<PAGE>


                      SECURITIES AND EXCHANGE COMMISSION

                            WASHINGTON, D.C. 20549

                                   FORM 10-K 

            [X] ANNUAL REPORT PURSUANT TO SECTION 12 OR 15(d) OF THE

                 SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]

                  For the fiscal year ended September 30, 1996

                                      OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

                 SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

           For the transition period from inception to September 30, 1996

                        Commission file number 033-80655

                        MOHEGAN TRIBAL GAMING AUTHORITY

             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARACTER)

             Non applicable                                06-143633
             ----------------------------------------------------------

             (State or other jurisdiction of           (IRS employer
            incorporation or organization)          Identification No.)

            Mohegan Sun Boulevard, P. O. Box 348, Uncasville, CT  06382
            -----------------------------------------------------------
            (address of principal executive offices)      (Zip Code)

         Registrant's telephone number, including area code (860) 204-7190

Securities Registered Pursuant to Section 12(b) of the Act: None

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    .                 
                                                  ---    ---

Securities Registered Pursuant to Section 12(g) of the Act: None

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 the Registrants' 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. Yes  X   No    .
                                 ---     ---


<PAGE>
                         MOHEGAN TRIBAL GAMING AUTHORITY

                                       INDEX



PART I.                                                                  PAGE

Item 1.  Business                                                         1
Item 2.  Properties                                                       4
Item 3.  Legal Proceedings                                                5
Item 4.  Submission of Matters to a Vote of Security Holders              5

PART II.

Item 5.  Market                                                           6
Item 6.  Selected Financial Data                                          6
Item 7.  Management Discussion and Analysis                               6
Item 8.  Financial Statements and Supplementary Data                      7
Item 9.  Change in and Disagreements with Accountants                     7

PART III.

Item 10. Executive Officers                                               8
Item 11. Executive Compensation                                          12
Item 12. Security Ownership                                              12
Item 13. Related Party Transactions                                      12

PART IV.

Item 14. Exhibits and Schedules                                          13







<PAGE>
                                   PART I
                                   ------

ITEM 1 - BUSINESS
-----------------

A. GENERAL DEVELOPMENT OF BUSINESS
   -------------------------------

The Mohegan Tribal Gaming Authority (the "Authority"), established in July 
15, 1995, is an instrumentality of the Mohegan Tribe of Indians of 
Connecticut (the "Tribe"). The Authority is developing a gaming and 
entertainment facility (the "Mohegan Sun"). The Authority's year-end is 
September 30.

The Authority has two major functions. The first, delegated to the 
Authority's Management Board, was to engage Trading Cove Associates ("TCA"), 
a Connecticut general partnership, to manage the development, operation, 
management, promotion and construction of the Mohegan Sun and all related 
development. The Management Board consist of the nine members of the Council 
(the governing body of the Tribe). The Management Board also selects tribal 
representatives to a Business Board which oversees the business aspects of 
the gaming operation (the "Business Board"). The Business Board is 
established under the management agreement between the Tribe and TCA (the 
"Management Agreement") and consists of two members appointed by the Tribe 
and two members appointed by TCA.

The second major function of the Authority is to regulate gaming. The 
Management Board appoints an independent Director of Regulation to ensure the 
integrity of the gaming operation through the promulgation and enforcement of 
appropriate regulation. The Director of Regulation serves at the pleasure of 
the Management Board. The Director is responsible for issuance and revocation 
of gaming licenses and employs a staff that is responsible for performing 
background investigation into gaming license applicants.

The Tribe and the Authority have entered into a land lease ("Lease") pursuant 
to which the Tribe is leasing to the Authority certain land located in 
southeastern Connecticut on which the Mohegan Sun is being constructed (the 
"Site"). The Site is a portion of a parcel of land that has been acquired and 
held in trust for the Tribe by the United States of America, with the Tribe 
retaining perpetual rights to the use of the Site.

The Tribe established the Authority with the exclusive power to conduct and 
regulate gaming activities for the Tribe. Under the Indian Gaming Regulatory 
Act of 1988, as amended ("IGRA"), 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 tribal state compact 
with the affected state. The Tribe and the State of Connecticut have entered 
into such a compact (the "Compact") that has been approved by the U.S. 
Secretary of the Interior.

<PAGE>

The Authority has engaged TCA to manage the development, construction and 
operation of the Mohegan Sun. TCA is 50% owned by Sun Cove Ltd., an owned 
affiliate of Sun International Hotels Limited ("Sun International") and 50% 
by Waterford Gaming, LLC.

The Authority is financing the development of the Mohegan Sun with the 
proceeds of the sale of $175.0 million of 13 1/2% Senior Notes due 2002 (the 
"Senior Notes"), $40.0 million of Subordinated Notes due 2003 (the 
"Subordinated Notes"), approximately $40.0 million available under 
equipment lease financing (the "Equipment Financing") and approximately $13.0 
million of senior indebtedness available for working capital purposes (the 
"Working Capital Financing"). In addition, Sun International has provided a 
$50.0 million secured completion guarantee to fund any cost overruns (the 
"Secured Completion Guarantee").

B. NARRATIVE DESCRIPTION OF BUSINESS
   ---------------------------------

GENERAL
-------

The Mohegan Sun is located on a heavily wooded 240-acre site on the banks of 
the Thames River, in southeastern Connecticut. The Mohegan Sun's historical 
northeastern Indian theme is conveyed through architectural features and the 
use of natural design elements such as timber, stone, and water. The Mohegan 
Sun is separated into four themed quadrants, each of which has its own unique 
entrance and is designed to reflect a separate seasonal theme - winter, 
spring, summer and fall - emphasizing the importance of the seasonal changes 
to tribal life.  The approximately 625,000 square foot facility includes 
approximately 150,000 square feet of gaming space, and is designed to 
accommodate approximately 3,000 slot machines and 180 table games. At the 
commencement of operation on October 12, 1996, the Authority had 2,500 slot 
machines and 179 table games.

The Mohegan Sun food service includes a 680-seat buffet, three specialty 
theme restaurants, a coffee shop, deli and a large food court. Multiple 
full-service and floor service bars are located throughout the facility, plus 
a lounge with live entertainment. For non-gaming entertainment, the Mohegan 
Sun offers a children's recreation area and child care facilities.

