8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): June 11, 2020

MOHEGAN TRIBAL GAMING AUTHORITY

(Exact name of registrant as specified in its charter)

Not Applicable	033-80655	06-1436334
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One Mohegan Sun Boulevard, Uncasville, CT	06382
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (860) 862-8000

Not Applicable

(Former name or former address, if changed since last report)

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	None	None

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Item 1.01 Entry into a Material Definitive Agreement.

On June 11, 2020, the Mohegan Tribal Gaming Authority d/b/a Mohegan Gaming & Entertainment (“MGE”) entered into a waiver (the “Waiver”) in respect of the indenture (the “Indenture”) governing its 7.875% Senior Notes due 2024 (the “Notes”), by and among MGE, The Mohegan Tribe of Indians of Connecticut, and U.S. Bank National Association, as trustee.

The Waiver waives any default or event of default that may occur with respect to the Notes under Section 6.01(j) of the Indenture that is the direct result of the cessation of gaming operations that commenced in March 2020 due to the recent global outbreak of a novel strain of coronavirus (COVID-19).

The summary of certain terms of the Waiver set forth above is qualified by reference to the full text of the Waiver, which is filed as Exhibit 4.1 to this Current Report on Form 8-K and incorporated herein by reference. Reference is also made to the full text of the Indenture, which is filed as Exhibit 4.1 to MGE’s Annual Report on Form 10-K for the fiscal year ended September 30, 2019 filed with the Securities and Exchange Commission on December 20, 2019.

Item 8.01 Other Events.

On March 18, 2020, in order to ensure the health and safety of its employees, guests and the surrounding communities in which MGE operates, consistent with directives from various government bodies, MGE announced its decision to temporarily suspend operations at its North American owned, operated and managed properties. During these closures, MGE took steps to significantly reduce expenses to protect its financial position, including the implementation of significant reductions in variable operating expenses, furloughs of approximately 98% of its workforce, reduction in capital expenditures and suspension of growth investments, among other initiatives. In late May 2020, two of MGE’s managed properties, Paragon Casino Resort and ilani Casino Resort, reopened, and on June 1, 2020, MGE’s flagship property, Mohegan Sun Casino, partially reopened. Based on data that is currently available, the following information reflects estimated, preliminary operating trends for Mohegan Sun from its opening date on June 1, 2020 through June 14, 2020 compared to the same period in 2019:

• Gaming revenues for Mohegan Sun since reopening (June 1, 2020 through June 14, 2020) increased approximately 10% compared to the prior year period;

• Net revenues for Mohegan Sun since reopening (June 1, 2020 through June 14, 2020) declined approximately 20% compared to the prior year period;

• Income from operations for Mohegan Sun since reopening (June 1, 2020 through June 14, 2020) increased approximately 15% compared to the prior year period;

• Adjusted EBITDA for Mohegan Sun since reopening (June 1, 2020 through June 14, 2020) increased approximately 10% compared to the prior year period;

• Operating margin for Mohegan Sun since reopening (June 1, 2020 through June 14, 2020) increased approximately 900 basis points compared to the prior year period; and

• Adjusted EBITDA margin for Mohegan Sun since reopening (June 1, 2020 through June 14, 2020) increased approximately 1,000 basis points compared to the prior year period.

MOHEGAN SUN

ADJUSTED EBITDA RECONCILIATION

Reconciliation of Income from Operations to Adjusted EBITDA:

Reconciliation of income from operations, a financial measure determined in accordance with accounting principles generally accepted in the United States of America, or GAAP, to Adjusted EBITDA is shown below (in thousands, unaudited):

	For the Period June 1 through June 14
	2020		2019
Income from operations	$	10,129	$	8,908
Depreciation and amortization		2,741		2,873
Adjusted EBITDA	$	12,870	$	11,781

Adjusted EBITDA Explanation:

Net income before interest, income taxes, depreciation and amortization, or EBITDA, is a commonly used measure of performance in the casino and hospitality industry. EBITDA is not a measure of performance calculated in accordance with GAAP. MGE historically has evaluated its operating performance with the non-GAAP measure, Adjusted EBITDA, which as used in this Current Report on Form 8-K represents income from operations before depreciation and amortization.

These trends are preliminary estimates only, based solely on currently available information relating to Mohegan Sun for the limited period from June 1, 2020 through June 14, 2020, and these trends may not continue at this property and may not recur at MGE’s other properties as they reopen, including as a result of varying levels of restrictions on operations imposed by governmental authorities, customer response and demand, the potential for authorities reimposing restrictions in response to continued developments with the COVID-19 pandemic and other events that could require new closures or delayed reopenings of MGE’s properties, and the other factors described under “Risk Factors” in MGE’s public filings. MGE does not intend to update interim results for its reopened properties or its other properties. In addition, these results are preliminary, based on management estimates, have not been reviewed by MGE’s auditors, or any other independent accounting firm, and are subject to change. MGE does not prepare monthly, property-level financials and MGE has not yet closed the financial records for its current fiscal quarter and, as a result, the information contained herein may not be indicative of final results for the period from June 1, 2020 through June 14, 2020 or indicative of the full fiscal quarter. As a result, this information constitutes forward-looking information and, therefore, this information is subject to risks and uncertainties, including possible adjustments and the risk factors highlighted under “Risk Factors” in MGE’s public filings.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
4.1	Waiver, dated as of June 11, 2020, by and among The Mohegan Tribal Gaming Authority, The Mohegan Tribe of Indians of Connecticut, and U.S. Bank National Association, as trustee

