Use these links to rapidly review the documentTABLE OF CONTENTS ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA





UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

FORM 10-K

(Mark One)ý

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934for the fiscal year ended December 31, 2010ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934for the transition period
from                                    to    
                                .


Commission file number 000-54193



STATION CASINOS LLC(Exact name of registrant as specified in its charter)

Nevada(State or other jurisdiction of
incorporation or organization)

27-3312261(I.R.S. Employer Identification No.)


1505 South Pavilion Center Drive, Las Vegas, Nevada 89135(Address of principal executive offices, Zip Code)

Registrant's
telephone number, including area code:(702) 495-3000

Securities
registered pursuant to Section 12(b) of the Act:None

Securities
registered pursuant to Section 12(g) of the Act:Voting Units

Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes o    No ý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. Yes o    No ý

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 ý    No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period
that the registrant was required to submit and post such
files). Yes o    No o

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 registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to
the Form 10-K. ý

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o

Accelerated filer o

Non-accelerated filer ý

Smaller reporting company o(Do not check if a smaller reporting company)


Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Act). Yes o    No ý

The aggregate market value of the voting common stock held by non-affiliates (all other persons other than executive officers or directors) of the
registrant as of June 30, 2010 was $0.

As
of January 31, 2011, there were no shares outstanding of the registrant's voting units.

Documents Incorporated by ReferenceNone.



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Table of Contents



TABLE OF CONTENTS



FORWARD LOOKING STATEMENTS

1PART IITEM 1.

BUSINESS

2ITEM 1A.

RISK FACTORS

24ITEM 1B.

UNRESOLVED STAFF COMMENTS

36ITEM 2.

PROPERTIES

36ITEM 3.

LEGAL PROCEEDINGS

39ITEM 4.

(REMOVED AND RESERVED)

39PART IIITEM 5.

MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDERMATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

40ITEM 6.

SELECTED FINANCIAL DATA

40ITEM 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

44ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

68ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

69ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

143ITEM 9A.

CONTROLS AND PROCEDURES

143ITEM 9B.

OTHER INFORMATION

143PART IIIITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

144ITEM 11.

EXECUTIVE COMPENSATION

147ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

148ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

149ITEM 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES

150PART IVITEM 15.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

151SIGNATURES

152


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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains forward-looking statements. Such statements contain words such as
"believes," "estimates," "expects," "intends," "plans," "projects," "may," "will," "should" or "anticipates" or the negative or other variation of these or similar words, or by discussions of strategy
or risks and uncertainties. Forward-looking statements in this Annual Report on Form 10-K include, among other things, statements concerning: projections of future results of
operations or financial condition; expectations regarding casino properties and future development plans; expectations of the continued availability of capital resources; and expectations regarding
the restructuring efforts of Station Casinos, Inc. ("STN") and its subsidiaries. STN and its subsidiaries are referred to collectively in this Annual Report on Form 10-K as
"Station." Any forward-looking statement is based upon a number of estimates and assumptions that, while considered reasonable by us, is inherently subject to significant business, economic and
competitive uncertainties and contingencies, many of which are beyond our or Station's control, and are subject to change. Actual results of operations may vary materially from any forward-looking
statement made herein. Forward-looking statements should not be regarded as a representation by us, Station or
any other person that the forward-looking statements will be achieved. Undue reliance should not be placed on any forward-looking statements. Some of the contingencies and uncertainties to which any
forward-looking statement contained herein is subject include, but are not limited to, the following:



For
additional contingencies and uncertainties, see "Item 1A. Risk Factors."

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PART I

ITEM 1.    BUSINESS.

Introduction

We are a Nevada limited liability company that was formed to acquire substantially all of the assets of Station pursuant to the joint
plan of reorganization of STN and certain affiliated debtors under Chapter 11 of Title 11 of the United States Code (the "Bankruptcy Code"). In addition, we anticipate acquiring substantially
all of the assets of Green Valley Ranch Gaming, LLC ("GVR") pursuant to the GVR Asset Purchase Agreement (as defined herein). The Company was formed on August 9, 2010 and has its
principal executive offices at 1505 South Pavilion Center Drive, Las Vegas, Nevada 89135. The telephone number for its executive offices is (702) 495-3000. Station's internet
website is www.stationcasinos.com and we expect to maintain the website after the Effective Date.

To
date, we have conducted no business and have no material assets or liabilities. We expect the reorganization of Station and acquisition of Green Valley Ranch (as defined herein) to be
completed by June 30, 2011, at which time we will acquire substantially all of the assets of Station in consideration for the issuance of (i) our voting units ("Voting Units") to Station
Voteco LLC, a Nevada limited liability company formed to hold the voting equity interests of the Company ("Station Voteco"), (ii) our non-voting units
("Non-Voting Units" together with our Voting Units, our "Units") to Station Holdco LLC, a Delaware limited liability company formed to hold the non-voting equity
interests of the Company ("Station Holdco"), and (iii) secured credit facilities, as well as acquire substantially all of the assets of GVR for approximately $500.0 million. See
"Item 1. BusinessChapter 11 Reorganization and Restructuring Transactions" for a further description of the reorganization of Station and acquisition of Green Valley Ranch.

Available Information

We are required to file annual, quarterly and other current reports and information with the SEC. You will be able to read and copy any
materials we file with the SEC at the SEC's Public Reference Room at 100 F Street N.E., Room 1580, Washington, D.C. 20549. You may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. Because we submit filings to the SEC electronically, access to this information is available at the SEC's
internet website (www.sec.gov). This site contains reports and other information regarding issuers that file electronically with the SEC.

Following
the Effective Date, we will also make available, free of charge, at our principal internet address (www.stationcasinos.com) our Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and, if applicable, amendments to those reports filed or furnished pursuant to the Exchange Act as
soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.

