lien Security Documents or any other Second Lien Note Document or Additional Parity Lien Facility Document (other than this Agreement) shall be effective to restrict or be deemed to restrict in any way the rights and remedies of the First Lien Secured Parties with respect to the Collateral as set forth in this Agreement and the First Lien Loan Documents.

(e) Except as otherwise specifically set forth or referred to in Section 3.1(d), the Second Lien Collateral Agent and the Second Lien Secured Parties may exercise rights and remedies as unsecured creditors against any Grantor that has guaranteed or granted Liens to secure the Second Lien Obligations in accordance with the terms of the Second Lien Note Documents, the Additional Parity Lien Facility Documents and applicable law; provided that, in the event that any Second Lien Secured Party becomes a judgment Lien creditor in respect of Collateral

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as a result of its enforcement of its rights as an unsecured creditor with respect to the Second Lien Obligations, such judgment Lien shall be subject to the terms of this Agreement for all purposes (including in relation to the First Lien Obligations) as the other Liens securing the Second Lien Obligations are subject to this Agreement.

(f) Section 3.1 hereof shall not be construed to in any way limit or impair the right of (i) any First Lien Secured Party or any Second Lien Secured Party to bid for or purchase Collateral at any private or judicial foreclosure upon such Collateral initiated by any of them and (ii) any Second Lien Secured Party’s right to receive any remaining proceeds of Collateral after the Discharge of First Lien Obligations.

(g) Nothing in this Agreement shall prohibit the receipt by any of the Second Lien Secured Parties of the required payments of interest, principal and other amounts owed in respect of the Second Lien Obligations as set forth in the Second Lien Note Documents as in effect on this date (subject to any modifications thereto permitted pursuant to Section 5.3(b)) or in the Additional Parity Lien Facility Documents as in effect on the date on which a fully executed Parity Lien Joinder in respect of the applicable Additional Parity Lien Facility shall have been delivered in accordance with Section 5.7 (subject to any modifications thereto permitted pursuant to Section 5.3(c)), so long as, to the extent Sections 3.1(a), 3.1(c) and 6.3(b) do not apply, such receipt is not the direct or indirect result of any Lien Enforcement Action or other enforcement in each case with respect to the Collateral in contravention of this Agreement.

(h) Nothing in this Agreement impairs or otherwise adversely affects any rights or remedies the First Lien Secured Parties may have with respect to the First Lien Collateral.

ARTICLE IV - PAYMENTS

Section 4.1 Application of Proceeds.

(a) So long as the Discharge of First Lien Obligations has not occurred, any Collateral (including, without limitation, any revenue of any Grantor, irrespective of whether such Grantor has deposited such revenue into a deposit account subject to an account control agreement) or proceeds thereof received by the First Lien Administrative Agent in connection with the sale or other Disposition of, or collection or realization on, such Collateral by the First Lien Administrative Agent whether or not in any Insolvency or Liquidation Proceeding or upon the exercise of any rights or remedies relating to the Collateral by the First Lien Administrative Agent and all payments or distributions of any kind received in connection with the same, shall be applied by the First Lien Administrative Agent first to the First Lien Obligations in such order as specified in the relevant First Lien Loan Documents. Upon the Discharge of First Lien Obligations, any remaining Collateral or proceeds thereof shall be delivered to the Second Lien Collateral Agent in the same form as received, with any necessary endorsements or as a court of competent jurisdiction may otherwise direct to be applied by the Second Lien Collateral Agent to the Second Lien Obligations in the order specified in Section 4.1(b).

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(b) The Second Lien Collateral Agent shall apply the proceeds of any sale or other Disposition of, or collection or realization on, any Second Lien Collateral, subject to Section 4.2, in accordance with Section 8.25.

Section 4.2 Payments Over. So long as the Discharge of First Lien Obligations has not occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, any Collateral or proceeds thereof (including assets or proceeds subject to Liens referred to in the final sentence of Section 2.3) received by any of the Second Lien Secured Parties (a) in connection with any Insolvency or Liquidation Proceeding, (b) in connection with the exercise of any right or remedy (including set-off) relating to the Collateral or (c) in contravention of this Agreement, shall be segregated and held in trust and forthwith paid over to the First Lien Administrative Agent for the benefit of the First Lien Secured Parties in the same form as received, with any necessary endorsements or as a court of competent jurisdiction may otherwise direct. The First Lien Administrative Agent is hereby authorized to make any such endorsements as agent for the any such Second Lien Secured Parties. This authorization is coupled with an interest and is irrevocable until the Discharge of First Lien Obligations.

ARTICLE V - OTHER AGREEMENTS

Section 5.1 Releases.

(a) If in connection with the exercise of the First Lien Administrative Agent’s remedies in respect of the Collateral provided for in Section 3.1, the First Lien Administrative Agent, for itself or on behalf of any of the First Lien Secured Parties, releases any of its Liens on any part of the Collateral, then the Liens, if any, of the Second Lien Collateral Agent, for itself and/or for the benefit of the Second Lien Secured Parties, on such part of the Collateral shall be automatically, unconditionally and simultaneously released without the need for any consent or other action on the part of any Second Lien Secured Party. The Second Lien Collateral Agent, for itself or on behalf of any such Second Lien Secured Parties, promptly shall execute and deliver to the First Lien Administrative Agent such termination statements, releases and other documents as the First Lien Administrative Agent or such Grantor may request to effectively confirm such release.

(b) If in connection with any sale, lease, exchange, transfer or other disposition of any Collateral (collectively, a “Disposition”) permitted under the terms of the First Lien Loan Documents, the Second Lien Indenture and the Additional Parity Lien Facility Documents (if any) (other than in connection with the exercise of the First Lien Administrative Agent’s remedies in respect of the Collateral provided for in Section 3.1), the First Lien Administrative Agent, for itself or on behalf of any of the First Lien Secured Parties, releases any of its Liens on any part of the Collateral, then the Liens, if any, of the Second Lien Collateral Agent, for itself or for the benefit of the Second Lien Secured Parties, on such Collateral shall be automatically, unconditionally and simultaneously released without the need for any consent or other action on the part of the Collateral Agent, the Authority, any Restricted Subsidiary (as such term is defined in the Second Lien Indenture) or any Second Lien Secured Party; provided, however, that, if the Liens securing the First Lien Obligations are released in connection with the Discharge of First Lien Obligations, the Liens securing the Second Lien Obligations on the Collateral will not be required to be released except to the extent the Collateral or any portion thereof is disposed or

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otherwise transferred or used in order to repay the First Lien Obligations secured by such Collateral. The Second Lien Collateral Agent, for itself or on behalf of any such Second Lien Secured Parties, promptly shall execute and deliver to the First Lien Administrative Agent such termination statements, releases and other documents as the First Lien Administrative Agent may request to effectively confirm such release.

(c) Until the Discharge of First Lien Obligations occurs, the Second Lien Collateral Agent, for itself and on behalf of the Second Lien Secured Parties, hereby irrevocably constitutes and appoints the First Lien Administrative Agent and any officer or agent of the First Lien Administrative Agent, with full power of substitution, as its true and lawful attorney-in-fact, coupled with an interest, with full irrevocable power and authority in the place and stead of the Second Lien Collateral Agent or such holder or in the First Lien Administrative Agent’s own name, from time to time in the First Lien Administrative Agent’s discretion, for the purpose of carrying out the terms of this Section 5.1 and Section 5.2, to take any and all appropriate action and to execute any and all documents and instruments which may be necessary to accomplish the purposes of this Section 5.1 and Section 5.2, including any endorsements or other instruments of transfer or release.

(d) To the extent that any First Lien Secured Party obtains any new liens or additional guaranties from any Grantor, then the Second Lien Collateral Agent, for itself and for the Second Lien Secured Parties, shall be granted a Lien on any such Collateral, subject to the Lien subordination provisions of this Agreement, and an additional guaranty, as the case may be; provided, however, that, notwithstanding anything herein to the contrary, in no event shall any Grantor be required to grant or permit any additional Liens on any Excluded Assets to secure any Second Lien Obligation (but only for so long as any such asset or property constitutes Excluded Assets).

(e) The Liens granted to secure the First Lien Obligations and the Second Lien Obligations shall attach to any proceeds resulting from actions taken as contemplated by Sections 5.1(a) and 5.1(b), subject to the relative priorities and provisions described herein, including, without limitation, Sections 2.1 and 3.1, and in the case of the Liens granted to secure the First Lien Obligations, subject to clause (f) below.

(f) Upon the Discharge of First Lien Obligations, the First Lien Administrative Agent’s Liens upon the Collateral will be automatically released and the First Lien Administrative Agent shall deliver all Pledged Collateral in its possession (if any) together with any necessary endorsements (such endorsement shall be without recourse and without any representation or warranty), first, to the Second Lien Collateral Agent to the extent Second Lien Obligations remain outstanding, and second, to the Grantors to the extent no First Lien Obligations or Second Lien Obligations remain outstanding (in each case, so as to allow such Person to obtain possession or control of such Pledged Collateral). The First Lien Administrative Agent further agrees to take all other action reasonably requested by the Second Lien Collateral Agent following the Discharge of First Lien Obligations, at the sole expense of the Grantors, in connection with the Second Lien Collateral Agent obtaining a first-priority interest in the Pledged Collateral, subject to Permitted Liens (as such term is defined in the Second Lien Indenture) or as a court of competent jurisdiction may otherwise direct.

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Section 5.2 Insurance; Condemnation. Unless and until the Discharge of First Lien Obligations has occurred, subject to the terms of, and the rights of the Grantors under, the First Lien Loan Documents, the First Lien Secured Parties shall have the sole and exclusive right to adjust settlement for any insurance policy covering the Collateral in the event of any loss thereunder and to approve any award granted in any condemnation or similar proceeding (or any deed in lieu of condemnation) affecting the Collateral. In furtherance of the foregoing, the First Lien Administrative Agent shall be authorized to instruct any issuer of insurance with respect to the Collateral for any Grantor to pay any checks in respect of the Collateral only to the First Lien Administrative Agent and, if for any reason the Second Lien Collateral Agent is named on any such check, the Second Lien Collateral Agent shall promptly sign all documents necessary to enable the First Lien Administrative Agent to deposit such check and receive the funds payable under such check (the First Lien Administrative Agent may, at its option, execute such documents on behalf of the Second Lien Collateral Agent under the powers granted under Section 5.1(b)). Unless and until the Discharge of First Lien Obligations has occurred, and subject to the rights of the Grantors under the First Lien Loan Documents, all proceeds of any such policy and any such award (or any payments with respect to a deed in lieu of condemnation) if in respect to the Collateral and to the extent required by the First Lien Loan Documents shall be paid to the First Lien Administrative Agent for the benefit of the First Lien Secured Parties pursuant to the terms of the First Lien Loan Documents (including, without limitation, for purposes of cash collateralization of letters of credit thereunder) and thereafter, to the extent no First Lien Obligations are outstanding, and subject to the rights of the Grantors under the Second Lien Note Documents and the Additional Parity Lien Facility Documents (if any), to the Second Lien Collateral Agent for the benefit of the Second Lien Secured Parties to the extent required under the Second Lien Note Documents and/or the Additional Parity Lien Facility Documents and then, to the extent no Second Lien Obligations are outstanding, to the owner of the subject property, such other Person as may be entitled thereto or as a court of competent jurisdiction may otherwise direct. Until the Discharge of First Lien Obligations has occurred, if any of the Second Lien Secured Parties shall, at any time, receive any proceeds of any such insurance policy or any such award or payment in contravention of this Agreement, it shall segregate and hold in trust and forthwith pay such proceeds over to the First Lien Administrative Agent in accordance with the terms of Section 4.2.

Section 5.3 Amendments to First Lien Loan Documents, Second Lien Note Documents and Additional Parity Lien Facility Documents.

(a) The First Lien Loan Documents may be amended, restated, supplemented or otherwise modified in accordance with their terms, and the First Lien Obligations may be Refinanced in whole or in part, in each case, without notice to, or the consent of the Second Lien Collateral Agent, any Additional Parity Lien Facility Representative or the Second Lien Secured Parties, all without affecting the Lien subordination or other provisions of this Agreement; provided, however, that (i) in the case of such a Refinancing transaction, (A) if such Refinancing Indebtedness will constitute First Lien Obligations, the incurrence of such Refinancing Indebtedness complies with the terms of this Agreement, including Sections 5.3 and 5.5, (B) if such Refinancing Indebtedness will constitute Second Lien Obligations, the incurrence of such Refinancing Indebtedness complies with the terms of this Agreement, including Section 5.7, and (C) any such Refinancing Indebtedness shall not be permitted to constitute both First Lien Obligations and Second Lien Obligations, and (ii) any such amendment, restatement, supplement, modification or Refinancing shall not, without the consent of the Second Lien Collateral Agent:

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(1) increase the aggregate sum (without duplication) of the following in excess of the Cap Amount: (x) the then outstanding aggregate principal amount of the loans under the First Lien Loan Agreement or the Refinance Documents, as applicable, plus (y) the aggregate amount of all undrawn commitments to extend credit under the First Lien Loan Agreement or the Refinance Documents, as applicable, plus (z) the aggregate amount available to be drawn under all outstanding letters of credit under the First Lien Loan Agreement or the Refinance Documents, as applicable, or

(2) contravene the provisions of this Agreement.

(b) The Second Lien Note Documents may be amended, restated, supplemented or otherwise modified in accordance with their terms (provided that any such amendment, restatement, supplement or other modification does not contravene the provisions of this Agreement), and the Second Lien Note Obligations may be Refinanced, in each case, without notice to, or the consent (except to the extent a consent is required to permit such amendment, supplement or other modification or such Refinancing transaction under any First Lien Loan Document, any Second Lien Note Document or any Additional Parity Lien Facility Document) of any First Lien Secured Party or any Additional Parity Lien Facility Secured Party, all without affecting the Lien subordination or other provisions of this Agreement, provided, however, that, in the case of such a Refinancing transaction, (i) if such Refinancing Indebtedness will constitute First Lien Obligations, the incurrence of such Refinancing Indebtedness complies with the terms of this Agreement, including Sections 5.3 and 5.5, (ii) if such Refinancing Indebtedness will constitute Second Lien Obligations, the incurrence of such Refinancing Indebtedness complies with the terms of this Agreement, including Section 5.7, and (iii) any such Refinancing Indebtedness shall not be permitted to constitute both First Lien Obligations and Second Lien Obligations.

(c) The Additional Parity Lien Facility Documents with respect to any Additional Parity Lien Facility may be amended, restated, supplemented or otherwise modified in accordance with their terms (provided that any such amendment, restatement, supplement or other modification does not contravene the provisions of this Agreement), and the Additional Parity Lien Facility Obligations with respect to such Additional Parity Lien Facility may be Refinanced, in each case, without notice to, or the consent (except to the extent a consent is required to permit such amendment, restatement, supplement or other modification or such Refinancing transaction under any First Lien Loan Document, any Second Lien Note Document or any Additional Parity Lien Facility Document) of any First Lien Secured Party or any Second Lien Secured Party, all without affecting the Lien subordination or other provisions of this Agreement, provided, however, that, in the case of such a Refinancing transaction, (i) if such Refinancing Indebtedness will constitute First Lien Obligations, the incurrence of such Refinancing Indebtedness complies with the terms of this Agreement, including Sections 5.3 and 5.5, (ii) if such Refinancing Indebtedness will constitute Second Lien Obligations, the incurrence of such Refinancing Indebtedness complies with the terms of this Agreement, including Section 5.7, and (iii) any such Refinancing Indebtedness shall not be permitted to constitute both First Lien Obligations and Second Lien Obligations.

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(d) The Second Lien Collateral Agent, on behalf of the Second Lien Secured Parties, agrees that each Second Lien Security Document shall include the following language (or language to similar effect approved by the First Lien Administrative Agent):

“Notwithstanding anything herein to the contrary, the lien and security interest granted to the Second Lien Collateral Agent pursuant to this Agreement and the exercise of any right or remedy by the Second Lien Collateral Agent hereunder are subject to the provisions of the Collateral Agency and Intercreditor Agreement dated as of October 26, 2009 (as amended, restated, supplemented or otherwise modified from time to time, the “Intercreditor Agreement”) by and among Mohegan Tribal Gaming Authority, Mohegan Basketball Club, LLC, Mohegan Golf, LLC, Mohegan Commercial Ventures PA, LLC, Mohegan Ventures-Northwest, LLC, Mohegan Ventures Wisconsin, LLC, MTGA Gaming, LLC, Wisconsin Tribal Gaming, LLC, Downs Racing, L.P., a Pennsylvania limited partnership, Backside, L.P., Mill Creek Land, L.P., Bank of America, N.A., as First Lien Administrative Agent, and U.S. Bank National Association, as Second Lien Collateral Agent, and certain other persons party or that may become party thereto from time to time. In the event of any conflict between the terms of the Intercreditor Agreement and this Agreement, the terms of the Intercreditor Agreement shall govern and control.”

Section 5.4 Bailee for Perfection.

(a) The First Lien Administrative Agent agrees to hold that part of the Collateral that is in its possession or control (or in the possession or control of its agents or bailees) to the extent that possession or control thereof is taken to perfect a Lien thereon under the UCC (such Collateral being the “Pledged Collateral”) as collateral agent for the First Lien Secured Parties and as bailee for the Second Lien Collateral Agent (such bailment being intended, among other things, to satisfy the requirements of Sections 8-301(a)(2) and 9-313(c) of the UCC) and any assignee of the Second Lien Collateral Agent solely for the purpose of perfecting the security interest granted under the First Lien Loan Documents and the Second Lien Note Documents (and, if applicable, the Additional Parity Lien Facility Documents), respectively, subject to the terms and conditions of this Section 5.4. In the event that the Second Lien Collateral Agent or any other Second Lien Secured Party shall come into possession of any Pledged Collateral prior to the Discharge of First Lien Obligations in contravention of this Agreement, then the Second Lien Collateral Agent or such other Second Lien Secured Party, as applicable, shall deliver such Pledged Collateral to the First Lien Administrative Agent.

(b) The First Lien Administrative Agent shall have no obligation whatsoever to the First Lien Secured Parties or the Second Lien Secured Parties to ensure that the Pledged Collateral is genuine or owned by any of the Grantors or to preserve rights or benefits of any Person except as expressly set forth in this Section 5.4. The duties or responsibilities of the First Lien Administrative Agent to the Second Lien Collateral Agent under this Section 5.4 shall be limited solely to holding the Pledged Collateral as bailee for the benefit of and on behalf of the First Lien Secured Parties and the Second Lien Collateral Agent in accordance with this Section 5.4 and delivering the Pledged Collateral upon a Discharge of First Lien Obligations as provided in paragraph (d) below.

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(c) The First Lien Administrative Agent acting pursuant to this Section 5.4 shall not have by reason of the First Lien Security Documents, the Second Lien Security Documents, this Agreement or any other document a fiduciary relationship in respect of the First Lien Secured Parties or any Second Lien Secured Party.

(d) Until the Discharge of First Lien Obligations has occurred, the First Lien Administrative Agent shall be entitled to deal with the Pledged Collateral in accordance with the terms of the First Lien Loan Documents as if the Liens of the Second Lien Collateral Agent under the Second Lien Security Documents did not exist. Until the Discharge of First Lien Obligations has occurred, the rights of the Second Lien Collateral Agent shall at all times be subject to the terms of this Agreement.

Section 5.5 When Discharge of First Lien Obligations Deemed to Not Have Occurred; Additional First Lien Indebtedness.

(a) If concurrently with the Discharge of First Lien Obligations, the Authority enters into any Refinancing in full of the then existing First Lien Obligations, which Refinancing is permitted by this Agreement (including Section 5.3(a)(2)), the Second Lien Indenture and the terms thereof and the Additional Parity Lien Facility Documents and the terms thereof, in each case, as in effect on the date hereof, then such Discharge of First Lien Obligations shall automatically be deemed not to have occurred for all purposes of this Agreement (other than with respect to any actions taken or the effectiveness of the provisos in Section 3.1(a)(i) as a result of the occurrence of such first Discharge of First Lien Obligations), and, from and after the date on which such Refinancing Indebtedness is incurred in accordance with the terms hereof, the obligations under such Refinancing shall automatically be treated as First Lien Obligations for all purposes of this Agreement, including for purposes of the Lien priorities and rights in respect of Collateral set forth herein, and the New Agent (as hereinafter defined) under such new First Lien Loan Documents shall be the First Lien Administrative Agent for all purposes of this Agreement.

