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Mohegan Sun and Foxwoods downgraded

2 March 2009

UNCASVILLE, Connecticut -- As reported by The Norwich Bulletin: "As if the slumping gaming revenues aren't bad enough, the two major rating companies — Standard & Poor's and Moody's Investors Service — have downgraded Mohegan Sun and Foxwoods, and could do so again as the year progresses.

"The ratings — an independent opinion of the general creditworthiness of a company — indicate a loss of confidence in the current economic malaise at the two tribal casinos. In more practical terms, diminished ratings mean the casinos could face difficulty borrowing money for things like expansion, including for a Foxwoods casino in Philadelphia.

"There is no rule that says interest rates are tied to ratings, but a downgrade reflects credit quality. With riskier credit comes higher interest, said Keith Foley, senior vice president of Moody's.

"...The financial morass Mohegan Sun and Foxwoods find themselves mired in affects most casino markets, said David G. Schwartz, director of the Center for Gaming Research at the University of Nevada at Las Vegas. The Connecticut casinos face constrained liquidity, high debt levels and a weakening credit market for the balance of the year, the ratings companies say..."

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