Chapter 11 Reorganization

Station is a gaming and entertainment company that currently owns and operates ten major hotel/casino properties (two of which are 50%
owned) under the Station and Fiesta brand names and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area. Station owns and operates Palace Station
Hotel & Casino ("Palace Station"), Boulder Station Hotel & Casino ("Boulder Station"), Texas Station Gambling Hall & Hotel ("Texas Station"), Sunset Station Hotel & Casino
("Sunset Station"), Santa Fe Station Hotel & Casino ("Santa Fe Station"), Red Rock Casino Resort Spa ("Red Rock"), Fiesta Rancho Casino Hotel ("Fiesta Rancho"), Fiesta Henderson Casino Hotel
("Fiesta Henderson"), Wild Wild West Gambling Hall & Hotel ("Wild Wild West"), Wildfire CasinoRancho ("Wildfire Rancho"), Wildfire CasinoBoulder ("Wildfire Boulder"),
Gold Rush Casino ("Gold Rush") and Lake Mead Casino. Station also owns a 50% interest in Green Valley Ranch

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Resort
Spa Casino ("Green Valley Ranch"), Aliante Station Casino + Hotel ("Aliante Station"), Barley's Casino & Brewing Company ("Barley's"), The Greens Gaming and Dining ("The
Greens") and Wildfire Lanes and Casino ("Wildfire Lanes"). Station also manages Gun Lake Casino.

On
November 7, 2007, STN completed a going private transaction that was sponsored by Frank J. Fertitta III and Lorenzo J. Fertitta and certain affiliates of Colony
Capital, LLC ("Colony") (such going private transaction is referred to herein as, the "Merger"). In connection with the Merger, STN's subsidiary, FCP PropCo, LLC ("Propco"), and certain
other subsidiaries of STN that directly or indirectly own interests in Propco (the "Propco Debtors") entered into a mortgage loan and related mezzanine financings in an aggregate principal amount of
$2.475 billion (the "CMBS Loans"). The CMBS Loans were secured by substantially all fee and leasehold real property comprising Palace Station, Boulder Station, Sunset Station and Red Rock
(collectively, the "Propco Properties"). In addition, STN, as borrower, entered into a $900 million senior secured credit agreement (the "Credit Agreement") which was secured by substantially
all of the assets of STN and its subsidiaries, other than Propco and the Propco Debtors. STN's $450 million 6% senior notes due April 1, 2012, $400 million 73/4%
senior notes due August 15, 2016, $450 million 61/2% senior subordinated notes due February 1, 2014, $700 million 67/8% senior subordinated
notes due March 1, 2016 and $300 million 65/8% senior subordinated notes due March 15, 2018 (collectively, "Senior and Senior Subordinated Notes") remained
outstanding following consummation of the Merger. On February 7, 2008, a wholly owned, indirect subsidiary of STN ("Landco"), as borrower, entered into a $250 million
delay-draw term loan collateralized by land located on the southern end of Las Vegas Boulevard at Cactus Avenue and land surrounding Wild Wild West in Las Vegas, Nevada (the "Land Loan").

The
Merger and related transactions left Station highly leveraged. Shortly thereafter, the economy in the United States sharply declined, consumer spending deteriorated and the credit
markets severely contracted. Foreclosure and unemployment rates in Nevada sharply increased, becoming among the highest in the United States, and many planned construction projects for new casinos in
Nevada were
delayed or cancelled, causing further deterioration of the Las Vegas economy and reduced discretionary consumer spending by Las Vegas residents. Station was severely impacted by the economic downturn
due to the fact all of its owned casinos are located in Las Vegas and its properties have historically attracted customers from the Las Vegas valley. In addition, the value of real estate in Nevada
significantly eroded as a result of the deterioration of the economy.

Due
to the economic conditions following the Merger, including the credit crisis and a decrease in consumer confidence levels, Station experienced a significant reduction in revenues.
Although Station engaged in cost reductions, reductions in workforce and other efforts to mitigate the impact of the decline in revenues, the results of operations of Station were materially and
adversely impacted by the economic downturn and its ability to service its debt obligations was impaired. In addition, the decline in real estate values in Nevada adversely affected the value of
Station's assets. The resulting deterioration of Station's results of operations and asset values, coupled with Station's high leverage and the general unavailability of credit, negatively impacted
Station's ability to service its outstanding indebtedness or otherwise raise capital for restructuring.

As
a result, on July 28, 2009 (the "Petition Date"), STN, FCP MezzCo Parent, LLC, FCP MezzCo Parent Sub, LLC, FCP MezzCo Borrower VII, LLC, FCP MezzCo
Borrower VI, LLC, FCP MezzCo Borrower V, LLC, FCP MezzCo Borrower IV, LLC, FCP MezzCo Borrower III, LLC, FCP MezzCo Borrower II, LLC, FCP MezzCo Borrower
I, LLC, FCP PropCo, LLC, Northern NV Acquisitions, LLC, Tropicana Station, LLC, River Central, LLC and Reno Land Holdings, LLC and affiliates FCP
Holding Inc., FCP VoteCo, LLC, Fertitta Partners, LLC (collectively, the "Debtors") filed voluntary petitions in the United States Bankruptcy Court for the District of Nevada in
Reno, Nevada (the "Bankruptcy Court") under Chapter 11 of the Bankruptcy Code. These cases are being jointly administered under the caption In re Station Casinos, Inc., et al Debtors
Case No. 09-52470 (the "Chapter 11 Case").

