Seneca Gaming Corporation (SGC) is wholly owned by the Seneca Nation of Indians of New York and chartered to manage all of the Nation’s gaming operations. SGC was chartered by the Nation in August 2002. SGC’s wholly owned subsidiaries, Seneca Niagara Falls Gaming Corporation, Seneca Erie Gaming Corporation and Seneca Territory Gaming Corporation were chartered in August 2002, August 2003 and September 2003, respectively. In August 2002 the Nation entered into a Compact with New York State that provides the Nation with the right to establish and operate three Class III gaming facilities in Western New York. We currently operate Seneca Niagara Casino and Seneca Allegany Casino, which opened on December 31, 2002 and May 1, 2004, respectively. The Seneca Niagara Casino and Seneca Allegany Casino are owned and operated by SNFGC and STGC, respectively. Our two Casinos are the only gaming facilities in New York State to offer both Class III slot machines and table games.

Under the Compact, the Nation also has an exclusive right to establish and operate a third Class III gaming facility in Erie County, New York. This exclusive right may terminate if the Nation fails to commence construction of a Class III gaming facility in Erie County by December 9, 2005 or if the Nation fails to commence Class III Gaming operations within sixty (60) months of December 9, 2002. On April 9, 2004, we entered into a non-binding letter of intent with Uniland Development Company, or Uniland, to purchase approximately 57.1 acres of property for this facility near the Buffalo-Niagara International Airport in Cheektowaga, New York, or the Cheektowaga Site. In May 2004, various parties, including the Mayor of the City of Buffalo, filed a complaint against Governor George E. Pataki, the State of New York, the Town of Cheektowaga and Uniland to prohibit the sale of the Cheektowaga Site to us. On June 16, 2004, The Honorable Joseph G. Makowski of the Supreme Court of the State of New York agreed with the plaintiffs and held that the Compact provision allowing the Nation to locate a Class III gaming facility anywhere in Erie County “in the event a site in the City of Buffalo is rejected by the Nation for any reason” is unconstitutional. The Town of Cheektowaga and Uniland have filed notices of appeal and we support their decision to appeal. In the event that we are able to open a Casino in Erie County, this Casino will be owned and operated by SEGC.