CURRENT STATUS
--------------

Although Mohegan Sun commenced operations subsequent to year-end, the final 
costs of developing, contructing, equipping and opening the Mohegan Sun have 
not been finalized. The $318 million total budgeted project costs are based 
on budgets prepared by the Authority with the assistance of Sun 
International, TCA and the contractors.  The Authority has entered into a 
guaranteed maximum price contract with the general contractor, Morse Diesel 
International, for the construction of Mohegan Sun. The final amount paid 
under such contract, however, is subject to modification based upon the 
occurrence of certain events, such as design change orders and costs 
associated with 


                                     2

<PAGE>

certain types of delays. The Authority and Morse Diesel 
International currently are negotiating whether certain costs incurred in 
construction of the Mohegan Sun are covered under the guaranteed maximum 
price or whether such cost increases are the result of change orders or other 
events that could result in an increase in the contract price above the 
guaranteed maximum price. The resolution of all or some of these issues in 
favor of Morse Diesel International may result in the final cost of Mohegan 
Sun exceeding its current budget. Based upon its review of the budget and the
open cost items, the Authority believes that the final, total cost of 
developing, constructing, equipping and opening the Mohegan Sun will not 
exceed the sum of the proceeds from the sale of the Senior Notes and the 
Subordinated Notes and amounts available under the Secured Completion 
Guarantee, the Equipment Financing and the Working Capital Financing. 
However, there is no assurance that such costs will not exceed budgeted 
amounts. As of December 4, 1996, the Authority has drawn $42 million under 
the Secured Completion Guarantee and issued additional subordinated notes to 
Sun International in principal amount equal of the amount of the draw. The 
Authority may not obligate itself to pay development costs in excess of $325 
million without the further consent of the National Indian Gaming Commission 
(the "NIGC"). In the event the resolution of the issues with Morse Diesel 
International result in total development costs being in excess of $325 
million, the Authority would require the consent of the NIGC, and there can 
be no assurances such consent would be given.

SEASONABILITY
-------------

Mohegan Sun currently operates in an industry which reflects the conditions 
that the seasons bring to Connecticut. The volume tends to peak in spring and 
summer as tourists come to the east coast, while fall and winter seasons tend 
to decline slightly as the climate changes.

COMPETITIVE CONDITIONS
----------------------

Because Mohegan Sun is marketed primarily to the day-trip customer, it 
competes primarily with other casinos within 150 miles and, to a lesser 
extent, with casinos in Atlantic City, New Jersey. Currently, Foxwoods is the 
only casino in operation within 150 miles of Mohegan Sun site. Foxwoods is 
located approximately 10 miles from the Mohegan Sun site and is currently the 
largest gaming facility in the United States in terms of the number of slot 
machines.

Currently, outside Atlantic City, New Jersey, casino gaming in the 
northeastern United States may be conducted only by federally recognized 
Indian tribes operating under IGRA. In addition to the Pequot Tribe, which 
operates Foxwoods, a federally recognized tribe in Rhode Island and a 
federally recognized tribe in Massachusetts are each seeking to establish 
gaming operations in their respective states. The Oneida Tribe, which 
operates a gaming facility in upstate New York, is seeking to expand its 
operations. In addition, a number of Indian tribes in New England are seeking 
federal recognition in order to establish gaming operations. The Authority 
cannot predict whether any of these tribes will be successful in establishing 
gaming operations and, if established, whether such gaming operations will 
have a material adverse effect on the proposed operations of Mohegan Sun.

In addition, a number of states, including Connecticut, have investigated 
legalizing casino gaming by non-Indians in one or more locations. In November 
1995, the Connecticut state legislature rejected a proposal submitted by the 
Pequot Tribe to develop a casino in Bridgeport, Connecticut. The Pequot 
proposal has been submitted in response to a request for proposals made by 
the State of Connecticut. Under the Compact, the Authority believes that if 
Connecticut were to legalize any gaming operations other than pursuant to 
IGRA (i.e., by an Indian tribe on Indian land) with slot machines or other 
commercial casino games, the Mohegan Tribe would no

                                       3
<PAGE>

longer be required to make payments to the State of Connecticut related to 
slot machine revenues (see Note 6 to Financial Statements). The Authority is 
unable to predict whether the Connecticut state legislature will accept any 
other casino proposal and, if such proposal results in a casino being 
contructed and opened, whether such casino will have a material adverse 
effect on Mohegan Sun.

ITEM 2 - PROPERTIES
-------------------

The Authority has entered into a Lease with the Tribe with respect to the 
Site. The initial term of the Lease is 25 years, with an option to extend the 
term for one additional 25 year term provided that the Authority is not in 
default under the Lease. The Lease also provides that all improvements 
constructed on the Site will become the property of the Tribe and subject to 
the Lease. The Lease is a net Lease requiring that the Authority be 
responsible for all costs of operating, constructing, maintaining, repairing, 
replacing and insuring the leased property, plus paying the Tribe an annual 
rent of $1.00. In addition to the rent, the Authority has used the proceeds 
from the issuance of the of the Subordinated Notes, as described in Note 2 to 
the Financial Statements, to acquire the Site on behalf of the Tribe. Due to 
these payments and other terms of the Lease described above, expenditures 
made by the Authority in connection with the acquisition of the Site and 
additional parcel (See Note 1 to Financial Statements) have been recorded as 
deferred lease costs and related improvements have been reflected as 
leasehold interests for financial reporting purposes. The deferred lease 
costs will be amortized on a straight-line basis over the term of the Lease, 
plus the option period (a total of 50 years). The leasehold interest will be 
amortized on a straight-line basis over the estimated life of the building 
(40 years).

The Site for Mohegan Sun, located approximately one mile from the interchange 
of I-395 and Connecticut Route 2A (which has been widened to a four-lane 
expressway), is just outside Montville, Connecticut. As part of its 
integrated development plan, the Authority has constructed a four-lane access 
road (with its own exit) from Route 2A, giving patrons of the Mohegan Sun 
direct access to Interstate 395 and Interstate 95, the main highway 
connecting Boston, Providence, and New York.




                                        4

<PAGE>

ITEM 3 - LEGAL PROCEEDINGS
--------------------------

The Authority does not have any legal proceedings pending as of September 30, 
1996.

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------

None.


                                        5

<PAGE>

                                    PART II
                                    -------

ITEM 5 - MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS
-------------------------------------------------------------------------------

Not applicable.


ITEM 6 - SELECTED FINANCIAL DATA
--------------------------------

The Authority was organized in July 1995 and completed its first full fiscal 
year on September 30, 1996. As a result of the Authority's brief operating 
history, Selected Financial Data has been omitted from Item 6 and readers are 
referred to the audited Financial Statements of the Authority contained 
elsewhere herein under Item 8.


ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
--------------------------------------------------------------------

GENERAL
-------

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

Proceeeds from the sale of the Senior Secured Notes and Subordinated Notes 
along with amounts available under Working Capital Financing and the 
Equipment Financing are the Authority's principal sources of liquidity for 
the fiscal year ended September 30, 1996.

The cost of developing, constructing, equipping and opening the Mohegan Sun 
is expected to total approximately $318.0 million, which consists of $305.0 
million of project development costs and $13.0 million of initial working 
capital.

Management has secured cash from Senior Secured Notes of $175.0 million, 
Equipment Financing for up to $40.0 million, Subordinated Notes of $40.0 
million, $50.0 million under the Secured Completion Guarantee provided by Sun 
International and $13.0 million in Working Capital which are the Authority's 
principal sources of liquidity.