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Restructuring Transactions

On August 27, 2010, the Bankruptcy Court entered an order confirming the Debtors joint plan of reorganization (the "Plan").
Under the Plan, the Company, as designee of German American Capital Corporation and JP Morgan Chase Bank, N.A., as holders of $1.8 billion in CMBS Loans (the "Mortgage Lenders"), is expected to
acquire the Propco Properties and certain related assets in satisfaction of the Mortgage Lenders' existing secured claims against Propco. In conjunction with these transfers to the Company, under the
Plan: (i) our Voting Units are expected to be issued to Station Voteco, which is expected to be owned by (a) Robert A. Cashell Jr. and Stephen J. Greathouse, who are expected to be
designated by the Mortgage Lenders as members of our Board of
Managers and owners of Station Voteco, and (b) an entity owned by Frank J. Fertitta III, our Chief Executive Officer, President and a member of our Board of Managers, and Lorenzo J. Fertitta, a
member of our Board of Managers, (ii) our Non-Voting Units are expected to be issued to Station Holdco, which is expected to be owned by the Mortgage Lenders, FI Station
Investor LLC, a newly formed limited liability company owned by affiliates of Frank J. Fertitta III and Lorenzo J. Fertitta ("FI Station Investor"), and the holders of the Senior and Senior
Subordinated Notes; and (iii) the Company is expected to enter into a new credit agreement (the "Propco Credit Agreement") with the Mortgage Lenders consisting of a term loan facility in the
principal amount of $1.6 billion and a revolving credit facility in the amount of $100 million, which revolving credit facility will increase to $150 million upon the prepayment
of $50 million of outstanding principal amount under the term loan (the transactions described in clauses (i) through (iii) collectively referred to herein as, the "Propco
Restructuring").

In
addition, Station Holdco will issue two classes of warrants to the Mortgage Lenders permitting the Mortgage Lenders to purchase a total of 5% of the non-voting equity of
Station Holdco at exercise prices based upon a multiple of the share value of Station Holdco on the Effective Date (the "Mortgage Lender Warrants"). The Mortgage Lenders will sell to FI Station
Investor one of the classes of warrants with the right to purchase up to 2.5% of the non-voting equity (the "Fertitta Warrants") and will transfer the remaining 2.5% of the Mortgage Lender
Warrants to holders of the mezzanine portion of the CMBS Loans. On or about the Effective Date, FI Station Investor is expected to assign the Fertitta Warrants to an affiliate of Colony. The Mortgage
Lender Warrants will have a per unit exercise price equal to two and one-half times the value of the Non-Voting Units on the Effective Date (as defined below) that will
increase by 15% on each of the third through seventh anniversaries of the Effective Date. The Fertitta Warrants will have a per unit exercise price equal to three times the value of the
Non-Voting Units on the Effective Date that will increase by 15% on each of the third through seventh anniversaries of the Effective Date. For purposes of determining the exercise price of
the Mortgage Lender Warrants and the Fertitta Warrants, the per unit value of the Non-Voting Units will be determined based on a total equity value of Station Holdco equal to
$200 million, plus the amount of any additional equity issued or capital contributions made as of the Effective Date, plus the amount of any reduction in the debt agreed to by the Mortgage
Lenders in exchange for Station Holdco equity (the "Plan Value"). The Mortgage Lender Warrants and the Fertitta Warrants may only be exercised following the earlier of (i) the six and
one-half year anniversary of the Effective Date and (ii) the occurrence of a capital raising transaction by Station Holdco that involves a determination of the equity value of
Station Holdco (other than the transactions contemplated by the Plan) which expire on the seventh anniversary of the Effective Date.

In
addition, pursuant to the terms of the Plan, STN and certain of its subsidiaries have entered into an Asset Purchase Agreement dated as of June 7, 2010, as amended (the "Asset
Purchase Agreement") with FG Opco Acquisitions LLC, an entity that is currently owned in whole or in part by Fertitta Entertainment LLC, which is owned by affiliates of Frank J. Fertitta
III and Lorenzo J. Fertitta ("Fertitta Entertainment"), and the Mortgage Lenders and will be owned by the Company upon consummation of the transactions contemplated by the Asset Purchase Agreement
(the "Opco Purchaser"). Pursuant to the terms of the Asset Purchase Agreement, the Opco Purchaser will acquire substantially all of the assets of STN and certain of its subsidiaries, including Santa
Fe Station, Texas Station, Fiesta Henderson, Fiesta Rancho and interests in certain Native American gaming projects (the "Opco Assets"), for a purchase

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price
of $772 million, consisting of the following: (i) an amount in cash equal to $317 million, subject to adjustment pursuant to the terms of the Asset Purchase Agreement; and
(ii) $455 million in aggregate principal amount of term loans, subject to adjustment pursuant to the terms of the Asset Purchase Agreement (together with a $25 million revolving
credit facility, the "Opco Credit Agreement") (the transactions described in this paragraph, collectively referred to herein as the "Opco Acquisition"). The lenders under the Opco Credit Agreement
will be the same lenders as under STN's existing Credit Agreement.

Pursuant
to the terms of the Plan, the proceeds of the sale of the Opco Assets will be distributed to secured creditors of STN in full satisfaction of their claims against Station. The
Plan also provides that certain general unsecured creditors of STN ("Opco Unsecured Creditors") will receive warrants (the "Unsecured Creditor Warrants") exercisable for 2.5% of the total equity of
Station Holdco. The Unsecured Creditor Warrants will have a per unit exercise price equal to two and one-half times the value of the Non-Voting Units on the Effective Date that
will increase by 15% on each of the third through seventh anniversaries of the Effective Date. For purposes of determining the exercise price of the Unsecured Creditor Warrants, the per unit value of
the Non-Voting Units will be determined based on the Plan Value. The Unsecured Creditor Warrants may only be exercised following the earlier of (i) the six and one-half
year anniversary of the Effective Date and (ii) the occurrence of a capital raising transaction by Station Holdco that involves a determination of the equity value of Station Holdco (other than
the transactions contemplated by the Plan), which expire on the seventh anniversary of the Effective Date.