(b) The Grantors will be permitted, subject to Section 5.3, to (i) Refinance the First Lien Obligations in full or (ii) in the event that no First Liens Obligations are then outstanding and the Discharge of First Lien Obligations shall have occurred with respect to the most recent First Lien Obligations, incur new First Lien Obligations under a new First Lien Loan Document (the Indebtedness incurred under clause (i) or (ii) shall be referred to in this Section 5.5 as “Additional First Lien Indebtedness”), and in connection therewith, designate as a holder of First Lien Obligations hereunder lenders and agents (including any New Agent) thereunder, in each case only to the extent the Refinancing Indebtedness or new Indebtedness is incurred in accordance with the terms of this Agreement (including Section 5.3 and this Section 5.5). The Grantors shall effect such designation by delivering to the Second Lien Collateral Agent, with copies to the Second Lien Trustee and to each previously identified Additional Parity Lien Facility Representative, each of the following:

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(i) on or prior to the date on which such Additional First Lien Indebtedness is incurred, an Officers’ Certificate stating that the Grantors intend to incur such Additional First Lien Indebtedness as Refinancing Indebtedness or Indebtedness under a new First Lien Loan Document, and certifying that (A) such incurrence is permitted and does not violate or result in any default under the Second Lien Note Documents or any then existing Additional Parity Lien Facility Document (other than any incurrence of First Lien Obligations that would simultaneously repay all First Lien Obligations under the First Lien Loan Documents under which such default would arise) and (B) the definitive documentation associated with such Additional First Lien Indebtedness contains a written agreement of the holders of such Indebtedness, for the enforceable benefit of all holders of existing and future Second Lien Obligations, and each existing and future Debt Representative as follows: (x) that the holders of all obligations associated with such Additional First Lien Indebtedness are bound by the provisions of, and agree to the terms of, this Agreement and (y) consenting to and directing the New Agent or other representative with respect to such Additional First Lien Indebtedness to perform its obligations under this Agreement; provided that such Additional First Lien Indebtedness shall not be permitted to constitute Indebtedness in respect of both First Lien Obligations and Second Lien Obligations;

(ii) evidence that the Grantors have duly authorized, executed (if applicable) and recorded (or caused to be recorded), or intend to authorize, execute and record (if applicable), in each appropriate governmental office all relevant filings and recordations to ensure that such Additional First Lien Indebtedness is secured by the First Lien Collateral in accordance with this Agreement and the First Lien Security Documents (including any opinions reasonably requested by the New Agent to confirm the validity and perfection of the First Lien Secured Parties’ Liens in the First Lien Collateral after giving effect to such Additional First Lien Indebtedness);

(iii) a written notice specifying the name and address of the New Agent or representative in respect of such Additional First Lien Indebtedness for purposes of Section 9.9; and

(iv) a copy of the executed First Lien Joinder, executed by the New Agent (on behalf of each First Lien Secured Party represented by it).

(c) Although the Grantors shall be required to deliver a copy of each of the foregoing documents described in clauses (i) through (iv) of Section 5.5(b) to the Second Lien Collateral Agent and each then existing Debt Representative, the failure to so deliver a copy of any such document to the Second Lien Collateral Agent or any Debt Representative (other than the certification described in clause (i) of Section 5.5(b) and the executed First Lien Joinder referred to in clause (iv) of Section 5.5(b), which shall in all cases be required and which shall be delivered to the Second Lien Collateral Agent and each then existing Debt Representative no later than five Business Days prior to the incurrence of the First Lien Loan Documents governing such Additional First Lien Indebtedness) shall not affect the status of such Additional First Lien Indebtedness as First Lien Obligations entitled to the benefits of this Agreement if the other requirements of this Section 5.5 are complied with.

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(d) If and to the extent requested by the New Agent, and so long as the Grantors shall have delivered copies of the certificates and documents referenced in clauses (i) through (iv) of Section 5.5(b) to each of the Second Lien Trustee and each previously identified Additional Parity Lien Facility Representative, each Debt Representative will (to the extent the Additional First Lien Indebtedness is incurred in accordance with such Debt Representative’s applicable Second Lien Documents) confirm in writing (by countersigning and acknowledging the First Lien Joinder) that (i) the holders of such contemplated Additional First Lien Indebtedness will be First Lien Secured Parties hereunder and (ii) the obligations of such holders associated with such Additional First Lien Indebtedness are First Lien Obligations hereunder. The failure of any Debt Representative to so confirm in writing shall not affect the status of such obligations as First Lien Obligations entitled to the benefits of this Agreement if the other requirements of this Section 5.5 are complied with.

(e) Each of the Second Lien Collateral Agent and each then existing Debt Representative shall have the right to request that the Authority provide a copy of executed opinions of counsel to be provided to the New Agent or to the holders of any Additional First Lien Indebtedness incurred in accordance with this Section, to the Second Lien Collateral Agent, on behalf of all Second Lien Secured Parties, as to the Additional First Lien Indebtedness being secured by a valid and perfected security interest in the First Lien Collateral. Notwithstanding the foregoing, nothing in this Agreement will be construed to allow the Authority or any other Grantor to incur additional Indebtedness unless otherwise permitted by the terms of all applicable First Lien Loan Documents and Second Lien Documents.

(f) Upon receipt of a notice (the “New First Lien Debt Notice”) stating that the Authority has entered into a Refinancing in full in respect of the then existing First Lien Obligations or a new First Lien Loan Document in accordance with the terms hereof (which notice shall include the identity of the new administrative and/or collateral agent under the applicable Refinance Documents, or other new First Lien Administrative Agent, such agent, the “New Agent”), and so long as the Grantors shall have delivered copies of the certificates and documents referenced in clauses (i) through (iv) of Section 5.5(b) to the Second Lien Collateral Agent, the Second Lien Collateral Agent shall promptly, at the Grantors’ cost and expense, (i) enter into such documents and agreements (including amendments, supplements or other modifications to this Agreement) as the Authority or such New Agent shall reasonably request in order to provide to the New Agent the rights contemplated hereby, in each case consistent in all material respects with the terms of this Agreement and (ii) deliver to the New Agent any Pledged Collateral held by it together with any necessary endorsements (or otherwise allow the New Agent to obtain control of such Pledged Collateral).

(g) If the new First Lien Obligations under the new First Lien Loan Documents are secured by assets of the Grantors constituting Collateral that do not also secure the Second Lien Obligations, then the Second Lien Obligations shall be secured at such time by a second priority Lien on such assets to the same extent provided in the new First Lien Security Documents and this Agreement; provided, however, that, notwithstanding anything herein to the contrary, in no event shall any Grantor be required to grant or permit any additional Liens on any Excluded Assets to secure the Second Lien Obligations (but only for so long as any such asset or property constitutes a Excluded Assets).

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Section 5.6 Appointment of First Lien Administrative Agent as collateral agent on behalf of Second Lien Collateral Agent. The Second Lien Collateral Agent on behalf of the Second Lien Secured Parties hereby appoints the First Lien Administrative Agent and the First Lien Administrative Agent agrees to act as collateral agent on behalf of the Second Lien Collateral Agent and the other Second Lien Secured Parties under each control agreement relating to any deposit accounts or securities accounts subject to a control agreement in favor of the First Lien Administrative Agent (the “Control Accounts”) solely for the purpose of perfecting the security interest of the Second Lien Collateral Agent and the other Second Lien Secured Parties in such Control Accounts granted under the Second Lien Documents, subject to the terms and conditions of this Section 5.

Until the Discharge of First Lien Obligations has occurred, the First Lien Administrative Agent shall be entitled to deal with the Control Accounts (and all deposits therein) in accordance with the terms of the First Lien Documents. The rights of the Second Lien Collateral Agent shall at all times be subject to the terms of this Agreement.

The First Lien Administrative Agent shall have no obligation whatsoever to the Second Lien Collateral Agent to assure that any of the Control Accounts or any deposits therein are genuine or owned by any of the Grantors or to preserve rights or benefits of any Person except as expressly set forth in this Section 5.6. The duties or responsibilities of the First Lien Administrative Agent under this Section 5.6 shall be limited solely to holding the Control Accounts as agent in accordance with this Section 5.6 solely for perfection of the Second Lien Collateral Agent’s liens in such Control Accounts, and the First Lien Administrative Agent acting pursuant to this Section 5.6 shall not have a fiduciary relationship in respect of the Second Lien Collateral Agent or any Second Lien Secured Party.

Unless the Lien of the Second Lien Collateral Agent on such Collateral shall have been or concurrently is released, after the occurrence of the Discharge of First Lien Obligations, the First Lien Administrative Agent and the Grantors shall at the request of the Second Lien Collateral Agent have each control agreement assigned to the Second Lien Collateral Agent or otherwise have control of all Control Accounts transferred to the Second Lien Collateral Agent, in each case, to the extent that the Second Lien Documents would entitle the Second Lien Collateral Agent to have control over the Control Accounts.

For purposes of this Section 5.6, as security for the payment and performance in full of all the Second Lien Obligations each Grantor hereby grants to the First Lien Administrative Agent for the benefit of the Second Lien Collateral Agent and the other Second Lien Secured Parties a Lien on and security interest in all of the right, title and interest of such Grantor, in and to and under such Control Accounts and the cash, funds, checks, notes, “securities entitlements” (as such terms are defined in the UCC), instruments and other assets from time to time on deposit in any such Control Account, wherever located and whether now existing or hereafter arising or acquired from time to time.

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Section 5.7 Additional Parity Lien Facilities.

(a) The Second Lien Collateral Agent will act as agent hereunder for, and perform its duties set forth herein on behalf of, each holder of Second Lien Obligations in respect of indebtedness that is incurred after the date hereof that:

(i) holds Additional Parity Lien Facility Obligations that are identified as such in accordance with the procedures set forth in clause (b) of this Section 5.7; and

(ii) signs, through its designated Additional Parity Lien Facility Representative identified pursuant to clause (b) of this Section 5.7, and delivers a Parity Lien Joinder.

(b) The Grantors will be permitted, subject to Section 5.3, to incur Indebtedness in respect of an Additional Parity Lien Facility and to designate as an additional holder of Second Lien Obligations hereunder lenders, agents and each Additional Parity Lien Facility Representative, as applicable, under such Additional Parity Lien Facility, in each case only to the extent such Additional Parity Lien Facility is incurred in accordance with the terms of this Agreement (including this Section 5.7) and only to the extent such incurrence is permitted under the terms of the First Lien Loan Documents and the Second Lien Documents. The Grantors shall effect such designation by delivering to the Second Lien Collateral Agent, with copies to the First Lien Administrative Agent, the Second Lien Trustee and to each previously identified Additional Parity Lien Facility Representative, each of the following:

(i) on or prior to the date on which such Additional Parity Lien Debt is incurred, an Officers’ Certificate stating that the Grantors intend to incur additional Indebtedness under such Additional Parity Lien Facility, and certifying that (A) such incurrence is permitted and does not violate or result in any default under the First Lien Loan Documents, the Second Lien Note Documents or any then existing Additional Parity Lien Facility Document (other than any incurrence of Second Lien Obligations that would simultaneously repay all First Lien Obligations or Second Lien Note Obligations, as applicable, under the First Lien Loan Documents or the Second Lien Loan Documents, as applicable, under which such default would arise) and (B) the definitive documentation associated with such Additional Parity Lien Facility contains a written agreement of the holders of such Indebtedness, for the enforceable benefit of all holders of existing and future First Lien Obligations, all other holders of existing and future Second Lien Obligations, and each existing and future First Lien Administrative Agent and each existing and future Debt Representative as follows: (x) that all Second Lien Obligations will be and are secured equally and ratably by all Liens granted to the Second Lien Collateral Agent, for the benefit of the Second Lien Secured Parties, at any time granted by any Grantor to secure any Second Lien Obligations whether or not upon property otherwise constituting collateral to such Second Lien Obligations and that all Liens granted pursuant to the Second Lien Security Documents will be enforceable by the Second Lien Collateral Agent for the benefit of all holders of Second Lien Obligations equally and ratably as contemplated by this Agreement, (y) that the holders of Second Lien Obligations in respect of such Additional Parity Lien Facility are bound by the provisions of, and agree to the terms of, this Agreement, including the provisions relating to the ranking of Liens and the

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order of application of proceeds from the enforcement of Liens and (z) consenting to and directing the Second Lien Collateral Agent to perform its obligations under this Agreement and the Second Lien Security Documents; provided that such Additional Parity Lien Debt shall not be permitted to also constitute Indebtedness in respect of First Lien Obligations;

(ii) evidence that the Grantors have duly authorized, executed (if applicable) and recorded (or caused to be recorded), or intend to authorize, execute and record (if applicable), in each appropriate governmental office all relevant filings and recordations to ensure that the Additional Parity Lien Facility Obligations in respect of such Additional Parity Lien Facility are secured by the Collateral in accordance with this Agreement and the Second Lien Security Documents (including any amendments to the applicable Second Lien Security Documents necessary to increase the amount of Second Lien Obligations secured thereby to an amount reasonably satisfactory to the Second Lien Collateral Agent and any opinions reasonably requested by the Second Lien Collateral Agent to confirm the validity and perfection of the Second Lien Secured Parties’ Liens in the Collateral after giving effect to such Additional Parity Lien Facility);

(iii) a written notice specifying the name and address of the Additional Parity Lien Facility Representative in respect of such Additional Parity Lien Facility for purposes of Section 9.9; and

(iv) a copy of the executed Parity Lien Joinder referred to in clause (a) above, executed by the new Additional Parity Lien Facility Representative (on behalf of each Additional Parity Lien Facility Secured Party represented by it).

(c) Although the Grantors shall be required to deliver a copy of each of the foregoing documents described in clauses (i) through (iv) of Section 5.7(b) to the First Lien Administrative Agent, the Second Lien Collateral Agent and to each then existing Debt Representative, the failure to so deliver a copy of any such document to the First Lien Administrative Agent, the Second Lien Collateral Agent or to any such Debt Representative (other than the certification described in clause (i) of Section 5.7(b) and the Parity Lien Joinder referred to in clause (iv) of Section 5.7(b), which shall in all cases be required and which shall be delivered to each of the First Lien Administrative Agent, the Second Lien Collateral Agent and to each then existing Debt Representative no later than five Business Days prior to the incurrence of the applicable Additional Parity Lien Facility) shall not affect the status of such Additional Parity Lien Facility as Additional Parity Lien Facility Obligations or Second Lien Obligations entitled to the benefits of this Agreement and the Second Lien Security Documents if the other requirements of this Section 5.7 are complied with.

(d) If and to the extent requested by the Second Lien Collateral Agent, and so long as the Grantors shall have delivered copies of the certificates and documents referenced in clauses (i) through (iv) of Section 5.7(b) to each of the First Lien Administrative Agent, the Second Lien Collateral Agent, the Second Lien Trustee and each previously identified Additional Parity Lien Facility Representative, each Debt Representative will (to the extent the applicable Additional Parity Lien Facility is incurred in accordance with such Debt Representative’s applicable Second Lien Documents) confirm in writing (by countersigning and acknowledging the

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applicable Parity Lien Joinder) that (i) the holders of such contemplated Additional Parity Lien Facility will be Second Lien Secured Parties hereunder, (ii) the obligations of such holders under the applicable contemplated Additional Parity Lien Loan Documents are Second Lien Obligations hereunder, and (iii) such obligations are secured by an equal and ratable second Lien on the Collateral as contemplated hereby. The failure of any Debt Representative to so confirm in writing shall not affect the status of such obligations as Additional Parity Lien Facility Obligations or Second Lien Obligations entitled to the benefits of this Agreement and the Second Lien Security Documents if the other requirements of this Section 5.7 are complied with.

(e) Each Debt Representative agrees that this Agreement and the applicable Second Lien Security Documents shall be amended to the extent necessary or desirable to cause the Liens granted thereby to be in favor of the holders of such new Second Lien Obligations (to the extent Liens in favor of such holders are expressly permitted by the terms hereof), and that the Second Lien Collateral Agent is authorized to enter into such amendments as set forth in Section 9.4. The Liens granted in favor of the Second Lien Collateral Agent, for the benefit of the Second Lien Secured Parties, shall be granted under the same Second Lien Security Documents.

(f) Each of the parties hereto agrees that this Agreement and the applicable Second Lien Security Documents shall be amended to the extent necessary or desirable to cause the holders of such new Second Lien Obligations to be treated in the same manner as the Second Lien Secured Parties under this Agreement, and that the Second Lien Collateral Agent is authorized to enter into such amendments as set forth in Section 9.4.

(g) Each of the Second Lien Collateral Agent and each then existing Debt Representative shall have the right to request that the Authority provide a copy of executed opinions of counsel to be provided to the holders of any Additional Parity Lien Facility incurred in accordance with this Section, to the Second Lien Collateral Agent, on behalf of all Second Lien Secured Parties, as to the associated Additional Parity Lien Debt being secured by a valid and perfected security interest in the Second Lien Collateral. Notwithstanding the foregoing, nothing in this Agreement will be construed to allow the Authority or any other Grantor to incur additional Indebtedness unless otherwise permitted by the terms of all applicable First Lien Loan Documents and Second Lien Documents.

ARTICLE VI - INSOLVENCY OR LIQUIDATION PROCEEDINGS

Section 6.1 Finance and Sale Issues. Until the Discharge of First Lien Obligations has occurred, if any Grantor shall be subject to any Insolvency or Liquidation Proceeding and the First Lien Administrative Agent shall desire to permit the use of cash collateral on which the First Lien Administrative Agent or any other creditor has a Lien, or to permit any Grantor to obtain financing from one or more First Lien Secured Parties or any other Person, under Section 363 or Section 364 of the Bankruptcy Code or any similar Bankruptcy Law (each, a “DIP Financing”), then the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, agrees that it will raise no objection to such use of cash collateral or DIP Financing so long as such cash collateral use or DIP Financing meets the following requirements:

(a) the aggregate principal amount of the DIP Financing plus the aggregate outstanding principal amount of First Lien Obligations plus the aggregate face amount of any letters of credit issued and not reimbursed under the First Lien Loan Agreement does not exceed $925,000,000;

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(b) such cash collateral use or DIP Financing is on commercially reasonable terms;

(c) the Second Lien Secured Parties retain the right to object to any ancillary agreements or arrangements regarding the cash collateral use or the DIP Financing that are materially prejudicial to their interests;

(d) the terms of the DIP Financing or cash collateral order do not compel the Grantors to seek confirmation of a specific plan of reorganization for which all or substantially all of the material terms are set forth in the DIP Financing documentation, the cash collateral order or a related document; and

(e) the DIP Financing documentation or cash collateral order does not expressly require the liquidation of the Collateral prior to a default under the DIP Financing documentation or cash collateral order.

To the extent the Liens securing the First Lien Obligations are subordinated to, or secured on an equal and ratable basis with, such DIP Financing which meets the requirements of clauses (a) through (e) or such use of cash collateral which meets the requirements of clauses (b) through (e) of this Section 6.1, the Second Lien Collateral Agent will subordinate its Liens on the Collateral to the Liens securing such DIP Financing or use of cash collateral (and all obligations relating thereto).

Section 6.2 Relief from the Automatic Stay. Until the Discharge of First Lien Obligations has occurred, the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, agrees that none of them shall seek (or support any other Person seeking) relief from the automatic stay or any other stay in any Insolvency or Liquidation Proceeding in respect of the Collateral, without the prior written consent of the First Lien Administrative Agent. Until the Discharge of First Lien Obligations has occurred, the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, further agrees that none of them shall object (or support any other Person who objects) to any motion by the First Lien Administrative Agent or the First Lien Secured Parties for relief from the automatic stay or any other stay in any Insolvency or Liquidation Proceeding in respect of the Collateral.

Section 6.3 Adequate Protection.

(a) The Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, agrees that none of them shall contest (or support any other Person contesting):

(1) any request by the First Lien Administrative Agent or the First Lien Secured Parties for adequate protection; or

(2) any objection by the First Lien Administrative Agent or the First Lien Secured Parties to any motion, relief, action or proceeding based on the First Lien Administrative Agent or the First Lien Secured Parties claiming a lack of adequate protection; or

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(3) the payment of interest, fees, expenses or other amounts to the First Lien Administrative Agent or any other First Lien Secured Party under Section 506(b) or 506(c) of the Bankruptcy Code or otherwise.

(b) Notwithstanding the foregoing provisions in this Section 6.3, in any Insolvency or Liquidation Proceeding:

(1) if the First Lien Secured Parties (or any subset thereof) are granted adequate protection in the form of additional payments or collateral in connection with any DIP Financing or use of cash collateral, then the Second Lien Collateral Agent, on behalf of itself or any of the Second Lien Secured Parties, may seek or request adequate protection in the form of a Lien on such additional collateral, which Lien will be subject to the terms of this Agreement subordinated to the Liens securing the First Lien Obligations and such DIP Financing or use of cash collateral (and all obligations relating thereto) on the same basis as the other Liens securing the Second Lien Obligations are so subordinated to the First Lien Obligations under this Agreement, and

(2) not in limitation of this Section 6.3 or elsewhere in this Agreement, in the event the Second Lien Collateral Agent, on behalf of itself or any of the Second Lien Secured Parties, seeks or requests adequate protection in respect of Second Lien Obligations and such adequate protection is granted in the form of additional collateral, then the Second Lien Collateral Agent, on behalf of itself or any of the Second Lien Secured Parties, agrees that the First Lien Administrative Agent shall also be granted a senior Lien on such additional collateral as security for the First Lien Obligations and for any cash collateral use or DIP Financing provided by the First Lien Secured Parties and that any Lien on such additional collateral securing the Second Lien Obligations shall be subordinated to the Lien on such collateral securing the First Lien Obligations and any such cash collateral or DIP Financing provided by the First Lien Secured Parties (and all obligations relating thereto) and to any other Liens granted to the First Lien Secured Parties as adequate protection on the same basis as the other Liens securing the Second Lien Obligations are so subordinated to such First Lien Obligations under this Agreement. Except as otherwise expressly set forth in Section 6.1 or in connection with the exercise of remedies with respect to the Collateral, nothing herein shall limit the rights of any Second Lien Secured Party from seeking adequate protection with respect to their rights in the Collateral in any Insolvency or Liquidation Proceeding (but not including adequate protection in the form of a cash payment, periodic cash payments or otherwise).