For the period from inception, July 15, 1995, through September 30, 1996, the 
Authority expended $230.5 million for the development of the Mohegan Sun which 
included $14.9 million of interest paid on May 15, 1996, to the holders of the 
Senior Notes.

In addition, on November 15, 1996, Mohegan Sun has made an interest payment 
of $11.8 million to the holders of the Senior Notes. As of December 4, 1996, 
the Authority has drawn $42.0 million under the Secured Completion Guarantee 
and issued additional subordinated notes to Sun International in principal 
amount equal to the amount of the draw.



                                      6


<PAGE>

Management believes that with the commencement of operations at the Mohegan 
Sun, on October 12, 1996, cash flow from operating activities will be sufficient
to pay for operations and service all debt incurred for the development of the 
Mohegan Sun.


ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
----------------------------------------------------

See Index to Financial Statements on page 15.


ITEM 9 - CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
-----------------------------------------------------------------------
         FINANCIAL DISCLOSURE
         --------------------

None.


                                        7


<PAGE>

                                   PART III
                                   --------

ITEM 10 - EXECUTIVE OFFICERS AND MEMBERS OF THE MANAGEMENT BOARD
----------------------------------------------------------------

MANAGEMENT
----------

The senior management for the Authority is responsible for the day to day 
operations of Mohegan Sun. Generally, matters of policy pertaining to the 
business of the Mohegan Sun must be approved by the Business Board.

The Authority has two major functions. The first, delegated to the 
Authority's Management Board, was to engage TCA to manage the development, 
operation, management, promotion and construction of the gaming enterprise 
and all related development. The Management Board consist of the nine members 
of the Council. The Management Board also selects tribal representatives to a 
Business Board which oversees the business aspects of the gaming operation 
(the "Business Board"). The Business Board is established under the 
Management Agreement and consists of two members appointed by the Tribe and 
two members appointed by TCA.

The second major function of the Authority is to regulate gaming. The 
Management Board appoints an independent Director of Regulation to ensure the 
integrity of the gaming operation through the promulgation and enforcement of 
appropriate regulation. The Director of Regulation serves at the pleasure of 
the Management Board. The Director of Regulation is responsible for issuance 
and revocation of gaming licenses and employs a staff that is responsible for 
performing background investigation into gaming license applicants.

The Senior Management of Mohegan Sun has been actively engaged in the gaming 
and lodging industries over the past twenty years.


The following table provides information as of September 30, 1996 with 
respect to each of (i) executive officers of the Authority and (ii) the 
members of the Management Board.

Name                        Age    Position
----                        ---    --------

Roland Harris.............   49    Chairman and member, Management Board


                                       8

<PAGE>

Name                        Age    Position
----                        ---    --------

Jayne Fawcett.............   59    Vice Chairman and member, Management Board

William J. Velardo........   41    Executive Vice President and General Manager

George T. Papanier........   39    Senior Vice President and Chief Financial 
                                    Officer

Mitchell Grossinger Etess.   38    Senior Vice President, Marketing

Carlisle Fowler...........   66    Treasurer and member, Management Board

Loretta Roberge...........   64    Corresponding Secretary and member, 
                                    Management Board

Shirley Walsh.............   48    Recording Secretary and member, Management 
                                    Board

Mark Brown................   38    Member, Management Board

Courtland Fowler..........   68    Member, Management Board

Maynard Strickland........   51    Member, Management Board

Glen R. LaVigne...........   35    Member, Management Board

___________________

ROLAND HARRIS- Mr. Harris has been Chairman and a member of the Management 
Board since October 1995. Mr. Harris is the founder and president of the firm 
Harris and Clark, Inc. - Civil Engineers, Land Surveyors & Land Planners, 
which has performed services for the Authority. Mr. Harris has served as 
First Selectman and CEO of the Town of Griswold, Connecticut and also as its 
Planning and Zoning Commissioner. He has served as Deputy Chief of the 
Griswold Fire Department as Fire Marshall and Inspector of the Town of 
Griswold. Prior to assuming the Chairmanship of the Management Board, Mr. 
Harris serves as the Tribal Planner. In addition to his duties as Chairman, 
Mr. Harris also is a member of the Business Board and Director of the Tribe's 
Housing Authority.

JAYNE FAWCETT- Ms. Fawcett has been Vice Chairman of the Management Board 
since December 1995 and a member of the Management Board since July 15, 1995. 
Ms. Fawcett worked as a social worker for the State of Connecticut in 1987 
and recently retired from teaching after 27 years of service. Ms. Fawcett was 
Chairman of the Constitutional Review Board from 1992 to 1993. In addition, 
she serves as an alternate on the Business Board and oversees the Tribe's 
public relations.

WILLIAM J. VELARDO- Mr. Velardo has been Executive Vice President, General 
Manager of the Authority since October 1995 and has 20 years of experience in 
gaming operations. Prior to his employment with the Authority, Mr. Velardo 
was Chief Operating Officer for River City, a riverboat gaming joint venture in
New Orleans, Louisiana. From 1991 to

                                       9

<PAGE>

1994, Mr. Velardo served as Senior Vice President, Casino Operations 
at Trump Plaza Hotel and Casino in New Jersey. Mr. Velardo opened the Mirage 
in Las Vegas and was Vice President, Table Games from 1989 to 1991. Mr. 
Velardo also worked as Assistant Casino Manager and Pit Manager for Caesars 
Tahoe and Caesars Palace.

GEORGE T. PAPANIER- Mr. Papanier has been Senior Vice President of Finance 
and the Chief Financial Officer of the Authority since October 1995. He has 
17 years experience in the casino and hotel industry. Prior to joining the 
Authority, Mr. Papanier worked for Hemmeter Enterprises from November 1994 to 
July 1995 as its Vice President of Operations and prior thereto was Vice 
President of Finance for Trump Plaza Hotel and Casino. Mr. Papanier also held 
various financial management positions at Bally's Grand, Golden Nugget and 
Sands Hotel and Casino. Mr. Papanier is a certified public accountant.

MITCHELL GROSSINGER ETESS- Mr. Etess has been Senior Vice President, 
Marketing since November 1995 and has 16 years experience in the casino and 
hotel industry. Prior to his employment with the Authority, Mr. Etess was 
Vice President 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 casino and 
hotel industry.

CARLISLE FOWLER- Mr. Fowler has been the Treasurer and a member of the 
Management Board since July 15, 1995 has been active in the Tribe's 
government for over 20 years. Prior to his retirement in 1989, Mr. Fowler was 
an electronics technician for the State of Connecticut and operated his own 
electronics business. Mr. Fowler serves on the Business Board and on the 
Finance Committee of the Management Board. Mr. Carlisle Fowler is the brother 
of Mr. Courtland Fowler.