In
addition, Opco Unsecured Creditors that are "accredited investors" (as defined in the Securities Act of 1933, as amended) will have an opportunity to participate in a rights offering
("Rights Offering") under which they may subscribe for and purchase their pro rata share of 15% of the equity interests of Station Holdco for an aggregate amount of $35.3 million. The Rights
Offering may be increased to fund (i) the payment of $50 million pay-down under the Propco Credit Agreement, (ii) a portion of the Opco Acquisition and
(iii) the acquisition of Green Valley Ranch, Aliante Station, or any other material gaming operations located with a 100-mile radius of Las Vegas, provided that the aggregate
purchase price payable for additional units so offered in the Rights Offering will not exceed $64.7 million. Certain affiliates of Fidelity Management & Research Company, Oaktree Capital
Management, L.P. and Serengeti Asset Management, LP (the "Put Parties") will purchase at least one-half of the equity interests of Station Holdco offered pursuant to the
Rights Offering and have committed to purchase the remainder of the equity interests of Station Holdco offered pursuant to the Rights Offering on or before June 30, 2011, to the extent that
such equity
interests are not purchased by other Opco Unsecured Creditors (the "Equity Put"). In consideration for their agreement to purchase equity interests that are not purchased by other Opco Unsecured
Creditors, the Put Parties will receive a $3 million cash payment on the Effective Date and reimbursement of expenses in an amount of up to $1.7 million.

Claimants
with respect to the Land Loan are expected to enter into an amended and restated credit agreement related to the Land Loan (the "Restructured Land Loan"). Pursuant to the terms
of the Restructured Land Loan, the principal outstanding is expected to be reduced to $105 million in exchange for warrants to purchase 60% of the outstanding equity interests in Landco
exercisable for nominal consideration (the "Landco Warrants" and together with the Mortgage Lender Warrants, the Fertitta Warrants and the Unsecured Creditor Warrants, the "Warrants").

On
March 9, 2011, Station GVR Acquisition, LLC (the "GVR Purchaser"), an indirect subsidiary of the Company, and GVR, owner of Green Valley Ranch, entered into an Asset
Purchase Agreement (the "GVR Asset Purchase Agreement") pursuant to which, the GVR Purchaser will purchase substantially all of the assets and assume certain specified liabilities of GVR for a
purchase price of approximately $500 million (the "GVR Acquisition"), consisting of the following: (i) an amount in cash equal to $225 million and (ii) $275 million
in aggregate principal amount of term loans (the "GVR Term Loan"). The GVR Asset Purchase Agreement contemplates that GVR will file voluntary petitions for relief under chapter 11 of the
Bankruptcy Code and that such acquisition will be pursuant to, among other things,

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Sections 363
and 365 of the Bankruptcy Code and as part of a pre-packaged chapter 11 plan of reorganization of GVR. The GVR Asset Purchase Agreement is subject to, among
other things, the bankruptcy court entering a confirmation order confirming the chapter 11 plan of reorganization of GVR.

On
March 22, 2011, the subsidiaries of STN that are sellers under the Asset Purchase Agreement and Station's 50%-owned joint ventures GVR and Aliante Gaming, LLC
("Aliante"), commenced a solicitation of approvals for a prepackaged plan of reorganization (the "Subsidiary Plan") to implement and facilitate the sale and related restructuring transactions
described in the Asset Purchase Agreement, the GVR Asset Purchase Agreement and a reorganization of Aliante pursuant to which its lenders would receive the equity of Aliante in exchange for their
claims. We expect that the Chapter 11 cases for such subsidiaries (the "Subsidiary Chapter 11 Cases") will be filed in the second quarter of 2011.

The
chart that follows below summarizes the Company's corporate structure and material debt facilities after giving effect to the Restructuring Transactions. In order to simplify the
presentation, not all entities expected to make up the enterprise are depicted in the chart below.

GRAPHIC

Following
consummation of the Plan and the GVR Acquisition it is expected that the Company and its subsidiaries will enter into long-term management contracts with affiliates
of Fertitta Entertainment to manage the Propco Properties, the Opco Assets and Green Valley Ranch (the "Management Agreements"). The Propco Restructuring, the Opco Acquisition, the GVR Acquisition,
the issuance of the Warrants, the Rights Offering, the Equity Put, entry into the Management Agreements and the Restructured Land Loan are referred to herein collectively as the "Restructuring
Transactions."

Although
the Plan was confirmed by the Bankruptcy Court on August 27, 2010, consummation of the Plan is subject to the satisfaction of certain conditions precedent, including
among other things, (i) the Bankruptcy Court shall have authorized the assumption and rejection of certain contracts of the Debtors,

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(ii) all
documents necessary to implement the Restructuring Transactions contemplated by the Plan, including but not limited to the equityholders agreement to be entered into upon emergence
from bankruptcy among the Company, its equityholders and its subsidiaries (the "Equityholders Agreement"), the Opco Credit Agreement, the Propco Credit Agreement, the Restructured Land Loan and the
Warrants, shall be in form and substance reasonably acceptable to the Debtors, and (iii) all necessary regulatory approvals, including but not limited to necessary approvals of the Nevada
Gaming Authorities (as defined herein), will have been obtained (the date upon which the actions described in clauses (i) through (iii) are completed is referred to herein as the
"Effective Date"). The Company currently expects that the Effective Date will occur by June 30, 2011, although the Company cannot assure you that the required regulatory approvals will be
obtained, that conditions to consummation of the Plan will be satisfied by that date, or at all, or that Station will be successful in implementing the Plan in the form contemplated, or at all. In
addition, the Subsidiary Chapter 11 Cases will need to be filed in the Bankruptcy Court for the purposes of effectuating the sale or transfer of all or a portion of their assets pursuant to the
Plan.

