| LONG-TERM DEBT | LONG-TERM DEBT: Long-term debt consisted of the following (in thousands): September 30, 2021 September 30, 2020 New Senior Secured Credit Facility - Revolving $ 27,000 $ — Line of Credit 20,227 — Prior Senior Secured Credit Facility - Revolving — 197,000 Prior Senior Secured Credit Facility - Term Loan A, net of discount and debt issuance costs of $4,199 — 227,710 Prior Senior Secured Credit Facility - Term Loan B, net of discount and debt issuance costs of $20,809 — 792,829 2021 8% Senior Secured Notes, net of discount and debt issuance costs of $17,269 1,157,731 — 2016 7 7/8% Senior Unsecured Notes, net of discount and debt issuance costs of $6,401 and $8,179, respectively 493,599 491,821 MGE Niagara Credit Facility - Revolving 27,534 26,187 MGE Niagara Credit Facility - Swingline 4,333 — MGE Niagara Credit Facility - Term Loan, net of debt issuance costs of $855 and $847, respectively 68,965 69,297 MGE Niagara Convertible Debenture 31,468 29,928 Mohegan Expo Credit Facility, net of debt issuance costs of $214 and $658, respectively 25,697 27,750 Guaranteed Credit Facility, net of debt issuance costs of $573 and $877, respectively 27,208 29,529 Mohegan Tribe Subordinated Loan — 5,000 Redemption Note Payable, net of discount of $8,710 and $15,701, respectively 53,130 69,099 Other 1,862 3,860 Long-term debt 1,938,754 1,970,010 Less: current portion of long-term debt (80,276) (75,355) Long-term debt, net of current portion $ 1,858,478 $ 1,894,655 Maturities of long-term debt, excluding unamortized debt issuance costs and discounts, are as follows (in thousands): Fiscal Years 2022 $ 80,490 2023 56,693 2024 127,988 2025 500,025 2026 1,175,720 Thereafter 31,860 Total $ 1,972,776 Refinancing Transactions On January 26, 2021, the Company completed a series of refinancing transactions, including (i) the entry into a new senior secured credit facility, (ii) issuance of new senior secured notes, (iii) prepayment of its prior Senior Secured Credit Facilities, (iv) prepayment of its Main Street Term Loan Facility and (v) repayment of the Mohegan Tribe Subordinated Loan. The Company incurred $24.0 million in costs in connection with these refinancing transactions. Previously deferred debt issuance costs and debt discounts totaling $23.7 million and new transaction costs of $0.1 million were recorded as a loss on modification and early extinguishment of debt. New debt issuance costs totaling $4.5 million were capitalized and will be amortized over the term of the related debt. The remaining $19.4 million in new debt issuance costs was reflected as debt discount and will be amortized over the term of the related debt. New Senior Secured Credit Facility On January 26, 2021, the Company entered into a credit agreement (the “Credit Agreement”) among the Company, the Mohegan Tribe, Citizens Bank, N.A., as administrative agent, and the other lenders and financial institutions party thereto, providing for a $262.875 million senior secured revolving credit facility (the “New Senior Secured Credit Facility”). The New Senior Secured Credit Facility matures on April 14, 2023. The initial draw under the New Senior Secured Credit Facility, together with proceeds from the 2021 Senior Secured Notes (defined below), was used to (i) prepay all amounts outstanding under the prior Senior Secured Credit Facilities, (ii) prepay all amounts outstanding under the Main Street Term Loan Facility, (iii) repay the Mohegan Tribe Subordinated Loan and (iv) pay related fees and expenses. The New Senior Secured Credit Facility will otherwise be available for general corporate purposes. Borrowings under the New Senior Secured Credit Facility bear interest as follows: (i) for base rate loans, a base rate equal to the highest of (x) the prime rate, (y) the federal funds rate plus 50 basis points and (z) the one-month LIBOR rate plus 100 basis points (the highest of (x), (y) and (z), the “base rate”), plus a leverage-based margin of 100 to 275 basis points; and (ii) for Eurodollar rate loans, the applicable LIBOR rate (subject to a 0.75% LIBOR floor) plus a leverage-based margin of 200 to 375 basis points. The Company is also required to pay a leverage-based undrawn commitment fee on the New Senior Secured Credit Facility of between 37.5 and 50 basis points. Interest on Eurodollar rate loans is payable in arrears at the end of each applicable interest period, but not less frequently than quarterly. Interest on base rate advances is payable quarterly in arrears. As of September 30, 2021, outstanding borrowings under the New Senior Secured Credit Facility accrue interest at 4.50%. The leverage-based undrawn commitment fee was 50 basis points as of September 30, 2021. As of September 30, 2021, letters of credit issued under the New Senior Secured Credit Facility totaled $2.0 million. The Company had $213.7 million of