Section 6.4 No Waiver. Subject to Sections 3.1(c) and 6.3(b), nothing contained herein shall prohibit or in any way limit any First Lien Secured Party from objecting in any Insolvency or Liquidation Proceeding or otherwise to any action taken by the Second Lien Collateral Agent or any other Second Lien Secured Party, including the seeking by the Second Lien Collateral Agent or any other Second Lien Secured Party of adequate protection or the asserting by the Second Lien Collateral Agent or any other Second Lien Secured Party of any of its rights and remedies under the Second Lien Note Documents, the Additional Parity Lien Facility Documents or otherwise; provided, however, that this Section 6.4 shall not limit the rights of the Second Lien Secured Parties under Section 3.1(c) of this Agreement.

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Section 6.5 Avoidance Issues. If any First Lien Secured Party is required in any Insolvency or Liquidation Proceeding or otherwise to turn over or otherwise pay to the estate of any Grantor any amount paid in respect of First Lien Obligations (a “Recovery”), then such First Lien Secured Party shall be entitled to a reinstatement of First Lien Obligations with respect to all such recovered amounts, and the Discharge of First Lien Obligations shall be deemed not to have occurred for all purposes hereunder. If this Agreement shall have been terminated prior to such Recovery or any finding of the invalidity of a Lien of the First Lien Administrative Agent, this Agreement shall be reinstated in full force and effect, and such prior termination shall not diminish, release, discharge, impair or otherwise affect the obligations of the parties hereto from such date of reinstatement.

Section 6.6 Reorganization Securities. If, in any Insolvency or Liquidation Proceeding, debt obligations of the reorganized debtor secured by Liens upon any property of the reorganized debtor are distributed pursuant to a plan of reorganization or similar dispositive restructuring plan, both on account of First Lien Obligations and on account of Second Lien Obligations, then, to the extent the debt obligations distributed on account of the First Lien Obligations and on account of the Second Lien Obligations are secured by Liens upon the same property, the provisions of this Agreement will survive the distribution of such debt obligations pursuant to such plan and will apply with like effect to the Liens securing such debt obligations.

Section 6.7 Post-Petition Interest.

(a) Neither the Second Lien Collateral Agent nor any other Second Lien Secured Party shall oppose or seek to challenge any claim by any First Lien Secured Party for allowance in any Insolvency or Liquidation Proceeding of First Lien Obligations consisting of post-petition interest, fees or expenses to the extent of the value of any First Lien Secured Party’s Lien, without regard to the existence of the Lien of the Second Lien Collateral Agent on behalf of the Second Lien Secured Parties on the Collateral.

(b) Neither the First Lien Administrative Agent nor any other First Lien Secured Party shall oppose or seek to challenge any claim by the Second Lien Collateral Agent or any other Second Lien Secured Party for allowance in any Insolvency or Liquidation Proceeding of Second Lien Obligations consisting of post-petition interest, fees or expenses to the extent of the value of the Lien of the Second Lien Collateral Agent on behalf of the Second Lien Secured Parties on the Collateral (after taking into account the First Lien Collateral).

Section 6.8 Waiver. The Second Lien Collateral Agent, for itself and on behalf of the Second Lien Secured Parties, waives any claim it may hereafter have against any First Lien Secured Party arising out of the election of any First Lien Secured Party of the application of Section 1111(b)(2) of the Bankruptcy Code, and/or out of any cash collateral or financing arrangement or out of any grant of a security interest in connection with the Collateral in any Insolvency or Liquidation Proceeding.

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Section 6.9 Separate Grants of Security and Separate Classification. The Second Lien Collateral Agent, for itself and on behalf of the Second Lien Secured Parties, the First Lien Administrative Agent for itself and on behalf of the First Lien Secured Parties, and each Additional Parity Lien Facility Representative, for itself and on behalf of the applicable Additional Parity Lien Facility Secured Parties, acknowledges and agrees that:

(a) the grants of Liens pursuant to the First Lien Security Documents and the Second Lien Security Documents constitute two separate and distinct grants of Liens;

(b) because of, among other things, their differing rights in the Collateral, the Second Lien Obligations are fundamentally different from the First Lien Obligations and must be separately classified in any plan of reorganization proposed or adopted in an Insolvency or Liquidation Proceeding;

(c) the First Lien Obligations include all interest on First Lien Obligations that accrues after the commencement of any Insolvency or Liquidation Proceeding of any Grantor at the rate provided for in the applicable First Lien Loan Documents governing the same, whether or not allowed or allowable;

(d) the payment and satisfaction of all of the Second Lien Obligations will be secured on an equal and ratable basis by the Liens established in favor of the Second Lien Collateral Agent for the benefit of the Second Lien Secured Parties; it being understood and agreed that nothing in this Section 6.9(d) is intended to alter the priorities as between the First Lien Secured Parties and the Second Lien Secured Parties as provided in Section 2.1; and

(e) this Agreement constitutes a “subordination agreement” under Section 510 of the Bankruptcy Code.

To further effectuate the intent of the parties as provided in the immediately preceding sentence, if it is held that the claims against the Grantors in respect of the Collateral constitute only one secured claim (rather than separate classes of senior and junior secured claims), then the Second Lien Collateral Agent, on behalf of the Second Lien Secured Parties, hereby acknowledges and agrees that, all distributions pursuant to Section 4.1 hereof or otherwise shall be made as if there were separate classes of senior and junior secured claims against the Grantors in respect of the Collateral (with the effect being that, to the extent that the aggregate value of the Collateral is sufficient (for this purpose ignoring all claims held by the Second Lien Collateral Agent on behalf of the Second Lien Secured Parties), the First Lien Secured Parties shall be entitled to receive, in addition to amounts otherwise distributed to them in respect of principal, pre-petition interest and other claims, all amounts owing in respect of post-petition interest, including any additional interest payable pursuant to the First Lien Loan Agreement arising from or related to a default, which is disallowed as a claim in any Insolvency or Liquidation Proceeding before any distribution is made in respect of the claims held by the Second Lien Secured Parties with respect to the Collateral; the Second Lien Collateral Agent, for itself and on behalf of the Second Lien Secured Parties hereby acknowledges and agrees to turn over to the First Lien Administrative Agent, for itself and on behalf of the First Lien Secured Parties, all amounts otherwise received or receivable by them to the extent needed to effectuate the intent of this sentence (with respect to the payment of post-petition interest) even if such turnover of amounts has the effect of reducing the amount of the claim of the Second Lien Secured Parties).

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ARTICLE VII - RELIANCE; WAIVERS; ETC.

Section 7.1 Reliance. Other than any reliance on the terms of this Agreement, the First Lien Administrative Agent, on behalf of itself and the First Lien Secured Parties, acknowledges that it and such First Lien Secured Parties have, independently and without reliance on the Second Lien Collateral Agent or any Second Lien Secured Parties, and based on documents and information deemed by them appropriate, made their own credit analysis and decision to enter into such First Lien Loan Documents and be bound by the terms of this Agreement and they will continue to make their own credit decision in taking or not taking any action under the First Lien Loan Documents or this Agreement. The Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, acknowledges that it and the Second Lien Secured Parties have, independently and without reliance on any First Lien Secured Party, and based on documents and information deemed by them appropriate, made their own credit analysis and decision to enter into each of the Second Lien Note Documents and any Additional Parity Lien Facility Documents and be bound by the terms of this Agreement and they will continue to make their own credit decision in taking or not taking any action under the Second Lien Note Documents, any Additional Parity Lien Facility Documents or this Agreement.

Section 7.2 No Warranties or Liability. The First Lien Administrative Agent, on behalf of itself and the First Lien Secured Parties under the First Lien Loan Documents, acknowledges and agrees that each of the Second Lien Collateral Agent and the Second Lien Secured Parties have made no express or implied representation or warranty, including with respect to the execution, validity, legality, completeness, collectibility or enforceability of any of the Second Lien Note Documents or the Additional Parity Lien Facility Documents, the ownership of any Collateral or the perfection or priority of any Liens thereon. Except as otherwise provided herein, the Second Lien Secured Parties will be entitled to manage and supervise their respective loans and extensions of credit under the Second Lien Note Documents and the Additional Parity Lien Facility Documents in accordance with law and as they may otherwise, in their sole discretion, deem appropriate. The Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, acknowledges and agrees that the First Lien Secured Parties have made no express or implied representation or warranty, including with respect to the execution, validity, legality, completeness, collectibility or enforceability of any of the First Lien Loan Documents, the ownership of any Collateral or the perfection or priority of any Liens thereon. Except as otherwise provided herein, the First Lien Secured Parties will be entitled to manage and supervise their respective loans and extensions of credit under their respective First Lien Loan Documents in accordance with law and as they may otherwise, in their sole discretion, deem appropriate. The Second Lien Collateral Agent and the Second Lien Secured Parties shall have no duty to the First Lien Administrative Agent or any of the First Lien Secured Parties, and the First Lien Secured Parties shall have no duty to the Second Lien Collateral Agent or any of the Second Lien Secured Parties, to act or refrain from acting in a manner which allows, or results in, the occurrence or continuance of an event of default or default under any agreements with any Grantor (including the First Lien Loan Documents, the Second Lien Note Documents and the Additional Parity Lien Facility Documents), regardless of any knowledge thereof which they may have or be charged with.

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Section 7.3 No Waiver of Lien Priorities.

(a) No right of any First Lien Secured Party or the First Lien Administrative Agent to enforce any provision of this Agreement or any First Lien Loan Document shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of any Grantor or by any act or failure to act by any First Lien Secured Party or the First Lien Administrative Agent, or by any noncompliance by any Person with the terms, provisions and covenants of this Agreement, any of the First Lien Loan Documents, any of the Second Lien Note Documents or any of the Additional Parity Lien Facility Documents, regardless of any knowledge thereof which any First Lien Secured Parties may have or be otherwise charged with.

(b) Without in any way limiting the generality of the foregoing paragraph (but subject to the rights of the Grantors under the First Lien Loan Documents and subject to the provisions of Sections 5.1(a), 5.1(d), 5.3(a) and 5.5), the First Lien Secured Parties, the First Lien Administrative Agent and any of them may, at any time and from time to time in accordance with the First Lien Loan Documents and/or applicable law, without the consent of, or notice to, the Second Lien Collateral Agent or any Second Lien Secured Parties, without incurring any liabilities to the Second Lien Collateral Agent or any Second Lien Secured Parties and without impairing or releasing the Lien priorities and other benefits provided in this Agreement (even if any right of subrogation or other right or remedy of the Second Lien Collateral Agent or any Second Lien Secured Parties is affected, impaired or extinguished thereby) do any one or more of the following:

(1) change the manner, place or terms of payment or change or extend the time of payment of, or amend, renew, exchange, increase or alter, the terms of any of the First Lien Obligations or any Lien on any First Lien Collateral or guaranty thereof or any liability of any Grantor, or any liability incurred directly or indirectly in respect thereof (including any increase in or extension of the First Lien Obligations, without any restriction as to the amount (subject to Section 5.3(a) hereof) tenor or terms of any such increase or extension) or otherwise amend, renew, exchange, extend, modify or supplement in any manner any Liens held by the First Lien Administrative Agent or any of the First Lien Secured Parties, the First Lien Obligations or any of the First Lien Loan Documents; provided that any such increase in the First Lien Obligations shall not increase the sum of the Indebtedness for borrowed money constituting principal under the First Lien Loan Agreement and the face amount of any letters of credit issued under the First Lien Loan Agreement to an amount in excess of the Cap Amount;

(2) sell, exchange, release, surrender, realize upon, enforce or otherwise deal with in any manner and in any order any part of the First Lien Collateral or any liability of any Grantor to the First Lien Secured Parties or the First Lien Administrative Agent, or any liability incurred directly or indirectly in respect thereof;

(3) settle or compromise any First Lien Obligation or any other liability of any Grantor or any security therefor or any liability incurred directly or indirectly in respect thereof and apply any sums by whomsoever paid and however realized to any liability (including the First Lien Obligations) in any manner or order; and

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(4) exercise or delay in or refrain from exercising any right or remedy against any Grantor or any security or any other Person, elect any remedy and otherwise deal freely with the Grantors or any First Lien Collateral and any security and any guarantor or any liability of any Grantor to the First Lien Secured Parties or any liability incurred directly or indirectly in respect thereof.

(c) Except as otherwise provided herein, the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, also agrees that the First Lien Secured Parties shall have no liability to the Second Lien Collateral Agent or any Second Lien Secured Parties, and the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, hereby waives any claim or defense against any First Lien Secured Party or the First Lien Administrative Agent, arising out of any and all actions which the First Lien Secured Parties or the First Lien Administrative Agent may take or permit or omit to take with respect to:

(1) the First Lien Loan Documents (other than this Agreement);

(2) the collection of the First Lien Obligations; or

(3) the foreclosure upon, or sale, liquidation or other Disposition of, any First Lien Collateral, other than the obligation to conduct any sale in a commercially reasonable manner.

The Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, agrees that the First Lien Secured Parties have no duty to them in respect of the maintenance or preservation of the First Lien Collateral, the First Lien Obligations or otherwise.

(d) Until the Discharge of First Lien Obligations, the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, hereby waives and agrees not to assert, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the Collateral or any other similar rights a junior secured creditor may have with respect to the Collateral under applicable law.

Section 7.4 Obligations Unconditional. All rights, interests, agreements and obligations of the First Lien Secured Parties and the Second Lien Secured Parties, respectively, hereunder shall remain in full force and effect irrespective of:

(a) any lack of validity or enforceability of any First Lien Loan Documents, any Second Lien Note Documents or any Additional Parity Lien Facility Documents or the perfection or attachment of any liens thereunder;

(b) except as otherwise expressly set forth in this Agreement, any change in the time, manner or place of payment of, or in any other terms of, all or any of the First Lien Obligations or Second Lien Obligations, or any amendment or waiver or other modification, including any increase in the amount thereof, whether by course of conduct or otherwise, of the terms of any First Lien Loan Document, any Second Lien Note Document or any Additional Parity Lien Facility Document;

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(c) except as otherwise expressly set forth in this Agreement, any exchange of any security interest in any Collateral or any other collateral, or any amendment, waiver or other modification, whether in writing or by course of conduct or otherwise, of all or any of the First Lien Obligations or Second Lien Obligations or any guaranty thereof;

(d) the commencement of any Insolvency or Liquidation Proceeding in respect of any Grantor; or

(e) any other circumstances which otherwise might constitute a defense available to, or a discharge of, any Grantor in respect of the First Lien Administrative Agent, the First Lien Obligations, any First Lien Secured Party, the Second Lien Collateral Agent, the Second Lien Obligations or any Second Lien Secured Party in respect of this Agreement.

ARTICLE VIII - APPOINTMENT OF SECOND LIEN COLLATERAL AGENT; IMMUNITIES OF SECOND LIEN COLLATERAL AGENT; RESIGNATION OR REMOVAL OF SECOND LIEN COLLATERAL AGENT; VOTING; APPLICATION OF PROCEEDS; RELEASE OF LIENS

The following provisions in this Article VIII are between and among the Second Lien Secured Parties and shall not bind or otherwise affect, or be enforceable by, any First Lien Secured Party. Each of the Grantors hereby specifically acknowledges, and agrees to be bound by, the provisions of Sections 8.21 and 8.22.

Section 8.1 Appointment of Second Lien Collateral Agent; Rights and Immunities of Second Lien Collateral Agent. Each of the Second Lien Trustee, on behalf of each Second Lien Note Secured Party, and each Additional Parity Lien Facility Representative, on behalf of each Additional Parity Lien Facility Secured Party represented by it, hereby appoints U.S. Bank National Association as the collateral agent under and for purposes of each of the Second Lien Security Documents and as the Second Lien Collateral Agent under and for purposes of this Agreement, and each of the Second Lien Trustee, on behalf of each Second Lien Note Secured Party, and each Additional Parity Lien Facility Representative, on behalf of each Additional Parity Lien Facility Secured Party represented by it, hereby authorizes U.S. Bank National Association, as the collateral agent under and for purposes of each of the Second Lien Security Documents and as the Second Lien Collateral Agent under and for purposes of this Agreement, to take such actions on its behalf under the provisions of the Second Lien Security Documents and this Agreement and to exercise such powers and perform such duties as are expressly delegated to the Second Lien Collateral Agent by the terms of the Second Lien Security Documents and this Agreement, together with such other powers as are reasonably incidental thereto. Each of the Second Lien Trustee, on behalf of each Second Lien Note Secured Party, each Additional Parity Lien Facility Representative, on behalf of each Additional Parity Lien Facility Secured Party represented by it, and each Second Lien Secured Party hereby agrees that the Second Lien Collateral Agent will be entitled to all of the rights, protections, immunities and indemnities set forth in the Second Lien Indenture and in the Second Lien Security Documents. The agreements in this Section 8.1 shall survive the repayment of the Second Lien Obligations and all other amounts payable hereunder, under the Second Lien Note Documents and under the Additional Parity Lien Facility Documents and the removal or resignation of the Second Lien Collateral Agent pursuant to the applicable provisions of this Agreement.

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Section 8.2 Undertaking of the Second Lien Collateral Agent.

(a) Subject to, and in accordance with, this Agreement and the Second Lien Security Documents, the Second Lien Collateral Agent will, for the benefit solely and exclusively of the present and future Second Lien Secured Parties:

(i) deliver and receive notices pursuant to this Agreement and the Second Lien Security Documents;

(ii) remit as provided in Section 4.1(b) and Section 8.25 all cash proceeds, cash equivalents and other distributions of or in respect of Collateral received by it from the collection, foreclosure or enforcement of its interest in the Collateral under this Agreement and the Second Lien Security Documents or any of its other interests, rights, powers or remedies;

(iii) execute and deliver amendments to this Agreement and the Second Lien Security Documents as from time to time authorized pursuant to Sections 5.7 and 9.4, subject to Section 8.8; and

(iv) release any Lien granted to it by any Second Lien Security Document upon any Collateral if and as required by Section 5.1 and Section 11.06 of the Indenture.

(b) Each Second Lien Secured Party acknowledges and consents to the undertaking of the Second Lien Collateral Agent set forth in Section 8.2(a) and agrees to such provisions and to each of the other provisions of this Agreement applicable to the Second Lien Collateral Agent.

Section 8.3 Powers of the Second Lien Collateral Agent.

(a) Each Second Lien Secured Party hereby irrevocably authorizes and empowers the Second Lien Collateral Agent to enter into and perform its obligations and protect, perfect, exercise and enforce its interest, rights, powers and remedies under the Second Lien Security Documents and applicable law and in equity and to act as set forth in this Agreement or as requested in any lawful directions given to it from time to time in respect of any matter by a written direction of the Required Second Lien Secured Parties.

(b) Neither the Second Lien Trustee, any Additional Parity Lien Facility Representative nor any Second Lien Secured Party have any liability whatsoever for any act or omission of the Second Lien Collateral Agent.

(c) Neither the Second Lien Collateral Agent or the Second Lien Trustee shall be required to qualify in any jurisdiction in which it is not presently qualified to perform its obligations hereunder and under the Second Lien Documents.

(d) The Second Lien Collateral Agent shall not be responsible for (i) perfecting or maintaining the lien of the Second Lien Security Documents, (ii) the filing, recording or continuing of any document, notice, instrument or financing statement in any public office, or (iii) providing or maintaining insurance on or the payment of taxes with respect to any of the Second Lien Collateral.

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Section 8.4 Documents and Communications. The Second Lien Collateral Agent will permit each Second Lien Secured Party, upon reasonable written notice from time to time, to inspect and copy, at the cost and expense of the party requesting such copies, any and all Second Lien Security Documents and other documents, notices, certificates, instructions or communications received by the Second Lien Collateral Agent in its capacity as such.

Section 8.5 For Sole and Exclusive Benefit of Second Lien Secured Parties. The Second Lien Collateral Agent will accept, hold, administer and enforce all Liens granted to it, for the benefit of the Second Lien Secured Parties, on the Collateral at any time transferred or delivered to it and all other interests, rights, powers and remedies at any time granted to or enforceable by the Second Lien Collateral Agent, solely and exclusively for the benefit of the present and future Second Lien Secured Parties, and will distribute all proceeds received by it in realization thereon or from enforcement thereof solely and exclusively pursuant to the provisions of Sections 4.1(b) and 8.25.