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	MOHEGAN TRIBAL GAMING AUTHORITY D/B/A
	MOHEGAN GAMING & ENTERTAINMENT
Date: June 17, 2020	By:	/s/ Ralph James Gessner Jr.
		Ralph James Gessner Jr.
		Chairman, Management Board

EX-4.1

Exhibit 4.1

EXECUTION VERSION

WAIVER

This Waiver (this “Waiver”), dated as of June 11, 2020, is made by and among The Mohegan Tribal Gaming Authority (the “Authority”), an instrumentality of The Mohegan Tribe of Indians of Connecticut (the “Tribe”), a federally recognized Indian tribe, in respect of that certain Indenture, dated as of October 14, 2016 (the “Indenture”), among the Authority, the Tribe, the guarantors party thereto and U.S. Bank National Association (the “Trustee”), pursuant to which the Authority has outstanding $500,000,000 aggregate principal amount of 7.875% Senior Notes due 2024 (the “Notes”), the Tribe and the Trustee. Capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Indenture.

WHEREAS, Section 6.01(j) of the Indenture provides that an Event of Default occurs with respect to the Notes if there is a cessation of gaming operations for a period of more than 90 consecutive days at the Resort or Pocono (other than as a result of a casualty loss);

WHEREAS, Section 9.02 of the Indenture provides that, subject to certain conditions, compliance with any provision of the Indenture or the Notes may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes (the “Requisite Consents”);

WHEREAS, the Authority issued a Consent Solicitation Statement, dated June 3, 2020, pursuant to which the Authority solicited the Holders to consent to the waiver set forth in Section 1 hereof (the “Consent Solicitation”);

WHEREAS; in accordance with the Consent Solicitation, as of 5:00 p.m. New York City time, on June 9, 2020, the Requisite Consents have been validly delivered by Holders and not validly revoked and the Authority has delivered to the Trustee the Requisite Consents to the waiver set forth in Section 1 hereof;

WHEREAS, the Authority hereby requests that the Trustee join with the Authority and the Tribe in the execution of this Waiver to confirm the Requisite Consents to the waiver set forth in Section 1 hereof;

NOW, THEREFORE, in consideration of the foregoing mutual agreements set forth herein, the parties hereto agree as follows:

Section 1.    Waiver. Any Default or Event of Default that may occur with respect to the Notes under Section 6.01(j) of the Indenture that is the direct result of the cessation of gaming operations that commenced in March 2020 due to the recent global outbreak of a novel strain of coronavirus (COVID-19) has been waived in accordance with the terms and conditions of the Indenture.

Section 2.    Ratification of Indenture. Except as expressly waived hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Waiver shall form a part of the Indenture for all purposes, and every Holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby. The Indenture and this Waiver shall henceforth be read and construed together for all purposes.

Section 3.    Trustee’s Disclaimer. The Trustee is entering into this Waiver in reliance on the Requisite Consents and the Officer’s Certificate and Opinion of Counsel being delivered by the Authority in connection herewith. In accordance therewith, the Trustee accepts the waiver to the Indenture effected hereby, but on the terms and conditions set forth in the Indenture, including the terms and provisions defining and limiting the liabilities and responsibilities of the Trustee. Without limiting the generality of the foregoing, the Trustee shall not be responsible in any manner whatsoever for or with respect to any of the recitals or statements contained herein, all of which recitals or statements are made solely by the Authority, or for or with respect to (i) the validity or sufficiency of this Waiver or any of the terms or provisions hereof, (ii) the proper authorization hereof by the Authority or the Tribe by action or otherwise, (iii) the due execution hereof by the Authority and the Tribe, or (iv) the consequences of any waiver herein provided for, and the Trustee makes no representation with respect to any such matters.

Section 4.    Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS WAIVER WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PRINCIPLES THEREOF (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

Section 5.    Miscellaneous. This Waiver shall be construed, administered and applied in accordance with the provisions of the Indenture. This Waiver may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original and all of which shall constitute together but one and the same agreement. Delivery of an executed counterpart of a signature page to this Waiver (including via any electronic means) by facsimile or other electronic transmission shall be effective as delivery of a manually executed counterpart of this Waiver.

[Remainder of page intentionally left blank]

IN WITNESS WHEREOF, the parties hereto have caused this Waiver to be duly executed as of the date first set forth above.

MOHEGAN TRIBAL GAMING AUTHORITY
By:	s/ Mario C. Kontomerkos
	Name:	Mario C. Kontomerkos
	Title:	Chief Executive Officer

THE MOHEGAN TRIBE OF INDIANS OF CONNECTICUT
By:	s/ Ralph James Gessner Jr.
	Name:	Ralph James Gessner Jr.
	Title:	Chairman

U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:	s/ Alicia Pelletier
	Name:	Alicia Pelletier
	Title:	Vice President

[Signature Page to Waiver]