borrowing capacity under the New Senior Secured Credit Facility as of September 30, 2021, after factoring in outstanding letters of credit. The New Senior Secured Credit Facility is fully and unconditionally guaranteed, jointly and severally, by each of 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 Digital, LLC, Mohegan Digital Services, LLC, MGNV Holding, LLC and MGNV, LLC (the “Guarantors”; and the Guarantors other than Mohegan Basketball Club LLC, the “Grantors”). The New Senior Secured Credit Facility is secured on a first priority senior secured basis by collateral constituting substantially all of the Company’s and Grantors’ assets. In the future, certain other subsidiaries of the Company may be required to become Guarantors and/or Grantors in accordance with the terms of the Credit Agreement and related loan documents. The Credit Agreement contains certain customary covenants applicable to the Company and its restricted subsidiaries, including covenants governing: incurrence of indebtedness, incurrence of liens, payment of dividends and other distributions, investments, asset sales, affiliate transactions and mergers or consolidations. Additionally, the Credit Agreement includes financial maintenance covenants pertaining to total leverage, secured leverage and fixed charge coverage, as well as a minimum liquidity covenant under certain conditions. The Credit Agreement also contains customary events of default relating to, among other things, failure to make payments, breach of covenants and breach of representations. Line of Credit On January 26, 2021, in connection with the New Senior Secured Credit Facility, the Company entered into a $25.0 million revolving credit facility with Bank of America, N.A. (the “Line of Credit”). The Line of Credit is coterminous with the New Senior Secured Credit Facility. Pursuant to provisions of the New Senior Secured Credit Facility, under certain circumstances, the Line of Credit may be converted into loans under the New Senior Secured Credit Facility. Each advance accrues interest at a base rate plus a spread. As of September 30, 2021, outstanding borrowings under the Line of Credit accrue interest at 4.00%. The Line of Credit contains negative covenants and financial maintenance covenants that are substantially the same as those contained in the New Senior Secured Credit Facility. 2021 8% Senior Secured Notes On January 26, 2021, the Company issued $1.175 billion second priority senior secured notes with interest at 8% per annum (the “2021 Senior Secured Notes”). The 2021 Senior Secured Notes mature on the earlier of February 1, 2026 and the Springing Maturity Date (as defined in the 2021 Senior Secured Notes indenture). Interest on the 2021 Senior Secured Notes is payable semi-annually in arrears on February 1 and August 1. The proceeds from the 2021 Senior Secured Notes were used as described above. Prior to February 1, 2023, the Company may redeem the 2021 Senior Secured Notes, in whole or in part, at a price equal to 100% of the principal amount of the 2021 Senior Secured Notes redeemed plus accrued and unpaid interest, if any, to, but not including, the date of redemption, and a make-whole premium (as described in the 2021 Senior Secured Notes indenture). In addition, the Company may, during the twelve-month period commencing on the issue date of the 2021 Senior Secured Notes and during the twelve-month period subsequent to such initial twelve-month period and prior to February 1, 2023, redeem in each such twelve-month period up to 10% of the initial aggregate principal amount of the 2021 Senior Secured Notes at a price equal to 103% of the principal amount of the 2021 Senior Secured Notes redeemed plus accrued and unpaid interest, if any, to, but not including, the date of redemption, provided that if the Company does not redeem 10% of the initial aggregate principal amount of the 2021 Senior Secured Notes during the initial twelve-month period commencing on the issue date of the 2021 Senior Secured Notes, the Company may, in the subsequent twelve-month period prior to February 1, 2023, redeem the 2021 Senior Secured Notes in an amount that does not exceed 10% of the initial aggregate principal amount of the 2021 Senior Secured Notes plus the difference between (i) 10% of the initial aggregate principal amount of the 2021 Senior Secured Notes and (ii) the aggregate principal amount of any 2021 Senior Secured Notes redeemed during such initial twelve-month period. On or after February 1, 2023, the Company may redeem some or all of the 2021 Senior Secured Notes at prices set forth in the 2021 Senior Secured Notes indenture plus accrued and unpaid interest, if any, to, but not including, the date of redemption. The 2021 Senior Secured Notes are fully and unconditionally guaranteed, jointly and severally, by each of the Guarantors and