This
report is not intended to be, and should not in any way be construed as, a solicitation of votes on the Subsidiary Plan. There can be no assurance that a sufficient percentage or
number of lenders will accept the Subsidiary Plan or that the Bankruptcy Court will confirm such plan. In addition, if the Subsidiary Plan is not accepted, confirmed or consummated, there can be no
assurance that the Company will be able to successfully develop, prosecute, confirm and consummate a plan of reorganization that is acceptable to the Bankruptcy Court and to the creditors, equity
holders and other parties in interest of GVR and Aliante.

Following
the consummation of the Plan, STN and certain of the other Debtors will be dissolved and, except to the extent set forth in the Plan, none of the Company, Fertitta
Entertainment, FI Station Investor nor any of their respective affiliates will succeed to the assets or liabilities of STN or the other Debtors.

Narrative Description of Business

Each of Station's properties caters primarily to local Las Vegas area residents. We intend to market the seven "Station" casinos
(including Red Rock and Green Valley Ranch) together under the Station Casinos' brand and the two "Fiesta" casinos under the Fiesta brand, offering convenience and choices to residents throughout the
Las Vegas valley with our strategically located properties.



Station's operating strategy emphasizes attracting and retaining customers primarily from the local and repeat visitor markets and we
intend to keep this operating strategy. Station's properties attract customers through:



Although
perceived value will initially attract a customer to the Station properties, actual value generates customer satisfaction and loyalty. Station believes that actual value becomes
apparent during the customer's visit through an enjoyable, affordable and high-quality entertainment experience. Las Vegas, which has been one of the fastest growing cities in the United
States, is characterized by a historically strong economy and demographics, which include an increasing number of retirees and other active gaming customers; however, the city continues to be
adversely affected by the national economic downturn. The current recession has had an adverse impact on the growth and economy of Las Vegas, resulting in significant declines in the local housing
market and rising unemployment which has negatively affected consumer spending and customer visits to Station's properties.

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Station believes that its out-of-town patrons are also discerning customers who enjoy a value oriented, high-quality approach.
Station believes that its patrons view its hotel and casino product as a preferable alternative to attractions located on the Las Vegas Strip and downtown Las Vegas.



Because Station targets the repeat customer, Station is committed to providing a high-value entertainment experience for
its customers in the restaurants, hotels, casinos and other entertainment amenities. Station has developed regional entertainment destinations for locals that include other amenities such as spas,
movie theaters, bowling centers, ice skating, live entertainment venues and child care facilities. In addition, Station believes the value offered by restaurants at each of its casino properties is a
major factor in attracting local gaming customers, as dining is a primary motivation for casino visits by many locals. Through their restaurants,
each of which has a distinct style of cuisine, the casino properties offer generous portions of high-quality food at reasonable prices. In addition, Station's operating strategy focuses on
slot and video poker machine play. Station's target market consists of frequent gaming patrons who seek a friendly atmosphere and convenience. Because locals and repeat visitors demand variety and
quality in their slot and video poker machine play, Station offers the latest in slot and video poker technology at its casino properties.

As
part of Station's commitment to providing a quality entertainment experience for its patrons, Station is dedicated to ensuring a high level of customer satisfaction and loyalty by
providing attentive customer service in a friendly, casual atmosphere. Station recognizes that consistent quality and a comfortable atmosphere stem from the collective care and friendliness of each
employee. Station began as a family-run business and has maintained close-knit relationships amongst its management and endeavors to instill among its employees this same sense
of loyalty. Toward this end, Station takes a hands-on approach through active and direct involvement with employees at all levels.



Station employs an innovative marketing strategy that utilizes frequent high-profile promotional programs in order to
attract customers and establish a high level of name recognition. In addition to aggressive marketing through television, radio and newspaper advertising, Station has created and sponsored promotions
that have become a tradition in the locals' market.

In
1999, Station introduced a unified Boarding Pass player rewards program at its Station properties. The Boarding Pass program allows guests to earn points based on their level of
gaming activity. The Fiesta properties offer a similar player rewards program called the Amigo Club. Members of the Boarding Pass and the Amigo Club can redeem points at any of the properties for free
slot play, meals in any of the restaurants, hotel rooms, movie passes, entertainment tickets or merchandise from its gift shops.

Station
is heavily focused on using cutting-edge technology to drive customer traffic with products created by Station such as its Jumbo Brand products, which include "Jumbo
Pennies," "Jumbo Bingo," "Jumbo Keno" and "Jumbo Hold'Em." Other products also include "Xtra Play Cash" and "Sports Connection," among others. Station believes that these products create sustainable
competitive advantages and will continue to distinguish it from its competition.



Due to the current state of the Las Vegas economy, Station has no short-term expansion plans but may pursue acquisitions.
Station's long-term growth strategy includes the master-planned expansions of its existing gaming facilities in Nevada, the development of gaming facilities on certain real estate it owns
or is under contract to acquire in the Las Vegas valley and Reno, Nevada, the evaluation and pursuit of additional acquisition or development opportunities in Nevada and other gaming markets and the
pursuit of additional management agreements with Native American tribes.

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Properties

Set forth below is certain information as of December 31, 2010 concerning the properties we will acquire (the "Acquired
Casinos") through the Restructuring Transactions. The Acquired Casinos are more fully described following the table.