LORETTA ROBERGE-  Mrs. Roberge has been Corresponding Secretary and a member 
of the Management Board since July 15, 1995. Mrs. Roberge has served as a 
paraprofessional at the Mohegan School for 24 years, working with children 
with special needs. Active in the Tribe's community all her life, Mrs. 
Roberge previously served as secretary of the Management Board. She presently 
chairs the Finance Committee, co-chairs the Glad and Sad Committee and is a 
member of the Cemetery Committee of the Tribe. 

SHIRLEY WALSH- Mrs. Walsh has been the Recording Secretary of the Management 
Board since October 1995 and has been a member of the Management Board since 
July 15, 1995. Mrs. Walsh has worked for the Tribe in various capacities for 
almost four years. Prior to that time, she was employed for 13 years by a 
local certified public accountant. Mrs. Walsh chaired the Tribe's Election 
Committee from 1994 to 1995 and serves on the Bingo, Glad and Sad and the 
Wigwam Committees of the Tribe.

MARK BROWN- Mr. Brown has been a member of the Management Board since October 
1995 and serves as the secretary liaison for the Council. Prior to joinng the 
Council, he served as a law enforcement officer for eight years. Mr. Brown 
worked with the Tribe's

                                      10


<PAGE>

historian during the period in which the Tribe was working to obtain federal 
recognition and also served on the Constitutional Review Board from 1993 to 
1994. Mr. Brown is the son of Ms. Pauline Brown, who is serving on the 
Constitutional Review Board. Mr. Brown has co-chaired the Tribe's Wigwam 
Committee for the past two years and also serves on its Cemetery Committee.

COURTLAND FOWLER- Mr. Fowler has been a member of the Management Board since 
July 15, 1995 and was a major contributor to the cultural research that led 
to the federal recognition of the Tribe. Mr. Fowler continues to lend his 
expertise to the Cultural Resources Department. Mr. Fowler was previously 
employed as a chemical operator and assistant foreman a Pfizer until his 
retirement in 1990. He served as Vice Chairman of the Management Board, as a 
member of the Constitutional Review Board and as a member of the Tribe's 
Cemetery Committee. Mr. Fowler also was on the committee that drafted the 
first constitution of the Tribe. Mr. Courtland Fowler is the brother of Mr. 
Carlisle Fowler.

MAYNARD STRICKLAND- Mr. Strickland has been a member of the Management Board 
since October 1995. During the past 20 years, Mr. Strickland owned and 
operated several restaurants in Norwich, Connecticut and in Florida. Mr. 
Strickland is actively engaged in developing the Tribe's Bingo facility to be 
housed in the Mohegan Sun Casino. Mr. Strickland was born and raised in the 
Tribe community, continuing a long family tradition of tribal involvement.

GLENN R. LAVIGNE- Mr. LaVigne has been a member of the Management Board since 
January 1996. Mr. LaVigne has been employed by the Town of Montville, 
Connecticut since 1979 and oversees building and maintenance for Montville's 
seven municipal buildings.




                                      11

<PAGE>

ITEM 11 - EXECUTIVES COMPENSATION
---------------------------------

The Authority does not offer their executive offers stock option or stock 
appreciation right plans.

The following table set for compensation paid or accrued during the year-end 
September 30, 1996, to the Executive Officers:

                     SUMMARY COMPENSATION TABLE
                     --------------------------
 
                                    Fiscal
Name and Principal Position       Year Ended      Salary
---------------------------       ----------     --------

William J. Velardo                  1996         $270,078
Executive Vice President

Mitchell Grossinger Etess           1996         $159,411
Senior Vice President Marketing

George T. Papanier                  1996         $146,105
Senior Vice President Finance
and Chief Financial Officer

ITEM 12 - SECURITY OWNERSHIP
----------------------------

The Gaming Authority has no outstanding voting securities.

ITEM 13 - RELATED PARTY TRANSACTIONS
------------------------------------

Mohegan Sun is managed by Trading Cove Associates, a partnership owned 
equally by Waterford Gaming LLC and a wholly-owned subsidiary of Sun 
International. Some employees of the Authority are tribal members. 
Additionally, it is the intention of the Authority to provide contracts or 
services to the members of the Tribe when compatible to the local market.

On October 7, 1995, the Authority entered into an agreement pursuant to which 
Harris and Clark, Inc. agreed to provide surveyance, civil engineering and 
professional design services to the Authority. Roland Harris, Chairman of the 
Management Board of the Authority, is the founder and president of the Harris 
and Clark, Inc. As of September 30, 1996, the Authority had paid 
approximately $547,706 in fees to Harris and Clark Inc. pursuant to such 
agreement. The Authority believes that the terms and conditions of this 
transaction are no less favorable than the Authority could have obtained at 
that time from unaffiliated third parties.


                                      12


<PAGE>

                                    PART IV
                                    -------

ITEM 14 - EXHIBITS AND SCHEDULES
--------------------------------

Exhibit
  No.          Description
-------        -----------

  3.1          Constitution of the Mohegan Tribe of Indians of Connecticut 
               (the "Tribe") ratified by Tribal vote on April 12, 1996 
               {**Exhibit 3.1}*

  3.2          Ordinance No. 95-7/15-1 of the Tribe for Gaming on Tribal 
               Lands, enacted on July 20, 1995 {**Exhibit 3.2}*

  4.1          Indenture dated as of September 29, 1995 among the Mohegan 
               Tribal Gaming Authority of the Tribe (the "Authority"), the 
               Tribe and First Fidelity Bank, as trustee {**Exhibit 4.1}*

  4.2          Purchase Agreement dated September 21, 1995 among Bear, 
               Stearns & Co. Inc. and Donaldson, Lufkin & Jenrette Securities 
               Corporation (collectively, the "Initial Purchasers"), the 
               Authority and the Tribe {**Exhibit 4.2}*

  4.3          Registration Rights Agreement dated as of September 29, 1995 
               among the Authority and the initial Purchasers {**Exhibit 4.3}*

 10.1          The Mohegan Tribe--State of Connecticut Gaming Mohegan Compact 
               between the Tribe and the State of Connecticut (the "Compact") 
               {**Exhibit 10.1}*

 10.2          Agreement dated April 25, 1994 between the Tribe and the State 
               of Connecticut resolving certain land claims (the "Resolution 
               Agreement") {**Exhibit 10.2}*

 10.3          Memorandum of Understanding April 25, 1994 between the Tribe 
               and the State of Connecticut regarding implementation of the 
               Compact and the Resolution Agreement {**Exhibit 10.3}*

 10.4          Agreement between the Tribe and the Town of Montville, 
               Connecticut {**Exhibit 10.4}*

---------------------
* Incorporated herein by reference to the specified Exhibit to the 
Authority's Registration Statement on Form S-1 (Registration No. 33-80655).