will be guaranteed by each other restricted subsidiary of the Company that becomes a guarantor in accordance with the terms of the 2021 Senior Secured Notes. The 2021 Senior Secured Notes are secured on a second priority senior secured basis by collateral constituting substantially all of the Company’s and Grantors’ assets. The 2021 Senior Secured Notes indenture contains certain customary covenants, including in respect of the Company’s and its restricted subsidiaries’ ability to incur additional debt, pay dividends or distributions, make certain investments, create liens on assets, enter into transactions with affiliates, merge or consolidate with another company or sell assets. The 2021 Senior Secured Notes indenture includes customary events of default, including, but not limited to, failure to make required payments and failure to comply with certain covenants. 2016 7 7 / 8 % Senior Unsecured Notes In October 2016, the Company issued $500.0 million senior unsecured notes with interest at 7.875% per annum (the “2016 Senior Unsecured Notes”). The 2016 Senior Unsecured Notes mature on October 15, 2024. Interest on the 2016 Senior Unsecured Notes is payable semi-annually in arrears on April 15 and October 15. Prior to October 15, 2019, the Company could have redeemed the 2016 Senior Unsecured Notes, in whole or in part, at a price equal to 100% of the principal amount of the 2016 Senior Unsecured Notes redeemed plus accrued and unpaid interest, if any, to the date of redemption and a make-whole premium. The 2016 Senior Unsecured Notes are redeemable at the Company’s option, in whole or in part, at any time on or after October 15, 2019, at specified redemption prices, plus accrued and unpaid interest, if any, to the date of redemption. If the Company experiences specific kinds of change-of-control triggering events, it is required to make an offer to repurchase the 2016 Senior Unsecured Notes at a price equal to 101% of the principal amount, plus accrued and unpaid interest, if any. Additionally, if the Company undertakes specific kinds of asset sales and does not use the related sale proceeds for specified purposes, the Company may be required to offer to repurchase the 2016 Senior Unsecured Notes at a price equal to 100% of the principal amount, plus accrued and unpaid interest, if any. In certain circumstances, if any gaming regulatory authority requires a holder or beneficial owner of the 2016 Senior Unsecured Notes to be licensed, qualified or found suitable under applicable gaming laws, and such holder or beneficial owner does not obtain such license, qualification or finding of suitability within a specified time, the Company can require such holder or beneficial owner to dispose of its 2016 Senior Unsecured Notes or call for redemption of the 2016 Senior Unsecured Notes held by such holder or beneficial owner at a price equal to accrued and unpaid interest, if any, plus the lesser of 100% of the principal amount thereof or the price paid for such notes by such holder or beneficial owner. The 2016 Senior Unsecured Notes are unsecured, unsubordinated obligations of the Company, and are guaranteed by certain of the Company’s restricted subsidiaries. The 2016 Senior Unsecured Notes indenture contains certain covenants that, subject to certain significant exceptions, limit, among other things, the Company’s and certain of its restricted subsidiaries’ ability to incur additional debt, pay dividends or distributions, make certain investments, create liens on assets, enter into transactions with affiliates, merge or consolidate with another company or transfer and sell assets. The 2016 Senior Unsecured Notes indenture also includes events of default, including, but not limited to, failure to make required payments, failure to comply with certain agreements or covenants, failure to pay certain other indebtedness the occurrence of which is caused by a failure to pay principal, premium or interest or results in the acceleration of such indebtedness, certain events of bankruptcy and insolvency and certain judgment defaults. MGE Niagara Credit Facilities In June 2019, MGE Niagara entered into a credit agreement with, among others, Bank of Montreal, as administrative agent, and the lenders party thereto (the “MGE Niagara Credit Agreement”), providing for certain credit facilities (the “MGE Niagara Credit Facilities”). On July 14, 2021, MGE Niagara entered into an amendment to the terms of the MGE Niagara Credit Facilities pursuant to an amended and restated credit agreement (the “MGE Niagara Amended Credit Agreement”). Among other things, the amendments contained in the MGE Niagara Amended Credit Agreement provide for a revolving credit facility in the amount of up to 180.0 million Canadian dollars ($141.6 million as of September 30, 2021) (the “MGE Niagara Revolving Facility”), a swingline