Hotel
Rooms (1)

Slots (2)

Gaming
Tables (3)

Parking
Spaces (4)

AcreageCasino PropertiesPalace Station


1,011


1,760


47


2,600


30Boulder Station


300


2,760


33


4,800


54Texas Station


200


2,006


27


5,900


47Sunset Station


457


2,463


41


5,500


82Santa Fe Station


200


2,825


40


5,200


39Red Rock


815


2,995


66


6,800


64Green Valley Ranch


495


2,407


48


3,900


40Fiesta Rancho


100


1,460


15


2,050


25Fiesta Henderson


224


1,618


16


3,000


46Other PropertiesWildfire Rancho





196





265


5Wildfire Boulder





167





230


2Gold Rush





147





125


1Lake Mead Casino





87





64


3Barley's (50% owned)





199








The Greens (50% owned)





37








Wildfire Lanes (50% owned)





197











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Palace Station is strategically located at the intersection of Sahara Avenue and Interstate 15, one of Las Vegas' most heavily traveled
areas. Palace Station is a short distance from McCarran International Airport and from major attractions on the Las Vegas Strip and downtown Las Vegas. Palace Station features a
turn-of-the-20th-century railroad station theme with non-gaming amenities including newly remodeled hotel rooms, seven full-service
restaurants, a 275-seat entertainment lounge, four additional bars, two swimming pools, an approximately 20,000-square-foot banquet and convention center, a gift
shop and a non-gaming video arcade.

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Palace
Station's seven full-service restaurants have a total of approximately 1,300 seats. These restaurants offer a variety of high-quality food at reasonable
prices, including the Grand Café, Feast Buffet, The Broiler Steaks and Seafood, Pasta Palace (an Italian restaurant), Cabo Mexican Restaurant, an 18-seat Oyster Bar and Food
Express Chinese Restaurant. In addition to these restaurants, Palace Station offers various fast-food outlets and the Louie Anderson Theater featuring Bonkers Comedy Club.



Boulder Station, which opened in August 1994, is strategically located on Boulder Highway, immediately adjacent to the Interstate 515
interchange. Station believes that this highly visible location at this well-traveled intersection offers a competitive advantage relative to existing hotels and casinos located on Boulder
Highway. Boulder Station is located approximately four miles east of the Las Vegas Strip and approximately four miles southeast of downtown Las Vegas. Boulder Station features a
turn-of-the-20th-century railroad station theme with non-gaming amenities including five full-service restaurants, a 750-seat
entertainment lounge, six additional bars, an 11-screen movie theater complex, a Kid's Quest child care facility, a swimming pool, a non-gaming video arcade and a gift shop.

Boulder
Station's five full-service restaurants have a total of over 1,400 seats. These restaurants offer a variety of high-quality meals at reasonable prices,
including the Grand Café, Feast Buffet, The Broiler Steaks and Seafood, Pasta Palace (an Italian restaurant) and Guadalajara Bar & Grille (a Mexican restaurant). In addition to
these restaurants, Boulder Station offers various fast-food outlets.



Texas Station, which opened in July 1995, is strategically located at the corner of Lake Mead Boulevard and Rancho Drive in North Las
Vegas. Texas Station features a
friendly Texas atmosphere, highlighted by distinctive early Texas architecture with non-gaming amenities including five full-service restaurants, a Kid's Quest child care
facility, a 300-seat entertainment lounge, a 1,700-seat event center, eight additional bars, an 18-screen movie theater complex, a swimming pool, a
non-gaming video arcade, a gift shop, a 60-lane bowling center and approximately 40,000 square feet of meeting and banquet space.

Texas
Station's five full-service restaurants have a total of approximately 1,200 seats. These restaurants offer a variety of high-quality food at reasonable
prices, including Coco's Bakery & Restaurant, Austins Steakhouse, San Lorenzo (an Italian restaurant), Feast Buffet (featuring seven different food stations) and Texas Star Oyster Bar, which
has 110 seats. In addition to the Texas Station-themed restaurants, guests may also enjoy the unique features of several bars and lounges including Martini Ranch, Whiskey Bar, Garage Bar, A Bar and
South Padre Honky Tonk. Texas Station also offers a variety of fast-food outlets to enhance the customers' dining selection.



Sunset Station, which opened in June 1997, is strategically located at the intersection of Interstate 515 and Sunset Road. Multiple
access points provide customers convenient access to the gaming complex and parking areas. Situated in a highly concentrated commercial corridor along Interstate 515, Sunset Station has prominent
visibility from the freeway and the Sunset commercial corridor. Sunset Station is located approximately nine miles east of McCarran International Airport and approximately seven miles southeast of
Boulder Station. Sunset Station features a Spanish/Mediterranean-style theme with non-gaming amenities including seven full-service restaurants themed to capitalize on the
familiarity of the restaurants at Station's other properties, a 520-seat entertainment lounge, a 4,000-seat outdoor amphitheater, eight additional bars, a gift shop, a
non-gaming video arcade, a 13-screen movie theater complex, a 72-lane bowling center, a Kid's Quest child care facility and a swimming pool.

Sunset
Station's seven full-service restaurants have a total of approximately 2,100 seats featuring "live-action" cooking and simulated patio dining. These
restaurant facilities offer a variety of high-quality

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food
at reasonable prices, including the Grand Café, Sonoma Cellar Steakhouse, Capri Italian Ristorante, Guadalajara Bar & Grille (a Mexican restaurant), Feast Buffet, a live
action buffet featuring Mexican, Italian, barbecue, American and Chinese cuisine, Hooter's and a 65-seat Oyster Bar. Guests may also enjoy the Gaudi Bar, a centerpiece of the casino
featuring over 8,000
square feet of stained glass. Sunset Station also offers a variety of fast-food outlets to enhance the customers' dining selection.



In October 2000, Station purchased Santa Fe Station which is strategically located at the intersection of Highway 95 and Rancho Drive,
approximately five miles northwest of Texas Station. Santa Fe Station features non-gaming amenities including four full-service restaurants, a gift shop, a
non-gaming video arcade, a swimming pool, a 500-seat entertainment lounge, seven additional bars, a 60-lane bowling center, a 16-screen movie theater
complex, a Kid's Quest child care facility and over 14,000 square feet of meeting and banquet facilities.