Section 8.6 No Implied Duty. The Second Lien Collateral Agent will be afforded all the protections and indemnities afforded to it under the Indenture. The Second Lien Collateral Agent will not be required to take any action hereunder that is contrary to applicable law or any provision of this Agreement.

Section 8.7 Appointment of Agents and Advisors. The Second Lien Collateral Agent may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, attorneys, accountants, appraisers or other experts or advisors selected by it in good faith as it may reasonably require and will not be responsible for any misconduct or negligence on the part of any of them.

Section 8.8 Other Agreements. The Second Lien Collateral Agent has accepted and is bound by the Second Lien Security Documents executed by the Second Lien Collateral Agent as of the date of this Agreement and, as directed in writing by the Required Second Lien Secured Parties, the Second Lien Collateral Agent shall execute additional Second Lien Security Documents delivered to it after the date of this Agreement and amendments thereto; provided, however, that such additional Second Lien Security Documents do not adversely affect the rights, privileges, benefits and immunities of the Second Lien Collateral Agent. The Second Lien Collateral Agent will not otherwise be bound by, or be held obligated by, the provisions of any credit agreement, indenture or other agreement governing Second Lien Obligations (other than this Agreement, the Second Lien Indenture and the Second Lien Security Documents); provided, further, that the Second Lien Collateral Agent shall be permitted (but not obligated except as otherwise set forth in this Agreement or the Indenture) to execute amendments hereto and to the Second Lien Security Documents executed as of the date of this Agreement, and such additional Second Lien Security Documents and amendments thereto, in each case without the consent of the Required Second Lien Secured Parties, to the extent set forth in Section 9.4, the Indenture or as set forth in any Second Lien Security Document.

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Section 8.9 Solicitation of Instructions.

(a) Notwithstanding anything to the contrary herein, the Second Lien Collateral Agent may at any time, including any circumstance in which the Secured Lien Collateral Agent is required to exercise discretion, approve documentation or any other matter, or take any other action under this Agreement or any other Security Document, solicit written confirmatory instructions, in the form of a written direction of the Required Second Lien Secured Parties, an Officers’ Certificate, an opinion of counsel or an order of a court of competent jurisdiction, as to any action that it may be requested or required to take, or that it may propose to take, in the performance of any of its obligations under this Agreement; provided, that, with respect to the release of any Second Lien Collateral, the Second Lien Collateral Agent may only request the instructions specified in Section 5.1 of this Agreement and Section 11.06 of the Second Lien Indenture with respect to any actions required hereof or thereof with respect to the release of such Second Lien Collateral. The Second Lien Collateral Agent shall in all cases be protected in acting in accordance with the direction of the Required Second Lien Secured Parties.

(b) No written direction given to the Second Lien Collateral Agent by the Required Second Lien Secured Parties that in the sole judgment of the Second Lien Collateral Agent imposes, purports to impose or might reasonably be expected to impose upon the Second Lien Collateral Agent any obligation or liability not set forth in or arising under this Agreement or the Second Lien Security Documents will be binding upon the Second Lien Collateral Agent unless the Second Lien Collateral Agent elects, at its sole option, to accept such direction.

Section 8.10 Limitation of Liability. The Second Lien Collateral Agent will not be responsible or liable for any action taken or omitted to be taken by it hereunder to any party, including any Second Lien Secured Party, except for its own gross negligence or willful misconduct as determined by a court of competent jurisdiction.

Section 8.11 Documents in Satisfactory Form. The Second Lien Collateral Agent will be entitled to require that all agreements, certificates, opinions, instruments and other documents at any time submitted to it, including those expressly provided for in this Agreement, be delivered to it in a form and with substantive provisions reasonably satisfactory to it.

Section 8.12 Entitled to Rely. The Second Lien Collateral Agent may seek and rely upon, and shall be fully protected in relying upon, any judicial order or judgment, upon any advice, opinion or statement of legal counsel, independent consultants and other experts selected by it in good faith and upon any certification, instruction, notice or other writing delivered to it by any Grantor in compliance with the provisions of this Agreement or delivered to it by the Second Lien Trustee or any Additional Parity Lien Facility Debt Representative as to the holders of Second Lien Obligations for whom it acts, without being required to determine the authenticity thereof or the correctness of any fact stated therein or the propriety or validity of service thereof. The Second Lien Collateral Agent may act in reliance upon any instrument comporting with the provisions of this Agreement or any signature reasonably believed by it to be genuine and may assume that any Person purporting to give notice or receipt or advice or make any statement or execute any document in connection with the provisions hereof has been duly authorized to do so. To the extent an Officers’ Certificate or opinion of counsel is required or permitted under this Agreement to be delivered to the Second Lien Collateral Agent in respect of

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any matter, the Second Lien Collateral Agent may rely conclusively on such Officers’ Certificate or opinion of counsel as to such matter and such Officers’ Certificate or opinion of counsel shall be full warranty and protection to the Second Lien Collateral Agent for any action taken, suffered or omitted by it under the provisions of this Agreement.

Section 8.13 Parity Lien Debt Default. The Second Lien Collateral Agent will not be required to inquire as to the occurrence or absence of any Parity Lien Debt Default and will not be affected by or required to act upon any notice or knowledge as to the occurrence of any Parity Lien Debt Default unless and until it is directed in writing by a request of the Required Second Lien Secured Parties.

Section 8.14 Actions by Second Lien Collateral Agent. As to any matter not expressly provided for by this Agreement, the Second Lien Collateral Agent will act or refrain from acting as directed in writing by a request of the Required Second Lien Secured Parties and will be fully protected if it does so, and any action taken, suffered or omitted pursuant hereto or thereto shall be binding on the holders of Second Lien Obligations.

Section 8.15 Security or Indemnity in Favor of Second Lien Collateral Agent. The Second Lien Collateral Agent will not be required to advance or expend any funds or otherwise incur any financial liability in the performance of its duties or the exercise of its powers or rights hereunder unless it has been provided with security or indemnity reasonably satisfactory to it against any and all liability or expense which may be incurred by it by reason of taking or continuing to take such action.

Section 8.16 Rights of Second Lien Collateral Agent. As among the Second Lien Secured Parties, in the event of any conflict between any terms and provisions set forth in this Agreement and those set forth in any Second Lien Security Document, the terms and provisions of this Agreement shall supersede and control the terms and provisions of such Second Lien Security Document. In the event there is any bona fide, good faith disagreement between the other parties to this Agreement or any of the Second Lien Security Documents resulting in adverse claims being made in connection with Collateral held by the Second Lien Collateral Agent and the terms of this Agreement or any of the Second Lien Security Documents do not unambiguously mandate the action the Second Lien Collateral Agent is to take or not to take in connection therewith under the circumstances then existing, or the Second Lien Collateral Agent is in doubt as to what action it is required to take or not to take hereunder or under the Second Lien Security Documents, it will be entitled to refrain from taking any action (and will incur no liability for doing so) until directed otherwise in writing by a request of the Required Second Lien Secured Parties or by order of a court of competent jurisdiction

Section 8.17 No Reliance on Second Lien Collateral Agent. Each of the Second Lien Trustee, on behalf of itself and each other Second Lien Note Secured Party, and each Additional Parity Lien Facility Representative, on behalf of itself and each other Additional Parity Lien Facility Secured Party represented by it, acknowledges that it has, independently and without reliance upon the Second Lien Collateral Agent or any other Second Lien Secured Party and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement and the other Second Lien Note Documents or Additional Parity Lien Facility Documents, as applicable, to which it is a party. Each of the Second

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Lien Trustee, on behalf of itself and each other Second Lien Note Secured Party, and each Additional Parity Lien Facility Representative, on behalf of itself and each other Additional Parity Lien Facility Secured Party represented by it, also acknowledges that it will, independently and without reliance upon the Second Lien Collateral Agent or any other Second Lien Secured Party and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement or any other Second Lien Note Document or Additional Parity Lien Facility Document, as applicable, to which it is a party, any related agreement or any document furnished hereunder or thereunder.

Section 8.18 Voting; Amendments of Second Lien Note Documents and Additional Parity Lien Facility Documents.

(a) In connection with any matter under this Agreement or the Second Lien Security Documents requiring a vote of holders of Second Lien Obligations, each series of Second Lien Obligations will cast its votes in accordance with the Second Lien Note Documents or the Additional Parity Lien Facility Documents, as applicable, governing such series of Second Lien Obligations and as contemplated by the definition of Required Second Lien Secured Parties hereunder. Following and in accordance with the outcome of the applicable vote under its Second Lien Note Documents and each series of Additional Parity Lien Facility Documents, as applicable, the Debt Representative of each series of Second Lien Obligations will cast all of its votes as a block in respect of any vote under this Agreement. Any direction in writing delivered to the Second Lien Collateral Agent by or with the written consent of the Required Second Lien Secured Parties (a) shall set forth the aggregate amount of Second Lien Obligations owed by the Grantors to the Second Lien Secured Parties represented by each Debt Representative under the Second Lien Note Documents or the applicable Additional Parity Lien Facility Documents, as the case may be, calculated as of the date of determination and in accordance with the definition of Required Second Lien Secured Parties hereunder, and (b) shall be binding upon all of the Second Lien Secured Parties, unless the matter which is the subject of the applicable vote requires pursuant to the terms hereof the consent of all Second Lien Secured Parties.

(b) The Second Lien Collateral Agent will deliver a copy of each amendment, supplement or other modification to this Agreement and the Second Lien Security Documents to the Second Lien Trustee and each Additional Parity Lien Facility Representative upon request.

(c) Notwithstanding anything to the contrary set forth in this Agreement, in any Second Lien Note Document or in any Additional Parity Lien Facility Document, no amendment, restatement, supplement, waiver or other modification of this Agreement or the Security Documents that reduces, impairs or adversely affects the right of any holder of Second Lien Obligations:

(i) to vote its Second Lien Obligations as to any matter described as subject to a vote of Required Second Lien Secured Parties (or which amends the provisions of this clause (c) or the definition of “Required Second Lien Secured Parties”, “Second Lien Obligations” or “Second Lien Secured Parties”);

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(ii) to share in the Collateral on an equal and ratable basis (including to share in the application of proceeds and other amounts as described in and contemplated by Sections 4.1 and 8.25);

(iii) with respect to the order of application (or has the affect of decreasing the amount) of any payments under Section 4.1 or Section 8.25; or

(iv) to require that Liens on all of the Collateral securing Second Lien Obligations be released only as set forth in the provisions described in Section 5.1 or Section 8.26;

will become effective without the consent of the requisite percentage or number of holders of each series of Second Lien Obligations under the Second Lien Note Documents or the applicable Additional Parity Lien Facility Documents.

Section 8.19 Resignation or Removal of Second Lien Collateral Agent. Subject to the appointment of a successor Second Lien Collateral Agent as provided in Section 8.20 and the acceptance of such appointment by the successor Second Lien Collateral Agent:

(a) the Second Lien Collateral Agent may resign at any time by giving not less than 30 days’ notice of resignation to each Debt Representative, the First Lien Administrative Agent and the Authority;

(b) the Second Lien Collateral Agent may be removed at any time, with or without cause, by a written direction of the Required Second Lien Secured Parties; and

(c) the Authority may remove the Collateral Agent if:

(1) the Collateral Agent is adjudged bankrupt or insolvent;

(2) a receiver, custodian or other public officer takes charge of the Collateral Agent or its property; or

(3) the Collateral Agent becomes incapable of acting.

Section 8.20 Appointment of Successor Second Lien Collateral Agent. Upon any such resignation or removal, a successor Second Lien Collateral Agent may be appointed in the manner provided for appointment of a successor Trustee in the Indenture.

Section 8.21 Merger, Conversion or Consolidation of Second Lien Collateral Agent. Any Person into which the Second Lien Collateral Agent may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which the Second Lien Collateral Agent shall be a party, or any Person succeeding to all or substantially all of the corporate trust business of the Second Lien Collateral Agent shall be the successor of the Second Lien Collateral Agent pursuant to Section 8.20; provided that (a) without the execution or filing of any paper with any party hereto or any further act on the part of any of the parties hereto, except where an instrument of transfer or assignment is required by law to effect such succession, anything herein to the contrary notwithstanding, such Person satisfies

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the eligibility requirements for a Trustee specified in the Indenture and (b) promptly after any such merger, conversion, consolidation or succession, the Second Lien Collateral Agent shall have notified the Grantors, the First Lien Administrative Agent and each Debt Representative thereof in writing.

Section 8.22 Compensation; Expenses. The Grantors jointly and severally agree to pay, promptly upon demand:

(a) such compensation to the Second Lien Collateral Agent and its agents as the Grantors and the Second Lien Collateral Agent may agree in writing from time to time;

(b) all reasonable costs and expenses incurred by the Second Lien Collateral Agent and its agents in the preparation, execution, delivery, filing, recordation, administration or enforcement of this Agreement or any Second Lien Security Document or any consent, amendment, supplement, waiver or other modification relating hereto or thereto;

(c) all reasonable fees, expenses and disbursements of legal counsel and any auditors, accountants, consultants or appraisers or other professional advisors and agents engaged by the Second Lien Collateral Agent or any Debt Representative incurred in connection with the negotiation, preparation, closing, administration, performance or enforcement of this Agreement and the Second Lien Security Documents or any consent, amendment, supplement, waiver or other modification relating hereto or thereto and any other document or matter requested by any Grantor;

(d) all reasonable costs and expenses incurred by the Second Lien Collateral Agent and its agents in creating, perfecting, preserving, releasing or enforcing the Second Lien Collateral Agent’s Liens on the Collateral, including filing and recording fees, expenses and taxes, stamp or documentary taxes, search fees, and title insurance premiums;

(e) all other reasonable costs and expenses incurred by the Second Lien Collateral Agent and its agents in connection with the negotiation, preparation and execution of this Agreement, the Second Lien Security Documents and any consents, amendments, supplements, waivers or other modifications thereto and the transactions contemplated thereby or the exercise of rights or performance of obligations by the Second Lien Collateral Agent hereunder and thereunder; and

(f) after the occurrence of any Parity Lien Debt Default, all reasonable costs and expenses incurred by the Second Lien Collateral Agent, its agents and any Debt Representative in connection with the preservation, collection, foreclosure or enforcement of the Collateral subject to the Second Lien Security Documents or any interest, right, power or remedy of the Second Lien Collateral Agent or in connection with the collection or enforcement of any of the Second Lien Obligations or the proof, protection, administration or resolution of any claim based upon the Second Lien Obligations in any Insolvency or Liquidation Proceeding, including all fees and disbursements of attorneys, accountants, auditors, consultants, appraisers and other professionals engaged by the Second Lien Collateral Agent, its agents or the Debt Representatives.

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The agreements in this Section 8.22 will survive repayment of the Second Lien Note Obligations and the Additional Parity Lien Facility Obligations and the removal or resignation of the Second Lien Collateral Agent.

Section 8.23 Indemnity.

(a) The Grantors jointly and severally agree to defend, indemnify, pay and hold harmless the Second Lien Collateral Agent, each Debt Representative, each Second Lien Secured Party and each of their respective Affiliates and each and all of the directors, officers, partners, trustees, employees, attorneys and agents, and (in each case) their respective heirs, representatives, successors and assigns (each of the foregoing, an “Indemnitee”) from and against any and all Indemnified Liabilities; provided that no Indemnitee will be entitled to indemnification hereunder with respect to any Indemnified Liability to the extent such Indemnified Liability is found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from the negligence or willful misconduct of such Indemnitee.

(b) All amounts due under this Section 8.23 will be payable upon demand.

(c) To the extent that the undertakings to defend, indemnify, pay and hold harmless set forth in Section 8.23(a) may be unenforceable in whole or in part because they violate any law or public policy, each of the Grantors will contribute the maximum portion that it is permitted to pay and satisfy under applicable law to the payment and satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of them.

(d) No Grantor will ever assert any claim against any Indemnitee, on any theory of liability, for any lost profits or special, indirect or consequential damages or (to the fullest extent a claim for punitive damages may lawfully be waived) any punitive damages arising out of, in connection with, or as a result of, this Agreement or any Second Lien Document or any agreement or instrument or transaction contemplated hereby or relating in any respect to any Indemnified Liability, and each of the Grantors hereby forever waives, releases and agrees not to sue upon any claim for any such lost profits or special, indirect, consequential or (to the fullest extent lawful) punitive damages, whether or not accrued and whether or not known or suspected to exist in its favor.

(e) The agreements in this Section 8.23 will survive repayment of the Second Lien Note Obligations and the Additional Parity Lien Facility Obligations and the removal or resignation of the Second Lien Collateral Agent.

Section 8.24 Application of Proceeds. Subject to the relative lien priorities and subordination provisions hereof, including, without limitation, Sections 3.1, 4.1 and 4.2, the Second Lien Collateral Agent shall apply the proceeds of any sale or other Disposition of, or collection or realization on, any Second Lien Collateral in the following order of priority:

(a) first, to the Second Lien Collateral Agent for application to the payment of all then outstanding reasonable and documented costs and expenses incurred by the Second Lien Collateral Agent in connection with a sale, collection or realization or otherwise in connection with this Agreement or any of the Second Lien Obligations, including all court costs and the reasonable fees and expenses of its agents and legal counsel, the repayment of all expenses, liabilities

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and advances made or incurred by the Second Lien Collateral Agent in connection therewith or made or incurred hereunder, under the Second Lien Note Documents or under the Additional Parity Lien Facility Documents for the account of the applicable Grantors and any other reasonable and documented costs or expenses incurred in connection with the exercise of any right or remedy hereunder, under the Second Lien Note Documents or under the Additional Parity Lien Facility Document;

(b) second, to the respective Debt Representatives equally and ratably for application to the payment in full of all outstanding Indebtedness and other Second Lien Obligations (other than Second Lien Obligations paid pursuant to clause first above) that are then due and payable to the Second Lien Secured Parties (which shall then be applied or held by each such Debt Representative in such order as may be provided in the applicable Second Lien Documents); and

(c) third, to the extent of any excess of such proceeds, to the payment to or upon the order of the Grantors or to whomsoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct.

For the avoidance of doubt, this section 8.24 is intended solely for the benefit of, and will only be enforceable as a third party beneficiary by, the Second Lien Collateral Agent and each present and future holder of Second Lien Obligations.

ARTICLE IX - MISCELLANEOUS.

Section 9.1 Notice of Event of Default. The First Lien Administrative Agent agrees to use reasonable efforts to notify the Second Lien Collateral Agent within ten (10) Business Days of any Event of Default under and as defined in the First Lien Loan Documents known to the First Lien Administrative Agent, and the Second Lien Collateral Agent will use reasonable efforts to notify the First Lien Administrative Agent within ten (10) Business Days of the occurrence of any Event of Default under and as defined in the Second Lien Indenture known to the Second Lien Collateral Agent. Each Debt Representative agrees to promptly notify the First Lien Administrative Agent and the Second Lien Collateral Agent of any Parity Lien Debt Default in respect of the Second Lien Indenture or the applicable Additional Parity Lien Facility, as the case may be.

Section 9.2 Conflicts. In the event of any conflict between the provisions of this Agreement and the provisions of the First Lien Loan Documents, the Second Lien Note Documents or the Additional Parity Lien Facility Documents, the provisions of this Agreement shall govern and control.

Section 9.3 Effectiveness; Continuing Nature of this Agreement; Severability. This Agreement shall become effective when executed and delivered by the parties hereto. This is a continuing agreement of lien subordination and the First Lien Secured Parties may continue, at any time and without notice to the Second Lien Collateral Agent or any other Second Lien Secured Party, to extend credit and other financial accommodations and lend monies to or for the benefit of the Grantors constituting First Lien Obligations in reliance hereon. The Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, hereby waives any

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right it may have under applicable law to revoke this Agreement or any of the provisions of this Agreement. The terms of this Agreement shall survive, and shall continue in full force and effect, in any Insolvency or Liquidation Proceeding. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall not invalidate the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. All references to any Grantor shall include such Grantor as debtor and debtor-in-possession and any receiver or trustee for any Grantor (as the case may be) in any Insolvency or Liquidation Proceeding. This Agreement shall terminate and be of no further force and effect:

(a) with respect to the First Lien Secured Parties and the First Lien Obligations, on the date of Discharge of First Lien Obligations, subject to Section 5.5 and the rights of the First Lien Secured Parties under Section 6.5; and

(b) with respect to the Second Lien Collateral Agent, the Second Lien Secured Parties and the Second Lien Obligations, upon the later of (1) the date upon which the obligations under the Second Lien Indenture terminate if there are no other Second Lien Obligations outstanding on such date and (2) if there are other Second Lien Obligations outstanding on such date, the date upon which such Second Lien Obligations are paid in full.

Section 9.4 Amendments; Waivers.