                                      13


<PAGE>

Exhibit
  No.          Description
-------        -----------


 10.5          Land Lease dated September 29, 1995 between the Tribe and the 
               Authority; Amendment of Land Lease dated September 29, 1995 
               {**Exhibit 10.5}*

 10.6          Open-end Construction--Permanent Leasehold Mortgage Deed, 
               Assignment of Leases and Rents and Security Agreement dated as 
               of September 29, 1995 between the Tribe and First Fidelity Bank,
               as trustee {**Exhibit 10.6}*

 10.7          Amended and Restated Gaming Facility Development and 
               Construction Agreement dated September 1, 1995 between the Tribe
               and Trading Cove Associates ("TCA") {**Exhibit 10.7}*

 10.8          Amended and Restated Gaming Facility Management Agreement 
               dated August 30, 1995 between the Tribe and TCA {**Exhibit 
               10.8}*

 10.9          Secured Completion Guarantee dated as of September 29, 1995 by 
               Sun International Hotels Limited ("Sun") in favor of First 
               Fidelity Bank, as trustee {**Exhibit 10.9}*

 10.10         Note Purchase Agreement dated as of September 29, 1995 between 
               the Authority and Sun {**Exhibit 10.10}*

 10.11         Cash Collateral Accounts Pledge and Security Agreement dated 
               as of September 29, 1995 among First Fidelity Bank, as trustee, 
               TCA, Sun, the Authority and the Tribe {**Exhibit 10.11}*

 10.12         Disbursement and Escrow Agreement dated as of September 29, 
               1995 among First Fidelity Bank, as escrow agent, Chicago Title 
               Insurance Company, as disbursement agent, First Fidelity Bank, 
               as trustee, TCA, Sun and the Authority {**Exhibit 10.12}*

 10.13         Pledge Agreement dated September 29, 1995 between Sun 
               International Investments Limited and First Fidelity Bank 
               {**Exhibit 10.13}*

 24.1          Consent of Independent Public Accounts of the Authority
               (as filed on page F-1 of 10-K)

 27            Financial Data Schedule

---------------------
* Incorporated herein by reference to the specified Exhibit to the 
Authority's Registration Statement on Form S-1 (Registration No. 33-80655).


                                      14


<PAGE>

                                 INDEX TO FINANCIAL STATEMENTS

Report of Independent Public Accountants                           F-1

Balance Sheets of Mohegan Tribal Gaming Authority as of
  September 30, 1996 and 1995                                      F-2-F-3

Statement of Cash Flows of Mohegan Tribal Gaming Authority
  as of September 30, 1996 and 1995                                F-4

Notes to Financial Statements of Mohegan Tribal Gaming Authority   F-5-F-13


                                      15

<PAGE>

                         REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Mohegan Tribal Gaming Authority:

We have audited the accompanying balance sheets of the Mohegan Tribal Gaming 
Authority (a development state entity) as of September 30, 1996 and 1995, and 
cash flows for the period of inception (July 15, 1995) to September 30, 1996. 
These financial statements are the responsibility of management. Our 
responsibility is to express an opinion on these financial statements based 
on our audits.

We conducted our audits in accordance with generally accepted auditing 
standards. 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. 
An audit also includes assessing the accounting principles used and 
significant estimates made by management, as well as evaluating the overall 
financial statement presentation. We believe that our audits provide a 
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in 
all material respects, the financial position of the Mohegan Tribal Gaming 
Authority as of September 30, 1996 and 1995, and its cash flows for the 
period from inception (July 15, 1995) to September 30, 1996, in conformity 
with generally accepted accounting principles.

                                ARTHUR ANDERSEN LLP

Hartford, Connecticut
November 27, 1996

                                       F-1
<PAGE>

                          MOHEGAN TRIBAL GAMING AUTHORITY
                          -------------------------------
                                  BALANCE SHEETS
                                  --------------
                  AS OF SEPTEMBER 30, 1996 AND SEPTEMBER 30, 1995
                  -----------------------------------------------
                                  (in thousands)
                                  --------------

            ASSETS                         SEPTEMBER 30,        SEPTEMBER 30,
            ------                             1996                  1995
                                               ----                  ----

CURRENT ASSETS:
 Cash                                        $  7,437             $   --
 Restricted cash                                5,100              213,300
 Deposits                                       5,900                 --
 Inventory                                        819                 --
 Other current assets                           2,135                 --
                                             --------             --------
    Total Current Assets                       21,391              213,300
                                             --------             --------


CAPITALIZED PROPERTY COSTS:
 Deferred lease cost                           30,081                 --
 Leasehold interest under construction        220,578                 --
 Furniture, fixture & equipment                14,259                 --
                                             --------             --------
    Total Capitalized Property
    Costs                                     264,918                 --
                                             --------             --------


OTHER ASSETS:
 Pre-opening costs                             11,186                 --
 Deferred financing costs                       9,286               11,352
 Organizational costs                             700                  700
                                             --------             --------
     Total Other Assets                        21,172               12,052
                                             --------             --------
     Total Assets                            $307,481             $225,352
                                             --------             --------
                                             --------             --------




The accompanying notes to financial statements are an integral part of these 
statements.


                                      F-2

<PAGE>

                          MOHEGAN TRIBAL GAMING AUTHORITY
                          -------------------------------
                                  BALANCE SHEETS
                                  --------------
                  AS OF SEPTEMBER 30, 1996 AND SEPTEMBER 30, 1995
                  -----------------------------------------------
                                  (in thousands)
                                  --------------

            LIABILITIES                    SEPTEMBER 30,        SEPTEMBER 30,
            -----------                        1996                  1995
                                               ----                  ----

CURRENT LIABILITIES:
 Construction retainage                      $  9,738             $   --
 Current maturities of long-term debt             250                 --
 Accounts payable                              33,077               10,352
 Accrued interest                              15,232                 --
 Accrued liabilities                            1,208                 --
 Credit line                                    4,749                 --
 Other current liabilities                        227                 --
                                             --------             --------
     Total Current Liabilities                 64,481               10,352
                                             --------             --------


COMMITMENTS AND CONTINGENCIES (SEE NOTE 5)


NON-CURRENT LIABILITIES:
 Senior notes                                 175,000              175,000
 Subordinated notes                            67,000               40,000
 Other long-term debt, net of
  current maturities                            1,000                 --
                                             --------             --------
     Total Non-Current Liabilities            243,000              215,000
                                             --------             --------
     Total Liabilities                       $307,481             $225,352
                                             --------             --------
                                             --------             --------





















The accompanying notes to financial statements are an integral part of these 
statements.