facility in the amount of up to 20.0 million Canadian dollars ($15.7 million as of September 30, 2021) (the “MGE Niagara Swingline Facility”) and a term loan facility in the amount of 90.0 million Canadian dollars ($70.8 million as of September 30, 2021) (the “MGE Niagara Term Loan Facility”). The MGE Niagara Amended Credit Agreement also reduced the Letter of Credit Sub-Limit under the MGE Niagara Revolving Facility to 45.0 million Canadian dollars ($35.4 million as of September 30, 2021). Availability under the MGE Niagara Revolving Facility and the MGE Niagara Swingline Facility is determined based on Province of Ontario-approved gaming capacity levels as set forth in the MGE Niagara Amended Credit Agreement. The MGE Niagara Credit Facilities mature on June 10, 2024. The MGE Niagara Term Loan Facility is repayable, in quarterly installments, at a rate of 5.0 million Canadian dollars ($3.9 million as of September 30, 2021) per annum, commencing September 30, 2019. Borrowings under the MGE Niagara Credit Facilities accrue interest at a base rate plus a spread. MGE Niagara is also required to pay a leverage-based Undrawn Fee under the MGE Niagara Revolving Facility of between 75 and 125 basis points. The MGE Niagara Amended Credit Agreement adjusted the Applicable Margin and Undrawn Fee (each as defined in the MGE Niagara Amended Credit Agreement) to provide for an additional pricing level, commencing from the closing date of the MGE Niagara Amended Credit Agreement until the end of the Initial Retesting Quarter (as defined in the MGE Niagara Amended Credit Agreement), which Initial Retesting Quarter commences with the first full fiscal quarter where gaming capacity is equal to or greater than 50% for the entirety of such fiscal quarter, or during any voluntary or involuntary closing period, as follows: (i) Bankers’ Acceptances, Letters of Credit, LIBOR Loans and CDOR Loans equal to 500 basis points, (ii) Prime Rate Loans and USBR Loans equal to 350 basis points and (iii) Undrawn Fee equal to 125 basis points. As of September 30, 2021, outstanding borrowings under the MGE Niagara Revolving Facility, the MGE Niagara Swingline Facility and the MGE Niagara Term Loan Facility accrue interest at 5.43%, 5.95% and 5.43%, respectively. As of September 30, 2021, the Undrawn Fee under the MGE Niagara Revolving Facility was 125 basis points. As of September 30, 2021, letters of credit issued under the MGE Niagara Revolving Facility totaled $35.0 Canadian dollars ($27.5 million as of September 30, 2021). MGE Niagara had $49.5 Canadian dollars ($38.9 million as of September 30, 2021) of borrowing capacity under the MGE Niagara Revolving Facility and MGE Niagara Swingline Facility as of September 30, 2021, after factoring in outstanding letters of credit and limitations under the MGE Niagara Credit Agreement in place at that time due to gaming capacity restrictions. MGE Niagara is an unrestricted subsidiary under the Company’s existing credit facilities and indentures and the MGE Niagara Credit Facilities are non-recourse to the Company and its restricted subsidiaries thereunder. The MGE Niagara Credit Facilities are secured by, among other things, substantially all of the properties and assets of MGE Niagara, subject to certain customary exceptions, as well as by a pledge of (i) all of the issued and outstanding shares of MGE Niagara and (ii) a convertible debenture held by a third-party investor. The MGE Niagara Credit Agreement contains customary covenants applicable to MGE Niagara, including covenants governing: incurrence of indebtedness, incurrence of liens, payment of dividends and other distributions, asset sales, acquisitions and investments, affiliate transactions and fundamental changes. The MGE Niagara Credit Agreement also includes financial maintenance covenants pertaining to total leverage and fixed charge coverage. In addition, the MGE Niagara Credit Agreement contains customary events of default relating to, among other things, failure to make payments, breach of covenants and breach of representations. The MGE Niagara Amended Credit Agreement amended the financial maintenance covenants applicable to MGE Niagara as follows: (i) during any Closure Period (as defined in the MGE Niagara Amended Credit Agreement), (a) minimum weekly liquidity in the amount of 12.5 million Canadian dollars ($9.8 million as of September 30, 2021) and (b) minimum monthly contractual payments from the Ontario Lottery and Gaming Corporation in the amount of 3.75 million Canadian dollars ($3.0 million as of September 30, 2021); (ii) after a reopening of the MGE Niagara Resorts, minimum liquidity in the amount of 15.0 million Canadian dollars ($11.8 million as of September 30, 2021), tested weekly until such time as the MGE Niagara Resorts have been open for twelve The MGE Niagara Amended Credit Agreement also