(a) No amendment, restatement, supplement, modification or waiver of any of the provisions of this Agreement by the Second Lien Collateral Agent, the First Lien Administrative Agent or any Additional Parity Lien Facility Representative shall be deemed to be made unless the same shall be in writing signed on behalf of each party hereto or its authorized agent and each waiver, if any, shall be a waiver only with respect to the specific instance involved and shall in no way impair the rights of the parties making such waiver or the obligations of the other parties to such waiver in any other respect or at any other time. Notwithstanding the foregoing, (i) no Grantor shall have any right to consent to or approve any amendment, restatement, supplement, modification or waiver of any provision of this Agreement (A) that is solely and exclusively an intercreditor matter that directly affects the First Lien Secured Parties and the Second Lien Secured Parties and does not adversely and directly affect the rights or obligations of any Grantor or (B) except to the extent its rights are directly affected; and (ii) neither any Grantor, the First Lien Administrative Agent nor any other First Lien Secured Party shall have any right to consent to or approve any amendment, restatement, supplement, modification or waiver of any provision of Article VIII hereof or any other provision of this Agreement that is solely and exclusively an intercreditor matter that directly affects the Second Lien Secured Parties and does not adversely affect the rights or obligations of any Grantor or any First Lien Secured Party (including, without limitation, Sections 2.3(c), 2.5 and 4.1(b)); provided that the Second Lien Trustee shall provide the Authority with prompt notice of, and final documentation related to, any such amendment, restatement, supplement, modification or waiver.

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(b) Notwithstanding clause (a) above:

(i) any amendment, restatement, supplement or other modification of this Agreement that has the effect solely of adding or maintaining Collateral, securing additional indebtedness that is otherwise permitted by the terms of the First Lien Loan Documents, the Second Lien Note Documents and this Agreement to be secured by the Collateral or preserving, perfecting or establishing the Liens thereon or the rights of the First Lien Administrative Agent or the Second Lien Collateral Agent therein will become effective when executed and delivered by the Authority, any other applicable Grantor party thereto and the First Lien Administrative Agent or by the Authority, any other applicable Grantor party thereto and the Second Lien Collateral Agent, as applicable;

(ii) no amendment, restatement, supplement or other modification of this Agreement that imposes any obligation upon the First Lien Administrative Agent, the Second Lien Collateral Agent, the Second Lien Trustee or any Additional Parity Lien Facility Representative or adversely affects the rights of the First Lien Administrative Agent, the Second Lien Collateral Agent, the Second Lien Trustee or any Additional Parity Lien Facility Representative, respectively, in each case, solely in its capacity as such, will become effective without the consent of the First Lien Administrative Agent, the Second Lien Collateral Agent, the Second Lien Trustee or such Additional Parity Lien Facility Representative, respectively; and

(iii) the Authority and the other Grantors may direct the Second Lien Collateral Agent and the Second Lien Trustee to amend, restate, supplement or otherwise modify this Agreement so long as the changes made by such amendment, restatement, supplement or other modification, taken together with all other changes to this Agreement and the Second Lien Security Documents, in each case as in effect on the date hereof, are not materially adverse to any Second Lien Secured Party; provided that the Authority and such other Grantors shall have delivered an Officers’ Certificate to the Second Lien Collateral Agent and the Second Lien Trustee certifying that the conditions described in this clause (iii) have been met and that such amendment, restatement, supplement or other modification is permitted under, and does not violate the terms of, any Second Lien Document.

(c) Notwithstanding Sections 9.4(a) and 9.4(b), the First Lien Administrative Agent, the Second Lien Collateral Agent and each applicable Grantor may, without the consent of any other First Lien Secured Party or other Second Lien Secured Party, enter into any amendment, restatement, supplement or other modification of this Agreement (i) contemplated by Section 9.4(b) or (ii) to cure any ambiguity, defect or inconsistency or to correct or supplement any provision in such document that may be inconsistent with any other provision of a First Lien Security Document or Second Lien Security Document, as applicable, or to further the intended purposes thereof or to provide additional benefits or rights to the First Lien Secured Parties or the Second Lien Secured Parties, as applicable, so long as prior to the execution of any such amendment, restatement, supplement or other modification referred to in this clause (c), each applicable Grantor shall have delivered to the First Lien Administrative Agent and the Second Lien Collateral Agent an Officers’ Certificate to the effect that such amendment, modification or waiver complies with the requirements of this clause (c).

(d) Each of the parties hereto agrees that, following a Refinancing of the First Lien Obligations made in accordance with Section 5.5, the New Agent, the Second Lien Collateral Agent and the Grantors may, without the consent of any other First Lien Secured Party or

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other Second Lien Secured Party, enter into any amendment, restatement, supplement or other modification of this Agreement to the extent necessary to confirm that the Liens granted by the applicable Refinance Security Documents in favor of the holders of such new First Lien Obligations (to the extent Liens in favor of such holders are expressly permitted by the terms hereof) constitute Liens securing First Lien Obligations and to confirm that such holders will be treated in the same manner as the First Lien Secured Parties under this Agreement, so long as prior to the execution of any such amendment, restatement, supplement or other modification referred to in this clause (d), each applicable Grantor shall have delivered to the New Agent and the Second Lien Collateral Agent an Officers’ Certificate to the effect that such amendment, restatement, supplement or other modification complies with the requirements of this clause (d).

Section 9.5 Information Concerning the Grantors.

(a) The First Lien Secured Parties, on the one hand, and the Second Lien Secured Parties, on the other hand, shall each be responsible for keeping themselves informed of (i) the financial condition of the Grantors and all endorsers and/or guarantors of the First Lien Obligations or the Second Lien Obligations and (ii) all other circumstances bearing upon the risk of nonpayment of the First Lien Obligations or the Second Lien Obligations.

(b) The First Lien Secured Parties shall have no duty to advise any Second Lien Secured Party of information known to it or them regarding such condition or any such circumstances or otherwise. In the event any of the First Lien Secured Parties, in its sole discretion, undertakes at any time or from time to time to provide any such information to any Second Lien Secured Party, it shall be under no obligation:

(i) to make, and the First Lien Secured Parties shall not make, any express or implied representation or warranty, including with respect to the accuracy, completeness, truthfulness or validity of any such information so provided;

(ii) to provide any additional information or to provide any such information on any subsequent occasion;

(iii) to undertake any investigation; or

(iv) to disclose any information which, pursuant to accepted or reasonable commercial finance practices, such party wishes to maintain confidential or is otherwise required to maintain confidential.

(c) The Second Lien Secured Parties shall have no duty to advise any First Lien Secured Party of information known to it or them regarding such condition or any such circumstances or otherwise. In the event any of the Second Lien Secured Parties, in its sole discretion, undertakes at any time or from time to time to provide any such information to any First Lien Secured Party, it shall be under no obligation:

(i) to make, and the Second Lien Secured Parties shall not make, any express or implied representation or warranty, including with respect to the accuracy, completeness, truthfulness or validity of any such information so provided;

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(ii) to provide any additional information or to provide any such information on any subsequent occasion;

(iii) to undertake any investigation; or

(iv) to disclose any information which, pursuant to accepted or reasonable commercial finance practices, such party wishes to maintain confidential or is otherwise required to maintain confidential.

Section 9.6 Subrogation. With respect to the value of any payments or distributions in cash, property or other assets that any of the Second Lien Secured Parties or the Second Lien Collateral Agent pays over to the First Lien Administrative Agent or the First Lien Secured Parties under the terms of this Agreement, the Second Lien Secured Parties shall be subrogated to the rights of the First Lien Secured Parties; provided that, the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, hereby agrees not to assert or enforce any such rights of subrogation it may acquire as a result of any payment hereunder until the Discharge of First Lien Obligations has occurred. The Grantors acknowledge and agree that the value of any payments or distributions in cash, property or other assets received by the Second Lien Collateral Agent or the Second Lien Secured Parties that are paid over to the First Lien Administrative Agent or the First Lien Secured Parties pursuant to this Agreement shall not reduce any of the Second Lien Obligations.

Section 9.7 Application of Payments. All payments received by the First Lien Administrative Agent or the First Lien Secured Parties may be applied, reversed and reapplied, in whole or in part, to such part of the First Lien Obligations provided for in the First Lien Loan Documents. The Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, assents to any extension or postponement of the time of payment of the First Lien Obligations or any part thereof and to any other indulgence with respect thereto, and subject to the other provisions of this Agreement, to any substitution, exchange or release of any security which may at any time secure any part of the First Lien Obligations and to the addition or release of any other Person primarily or secondarily liable therefor.

Section 9.8 SUBMISSION TO JURISDICTION; WAIVERS.

(a) ALL LEGAL ACTIONS OR PROCEEDINGS BROUGHT AGAINST ANY PARTY (OTHER THAN THE AUTHORITY OR THE TRIBAL GRANTORS, AS DEFINED IN SECTION 9.20) (EACH A “NON-TRIBAL PARTY”) ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION AND ENFORCEMENT IN RESPECT HEREOF, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK, AND BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH NON-TRIBAL PARTY, FOR ITSELF, IN CONNECTION WITH ITS PROPERTIES AND ON BEHALF OF THE RESPECTIVE SECURED PARTIES IT REPRESENTS, IRREVOCABLY (I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (II) WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT

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COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME; (III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE MADE BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE APPLICABLE NON-TRIBAL PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 9.9 HEREOF; (IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE NON-TRIBAL PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (V) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION.

(b) EACH OF THE NON-TRIBAL PARTIES HERETO, ON BEHALF OF ITSELF AND THE RESPECTIVE SECURED PARTIES IT REPRESENTS, IF APPLICABLE, HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER HEREOF, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH NON-TRIBAL PARTY HERETO, ON BEHALF OF ITSELF AND THE RESPECTIVE SECURED PARTIES IT REPRESENTS, IF APPLICABLE, ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH NON-TRIBAL PARTY HERETO, ON BEHALF OF ITSELF AND THE RESPECTIVE SECURED PARTIES IT REPRESENTS, IF APPLICABLE, FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION 9.8(b) AND EXECUTED BY EACH OF THE NON-TRIBAL PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

(c) EACH NON-TRIBAL PARTY HERETO, ON BEHALF OF ITSELF AND THE RESPECTIVE SECURED PARTIES IT REPRESENTS, IF APPLICABLE, WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER FIRST LIEN LOAN DOCUMENT, SECOND LIEN NOTE DOCUMENT OR ADDITIONAL PARITY LIEN FACILITY DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR ACTION OF ANY PARTY HERETO.

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Section 9.9 Notices. All notices to the Second Lien Secured Parties and the First Lien Secured Parties permitted or required under this Agreement shall also be sent to the Second Lien Collateral Agent and the First Lien Administrative Agent, respectively. Unless otherwise specifically provided herein, any notice, request or other communication herein required or permitted to be given shall be in writing and may be personally served, faxed, electronically mailed or sent by United States mail or courier service. All notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery and shall be deemed to have been given when delivered in person or by courier service, upon receipt of electronic mail, facsimile, or United States mail (registered or certified) with postage prepaid and properly addressed. For the purposes hereof, the addresses of the parties hereto shall be as set forth below each party’s name on the signature pages attached hereto or, with respect to any Additional Parity Lien Facility Representative, at such address as such Additional Parity Lien Facility Representative may specify in the applicable Parity Lien Joinder, or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties.

Section 9.10 Further Assurances. The First Lien Administrative Agent, on behalf of itself and the First Lien Secured Parties, and the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, and the Grantors, agree that each of them shall take such further action and shall execute and deliver such additional documents and instruments (in recordable form, if requested) as the First Lien Administrative Agent or the Second Lien Collateral Agent may reasonably request to effectuate the terms of and the Lien priorities contemplated by this Agreement.

Section 9.11 APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

Section 9.12 Binding on Successors and Assigns. This Agreement shall be binding upon the First Lien Administrative Agent, the First Lien Secured Parties, the Second Lien Collateral Agent, the Second Lien Secured Parties and their respective successors and assigns. If either of the First Lien Administrative Agent or the Second Lien Collateral Agent resigns or is replaced pursuant to the First Lien Loan Agreement or the Second Lien Indenture, as applicable, its successor shall be deemed to be a party to this Agreement and shall have all of the rights of and be subject to all of the obligations of this Agreement.

Section 9.13 Specific Performance. Each of the First Lien Administrative Agent and the Second Lien Collateral Agent may demand specific performance of this Agreement. The First Lien Administrative Agent, on behalf of itself and the First Lien Secured Parties, and the Second Lien Collateral Agent, on behalf of itself and the Second Lien Secured Parties, hereby irrevocably waive any defense based on the adequacy of a remedy at law and any other defense which might be asserted to bar the remedy of specific performance in any action which may be brought by any of the First Lien Administrative Agent or the First Lien Secured Parties or the Second Lien Collateral Agent or the Second Lien Secured Parties, as the case may be.

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Section 9.14 Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose or be given any substantive effect.

Section 9.15 Counterparts. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement or any document or instrument delivered in connection herewith by facsimile shall be effective as delivery of a manually executed counterpart of this Agreement or such other document or instrument, as applicable.

Section 9.16 Authorization. By its signature, each Person executing this Agreement on behalf of a party hereto represents and warrants to the other parties hereto that (a) it is duly authorized to execute this Agreement and (b) this Agreement, when executed and delivered, will constitute the valid and legally binding obligation of each of the First Lien Administrative Agent and the Second Lien Collateral Agent enforceable in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by equitable principles.

Section 9.17 No Third Party Beneficiaries. This Agreement and the rights and benefits hereof shall inure to the benefit of each of the parties hereto and its respective successors and assigns and shall inure to the benefit of each of the First Lien Secured Parties and the Second Lien Secured Parties. No other Person shall have or be entitled to assert rights or benefits hereunder. Nothing in this Agreement shall impair, as between the Grantors and the First Lien Secured Parties, or as between the Grantors and the Second Lien Secured Parties, the obligations of the Grantors to pay principal, interest, fees and other amounts as provided in the First Lien Loan Documents and the Second Lien Note Documents or the Additional Parity Lien Facility Documents, respectively.

Section 9.18 Provisions Solely to Define Relative Rights. The provisions of this Agreement are and are intended solely for the purposes of defining the relative rights of the First Lien Secured Parties on the one hand and the Second Lien Secured Parties on the other hand and the relative rights as among the Second Lien Secured Parties. None of the Grantors or any other creditor thereof shall have any rights hereunder and no Grantor may rely on the terms hereof. Nothing in this Agreement is intended to or shall impair the obligations of the Grantors, which are absolute and unconditional, to pay the First Lien Obligations and the Second Lien Obligations as and when the same shall become due and payable in accordance with their terms, and to comply with its obligations under Sections 8.21 and 8.22.

Section 9.19 Additional Grantors. The Authority shall cause each of its subsidiaries that becomes a Grantor or is required by any First Lien Loan Document, Second Lien Loan Document or Additional Parity Lien Facility Document to become a party to this Agreement to become a party to this Agreement by causing such subsidiary to execute and deliver to the parties hereto a Grantor Joinder, pursuant to which such subsidiary shall agree to be bound by the terms of this Agreement to the same extent as if it had executed and delivered this Agreement as of the date hereof. The Authority agrees to provide to each Debt Representative a copy of each Grantor Joinder executed and delivered pursuant to this Section 9.19.

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Section 9.20 Consent to Suit. The Tribe does not consent to the enforcement, levy, or other execution of any judgment for money or other damages against any assets, real or personal, of the Tribe. The Authority, on its own behalf and on behalf of the other Grantors, to the extent they have sovereign immunity (such other Grantors, collectively, the “Tribal Grantors”), consent to the enforcement and execution of any judgment, whether obtained as a result of judicial, administrative, or arbitrational proceeding, against any assets of the Authority and the Tribal Grantors. Subject to the foregoing, the Authority and the Tribal Grantors waive their respective sovereign immunity from unconsented suit, whether such suit be brought in law or in equity, or in administrative proceedings or proceedings in arbitration, to permit the commencement, maintenance, and enforcement of any action, by any Person with standing to maintain such action, to interpret or enforce the terms of this Agreement and to enforce and execute any judgment resulting therefrom against the Authority and the Tribal Grantors or the assets of the Authority and the Tribal Grantors. Notwithstanding any provisions of law or canon of construction, the Authority and the Tribal Grantors each intend this waiver to be interpreted liberally to permit the full litigation of disputes arising under or out of this Agreement. Without limiting the generality of the foregoing, the Authority and the Tribal Grantors waive their immunity from unconsented suit to permit the maintenance of the following actions:

(a) Courts. The Authority and the Tribal Grantors each waive their immunity from unconsented suit to permit any court of competent jurisdiction to (i) enforce and interpret the terms of this Agreement and award and enforce the award of damages against the Authority or the Tribal Grantors owing as a consequence of a breach thereof, whether such award is the product of litigation, administrative proceedings or arbitration, (ii) determine whether any consent or approval of the Authority or the Tribal Grantors has been improperly granted or unreasonably withheld; (iii) enforce any judgment prohibiting the Authority or the Tribal Grantors from taking any action, or mandating or obligating the Authority or the Tribal Grantors to take any action, including a judgment compelling the Authority or the Tribal Grantors to submit to binding arbitration; and (iv) adjudicate any claim under the Indian Civil Rights Act of 1968, 25 U.S.C. § 1302 (or any successor statute).

(b) Arbitration. The Authority and the Tribal Grantors each waive their immunity from unconsented suit to permit arbitrators, appointed and acting under the commercial arbitration rules of the American Arbitration Association, whenever and to the extent any agreement to submit a matter to arbitration is made by the Authority, to (i) enforce and interpret the terms of this Agreement and to award and enforce the award of any damages against the Authority or the Tribal Grantors owing as a consequence thereof; (ii) determine whether any consent or approval of the Authority or the Tribal Grantors has been unreasonably withheld; and (iii) enforce any judgment prohibiting the Authority or the Tribal Grantors from taking any action, or mandating or obligating the Authority or the Tribal Grantors to take any action, including a judgment compelling the Authority or the Tribal Grantors to submit to binding arbitration.

[Signature Pages Follow]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

BANK OF AMERICA, N.A., as First Lien Administrative Agent
By:	/S/    MAURICE WASHINGTON
	Name: Maurice Washington Title:   Agency Management Officer
Address: Bank of America, N.A. MC: TX1-492-14-11 901 Main Street, 14th Floor Dallas, TX 75202-3714

Collateral Agency and Intercreditor Agreement

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U.S. BANK NATIONAL ASSOCIATION, as Second Lien Collateral Agent
By:	/S/    CAUNA M. SILVA
	Name: Cauna M. Silva Title:   Vice President
Address: U.S. Bank National Association 225 Asylum Street - 23rd Floor Hartford, CT, 06103
U.S. BANK NATIONAL ASSOCIATION, as Second Lien Trustee
By:	/S/    CAUNA M. SILVA
	Name: Cauna M. Silva Title:   Vice President
Address: U.S. Bank National Association 225 Asylum Street - 23rd Floor Hartford, CT, 06103

Intercreditor Agreement

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Acknowledged and Agreed to by:

MOHEGAN TRIBAL GAMING AUTHORITY
By:	/S/    MARILYNN R. MALERBA
	Name: Marilynn R. Malerba Title:   Chairwoman
MOHEGAN BASKETBALL CLUB, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
MOHEGAN VENTURES-NORTHWEST, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
MOHEGAN COMMERCIAL VENTURES PA, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
DOWNS RACING, L.P. By Mohegan Commercial Ventures PA, LLC, Its General Partner
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager

Intercreditor Agreement

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BACKSIDE, L.P. By Mohegan Commercial Ventures PA, LLC, Its General Partner
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
MILLCREEK LAND, L.P. By Mohegan Commercial Ventures PA, LLC, Its General Partner
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
NORTHEAST CONCESSIONS, L.P. By Mohegan Commercial Ventures PA, LLC, Its General Partner
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
MOHEGAN GOLF, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
MOHEGAN VENTURES WISCONSIN, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager

Collateral Agency and Intercreditor Agreement

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WISCONSIN TRIBAL GAMING, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
MTGA GAMING, LLC
By:	/S/    MITCHELL G. ETESS
	Name: Mitchell G. Etess Title:   Manager
Address for each of the Grantors: Mohegan Tribal Gaming Authority 1 Mohegan Sun Boulevard, Uncasville, CT 06387,

Collateral Agency and Intercreditor Agreement

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EXHIBIT A

to Collateral Agency and Intercreditor Agreement

FORM OF GRANTOR JOINDER AGREEMENT

Reference is made to that certain Collateral Agency and Intercreditor Agreement, dated as of October 26, 2009 (as amended, restated, supplemented or otherwise modified from time to time, the “Intercreditor Agreement”), among MOHEGAN TRIBAL GAMING AUTHORITY (the “Authority”), an instrumentality of The Mohegan Tribe of Indians of Connecticut (the “Tribe”), MOHEGAN BASKETBALL CLUB, LLC (“MBC”), a limited liability company formed under the laws of the Tribe, MOHEGAN GOLF, LLC (“Mohegan Golf”), a limited liability company formed under the laws of the Tribe, MOHEGAN COMMERCIAL VENTURES PA, LLC (“MCV-PA”), a Pennsylvania limited liability company, MOHEGAN VENTURES-NORTHWEST, LLC (“Mohegan Ventures-NW”), a limited liability company formed under the laws of the Tribe, MOHEGAN VENTURES WISCONSIN, LLC (“MVW”), a limited liability company formed under the laws of the Tribe, MTGA GAMING, LLC (“MTGA Gaming”), a Delaware limited liability company, WISCONSIN TRIBAL GAMING, LLC (“WTG”), a Delaware limited liability company, DOWNS RACING, L.P. (“DOWNS RACING”), a Pennsylvania limited partnership, BACKSIDE, L.P. (“Backside”), a Pennsylvania limited partnership, MILL CREEK LAND, L.P., a Pennsylvania limited partnership (“Mill Creek” and together with the Authority, MBC, Mohegan Golf, Mohegan Ventures-NW, MVW, MTGA Gaming, WTG, Downs Racing and Backside, each, a “Guarantor”, and collectively, the “Guarantors”), each other Grantor (as defined in the Intercreditor Agreement) party thereto from time to time, Bank of America, N.A., as administrative agent and L/C Issuer for the First Lien Secured Parties (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “First Lien Administrative Agent”), U.S. Bank National Association, as trustee under the Second Lien Indenture (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “Second Lien Trustee”), and U.S. Bank National Association, as collateral agent for the Second Lien Secured Parties (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “Second Lien Collateral Agent”). Capitalized terms used herein without definition shall have the meaning assigned thereto in the Intercreditor Agreement.