                                      F-3

<PAGE>

                          MOHEGAN TRIBAL GAMING AUTHORITY
                          -------------------------------
                              STATEMENT OF CASH FLOW
                              ----------------------
                  FOR THE PERIOD FROM INCEPTION (JULY 15, 1995)
                  ---------------------------------------------
                            THROUGH SEPTEMBER 30, 1996
                            --------------------------
                                  (in thousands)
                                  --------------

PRE-OPENING ACTIVITIES:
 Increase in inventory                                  $    (819)
 Increase in deposits                                      (5,900)
 Increase in other current assets                          (2,135)
 Increase in construction retainage                         9,738
 Increase in accounts payable                              33,077
 Increase in accrued liabilities and interest              16,440
 Increase in other current liabilities                        727
                                                        ---------
     Net cash provided by pre-opening activities           51,128
                                                        ---------


INVESTING ACTIVITIES
 Deferred lease cost                                      (30,081)
 Leasehold interest under construction                   (220,578)
 Net equipment additions                                  (14,259)
 Pre-opening costs                                        (11,186)
 Deferred financing costs                                  (9,286)
 Organizational costs                                        (700)
                                                        ---------
     Net cash used in investing activities               (286,090)
                                                        ---------


FINANCING ACTIVITIES:
 Proceeds from issuance of long-term debt                 247,499
                                                        ---------
     Net cash provided by financing activities            247,499
                                                        ---------
     Net increase in cash  and cash equivalents            12,537
                                                        ---------
     
CASH AND CASH EQUIVALENTS, at beginning of period           --
                                                        ---------
CASH AND CASH EQUIVALENTS, at end of period                12,537
                                                        ---------
                                                        ---------

SUPPLEMENTAL INFORMATION:

 INTEREST PAID                                          $ 14,925
                                                        ---------
                                                        ---------


The accompanying notes to financial statements are an integral part of these 
statements.



                                      F-4


<PAGE>

NOTES TO FINANCIAL STATEMENT OF MOHEGAN TRIBAL GAMING AUTHORITY:
----------------------------------------------------------------

1. GENERAL INFORMATION AND SUMMARY OF SIGNIFICANT ACCOUNT POLICIES:
-------------------------------------------------------------------

The Mohegan Tribal Gaming Authority (the "Authority"), established on July 15, 
1995, is an instrumentality of the Mohegan Tribe of Indians of Connecticut 
(the "Tribe"). The Authority is developing a gaming and entertainment facility 
(the "Mohegan Sun"). The Authority's year-end is September 30.

The Tribe and the Authority have entered into a land lease ("Lease") (see 
Note 3) pursuant to which the Tribe is leasing to the Authority certain land 
located in southeastern Connecticut on which the Mohegan Sun is being 
constructed (the "Site"). The Site is a portion of a parcel of land that has 
been acquired and held in trust for the Tribe by the United States of 
America, with the Tribe retaining perpetual rights to the use of the Site.

The Tribe established the Authority with the exclusive power to conduct and 
regulate gaming activities for the Tribe. Under the Indian Gaming Regulatory 
Act of 1988, as amended ("IGRA"), 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 tribal state compact 
with the affected state. The Tribe and the State of Connecticut have entered 
into such a compact (the "Compact") that has been approved by the Secretary 
of the Interior.

The Authority has engaged Trading Cove Associates ("TCA") to manage the 
development, construction and operation of the Mohegan Sun. TCA is 50% owned 
by Sun Cove, an affiliate of Sun International Hotels Limited ("Sun 
International"), and 50% by Waterford Gaming, LLC.

The Authority is financing the development of the Mohegan Sun with the 
proceeds of the sale of senior notes, subordinated notes and equipment and 
working capital financing as described in Note 2. The total cost of 
development and construction of Mohegan Sun and working capital is estimated 
to be $318 million, all of which has been obtained as of the balance sheet 
date as follows (000's):

     Senior Notes                   $175,000
     Subordinated Notes               40,000
     Subordinated Notes: Secured      
       Completion Guarantee           50,000
     Working Capital Financing        13,000
     Equipment Financing              40,000
                                    --------

                                    $318,000
                                    --------
                                    --------

                                      F-5

<PAGE>

The Secured Completion Guarantee provides that, subject to certain 
qualifications, Sun International will provide up to $50.0 million to fund 
any cost overruns incurred in connection with the construction, development, 
equipping and opening of the Mohegan Sun. The Guarantee terminates on 
September 30, 1997, or, if certain other criteria are met as agreed upon by 
the Authority and Sun International. Any draws on the Guarantee are evidenced 
by additional subordinated notes issued by the Authority to Sun 
International. These additional subordinated notes will bear interest at the 
prime rate plus 1% and are payable under the same terms as the subordinated 
notes (see Note 2).

USE OF ESTIMATES IN THE PRESENTATION OF FINANCIAL STATEMENTS -
--------------------------------------------------------------

The preparation of financial statements in conformity with generally accepted 
accounting principles requires management to make estimates and assumptions 
that affect the reported amounts of assets and liabilities and disclosure of 
contingent assets and liabilities at the date of the financial statements. 
Actual results could differ from those estimates.

FAIR VALUE OF FINANCING INSTRUMENTS -
-------------------------------------

The Authority's carrying amount of financial instruments including cash, 
payables and debt, approximate fair market value.

DEVELOPMENT STAGE ENTERPRISE -
------------------------------

The Authority is classified as a Development Stage enterprise as defined by 
Statement of Financial Accounting Standards No. 7.

CASH EQUIVALENTS -
------------------

For purposes of the Financial Statements, the Authority has considered all 
investments with maturities of three months or less to be cash equivalents.

RESTRICTED CASH
---------------

Included in restricted cash are approximately $850,000 held as collateral for 
road construction permits and land required for the completion of the 
Authority's roadway access and approximately $4.3 million in working capital 
for the impressment of the slot machines.


                                      F-6

<PAGE>

DEPOSITS AND OTHER CURRENT ASSETS
---------------------------------

The Authority has expended approximately $5.9 million in deposits for items 
relating to the development of the Mohegan Sun that will be refunded in full 
during the first quarter of fiscal 1997.

INVENTORIES
-----------

Inventories of provisions and supplies are carried at the lower of cost 
(weighted average) or market.

CAPITALIZED PROPERTY COSTS -
----------------------------

Capitalized property costs consist of (i) deferred lease costs related to the 
payment made by the Authority on behalf of the Tribe for the acquisition of 
the Site, (ii) leasehold interest costs which represent costs incurred 
through the balance sheet date for the construction of the Mohegan Sun and 
(iii) equipment (primarily furniture and computers) that are being used in 
connection with the pre-opening activities of the Authority. Upon the 
commencement of operations, these costs will be depreciated or amortized, as 
applicable, on a straight-line basis over the following estimated useful 
lives:

      Deferred lease cost               50 years
      Leasehold interest cost           40-50 years
      Equipment                         5-7 years

DEFERRED LEASE COST -
---------------------

Deferred lease cost consists of the following (000's):

      Acquisition cost of the site      $28,581
      Acquisition cost of additional
       parcel                             1,500
                                        -------
                                        $30,081
                                        -------
                                        -------

The Site and the additional parcel were acquired from third parties unrelated 
to the Tribe or the Authority. The Authority will not be reimbursed by the 
Tribe for these payments.

OTHER ASSETS -
--------------

Other assets consist of pre-opening, deferred financing and organization 
costs. Pre-opening costs are mainly payroll and related benefits and general 
office overhead incurred through the balance sheet date. Deferred financing 
costs have been incurred in connection with the issuance of the senior notes 
and the subordinated notes. Organization costs represent primarily legal 
costs incurred in the organization of the Authority.