Santa
Fe Station's four full-service restaurants have a total of approximately 1,000 seats, which include The Charcoal Room (a steakhouse), Cabo Mexican Restaurant, a
24-hour cafe and the Feast Buffet, a live action buffet featuring Mexican, Italian, barbecue, American and Chinese cuisine. Guests may also enjoy Revolver Saloon and Dance Hall or 4949
Lounge, a centerpiece of the casino. Santa Fe Station also offers a variety of fast-food outlets to enhance the customers' dining selection.



Red Rock, which opened in April 2006, is strategically located on Charleston Boulevard at the Interstate 215/Charleston interchange in
the Summerlin master-planned community in Las Vegas, Nevada. Red Rock features an elegant desert oasis theme with a contemporary design, offering 815 hotel rooms featuring ultra-modern design filled
with the most up-to-date luxury amenities. In addition to its standard guestrooms, the hotel offers six styles of suites, including
one-of-a-kind custom villas and penthouse suites. Additional non-gaming amenities include nine full-service restaurants, a
16-screen movie theater complex, 94,000 square feet of meeting and convention space, a full-service spa, a 72-lane bowling center and a Kid's Quest child care
facility.

Red
Rock's nine full-service restaurants have a total of approximately 1,600 seats and include Hachi (a contemporary Japanese restaurant), T-bones Chophouse,
Terra Rossa (an Italian restaurant), Cabo Mexican Restaurant, the Grand Café, Feast Buffet, a live action buffet featuring Mexican, Italian, barbecue, American and Chinese cuisine, Sand
Bar, Yard House and LBS: A Burger Joint (a gourmet burger restaurant). In addition, Red Rock features numerous bars and
lounges including Rocks Lounge offering free live entertainment, Onyx Bar, Sand Bar and Lucky Bar. Red Rock also offers a variety of fast-food outlets to enhance the customers' dining
selection.



Green Valley Ranch, which opened in December 2001, is strategically located at the intersection of Interstate 215 and Green Valley
Parkway in Henderson, Nevada. Green Valley Ranch is approximately five minutes from McCarran International Airport and seven minutes from the Las Vegas Strip. Green Valley Ranch was designed to
complement the Green Valley master-planned community. The AAA Four Diamond resort features a Mediterranean-style villa theme with non-gaming amenities including eight
full-service restaurants, a 4,200-square-foot non-gaming arcade, a state-of-the-art spa with outdoor pools, a
10-screen movie theater complex, two gift shops, approximately 65,000 square feet of meeting and convention space and an entertainment lounge. Green Valley Ranch also offers an
8-acre complex featuring private poolside cabanas, a contemporary poolside bar and grill, one and a half acres of vineyards and an outdoor performance venue.

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Green
Valley Ranch's eight full-service restaurants include the China Spice (a Chinese restaurant), Sushi+Sake, Terra Verde (an Italian restaurant), Hank's Fine Steaks and
Martinis, The Original Pancake House, Feast Buffet, a live action buffet featuring Mexican, Italian, barbecue, American and Chinese cuisine, Tides Oyster Bar and Turf Grill. Green Valley Ranch also
offers a variety of fast-food outlets to enhance the customers' dining selection. Guests may also enjoy the Drop Bar, a centerpiece of the casino, The Lobby Bar, which is open to the hotel
entrance and the pool area, and Ovation, an entertainment lounge.



Fiesta Rancho was purchased by Station in January 2001 and is strategically located at the intersection of Lake Mead Boulevard and
Rancho Drive in North Las Vegas across from Texas Station. Fiesta Rancho features a Southwestern theme with non-gaming amenities including three full-service restaurants, a
gift shop,
a non-gaming video arcade, a swimming pool, a 600-seat entertainment lounge, a regulation-size ice skating rink and three additional bars.

Fiesta
Rancho's three full-service restaurants have a total of over 870 seats, and include a 24-hour Denny's Restaurant, Garduno's (a Mexican restaurant), and
Festival Buffet. Fiesta Rancho also offers a variety of fast-food outlets to enhance the customers' dining selection.



Fiesta Henderson was purchased by Station in January 2001 and is strategically located at the intersection of Interstate 215 and
Interstate 515 in Henderson, Nevada. The property features four full-service restaurants, a 12-screen movie theater complex, a gift shop, a swimming pool, three bars and
lounges and meeting space.

Fiesta
Henderson's four full-service restaurants have a total of approximately 1,100 seats, and include a 24-hour Denny's Restaurant, Fuego Steakhouse, Amigo's
Mexican Cantina and Festival Buffet. Fiesta Henderson also offers a variety of fast-food outlets to enhance the customers' dining selection.



In January 2003, Station purchased Wildfire Rancho located on Rancho Drive across from Texas Station. Wildfire Rancho's
non-gaming amenities include a lounge, outdoor patio and a full-service restaurant.



In August 2004, Station purchased Wildfire Boulder (formerly known as Magic Star) and Gold Rush. Wildfire Boulder is located on Boulder
Highway in Henderson, Nevada. Gold Rush is located at the intersection of Interstate 515 and Sunset Road, adjacent to Sunset Station in Henderson, Nevada. Both properties offer non-gaming
amenities which include a full-service restaurant and a bar.



In September 2006, Station purchased Lake Mead Casino located in Henderson, Nevada. Lake Mead Casino's non-gaming amenities
include a full-service restaurant and bar.