This Grantor Joinder Agreement, dated as of __________, 20__ (this “Grantor Joinder”), is being delivered pursuant to Section 9.19 of the Intercreditor Agreement.

The undersigned, _________, a ___________ (the “Joining Grantor”), hereby agrees to become a party to the Intercreditor Agreement as a Grantor thereunder, for all purposes thereof on the terms set forth therein, and to be bound by the terms of the Intercreditor Agreement as fully as if the Joining Grantor had executed and delivered the Intercreditor Agreement as of the date thereof.

This Grantor Joinder may be executed in two or more counterparts, each of which shall constitute an original but all of which when taken together shall constitute one contract.

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THIS GRANTOR JOINDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

The provisions of Article IX of the Intercreditor Agreement shall apply with like effect to this Grantor Joinder.

[Signature Pages Follow]

Intercreditor Agreement

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IN WITNESS WHEREOF, the Joining Grantor has caused this Grantor Joinder to be duly executed by its authorized representative as of the day and year first above written.

[JOINING GRANTOR]
By:
	Name: Title:

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Each of the First Lien Administrative Agent and the Second Lien Collateral Agent acknowledges receipt of this Grantor Joinder and agrees to act as First Lien Administrative Agent and Second Lien Collateral Agent, respectively, with respect to the Collateral pledged by the Joining Grantor, as of the day and year first above written.

BANK OF AMERICA, N.A, as First Lien Administrative Agent
By:
	Name: Title:
U.S. BANK NATIONAL ASSOCIATION, as Second Lien Collateral Agent
By:
	Name: Title:

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EXHIBIT B-1

to Collateral Agency and Intercreditor Agreement

FORM OF FIRST LIEN JOINDER AGREEMENT

Reference is made to that certain Collateral Agency and Intercreditor Agreement, dated as of October 26, 2009 (as amended, restated, supplemented or otherwise modified from time to time, the “Intercreditor Agreement”), among MOHEGAN TRIBAL GAMING AUTHORITY (the “Authority”), an instrumentality of The Mohegan Tribe of Indians of Connecticut (the “Tribe”), MOHEGAN BASKETBALL CLUB, LLC (“MBC”), a limited liability company formed under the laws of the Tribe, MOHEGAN GOLF, LLC (“Mohegan Golf”), a limited liability company formed under the laws of the Tribe, MOHEGAN COMMERCIAL VENTURES PA, LLC (“MCV-PA”), a Pennsylvania limited liability company, MOHEGAN VENTURES-NORTHWEST, LLC (“Mohegan Ventures-NW”), a limited liability company formed under the laws of the Tribe, MOHEGAN VENTURES WISCONSIN, LLC (“MVW”), a limited liability company formed under the laws of the Tribe, MTGA GAMING, LLC (“MTGA Gaming”), a Delaware limited liability company, WISCONSIN TRIBAL GAMING, LLC (“WTG”), a Delaware limited liability company, DOWNS RACING, L.P. (“DOWNS RACING”), a Pennsylvania limited partnership, BACKSIDE, L.P. (“Backside”), a Pennsylvania limited partnership, MILL CREEK LAND, L.P., a Pennsylvania limited partnership (“Mill Creek” and together with the Authority, MBC, Mohegan Golf, Mohegan Ventures-NW, MVW, MTGA Gaming, WTG, Downs Racing and Backside, each, a “Guarantor”, and collectively, the “Guarantors”), each other Grantor (as defined in the Intercreditor Agreement) party thereto from time to time, Bank of America, N.A., as administrative agent and L/C Issuer for the First Lien Secured Parties (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “First Lien Administrative Agent”), U.S. Bank National Association, as trustee under the Second Lien Indenture (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “Second Lien Trustee”), and U.S. Bank National Association, as collateral agent for the Second Lien Secured Parties (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “Second Lien Collateral Agent”). Capitalized terms used herein without definition shall have the meaning assigned thereto in the Intercreditor Agreement.

This First Lien Joinder Agreement, dated as of                     , 20     (this “First Lien Joinder”), is being delivered pursuant to Section 5.5(b) of the Intercreditor Agreement as a condition precedent to the Indebtedness for which the undersigned is acting as agent being entitled to the benefits of being First Lien Obligations under the Intercreditor Agreement.

1. Joinder. The undersigned,                             , a                             , (the “New Representative”) as [trustee, administrative agent] under that certain [describe applicable indenture, credit agreement or other document governing the Additional First Lien Indebtedness] (the “New First Lien Loan Agreement”) hereby agrees to become party as a New Agent, First Lien Administrative Agent and a First Lien Secured Party under the Intercreditor Agreement for all purposes thereof on the terms set forth therein, and to be bound by the terms, conditions and provisions of the Intercreditor Agreement as fully as if the undersigned had executed and delivered the Intercreditor Agreement as of the date thereof.

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2. Priority Confirmation. The undersigned New Representative, on behalf of itself and each holder of obligations in respect of the Additional First Lien Indebtedness to be incurred under the New First Lien Loan Agreement (together with the New Representative, the “New First Lien Secured Parties”), hereby agrees, for the enforceable benefit of all existing and future First Lien Secured Parties, each existing and future Debt Representative and each existing and future Second Lien Secured Party, and as a condition to having the Indebtedness and other obligations incurred with or with respect to the New First Lien Loan Agreement being treated as First Lien Obligations under the Intercreditor Agreement that:

(a) the New Representative and each other New First Lien Secured Party is bound by the terms, conditions and provisions of the Intercreditor Agreement; and

(b) the New Representative shall perform its obligations under the Intercreditor Agreement and the First Lien Security Documents.

3. Authority as Agent. The New Representative represents, warrants and acknowledges that it has the authority to bind each of the New First Lien Secured Parties to the Intercreditor Agreement and such New First Lien Secured Parties are hereby bound by the terms, conditions and provisions of the Intercreditor Agreement.

4. New Agent. The New Agent in respect of the New First Lien Loan Agreement is [insert name of New Representative]. The address of the New Agent in respect of the New First Lien Loan Agreement for purposes of all notices and other communications hereunder and under the Intercreditor Agreement is                 ,                 , Attention of                  (Facsimile No.                     , electronic mail address:                     ).

5. Officers’ Certificate. Each of the undersigned Grantors hereby certifies that the Grantors have previously delivered the Officers’ Certificate contemplated by Section 5.5(b)(i) of the Intercreditor Agreement and all other information, evidence and documentation required by Section 5.5 of the Intercreditor Agreement, in each case in accordance with the terms of the Intercreditor Agreement.

6. Counterparts. This First Lien Joinder may be executed in two or more counterparts, each of which shall constitute an original but all of which when taken together shall constitute one contract.

7. Governing Law. THIS FIRST LIEN JOINDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

8. Miscellaneous. The provisions of Article IX of the Intercreditor Agreement shall apply with like effect to this First Lien Joinder.

[Signature Pages Follow]

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IN WITNESS WHEREOF, the New Representative has caused this First Lien Joinder to be duly executed by its authorized representative, and each Grantor party hereto has caused the same to be accepted by its authorized representative, as of the day and year first above written.

[NEW REPRESENTATIVE]
By:
	Name:
	Title:

Collateral Agency and Intercreditor Agreement

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Acknowledged and agreed:
MOHEGAN TRIBAL GAMING AUTHORITY
By:
	Name:
	Title:
MOHEGAN BASKETBALL CLUB, LLC
By:
	Name:
	Title:
MOHEGAN VENTURES-NORTHWEST, LLC
By:
	Name:
	Title:
MOHEGAN COMMERCIAL VENTURES PA, LLC
By:
	Name:
	Title:
DOWNS RACING, L.P.
By Mohegan Commercial Ventures PA, LLC,
Its General Partner
By:
	Name:
	Title:

Intercreditor Agreement

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BACKSIDE, L.P.
By Mohegan Commercial Ventures PA, LLC,
Its General Partner
By:
	Name:
	Title:
MILLCREEK LAND, L.P.
By Mohegan Commercial Ventures PA, LLC,
Its General Partner
By:
	Name:
	Title:
NORTHEAST CONCESSIONS, L.P.
By Mohegan Commercial Ventures PA, LLC,
Its General Partner
By:
	Name:
	Title:
MOHEGAN GOLF, LLC
By:
	Name:
	Title:
MOHEGAN VENTURES WISCONSIN, LLC
By:
	Name:
	Title:

Collateral Agency and Intercreditor Agreement

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WISCONSIN TRIBAL GAMING, LLC
By:
	Name:
	Title:
MTGA GAMING, LLC
By:
	Name:
	Title:

[OTHER GRANTORS]

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EXHIBIT B-2

to Collateral Agency and Intercreditor Agreement

FORM OF PARITY LIEN JOINDER AGREEMENT

Reference is made to that certain Collateral Agency and Intercreditor Agreement, dated as of October 26, 2009 (as amended, restated, supplemented or otherwise modified from time to time, the “Intercreditor Agreement”), among MOHEGAN TRIBAL GAMING AUTHORITY (the “Authority”), an instrumentality of The Mohegan Tribe of Indians of Connecticut (the “Tribe”), MOHEGAN BASKETBALL CLUB, LLC (“MBC”), a limited liability company formed under the laws of the Tribe, MOHEGAN GOLF, LLC (“Mohegan Golf”), a limited liability company formed under the laws of the Tribe, MOHEGAN COMMERCIAL VENTURES PA, LLC (“MCV-PA”), a Pennsylvania limited liability company, MOHEGAN VENTURES-NORTHWEST, LLC (“Mohegan Ventures-NW”), a limited liability company formed under the laws of the Tribe, MOHEGAN VENTURES WISCONSIN, LLC (“MVW”), a limited liability company formed under the laws of the Tribe, MTGA GAMING, LLC (“MTGA Gaming”), a Delaware limited liability company, WISCONSIN TRIBAL GAMING, LLC (“WTG”), a Delaware limited liability company, DOWNS RACING, L.P (“DOWNS RACING”), a Pennsylvania limited partnership, BACKSIDE, L.P. (“Backside”), a Pennsylvania limited partnership, MILL CREEK LAND, L.P., a Pennsylvania limited partnership (“Mill Creek” and together with the Authority, MBC, Mohegan Golf, Mohegan Ventures-NW, MVW, MTGA Gaming, WTG, Downs Racing and Backside, each, a “Guarantor”, and collectively, the “Guarantors”), each other Grantor (as defined in the Intercreditor Agreement) party thereto from time to time, Bank of America, N.A., as administrative agent and L/C Issuer for the First Lien Secured Parties (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “First Lien Administrative Agent”), U.S. Bank National Association, as trustee under the Second Lien Indenture (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “Second Lien Trustee”), and U.S. Bank National Association, as collateral agent for the Second Lien Secured Parties (as defined in the Intercreditor Agreement) (in such capacity, together with its successors and assigns from time to time, the “Second Lien Collateral Agent”). Capitalized terms used herein without definition shall have the meaning assigned thereto in the Intercreditor Agreement.

This Parity Lien Joinder Agreement, dated as of                     , 20     (this “Parity Lien Joinder”), is being delivered pursuant to Section 5.7 of the Intercreditor Agreement as a condition precedent to the incurrence of the Indebtedness for which the undersigned is acting as agent being entitled to the benefits of being Second Lien Obligations under the Intercreditor Agreement.

1. Joinder. The undersigned,                    , a                     , (the “New Representative”) as [trustee, administrative agent] under that certain [describe Additional Parity Lien Facility] (the “New Second Lien Facility”) hereby agrees to become party as an Additional Parity Lien Facility Representative and a Second Lien Secured Party under the Intercreditor Agreement for all purposes thereof on the terms set forth therein, and to be bound by the terms, conditions and provisions of the Intercreditor Agreement as fully as if the undersigned had executed and delivered the Intercreditor Agreement as of the date thereof.

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2. Lien Sharing and Priority Confirmation. The undersigned New Representative, on behalf of itself and each holder of obligations in respect of the New Second Lien Facility (together with the New Representative, the “New Second Lien Secured Parties”), hereby agrees, for the enforceable benefit of all existing and future First Lien Secured Parties, each existing and future Debt Representative and each existing and future Second Lien Secured Party, and as a condition to being treated as Second Lien Obligations under the Intercreditor Agreement that:

(a) all Second Lien Obligations will be and are secured equally and ratably by all Liens granted to the Second Lien Collateral Agent, for the benefit of the Second Lien Secured Parties, which are at any time granted by any Grantor to secure any Second Lien Obligations whether or not upon property otherwise constituting collateral for such New Second Lien Facility, and that all Liens granted pursuant to the Second Lien Security Documents will be enforceable by the Second Lien Collateral Agent for the benefit of all holders of Second Lien Obligations equally and ratably as contemplated by the Intercreditor Agreement;

(b) the New Representative and each other New Second Lien Secured Party is bound by the terms, conditions and provisions of the Intercreditor Agreement and the Second Lien Security Documents, including, without limitation, the provisions relating to the ranking of Liens and the order of application of proceeds from the enforcement of Liens; and

(c) the New Representative shall perform its obligations under the Intercreditor Agreement and the Second Lien Security Documents.

3. Appointment of Second Lien Collateral Agent. The New Representative, on behalf of itself and the New Second Lien Secured Parties, hereby (a) irrevocably appoints U.S. Bank National Association as Second Lien Collateral Agent for purposes of the Intercreditor Agreement and the Second Lien Security Documents, (b) irrevocably authorizes the Second Lien Collateral Agent to take such actions on its behalf and to exercise such powers as are delegated to the Second Lien Collateral Agent in the Intercreditor Agreement and the Second Lien Security Documents, together with such actions and powers as are reasonably incidental thereto, and authorizes the Second Lien Collateral Agent to execute any Second Lien Security Documents on behalf of all Second Lien Secured Parties and to take such other actions to maintain and preserve the security interests granted pursuant to any Second Lien Security Documents, and (c) acknowledges that it has received and reviewed the Intercreditor Agreement and the Second Lien Security Documents and agrees to be bound by the terms thereof. The New Representative, on behalf of the New Second Lien Secured Parties, and the Second Lien Collateral Agent, on behalf of the existing Second Lien Secured Parties, each hereby acknowledges and agrees that the Second Lien Collateral Agent in its capacity as such shall be agent on behalf of the New Representative and on behalf of all other Second Lien Secured Parties.

4. Consent. The New Representative, on behalf of itself and the New Second Lien Secured Parties, consents to and directs the Second Lien Collateral Agent to perform its obligations under the Intercreditor Agreement and the Second Lien Security Documents.

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5. Authority as Agent. The New Representative represents, warrants and acknowledges that it has the authority to bind each of the New Second Lien Secured Parties to the Intercreditor Agreement and such New Second Lien Secured Parties are hereby bound by the terms, conditions and provisions of the Intercreditor Agreement, including, without limitation, the provisions relating to the ranking of Liens and the order of application of proceeds from the enforcement of Liens.

6. Additional Parity Lien Facility Representative. The Additional Parity Lien Facility Representative in respect of the New Second Lien Facility is [insert name of New Representative]. The address of the Additional Parity Lien Facility Representative in respect of the New Second Lien Facility for purposes of all notices and other communications hereunder and under the Intercreditor Agreement is                     ,                     , Attention of                      (Facsimile No.                    , electronic mail address:                    ).

7. Officers’ Certificate. Each of the undersigned Grantors hereby certifies that the Grantors have previously delivered the Officers’ Certificate contemplated by Section 5.7(b)(i) of the Intercreditor Agreement and all other information, evidence and documentation required by Section 5.7 of the Intercreditor Agreement, in each case in accordance with the terms of the Intercreditor Agreement.

8. Reaffirmation of Security Interest. By acknowledging and agreeing to this Parity Lien Joinder, each of the Grantors and each of the Guarantors party hereto hereby (i) confirms and reaffirms the security interests pledged and granted pursuant to the Second Lien Security Documents and grants a security interest in all of its right, title and interest in the Collateral (as defined in the applicable Second Lien Security Documents), whether now owned or hereafter acquired to secure the Second Lien Obligations, and agrees that such pledges and grants of security interests shall continue to be in full force and effect, (b) confirms and reaffirms all of its obligations under its guarantees pursuant to the applicable Second Lien Note Documents and the Additional Parity Lien Facility Documents and agrees that such guarantees shall continue to be in full force and effect, and (c) authorizes the filing of any financing statements describing the Collateral (as defined in the applicable Second Lien Security Documents) in the same manner as described in the applicable Second Lien Security Documents or in any other manner as the Second Lien Collateral Agent may determine is necessary, advisable or prudent to ensure the perfection of the security interests in the Collateral (as defined in the applicable Second Lien Security Documents) granted to the Second Lien Collateral Agent hereunder or under the applicable Second Lien Security Documents.

9. Counterparts. This Parity Lien Joinder may be executed in two or more counterparts, each of which shall constitute an original but all of which when taken together shall constitute one contract.

10. Governing Law. THIS PARITY LIEN JOINDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

11. Miscellaneous. The provisions of Article IX of the Intercreditor Agreement shall apply with like effect to this Parity Lien Joinder.

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[Signature Pages Follow]

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IN WITNESS WHEREOF, the New Representative has caused this Agreement to be duly executed by its authorized representative, and each Grantor and Guarantor party hereto has caused the same to be accepted by their respective authorized representatives, as of the day and year first above written.

[NEW REPRESENTATIVE]
By:
	Name:
	Title:

Collateral Agency and Intercreditor Agreement

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Acknowledged and agreed:
MOHEGAN TRIBAL GAMING AUTHORITY
By:
	Name:
	Title:
MOHEGAN BASKETBALL CLUB, LLC
By:
	Name:
	Title:
MOHEGAN VENTURES-NORTHWEST, LLC
By:
	Name:
	Title:
MOHEGAN COMMERCIAL VENTURES PA, LLC
By:
	Name:
	Title:
DOWNS RACING, L.P.
By Mohegan Commercial Ventures PA, LLC,
Its General Partner
By:
	Name:
	Title:

Intercreditor Agreement

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BACKSIDE, L.P.
By Mohegan Commercial Ventures PA, LLC,
Its General Partner
By:
	Name:
	Title:
MILLCREEK LAND, L.P.
By Mohegan Commercial Ventures PA, LLC,
Its General Partner
By:
	Name:
	Title:
NORTHEAST CONCESSIONS, L.P.
By Mohegan Commercial Ventures PA, LLC,
Its General Partner
By:
	Name:
	Title:
MOHEGAN GOLF, LLC
By:
	Name:
	Title:
MOHEGAN VENTURES WISCONSIN, LLC
By:
	Name:
	Title:

Collateral Agency and Intercreditor Agreement

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WISCONSIN TRIBAL GAMING, LLC
By:
	Name:
	Title:
MTGA GAMING, LLC
By:
	Name:
	Title:

[OTHER GRANTORS]

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The Second Lien Collateral Agent acknowledges receipt of this Parity Lien Joinder and agrees to act as Second Lien Collateral Agent with respect to the New Second Lien Facility in accordance with the terms of the Intercreditor Agreement and the Second Lien Collateral Documents.