                                       F-7


<PAGE>

Beginning on the opening date of the Mohegan Sun, these costs will be 
amortized on a straight-line basis over the following estimated useful lives:

     Pre-opening costs                  12 months
     Deferred financing costs           7 years
     Organization costs                 5 years

RETAINAGE
---------

Retainage consists of amounts withheld from construction draws for the 
General and Infrastructure contractor to ensure adequate performance and 
completion of the development of Mohegan Sun and is expected to be remitted 
in the 1997 fiscal year.

2. DEBT
-------

A.  The Authority has issued $175 million in Senior Notes due 2002 (the 
"Senior Notes") with fixed interest payable at a rate of 13-1/2% per annum 
and Cash Flow Participation Interest in an aggregate amount of 5.0% of the 
Authority's Cash Flow up to a limit, during any two consecutive semi-annual 
periods, ending September 30, of $250 million of the Authority's Cash Flow. 
Fixed interest is payable semi-annually and commenced May 15, 1996. No Cash 
Flow Participation Interest shall be payable with respect to any period prior 
to the earlier of the first day the Mohegan Sun commences operations or 
October 31, 1996. The aggregate amount of Cash Flow Participation Interest 
payable will be reduced pro rata for reductions in outstanding principal 
amount of Senior Notes. The payment of Cash Flow Participation Interest may 
be deferred if the Authority's Fixed Charge Coverage Ratio (as defined) is 
less than 2 to 1. The Senior Notes are redeemable at set prices as set forth 
in the Senior Notes after November 15, 1999, at the option of the Authority. 
Upon the occurrence of certain events (as specified in the Indenture for the 
Senior Notes) each holder of Senior Notes can require the Authority to 
repurchase the notes at prices specified in the Senior Notes. Beginning with 
fiscal year ending September 30, 1997, the Authority will be required, under 
certain circumstances, to offer to purchase, at set prices, certain amounts 
of Senior Notes then outstanding.

B.  The Authority has obtained $67.0 million of subordinated financing from 
Sun International and Waterford Gaming LLC in the form of two notes. The 
first note for $40.0 million (Subordinated Notes) bears interest at 15% per 
year, paid semi-annually. The second note for $27.0 million (Secured 
Completion Guarantee) bears interest at 1% over prime. Both are due 2003; 
however, principal cannot be paid until the Senior Notes have been paid in 
full, unless certain conditions are met.

C.  The Authority has obtained a mortgage note payable of approximately $1.3 
million from a local bank to fund property purchased for the development of 
Mohegan Sun payable in yearly payments of $250,000 for 5 years.

                                       F-8
<PAGE>

D.  The Authority has obtained two lines of credit totaling $13.0 million. 
The line of credit for $12.5 million, obtained from Fleet Bank, offers LIBOR 
and Base rate options (9.25% as of September 30, 1996). The maximum 
borrowings under the Fleet line of credit shall be reduced by $2,000,000 on 
April 1, 1997 and by an additional $2,000,000 on each one month anniversary 
date thereafter. The second line of credit for $500 thousand was obtained 
from Norwich Savings bears interest at a rate of 7 3/4%. As of September 30, 
1996, $4.8 million was outstanding under both lines of credit. These amounts 
were used for the impressment of slot machines and Bingo operations.

Long-term debt consists of the following(000's):

Senior Secured Notes (A)                     $175,000
Subordinated Notes (B)                         67,000
Mortgage Note Payable (C)                       1,250
Line of Credit (D)                              4,749
                                             --------
  Total Debt                                  247,999

Less Current Maturities                         4,999
                                             --------
                                             $243,000
                                             --------
                                             --------

The above described debt is secured by substantially all the assets of the 
Authority.

                     REPAYMENTS OF DEBT FOR NEXT FIVE YEARS

Year ending
September 30,                               Amounts
-------------                               -------
                                            (000's)

   1997                                    $  4,999
   1998                                         250
   1999                                         250
   2000                                         250
   2001                                         250
THEREAFTER                                  242,000
                                           --------
                                           $247,999
                                           --------
                                           --------

The ability of the Authority to meet its debt service requirements will be 
entirely dependent upon the completion and future successful performance of 
the Mohegan Sun, which is subject to financial, economic, political, 
competitive, and other factors, many of which are beyond the Authority's 
control.

                                     F-9

<PAGE>

The amount of interest capitalized in leasehold interest under construction 
on the balance sheet for the period from inception to September 30, 1996, was 
approximately $30.2 million.

3.  LEASE AGREEMENTS-
---------------------

As discussed in Note 1, the Authority has entered into a Lease with the Tribe 
with respect to the Site. The initial term of the Lease is 25 years, with an 
option to extend the term for an additional 25 years provided that the 
Authority is not in default under the Lease. The Lease also provides that all 
improvements constructed on the Site will become the property of the Tribe 
and subject to the Lease. The Lease is a net Lease requiring that the 
Authority be responsible for all costs of operating, constructing, 
maintaining, repairing, replacing and insuring the leased property, plus 
paying the Tribe an annual rent of $1.00. In addition to the rent, the 
Authority has used the proceeds from the issuance of the Subordinated Notes, 
described in Note 2, to acquire the Site on behalf of the Tribe. Due to 
these payments and other terms of the Lease described above, expenditures 
made by the Authority in connection with the acquisition of the Site and the 
Additional Parcel have been recorded as deferred lease costs. These deferred 
lease costs will be amortized on a straight-line basis over the term of the 
Lease, plus the option period (a total of 50 years). The leasehold interest 
will be amortized on a straight-line basis over the estimated life of the 
buildings (40 years).

The Authority leases various equipment and vehicles under operating 
leases. Future minimum lease payments under the noncancelable operating 
leases are as follows:

                                     Amounts
                                     -------
                                     (000's)

1997                                 $3,664
1998                                  3,650
1999                                  3,421
2000                                  3,041
Thereafter                             -0-
                                    --------
                                    $13,776
                                    ========


4.  INCOME TAXES-
-----------------

The Tribe is an "Indian Tribal Government" within the meaning of sections 
7701(a)(40) and 7871 of the Internal Revenue Code of 1986, as amended. As 
such, the Authority has tax-exempt status with respect to federal and state 
income and certain excise taxes.

                                     F-10
<PAGE>

5.  COMMITMENTS AND CONTINGENCIES:
----------------------------------

The Tribe, by itself and acting through the Authority, and TCA have entered 
into an Amended and Restated Gaming Facility Development and Construction 
Agreement ("the Construction Agreement") providing for the design, 
construction, furnishing and site development of the Mohegan Sun by TCA. The 
total cost of the Mohegan Sun as outlined in the Construction Agreement, is 
not to exceed $325 million. The Tribe has assigned its rights and obligations 
in the Agreement to the Authority.