restricts Permitted Management and Consulting Fees and other Distributions (as defined in the MGE Niagara Amended Credit Agreement) to those permitted by lender consent until (i) the completion of four consecutive fiscal quarters demonstrating compliance with the maximum Total Leverage Ratio (as defined in the MGE Niagara Amended Credit Agreement) and (ii) a Total Leverage Ratio (as defined in the MGE Niagara Amended Credit Agreement) of less than 3.00:1.00 for the two most recent consecutive fiscal quarters. MGE Niagara Convertible Debenture In June 2019, MGE Niagara issued a convertible debenture (the “MGE Niagara Convertible Debenture”) to a third-party investor (the "Convertible Debenture Holder") in an aggregate principal amount of 40.0 million Canadian dollars ($31.5 million as of September 30, 2021). The MGE Niagara Convertible Debenture is convertible, at the option of the Convertible Debenture Holder, between the fourth and sixth anniversaries of the Closing Date, into Class B Special shares representing 40% of the capital of MGE Niagara. The Class B Special shares will be similar in nature to the existing Common shares. The MGE Niagara Convertible Debenture accrues interest at an annual rate of 3.50% prior to the sixth anniversary of the Closing Date and 8.00% thereafter, compounded annually. The first interest payment is payable on June 11, 2022, with annual payments due thereafter. Repayment of the outstanding principal, plus any accrued interest, is due thirty days following the expiration or the termination of the Casino Operating and Services Agreement. If the MGE Niagara Convertible Debenture is not converted as of the sixth anniversary of the Closing Date, either MGE Niagara or the Convertible Debenture Holder may elect early repayment of half of the principal outstanding as of such date. Mohegan Expo Credit Facility In April 2017, the Company, through its wholly-owned subsidiary, Mohegan Expo Center, LLC (“Mohegan Expo”), entered into a loan agreement with certain third-party lenders providing for a $25.0 million tax-exempt senior secured multi-draw term loan with an $8.3 million increase option (the “Mohegan Expo Credit Facility”). In September 2017, Mohegan Expo exercised the Mohegan Expo Credit Facility increase option. The proceeds from the Mohegan Expo Credit Facility were used to partially finance the construction of an $80.0 million exposition and convention center (the “Earth Expo & Convention Center”). The Earth Expo & Convention Center opened in May 2018. For the fiscal years ended September 30, 2021, 2020 and 2019, Mohegan Expo generated net revenues totaling $1.9 million, $3.5 million and $6.0 million, respectively, and loss from operations totaling $1.8 million, $1.4 million and $81,000, respectively. The Mohegan Expo Credit Facility matures on April 1, 2022. The Mohegan Expo Credit Facility is repayable with an initial payment of $1.1 million for the period from April 18, 2018 through September 30, 2018 commencing on October 1, 2018 and in quarterly installments, at a rate of $2.5 million per annum, thereafter. As of September 30, 2021, outstanding borrowings under the Mohegan Expo Credit Facility accrue interest at 3.95%. Mohegan Expo is required to maintain a six-month debt service reserve in a designated account under the Mohegan Expo Credit Facility. The Mohegan Expo Credit Facility is a senior secured obligation of Mohegan Expo, collateralized by all existing and future assets of Mohegan Expo. The Mohegan Expo Credit Facility subjects Mohegan Expo to certain covenant requirements. Guaranteed Credit Facility In September 2018, the Company entered into a loan agreement with certain third-party lenders providing for a $23.7 million term loan secured by a 90% loan guarantee by the Department of the Interior, Assistant Secretary—Indian Affairs, Division of Capital Investment (the “Guaranteed Credit Facility”), pursuant to the Indian Loan Guaranty, Insurance and Interest Subsidy Program (the “BIA Loan Guaranty Program”). In October 2018, the Company entered into a follow-on loan agreement providing for an additional $11.3 million term loan under the BIA Loan Guaranty Program. This additional term loan completed the allocation to the Company of $35.0 million in guaranteed term loans under the BIA Loan Guaranty Program. The proceeds from the Guaranteed Credit Facility were used to reimburse certain costs relating to the Earth Expo & Convention Center. The Guaranteed Credit Facility matures on October 1, 2023. The Guaranteed Credit Facility is repayable, in quarterly installments, at a rate of $2.6 million per annum, commencing January 1, 2019. As of September 30, 2021, outstanding borrowings under the Guaranteed Credit Facility accrue interest at 2.84%. The Guaranteed Credit Facility subjects the Company to certain covenant requirements. Redemption Note Payable |