Dated:                    , 20    

U.S. BANK NATIONAL ASSOCIATION, as Second Lien Collateral Agent
By:
	Name:
	Title:

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EX-10.36

Exhibit 10.36

AMENDMENT NO. 1 TO

THIRD AMENDED AND RESTATED LOAN AGREEMENT

THIS AMENDMENT NO. 1 TO THIRD AMENDED AND RESTATED LOAN AGREEMENT (this “Amendment”) dated as of October 26, 2009, is entered into by and among THE MOHEGAN TRIBE OF INDIANS OF CONNECTICUT, a federally recognized Indian Tribe and Native American sovereign nation (the “Tribe”), the MOHEGAN TRIBAL GAMING AUTHORITY, a governmental instrumentality of the Tribe (the “Borrower”), and BANK OF AMERICA, N.A., as Administrative Agent (the “Administrative Agent”), with the consent of the Required Lenders pursuant to Section 12.01 of the Third Amended and Restated Loan Agreement dated as of December 10, 2008 (as amended, the “Loan Agreement”) among the Tribe, the Borrower, the Administrative Agent, and the lenders signatory thereto from time to time (the “Lenders”). Capitalized terms set forth without definition in this Amendment shall have the meanings set forth in the Loan Agreement. Reference is made to the following facts:

RECITALS

A. The Borrower has informed the Administrative Agent that concurrently with or prior to the effectiveness of this Amendment, the Borrower will issue second lien notes (collectively, the “Second Lien Notes”) in favor of certain noteholders, in an aggregate principal amount of up to $200,000,000. The net proceeds of the Second Lien Notes shall be used to (i) prepay the Term Loans in full, (ii) repay a portion of the outstanding Revolving Loans, and (iii) pay transaction costs related to such issuance.

B. Concurrently with the prepayment of the Revolving Loans described above, the Aggregate Revolving Commitments shall be reduced by $25,000,000.

C. Additionally, the Borrower has requested that the Required Lenders amend the Loan Agreement to permit the sale or lease of a portion of the Pocono Downs property in connection with the proposed development of a hotel on such parcel. The hotel is in the early concept phase and the idea currently being considered contemplates an approximately six acre parcel southwest of the existing casino at Pocono Downs.

AGREEMENT

For good and valuable consideration, the adequacy and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

1. Section 1.01—Definitions. Section 1.01 of the Loan Agreement is hereby amended by adding the following at the end of the defined term “Agreement”:

“Amendment No. 1 Effective Date” shall mean the date upon which each of the conditions precedent to Amendment No. 1 to Third Amended and Restated Loan Agreement among the Tribe, the Borrower and the Administrative Agent have been satisfied, each in form and substance acceptable to the Administrative Agent.

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2. Section 1.01—Definitions. Section 1.01 of the Loan Agreement is hereby amended by deleting the defined term “Applicable Rate” and substituting the following in its place (it being understood that such changes to the Applicable Rate shall become effective on the Amendment No. 1 Effective Date and result in an immediate change in the interest applicable to the Loans):

“Applicable Rate” means the following percentages per annum, based upon the Total Leverage Ratio as set forth in the most recent Compliance Certificate or Pricing Certificate received by the Administrative Agent pursuant to Sections 8.02(b) or (c):

Pricing Level	Total Leverage Ratio	Commitment Fee	Eurodollar Rate and Letters of Credit	Base Rate Margin
1	<4.50:1	0.250% unless the Total Leverage Ratio is less than 4.00:1.00, in which case the Commitment Fee rate shall be 0.20%	2.500%	1.250%
2	³4.50:1 but <5.00:1	0.250%	2.750%	1.500%
3	³5.00:1 but <5.50:1	0.375%	3.000%	1.750%
4	³5.50:1 but <6.00:1	0.375%	3.250%	2.000%
5	³6.00:1 but <6.50:1	0.500%	3.500%	2.250%
6	³6.50:1 but <7.00:1	0.500%	3.750%	2.500%
7	³7.00:1	0.500%	4.000%	2.750%

Any increase or decrease in the Applicable Rate resulting from a change in the Total Leverage Ratio shall become effective as of the first Business Day of the first calendar month immediately following the date a Compliance Certificate or Pricing Certificate is delivered pursuant to Section 8.02(b) or (c); provided, however, that if a Compliance Certificate or Pricing Certificate is not delivered when due in accordance with such Section, then Pricing Level 7 shall apply as of the first Business Day after the date on which such Compliance Certificate or Pricing Certificate was required to have been delivered until the Compliance Certificate or Pricing Certificate is delivered.

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3. Section 1.01—Definitions. Section 1.01 of the Loan Agreement is hereby amended by deleting the defined term “Permitted Dispositions” and substituting the following in its place:

“Permitted Dispositions” means (a) Dispositions of Authority Property which, during the period following the Closing Date, do not have an aggregate book value which is in excess of 5% of the aggregate book value of the assets comprising Mohegan Sun (in each case, valuing the asset disposed of as of the date of its Disposition and in comparison to the value of Mohegan Sun as of the date of the latest Disposition), determined with reference to the then most recent audited financial statements of Borrower, and (b) the Permitted Pocono Transaction.

4. Section 1.01—Definitions. Section 1.01 of the Loan Agreement is hereby amended by adding the following language following the defined term “Permitted Right of Others”:

“Permitted Pocono Transaction” means the transaction pursuant to which the applicable Pocono Downs Subsidiary or Pocono Downs Subsidiaries, as the case may be, sells or leases a portion of the Pocono Downs property (the “Excess Parcel”) to a third-party purchaser or lessee, as applicable, which purchaser or lessee shall be not be an Affiliate of the Borrower, subject to the following conditions:

(a) such sale or lease, as the case may be, of the Excess Parcel shall be evidenced by either (i) a deed conveying such Excess Parcel or (ii) a ground lease providing for the lease of the Excess Parcel, for the purpose of having a hotel with a minimum of 200 rooms constructed on such Excess Parcel (the “Project”), which deed or lease, as applicable, shall be in form and substance reasonably satisfactory to the Administrative Agent;

(b) in connection with a sale or lease of the Excess Parcel, the Pocono Downs Subsidiaries and the Administrative Agent shall amend and restate, for the benefit of the Lenders, the applicable Pocono Downs Mortgage(s) and any related security documents to reflect the removal of the Excess Parcel from the lien of such mortgage(s);

(c) following conveyance or lease of the Excess Parcel as contemplated herein, if the Borrower or the applicable Pocono Downs Subsidiary enters into a lease or sublease, as applicable, of the Project (such lease or sublease being referred to as the “Project Lease”), concurrently with the execution of such Project Lease, (i) the landlord under the Project Lease shall deliver to the Administrative Agent an executed estoppel certificate, (ii) the Borrower or the applicable Pocono Downs Subsidiary shall execute and deliver a leasehold mortgage with respect to the Project Lease, and (iii) the Administrative Agent shall receive the commitment of the Title Company to issue a lender’s title policy, along with such endorsements as the Administrative Agent may request, with respect to the leasehold mortgage referred to in clause (ii), each of which items shall be in form and substance reasonably acceptable to the Administrative Agent;

(d) in connection with such sale or lease, the Borrower shall cause the Title Company to deliver to the Administrative Agent a bring-down of the title insurance policy relating to the Pocono Downs property to reflect the release of the Excess Parcel and a leasehold mortgage policy relating to the Project Lease, if applicable, along with such other endorsements to such title policy as the Administrative Agent may reasonably require;

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(e) in connection with a sale or lease of the Excess Parcel, the Borrower shall obtain (i) a new survey of the Pocono Downs property evidencing the partitioning and conveyance of such Excess Parcel as a separate legal parcel, which survey shall be in form and substance reasonably acceptable to the Administrative Agent, and (ii) evidence that the Excess Parcel constitutes a separate tax lot, and shall promptly deliver such survey and evidence to the Administrative Agent;

(f) with respect to any sale of the Excess Parcel, the Borrower shall prepay the Loans from the Net Cash Proceeds of such transaction to the extent provided for in Section 2.07;

(g) both before and after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing;

(h) the Borrower shall agree to deliver to the Administrative Agent, promptly upon request, such documentation as the Administrative Agent may reasonably request regarding the status of construction of the project to be developed on the Excess Parcel; and

(i) the Borrower shall deliver to the Administrative Agent, promptly upon the consummation of such transaction, a true and correct copy of each agreement or other document executed or delivered in connection with such transaction.

5. Section 2.01 – Revolving Loans. Upon the Amendment No. 1 Effective Date, the Aggregate Revolving Commitments shall be reduced by $25,000,000. In connection with such reduction, each Lender’s Revolving Commitment shall be reduced in accordance with such Lender’s Applicable Revolving Percentage of such reduction amount.

6. Section 9.03—Indebtedness. Section 9.03 of the Loan Agreement is hereby amended by (i) deleting “and” at the end of clause (j) thereof, (ii) deleting “.” at the end of clause (k) thereof and substituting “; and” therefor, and (iii) inserting the following as new clause (l) following the existing clause (k):

(l) Indebtedness (which may consist Capital Lease obligations of the Borrower or the applicable Pocono Downs Subsidiary) in an aggregate principal amount not to exceed $55,000,000 at any time outstanding in connection with the development of the Project.

7. Section 9.13(a)—Maximum Total Leverage Ratio. Section 9.13(a) of the Loan Agreement is hereby deleted in its entirety and the following is hereby substituted therefor:

(a) Maximum Total Leverage Ratio. Permit the Total Leverage Ratio, as of the last day of any Fiscal Quarter described in the matrix below, to exceed the ratio set forth opposite that Fiscal Quarter:

Fiscal Quarters Ending	Maximum Ratio
September 30, 2009 through December 31, 2010	7.25:1.00
March 31, 2011	7.00:1.00
June 30, 2011	6.75:1.00
September 30, 2011	6.50:1.00
December 31, 2011 and thereafter	6.25:1.00

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8. Section 9.13(b)—Senior Leverage Ratio. Section 9.13(b) of the Loan Agreement is hereby deleted in its entirety and the following is hereby substituted therefor:

(b) Senior Leverage Ratio. Permit the Senior Leverage Ratio to exceed, as of the last day of any Fiscal Quarter described in the matrix below, the ratio set forth opposite that Fiscal Quarter:

Fiscal Quarters Ending	Maximum Ratio
September 30, 2009 through March 31, 2010	4.75:1.00
June 30, 2010 through December 31, 2010	4.50:1.00
March 31, 2011 through September 30, 2011	4.25:1.00
December 31, 2011 and thereafter	3.75:1.00

9. Section 9.17—Capital Expenditures. Section 9.17(d) of the Loan Agreement is hereby deleted in its entirety and the following is hereby substituted therefor:

(d) Capital Expenditures made in respect of Mohegan Sun, Pocono Downs and for Related Businesses (including, to the extent characterized as a Capital Expenditure, Capital Expenditures for associated licensing fees) in an aggregate amount which does not exceed $125,000,000 during the period following the Closing Date; and

10. Section 11.11(a)—Collateral and Guaranty Matters. Section 11.11(a) of the Loan Agreement is hereby deleted in its entirety and the following is hereby substituted therefor:

(a) to release any Lien on any property granted to or held by the Administrative Agent under any Loan Document (i) upon termination of the Aggregate Revolving Commitments and payment in full of all Obligations (other than contingent indemnification obligations) and the expiration of or termination of all Letters of Credit, (ii) that is sold or leased or to be sold or leased as part of or in connection with any sale or lease permitted hereunder or under any other Loan Document including, without limitation, the Permitted Pocono Transaction, or (iii) subject to Section 12.01, if approved, authorized or ratified in writing by the Required Lenders;

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11. Exhibit B – Compliance Certificate. The form of Compliance Certificate attached to the Loan Agreement as Exhibit B is hereby amended and restated in its entirety with the form of Compliance Certificate attached to this Amendment as Annex I.

12. Amendment Fee. The Borrower hereby agrees to pay to the Administrative Agent, for the account of the Lenders, an amendment fee to each Lender consenting to this Amendment at the rate advised to the Lenders (the “Amendment Fee”). The Amendment Fee will be payable to the Lenders within one Business Day following the Amendment No. 1 Effective Date.

13. Conditions Precedent. The effectiveness of this Amendment is subject to the prior satisfaction of each of the following conditions (the date of such satisfaction being referred to herein as the “Amendment No. 1 Effective Date”), each of which shall be in form and substance satisfactory to the Administrative Agent:

(a) the Administrative Agent shall have received this Amendment, duly executed by the Borrower and the Tribe;

(b) the Administrative Agent shall have received a written consent from each of the Required Lenders, substantially in the form of Exhibit A attached hereto;

(c) the Administrative Agent shall have received an intercreditor agreement with respect to the Second Lien Notes, duly executed by the Borrower and the trustee for the holders of the Second Lien Notes, substantially in the form of Exhibit B;

(d) the Administrative Agent shall have received all such Collateral Documents, financing statements, control agreements, and other documents as the Administrative Agent may require in order to create or preserve a first priority Lien on any collateral which is also subject to a Lien benefiting the holders of the Second Lien Notes;

(e) the Administrative Agent shall have received a true and correct copy of the indenture pursuant to which the Second Lien Notes were issued, along with all other schedules, instruments, agreements and other documents issued in connection therewith; and

(f) the Loans shall have been prepaid in an aggregate amount equal to 100% of all Net Cash Proceeds received on account of the Second Lien Notes, which prepayment shall be applied in the manner provided for in Section 2.07(f) of the Loan Agreement.

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14. Reaffirmation of Loan Documents; No Default; No Defenses; etc. Each of the Borrower and the Tribe hereby reaffirms the Loan Agreement, as amended by this Amendment, and the Loan Documents and its respective obligations to the Administrative Agent and Lenders thereunder. Each of the Borrower and the Tribe represents and warrants that there are no outstanding Events of Default by it under the Loan Agreement or any Loan Document. The representations and warranties of the Tribe and each Loan Party contained in Articles V and VI of the Loan Agreement and each other Loan Document are true and correct on and as of the date of this Amendment, except to the extent that such representations and warranties specifically refer to an earlier date, in which such representations and warranties refer to such earlier date, and except that for purposes of this sentence, the representations and warranties contained in subsections (a) and (b) of Section 6.05 of the Loan Agreement refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 8.01 of the Loan Agreement. Each of the Borrower and the Tribe acknowledges that the Administrative Agent and Lenders have fully complied with their respective obligations under any Loan Document and that neither the Borrower nor the Tribe has any defenses to the validity, enforceability or binding effect of any Loan Document.

15. Counterparts. This Amendment may be executed in any number of counterparts and by different parties on separate counterparts, each of which when so executed and delivered shall be deemed an original and all of which when taken together, shall constitute but one and the same instrument.

16. Otherwise Not Affected. In the event of any conflict or inconsistency between the Loan Agreement and the provisions of this Amendment, the provisions of this Amendment shall govern. Except to the extent set forth herein, the Loan Agreement shall remain unaltered and in full force and effect.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties hereto have executed this Amendment by their respective duly authorized officers as of the date first above written.

MOHEGAN TRIBAL GAMING AUTHORITY
By:	/S/    MARILYNN R. MALERBA
Name:	Marilynn R. Malerba
Title:	Chairwoman

THE MOHEGAN TRIBE OF INDIANS OF CONNECTICUT (for the limited purpose of joining in Section 14 as to itself)
By:	/S/    MARILYNN R. MALERBA
Name:	Marilynn R. Malerba
Title:	Chairwoman

BANK OF AMERICA, N.A., as Administrative Agent and L/C Issuer
By:	/S/    MAURICE WASHINGTON
Name:	Maurice Washington
Title:	Vice President

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EXHIBIT A

CONSENT OF LENDER

This Consent of Lender (this “Consent”) is delivered pursuant to the proposed Amendment No. 1 to Third Amended and Restated Loan Agreement (the “Amendment”), dated as of the date hereof, amending the Third Amended and Restated Loan Agreement dated as of December 10, 2008, among The Mohegan Tribe of Indians of Connecticut, a federally recognized Indian Tribe and Native American sovereign nation (the “Tribe”), the Mohegan Tribal Gaming Authority, a governmental instrumentality of the Tribe, the Lenders (as defined therein), and Bank of America, N.A., as Administrative Agent.

The undersigned Lender hereby consents to the execution, delivery and performance of the Amendment and to the execution and delivery of the Amendment by the Administrative Agent on its behalf, substantially in the form presented to the undersigned as a draft. It is acknowledged and agreed that the Borrower and the Tribe are entitled to rely on this Consent.

NAME OF LENDER

By:

Name:

Title:

Dated:

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EXHIBIT B

INTERCREDITOR AGREEMENT

See attached.

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Annex I

COMPLIANCE CERTIFICATE

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EX-10.37

Exhibit 10.37

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into as of this 28^th day of April, 2008, by and between Toby A. Arnheim, on behalf of myself and my heirs, personal representatives, executors, administrators and assigns (hereinafter, “Employee”) and the Mohegan Tribal Gaming Authority (hereinafter, “MTGA”), on its behalf and on behalf of its affiliates, successors, or assigns.

RECITALS

A. MTGA is an instrumentality of the Mohegan Tribe of Indians of Connecticut, a federally recognized Indian tribe, owners and operators of, among other things, the Mohegan Sun, a Class III gaming casino located on the Mohegan Reservation and operated under the authority of the National Indian Gaming Commission and the Indian Gaming Regulatory Act and pursuant to a Compact with the State of Connecticut; and

B. MTGA, as an instrumentality of the Mohegan Tribe of Indians of Connecticut, is a sovereign Indian tribal entity that is immune from unconsented suit; and

C. MTGA is willing to waive its sovereign immunity for the purposes and to the extent set forth herein, in consideration for Employee’s agreement to perform Employee’s obligations and duties as an employee of MTGA as such obligations and duties may be established, modified, or assigned by the President and CEO of MTGA (or his authorized designee) as per this Agreement; and

D. MTGA acts with respect to its employees exclusively through its President and CEO, in whom is vested sole legal authority to make decisions with respect to Employee’s employment, the terms and conditions of Employee’s employment and the continuation and/or termination of Employee’s employment; and

E. Employee has experience in the construction industry including managing, supervising and overseeing the design, construction, final program elements and completion of new projects , expansions, upgrades renovations, developments of existing projects, new developments, master plans and such other projects relating to improvements to real property as well as all appurtances thereto; and

F. MTGA desires and intends to employ the Employee as Senior Vice President of Construction as per the position description attached hereto and incorporated herein by reference as Exhibit A (hereinafter, “Position”) including those project or projects as may be assigned by MTGA from time to time and pursuant to the terms and conditions set forth in this Agreement.

NOW THEREFORE, in consideration of the mutual promises and covenants set forth herein, the incorporation of the above Recitals and of such other consideration the receipt and sufficiency of which each of the parties hereto acknowledges, Employee and MTGA agree as follows:

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1. DEFINITIONS As used in this Agreement:

1.1 “MTGA” means the Mohegan Tribal Gaming Authority, its successors and assigns, affiliates, and/or any organizations or businesses controlled by it.

1.2 “Conflicting Organization” means Employee and/or in affiliation with any person, group of persons, entity or organization which is engaged in or is about to become engaged in the design, development, administration, operation or marketing of a gaming casino in competition with MTGA.

1.3 “Base Salary” means Employee’s regular salary as established by the President and CEO and paid in regular periodic installments, subject to normal withholding and any deductions required by applicable law, and does not include any bonuses or additional compensation of any kind.

1.4 “Non-Compete Area” means the States of Connecticut, Rhode Island, Massachusetts, New Jersey and New York

2. EMPLOYEE COVENANTS

2.1 Employee shall not without the express prior written permission of the President and CEO of MTGA, during the duration of the term of this Agreement as the same may be otherwise extended and for a period of twelve (12) months following the termination of this Agreement for any reason or no reason:

(a) directly or indirectly engage in the gaming industry within the Non-Compete Area;

(b) contact for the purpose of soliciting business any person or entity who was at any time a patron of or vendor or supplier to MTGA;

(c) perform services of any kind for any person or entity that was at any time a patron of or vendor or supplier to MTGA; or

(d) directly or indirectly hire or offer to hire any employee or independent contractor of MTGA, or contact or solicit, directly or indirectly, any employee or independent contractor of MTGA for the purpose of recruiting such employee or independent contractor for employment or retention for another employer.

2.2 Employee further covenants and agrees that in the event that Employee voluntarily terminates such Employee’s employment by resignation, Employee shall deliver written notice of termination at least sixty (60) days in advance of said termination date to the President and CEO. Employee understands and acknowledges that should Employee exercise Employee’s right to terminate, Employee’s covenants as set forth in this Agreement including those set forth in 2.1 above remain in full force and effect for the duration and within the Non-Compete Area as set forth herein.

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2.3 Employee acknowledges that Employee’s skills are transferable or applicable to industries or entities which are not in competition with MTGA and/or that Employee may engage in the gaming industry outside the Non-Compete area, so that these covenants against competition with MTGA contained herein will not prevent Employee from earning a living. Employee understands that Employee may make a written request to the President and CEO of MTGA for a waiver of any of the provisions of this Paragraph 2, and that the decision of the President and CEO in response to any such request for such a waiver shall be final and shall not be subject to an appeal or review in any forum.

2.4 Employee also covenants that Employee is legally authorized to work in the United States and has the proper identification or proof as required by law. Furthermore Employee acknowledges that this Agreement is contingent upon Employee’s submission to the State of Connecticut of the required forms and accurate disclosures and Employee’s receipt of a temporary gaming license by the State of Connecticut Department of Revenue Services and the fulfillment of all other requirements of the State of Connecticut to which Employee is subject.

3. TERM

The Agreement will commence on April 28, 2008 and continue for a period of three (3) years through April 30, 2011 (“Original Term”) and thereafter upon a year to year basis upon the mutual consent of the parties to be determined 60 days prior to the expiration of the original 3 year term or each yearly .renewal, if any (“Term”), unless otherwise earlier terminated in accordance with the terms and conditions set forth herein.