The Tribe has entered into a seven-year Amended and Restated Gaming Facility 
Management Agreement ("the Management Agreement") with TCA to provide for the 
management of the Mohegan Sun. Under the terms of the Management Agreement, 
the Tribe has granted TCA the exclusive right and obligation to develop, 
manage, operate and maintain the Mohegan Sun and all other related facilities 
that are owned by the Tribe or any of its instrumentalities. The Management 
Agreement authorizes TCA to pay itself a monthly management fee from the 
Mohegan Sun's net revenues (as defined). The management fee under the 
Management Agreement is expressed as a percentage of net revenues, which 
ranges from 30% to 40%, depending on the level of the net revenues generated 
by the Mohegan Sun. The Tribe has assigned its rights in and delegated its 
obligations under the Management Agreement to the Authority.

The Authority has entered into a guaranteed maximum price contract with the 
general contractor, Morse Diesel International, for the construction of the 
Mohegan Sun. The final amount paid under such contract, however, is subject 
to modification based upon the occurrence of certain events, such as design 
change orders and costs associated with certain types of delays. The 
Authority and Morse Diesel International currently are negotiating whether 
certain costs incurred in construction or the Mohegan Sun are covered under 
the guaranteed maximum price or whether such cost increases are the result of 
change orders or other events that could result in an increase in the 
contract price above the guaranteed maximum price. The resolution of all or 
some of these issues in favor of Morse Diesel International may result in the 
final cost of Mohegan Sun exceeding its current budget. Based upon its review 
of the budget and the open cost items, the Authority believes that the final, 
total cost of developing, constructing, equipping and opening the Mohegan Sun 
will not exceed the sum of the proceeds from the sale of the Senior Notes and 
the Subordinated Notes and amounts available under the Secured Completion 
Guarantee, the Equipment Financing and the Working Capital Financing. 
However, there is no assurance that such costs will not exceed budgeted 
amounts. As of December 4, 1996, the Authority has drawn $42 million under 
the Secured Completion Guarantee and issued additional subordinated notes to 
Sun International in principal amount equal to the amount of the draw. The 
Authority may not obligate itself to pay development costs in excess of $325 
million without the further consent of the National Indian Gaming Commission 
(the "NIGC"). In the event the resolution of the issues with Morse Diesel 
International result in total development costs 

                                      F-11

<PAGE>

being in excess of $325 million, the Authority would require the consent of 
the NIGC, and there can be no assurances such consent would be given.

The Authority has established a Cash Maintenance Account as a way of 
accumulating funds to protect the Bond Holders in the event of a default. For 
the calendar years ended 1997-2001, the annual deposit required is $6.0 
million per year and thereafter, such amount necessary to keep at least $36.0 
million in the Cash Maintenance Account.

The Authority also has established an Interest and Excess Cash Flow Account 
into which it must place the fixed interest accrued during each month on the 
Senior Debt and the Subordinated Debt, 50% of the Excess Cash Flow (as 
defined) generated by the Mohegan Sun in the previous month and the Cash Flow 
Participating interest accrued for the prior month. These amounts are to be 
used to pay current interest and to provide funds for redemption of Senior 
Debt as provided in the Indenture. If the Senior Debt holders decline 
redemption, these funds may be used to redeem the subordinated debt, with any 
remaining balance available for distribution to the Tribe.

The Authority shall also make a minimum monthly payment to the Tribe of 
$50,000. In addition, the Authority may make a monthly payment to the Tribe 
with respect to net revenues (as defined), generated by the Mohegan Sun in 
the preceding month. Such amount shall only be made after certain other 
minimum Priority Payments and required deposits in to certain reserve 
accounts (as defined) have been made. No payments have been made or are due 
as of September 30, 1996.

6. COMPACT WITH THE STATE OF CONNECTICUT
----------------------------------------

The Tribe's Compact with the State of Connecticut stipulates that a portion 
of the revenues earned on slot machines will be paid to the State of 
Connecticut. For each twelve-month period commencing July 1, 1995, the 
minimum contribution of the Tribe to the State of Connecticut shall be the 
lesser of (a) 30% of gross revenues from slot machines, or (b) the greater of 
(i) 25% of gross revenues from slot machines or (ii) $80,000,000. These 
payments will not be required if the State of Connecticut legalizes any other 
gaming operations with slot machines to be operated in the State of 
Connecticut (other than on certain Indian lands). No payments have been made 
or are due as of September 30, 1996.

7. TOWN OF MONTVILLE
--------------------

The Tribe has entered into an agreement with the Town of Montville, 
Connecticut (the "Town") pursuant to which the Tribe has agreed to pay to the 
Town (i) an annual payment of $500,000 to compensate the Town for the 
financial impact of removing the Site from the Town's tax rolls and 
jurisdiction and (ii) a one-time fee of $3.0 million to make improvements to 
the Town's water system, which improvements are necessitated by the 
development and operation of the Mohegan Sun. The one-time payment is due 

                                      F-12

<PAGE>

and the annual payments commence one year after the commencement of slot 
machine gaming activities.

It is anticipated that these payments will be made by the Authority on behalf 
of the Tribe. When that occurs, the one-time fee of $3.0 million for 
improvement of the Town's water system will be capitalized as part of 
leasehold interest (see Note 3), while the annual payments of $500,000 will be 
treated as operating expenses of the Authority since they are effectively in 
lieu of property taxes that would be the responsibility of the Authority 
under the Lease. It is not anticipated that the Tribe will reimburse the 
Authority for these payments.

8. SUBSEQUENT EVENTS
--------------------

As of September 30, 1996, the Authority has entered into or is negotiating 
various commitments to obtain (through purchase or under capital or operating 
leases) approximately $56.9 million worth of assets. Also, the Authority has 
drawn down an additional $6 million on the working capital line of credit 
subsequent to September 30, 1996.


Mohegan Sun plans on implementing a 401(k) plan during the second quarter of 
fiscal 1997.

Mohegan Sun opened to the general public on October 12, 1996.



                                      F-13

<PAGE>

SIGNATURES
----------

     Pursuant to the requirements of Section 13 or 15(d) of the Securities 
Exchange Act of 1934, the registrant has duly caused this report to be on its 
behalf by the undersigned, thereunto duly authorized.

                                      MOHEGAN TRIBAL GAMING AUTHORITY
                                      -------------------------------


Date: December 30, 1996                   By: /s/ Roland Harris
      -----------------------------           ---------------------------------
                                              Roland Harris,
                                              Business Board Member

Date: December 30, 1996                   By: /s/ Len Wolman
      -----------------------------           ---------------------------------
                                              Len Wolman,
                                              Business Board Member

Date: December 30, 1996                   By: /s/ William J. Velardo
      -----------------------------           ---------------------------------
                                              William J. Velardo,
                                              Executive Vice President

Date: December 30, 1996                   By: /s/ George T. Papanier
      -----------------------------           ---------------------------------
                                              George T. Papanier, CFO and
                                              Senior Vice President of Finance