4. COMPENSATION

4.1 All payments of Base Salary and other compensation or benefits to be provided to Employee shall be payable in accordance with MTGA’s ordinary payroll practices, subject to normal withholding and any deductions required by applicable law as the same may be changed from time to time and in accordance with MTGA’s policies and procedures except as otherwise specifically set forth herein.

(a) During the Term of this Agreement, MTGA shall compensate Employee a base salary (“Base Salary”) at the annual rate of $500,000 payable in installments as per MTGA’s regular periodic payments subject to deductions and withholding all in accordance with applicable law and the terms contained herein.

(b) Employee’s Base Salary may be subject to increase subject to MTGA’s policies and procedures regarding salary review, performance and financial criteria and increases, if any, then in effect for employees similarly situated to Employee as the President and CEO shall determine in his sole discretion.

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(c) During the Term of this Agreement, the Employee shall also receive travel and expense reimbursements in accordance with MTGA’s policies and procedures then in effect, and which may be amended from time to time.

(d) During the Term of this Agreement, Employee shall receive a car allowance and living allowance of $6000.00 pet month applying the standard gross up formula. Employee recognizes that this allowance is not considered base pay or used to calculate bonuses or any other benefits that may be granted by MTGA to its employees.

(e) During the term of this Agreement, Employee shall be eligible to participate in the bonus program established by the President and CEO with respect to other employees involved in construction management and/or construction supervision, which bonus program is a separate bonus program and not the bonus program, if any, generally made available to other MTGA executive management employees. This bonus program will be established and implemented based on Employee’s Position and completion of its duties and responsibilities using such factors as Employee’s adherence to the schedules contained in the budget(s) for the projects to be worked on by Employee, which will account for approximately 33% of the total bonus, meeting the budget(s) for said project(s) and/or the particular project or projects included in those duties and responsibilities assigned to Employee, which will account for approximately 33% of the total bonus and adhering to life safety policies and procedures, team work, leadership and such other criteria to be developed by MTGA for employees similarly situated to Employee, which will account for the remaining 33% of the total bonus with all such factors and criteria to be approved by the President and CEO in his sole and absolute discretion. Subject to the final approved bonus plan, incremental payments will be made annually with 25% of the total pool payable in year 1 and again in year 2 with the remaining 50% payable at the conclusion of the third year when final accounting of Project Horizon is complete. Employee acknowledges that Employee is not entitled to participate in any other bonus or incentive programs that maybe available to other employees of MTGA. In order to receive this bonus as described herein, Employee must be a current employee of MTGA, shall not have given notice of an intent to resign or terminate such Employee’s employment on or prior to the date the bonus is to be paid or is not subject to termination of employment by MTGA or otherwise subject to an investigation or other disciplinary proceeding.

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(i) MTGA anticipates that the bonus to which Employee is subject will be up to approximately 100% of the Employee’s Base Salary from a pool that will consist of a portion of the annual salaries of those employees similarly situated to Employee as well as such other factors as the President and CEO of MTGA shall determine in his sole discretion. Upon the finalization of the bonus program such program will be deemed to be a part this Agreement. Employee shall also be entitled to periodic payments of such bonus and remainder paid upon the completion of the project or projects as the President and CEO shall determine.

(e) Employee will be also entitled to be reimbursed for relocation and recruitment expenses (“Relocation Expenses”) up to Fifteen Thousand Dollars ($15,000) net in addition to Employee’s actual cost of the relocation of Employee’s personal or household goods in accordance with MTGA’s Relocation and Reimbursement Policy attached hereto as Exhibit B. This reimbursement to Employee is contingent upon Employee not resigning from Employee’s Position or otherwise terminating Employee’s employment by Position abandonment or otherwise prior to the expiration of the Term or twelve months, whichever is the earlier to occur (the “Amortization Period”). In the event the above occurs, Employee is required upon the termination or resignation date as described herein, reimburse Employer a portion of the Relocation Expenses equal to the unamortized portion of such Relocation Expenses, which Expenses will be amortized over a strait line basis over the Amortization Period. By way of an example if the Term of Employee’s Agreement is for 11 months and Employee receives reimbursement for Relocation Expenses in the amount of $9,000, if Employee resigns after 8 months, Employee shall be required to reimburse Employer $2,454.55 as the unamortized value of the Relocation Expenses amortized on a strait line basis over the Amortization Period, which in this example is a period of 11 months. Upon the termination of Employee’s Employment as described herein, Employee agrees to repay Employer and furthermore authorizes Employer to deduct from any wages or other sums or compensation due and owing to Employee hereunder the amount of the unamortized portion of said Relocation Expenses.

(f) MTGA and Employee acknowledge that such compensation and the other covenants and agreements of MTGA contained herein are fair and adequate compensation for the Employee’s services and for the mutual promises described herein.

(g) Employee acknowledges and agrees that any employee benefits provided to the Employee by MTGA incident to Employee’s employment are governed by the applicable plan documents, summary plan descriptions or employment policies, and may be modified, suspended or revoked at any time, in accordance with the terms and provisions of the applicable documents or policies.

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5. RESPONSIBILITIES

5.l Employee acknowledges and agrees that Employee shall be employed in the location set forth in Employee’s Position description and shall perform such services in such other locations, if any, as Employer may direct. Employee agrees to devote Employee’s best efforts and all of Employee’s working time to such Employee’s Position with MTGA. Employee shall not engage in any additional employment or perform any other services for any third party without the prior written approval of MTGA, which consent can be granted or withheld in MTGA’s sole discretion

5.2 The Employee acknowledges and agrees that the duties and responsibilities of the Employee required by the Position are wholly within the discretion of the Executive Vice President and Chief Operating Officer and/or such other individual(s) as the President and CEO may designate, which duties and responsibilities may be modified, or new duties and responsibilities may be imposed by MTGA consistent with the Position and/or the description of job duties and responsibilities.

5.3 Employee agrees that. during Employee’s employment, and continuing for a reasonable period after Employee’s termination of employment with MTGA, Employee will cooperate with and assist MTGA in defense of any claims that may be made against MTGA, and will cooperate with and assist MTGA in the prosecution of any claims that may be made by MTGA, to the extent that such claims may relate to the services performed by Employee hereunder. MTGA agrees to reimburse Employee for all of Employee’s reasonable out-of-pocket expenses associated with such assistance and cooperation, including travel expenses.

5.4 Employee understands and agrees that all records, material and information obtained by Employee about MTGA shall at all times be treated and maintained in confidence and shall remain the exclusive property of MTGA during and following the Term of Employee’s employment with the MTGA. Employee further agrees that Employee shall at all times adhere to all policies, standards and procedures as established by MTGA for protecting the confidentiality of information and records, including but not limited to trade secrets and will not use such confidential information for its own use or for the benefit of any other party. This provision shall survive the expiration or other termination of this Agreement.

5.5 Employee further understands that upon the termination of Employee’s employment with MTGA, Employee will return to and leave with MTGA all documents, records and notebooks concerning the business of the MTGA, including copies thereof, then in Employee’s actual or constructive possession, whether prepared by Employee or by others. Furthermore, Employee will not duplicate such materials or use any such materials for Employee’s own use or the use of another person, corporation or entity at any time, either during or following the Term hereof. This provision shall survive the expiration or other termination of this Agreement.

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6. TERMINATION

6.1 Employee acknowledges and agrees that the President and CEO or his designee has the right to terminate this Agreement, for any reason or no reason, by providing Employee with ten (10) days prior written notice of termination or payment in lieu of such compensation during such notice period. If the Agreement is terminated by Employee and not by MTGA, except as otherwise set forth herein, MTGA is not obligated to pay Employee compensation during such notice period unless MTGA elects to have Employee continue in such Employee’s employ during such period and only for the number of days MTGA elects to have Employee continue in such employ. However, if the Agreement is terminated by MTGA without “good cause” as defined below, MTGA covenants and agrees to provide Employee, the ten (10) day compensation period along with the severance pay as described in Paragraph 7 herein.

6.2 The Employee acknowledges and agrees that MTGA may terminate this Agreement at any time, without notice, for any ‘good cause’ to include but not be limited to the following:

a. The Employee’s violation of MTGA’s policies, including, but not limited to, Employee’s violation of the standards of personal conduct as set forth in Mohegan Sun Policy #27, as the same may be amended from time to time or if such policy is replaced, such replacement policy;

b. Employee’s breach of any of the covenants contained herein, including Employee’s covenants not to compete and not to solicit MTGA’s employees or independent contractors to work or provide services for another;

c. Employee’s conviction of a felony or a misdemeanor or any crime involving moral turpitude; or

d. Employee’s misconduct in the course and scope of Employee’s employment including theft, misappropriation of MTGA property, dishonesty or fraud;

e. A knowing violation of any law or regulation resulting in adverse consequences to MTGA;

f. Employee’s engagement, directly or indirectly, in a conflict of interest;

g. Employee’s failure or refusal to follow the directives of the Executive Vice President and Chief Operating Officer or the President and CEO; or

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h. The failure of Employee to maintain or obtain gaming and or other license(s) necessary for Employee to function and operate in the jurisdictions where Employee’s duties and responsibilities of the Position are to be performed or in other jurisdictions where MTGA may direct Employee to perform services.

Employee understands that the forgoing is merely illustrative of grounds of “good cause” termination, and is not an exclusive or exhaustive list.

Employee understands that Employee has a right to a rudimentary hearing prior to the termination of such Employee’s termination of employment for cause, at which hearing Employee shall be afforded an opportunity to present reasons to the President and CEO or his designee why the termination should not be imposed. However, Employee understands that any such hearing shall be subject to such limitations in time and scope that the MTGA may impose and is subject to the limited review and the limitation of damages or ‘Remedies” that are specifically set forth herein. Employee specifically and unconditionally waives all other rights and remedies.

In the event that Employee is terminated by MTGA for “good cause” MTGA shall only be required to pay Employee those amounts due to Employee up through the date of termination, and Employee shall not be entitled to receive any other compensation in the form of bonus, severance or otherwise.

6.3 REMEDIES

(a) Employee recognizes and acknowledges that if Employee violates the covenants and undertakings of this Agreement, Employee may cause MTGA irreparable injury and damage. Therefore, Employee agrees that should Employee violate this Agreement, MTGA may seek to enjoin Employee’s actions which are in breach of this Agreement and that MTGA is entitled to recover from Employee all of its reasonable costs and expenses, including reasonable attorney’s fees, incurred by or on behalf of MTGA in the enforcement of this Agreement or any part thereof and in its investigation of Employee’s violation of this Agreement, as well as any damages that may be proven to the satisfaction of a court of competent jurisdiction.

(b) Employee acknowledges that MTGA may disclose this Agreement to any entity with whom Employee becomes affiliated or employed following the termination of Employee’s employment with and by MTGA in order to enforce the restrictions contained herein regarding competition, solicitation and confidentiality.

(c) Employee understands that the Mohegan Tribe of Indians of Connecticut and MTGA have established the Mohegan Gaming Disputes Court on the Mohegan Reservation. Employee hereby expressly consents to the exercise of personal jurisdiction over Employee by the Mohegan Gaming Disputes Court.

(d) Employee understands and agrees that, since Employee is not restricted from traveling and relocating, MTGA may at its discretion bring an action to enforce this Agreement against Employee in any court that can assert personal jurisdiction over Employee, including but not limited to the Mohegan Gaming Disputes Court.

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(e) Employee understands and agrees that any claim made by Employee that MTGA has breached its obligations under this Agreement may be asserted solely and exclusively in the Mohegan Gaming Disputes Court. In order to permit the Mohegan Gaming Disputes Court to assert subject matter jurisdiction over such a claim, MTGA hereby grants a limited waiver of its sovereign immunity and consents to suit by Employee for enforcement of MTGA’s obligations under this Agreement but limits said waiver so that the maximum amount Employee may recover is twelve (12) months of base pay to be paid to Employee at normal intervals subject to withholding and $25,000 in a lump sum payment subject to withholding, and MTGA shall not be liable for any additional or consequential damages or compensation of any kind or nature.

7. SEVERANCE

Employee and MTGA acknowledge and agree that, if MTGA elects to terminate this Agreement at any time prior to the expiration of the Term, for any reason other than “good cause” as defined above, Employee shall, in addition to such compensation that has already accrued to Employee, be entitled to severance pay. Such severance pay shall be equal to the lesser of (i) the amount that would have been payable to Employee had this Agreement continued through the expected expiration date of the Original Term or (ii) twelve (12) months pay based on Employee’s Base Salary, either of which are subject to normal withholding and deductions and $25,000 in a lump sum amount, also subject to withholding.

8. SEVERABILITY

The parties acknowledge and agree that each covenant and/or provision of this Agreement shall be enforceable independently of every other covenant and/or provision. Furthermore, the parties acknowledge and agree that, in the event any covenant and/or provision of this Agreement is determined lobe unenforceable for any reason, the remaining covenants and/or provisions will remain effective, binding and enforceable. If invalidity or unenforceability is due to the unreasonableness of the time or the geographical areas covered by Paragraph 2, such provisions shall be effective for whatever length of time and within such area as a court of competent jurisdiction deems appropriate.

9. EFFECT OF WAIVERS

The failure of MTGA to insist upon strict adherence to one or more or all of the covenants and restrictions set forth above, on one or more occasions, or the failure to insist upon strict adherence by another MTGA employee who is a party to an agreement similar to this Agreement, shall not be construed as a waiver of MTGA’s right to require strict compliance with any or all of such covenants or restrictions.

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10. APPLICABLE LAW

This Agreement shall be governed for all purposes by the Constitution and laws of the Mohegan Tribe of Indians of Connecticut.

11. ACKNOWLEDGEMENT

11.1 Employee acknowledges that Employee has had an opportunity to review a copy of this Agreement prior to signing it and has carefully read and understands all of the terms stated in this Agreement.

11.2 Employee further acknowledges and understands that Employee must sign and abide by this Agreement in order to be eligible to receive the consideration described in this Agreement.

12. AMENDMENTS

This Agreement may only be amended by a written document signed by the President and CEO and Employee. In the event that substantial modification to Employee’s Position, work assignment, location of the performance of Employee’s duties and responsibilities, working hours, title, or other material change in the terms and conditions of Employee’s employment, is requested, such request shall be directed to the President and CEO, who has the sole authority to grant or deny any such requested changes. The decision of the President and CEO shall be final. Employee acknowledges that Employee’s covenants not to compete will remain in full force and effect regardless of any modifications of the terms and conditions of this Agreement.

13. NOTICES

Any notice required or permitted under this Agreement shall be in writing and shall be sent certified mail, return receipt requested or by next day mail service by a recognized national overnight service addressed as follows:

Employer:	The Mohegan Tribal Gaming Authority
	One Mohegan Sun Way
	Uncasville, CT 06382
	Attention: Executive Vice President and Chief Operating Officer With a copy to the President and CEO at the address set forth above
Employee:

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14. ENTIRE AGREEMENT

Both parties acknowledge and agree that this Agreement constitutes the complete and entire agreement between the parties; that the parties have executed this Agreement based upon the express terms and provisions set forth herein; that the parties have not relied on any representations, oral or written, which are not set forth in this Agreement; that no previous agreement, either oral or written, shall have any effect on the terms or provisions of this Agreement; and that all previous agreements, either oral or written, are expressly superseded and revoked by this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

The Mohegan Tribal Gaming Authority

/s/    Mitchell Grossinger Etess

Mitchell Grossinger Etess

President and CEO

/s/    Toby A. Arnheim

Employee Signature

Toby A. Arnheim

Printed Name of Employee

April 22, 2008

Date

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EX-10.38

Exhibit 10.38

AMENDMENT TO EMPLOYMENT AGREEMENT

This Amendment to Employment Agreement (“Amendment”) is made this 9th day of April, 2009 by and between Toby A. Arnheim (“Employee”) and the Mohegan Tribal Gaming Authority (“MTGA”) with its principal place of business at One Mohegan Sun Boulevard, Uncasville, CT 06382.

Whereas, on April 28, 2008, Employee entered into an Employment Agreement with MTGA; and

Whereas, the parties wish to amend a certain provision in the Employment Agreement.

Now therefore, in consideration of the covenants and the mutual promises of the parties contained herein, the incorporation of the above paragraphs and other good and valuable consideration, the receipt and sufficiency of which each of the parties hereto acknowledges, the parties agree as follows:

1. Paragraph 4.1 (d) shall be deleted in its entirety and replaced with the following:

“4.1 (d) During the Term of this Agreement. Employee shall receive a car allowance and living allowance of $7,000.00 per month applying the standard gross up formula. Employee recognizes that this allowance is not considered base pay or used to calculate bonuses or any other benefits that may be granted by MTGA to its employees.”

2. This Amendment shall be effective April 1, 2009.

3. This Amendment may be executed in any number of counterparts and each shall be deemed an original and together shall constitute one and the same instrument.

4. This Amendment is intended to supplement and amend the Employment Agreement. To the extent any of the provisions contained in this Amendment conflict with or are inconsistent with the provisions of the Employment Agreement the provisions of this Amendment shall govern. Except to the extent set forth herein, the Employment Agreement shall remain in full force and effect.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment on the date first above written.

Mohegan Tribal Gaming Authority		Toby A. Arnheim
By:	/s/    Jeffrey E. Hartmann	By:	/s/    Toby A. Arnheim
Title:	EVP/COO

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EX-12.1

Exhibit 12.1

	For the Fiscal Years Ended September 30,
	2009			2008			2007			2006			2005
	(in thousands, except ratios)
Income from continuing operations before minority interests	$	117,352		$	146,531		$	171,898		$	154,350		$	22,925
Fixed charges		132,691			128,861			126,975			123,553			116,134
Amortization of capitalized interest		2,263			1,287			1,945			3,186			3,276
Capitalized interest		(1,062	)		(6,548	)		(1,673	)		(1,180	)		(21	)
Minority interests		1,992			2,729			648			420			514
Earnings	$	253,236		$	272,860		$	299,793		$	280,329		$	142,828
Interest expense, net of capitalized interest	$	101,407		$	88,962		$	90,528		$	87,952		$	84,905
Capitalized interest		1,062			6,548			1,673			1,180			21
Amortization of debt issuance costs		8,282			4,831			3,835			2,976			3,106
Interest portion of rental expense (1)		1,515			1,435			1,145			738			636
Accretion of discount to the relinquishment liability		20,425			27,085			29,794			30,707			27,466
Total fixed charges	$	132,691		$	128,861		$	126,975		$	123,553		$	116,134
Ratio of earnings to fixed charges		1.91			2.12			2.36			2.27			1.23

(1) A 10.0% factor was utilized to calculate the interest portion of rental expense, which the Authority believes to be a reasonable approximation.

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EX-31.1

Exhibit 31.1

CERTIFICATION

I, Mitchell Grossinger Etess, certify that:

1. I have reviewed this Annual Report on Form 10-K for the fiscal year ended September 30, 2009 of the Mohegan Tribal Gaming Authority;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in the Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 28, 2009	/S/    MITCHELL GROSSINGER ETESS
	Mitchell Grossinger Etess Chief Executive Officer, Mohegan Tribal Gaming Authority

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Leo M. Chupaska, certify that:

1. I have reviewed this Annual Report on Form 10-K for the fiscal year ended September 30, 2009 of the Mohegan Tribal Gaming Authority;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in the Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 28, 2009	/S/    LEO M. CHUPASKA
	Leo M. Chupaska Chief Financial Officer, Mohegan Tribal Gaming Authority

EX-32.1

Exhibit 32.1

Written Statement of Chief Executive Officer

Pursuant to Section 906 of the

Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)

The undersigned, the Chief Executive Officer of the Mohegan Tribal Gaming Authority (the “Authority”), hereby certifies that, to his knowledge, on the date hereof:

(a) this Annual Report on Form 10-K of the Authority for the fiscal year ended September 30, 2009 filed on the date hereof with the Securities and Exchange Commission (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(b) information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Authority.

/S/    MITCHELL GROSSINGER ETESS        

Mitchell Grossinger Etess

Chief Executive Officer, Mohegan Tribal Gaming Authority

December 28, 2009

A signed original of this written statement required by Section 906 has been provided to the Authority and will be retained by the Authority and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

Written Statement of Chief Financial Officer

Pursuant to Section 906 of the

Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)

The undersigned, the Chief Financial Officer of the Mohegan Tribal Gaming Authority (the “Authority”), hereby certifies that, to his knowledge, on the date hereof:

(a) this Annual Report on Form 10-K of the Authority for the fiscal year ended September 30, 2009 filed on the date hereof with the Securities and Exchange Commission (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(b) information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Authority.

/S/    LEO M. CHUPASKA        

Leo M. Chupaska

Chief Financial Officer, Mohegan Tribal Gaming Authority

December 28, 2009

A signed original of this written statement required by Section 906 has been provided to the Authority and will be retained by the Authority and furnished to the Securities and Exchange Commission or its staff upon request.