Barley's, which opened in January 1996, is a casino and brew pub located in Henderson, Nevada. Barley's non-gaming
amenities include a full-service restaurant, a pizza kitchen and a bar. In November 2005, Station purchased a 50% interest in The Greens, a restaurant and lounge, located in Henderson,

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Nevada.
The Greens' non-gaming amenities include a full-service restaurant and bar. In October 2007, Station purchased a 50% interest in Wildfire Lanes (formerly known as
Renata's) located in Henderson, Nevada. Wildfire Lanes' non-gaming amenities include a full-service restaurant, a bar and an 18-lane bowling center. Station is the
managing partner for Barley's, The Greens and Wildfire Lanes and receives a management fee equal to approximately 10% of Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA").



Station manages the Gun Lake Casino in Allegan County, Michigan, which opened in February 2011, on behalf of the
Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians of Michigan, a federally recognized Native American tribe commonly referred to as the
Gun Lake Tribe.

On
November 13, 2003, Station agreed to purchase a 50% interest in MPM Enterprises, LLC, a Michigan limited liability company ("MPM"). MPM has entered into development and
management agreements with the Gun Lake Tribe, pursuant to which MPM agreed to assist the tribe in developing and operating a gaming and entertainment project to be located in Allegan County,
Michigan. Gun Lake Casino, is located on approximately 147 acres on U.S. Highway 131 and 129th Avenue, approximately 25 miles south of Grand Rapids, Michigan and 27 miles north of
Kalamazoo, Michigan, and includes approximately 1,400 slot machines, 28 table games and various dining options.

The
Sixth Amended and Restated Management Agreement (the "Gun Lake Management Agreement") has a term of seven years from the opening of the facility and provides for a management fee of
30% of the project's net income to be paid to MPM. Pursuant to the terms of the MPM operating agreement, Station's, or the Company's as successor to Station, portion of the management fee is 50% of
the first $24 million of management fees earned, 83% of the next $24 million of management fees and 93% of any management fees in excess of $48 million.

Expansion Strategy



Station believes that a highly visible location, convenient access and ample parking are critical factors in attracting local patronage
and repeat visitors. Additionally, sites must be large enough to support multi-phased, master-planned growth to capitalize on growing demand in incremental stages. Station selects sites that are
located within a dense population base which generally are adjacent to high-traffic surface streets and interstate highways. Station believes that each of its casino properties' locations
has provided it with a significant competitive advantage to attract its targeted customer base. In the Las Vegas metropolitan area, as a result of Senate Bill 208, there are a limited number of sites
available for development off of "The Strip" or downtown and Station controls a number of these sites.



No master-planned development is currently contemplated, but a long-term master-planned expansion strategy would include
the master-planned expansion of Station's existing and future gaming locations. In designing project sites, Station plans and engineers for multi-phased facility expansions to accommodate future
growth which allows Station to develop dominant properties. A project's master-planned design typically allows the option of adding hotel rooms, casino space, parking structures and
non-gaming entertainment such as movie theaters, additional restaurants, retail shops and various other entertainment venues.

Station
continually evaluates the timing and scope of its master-planned developments at each of its properties and may determine from time to time to expand the scope of, improve on or
suspend the

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implementation
of its master plans. These decisions are dependent upon the availability of financing, competition and future economic and gaming regulatory environments, many of which are beyond
Station's control.



Station has acquired several parcels of land in the Las Vegas valley, northern California and Reno, Nevada, which could be used for new
casino development or other associated development. Station also evaluates other development and acquisition opportunities in current and emerging gaming markets, including land-based,
dockside, riverboat and Native American gaming. The decision by Station whether to proceed with any new gaming development or acquisition opportunity is dependent upon future economic and regulatory
factors, the availability of financing and competitive and strategic considerations, many of which are beyond its control.



As of December 31, 2010, Station had land held for development consisting primarily of eleven sites that are owned or leased,
which includes 368 acres in the Las Vegas valley, 772 acres in northern California and 200 acres in Reno, Nevada. The primary gaming-entitled land that Station owns in the Las Vegas valley consists of
77 acres of land (96 acres including those leased or under contract) on which the Wild Wild West is located and the surrounding area, 71 acres located at the intersection of Durango Road and the
Southern Beltway/Interstate 215 in the southwest area of Las Vegas, 58 acres also located in southwest Las Vegas at the intersection of Town Center and Interstate 215, 45 acres in the master-planned
community of Inspirada located in Henderson, Nevada, 58 acres located on the southern end of Las Vegas Boulevard at Cactus Avenue and 30 acres on Boulder Highway at the site formerly known as the
Castaways Hotel Casino and Bowling Center.

In
December 2008, Station amended the lease and purchase agreement for the 19-acre parcel of land on which Wild Wild West is located. Under the amended agreement, Station has
an option to purchase the land for a purchase price of $36 million. The amended lease also includes options to purchase the land in July 2023, 2044 and 2065 for a purchase price equal to fair
market value as of July 2022, 2043 and 2064, respectively. No amounts related to these purchase options have been recorded on Station's consolidated balance sheets at December 31, 2010. In
March 2011, Station was notified by the lessor that the lease had been terminated. We are currently in negotiations regarding possible modifications to this lease, however we can provide no assurance
that we will be able to reach an agreement with the lessor.



Station has entered into development and management agreements with the Federated Indians of Graton Rancheria (the "FIGR"), a federally
recognized Native American tribe. Pursuant to those agreements, Station, or the Company as successor to Station, will assist the FIGR in developing, financing and operating a gaming and entertainment
project to be located near the City of Rohnert Park in Sonoma County, California.

The
management agreement has a term of seven years from the date of opening of the project and Station will receive a management fee equal to 24% of the facility's net income in years 1
through 4 and 27% of the facility's net income in years 5 through 7. Station will also receive a development fee equal to 2% of the cost of the project upon the opening of the project. The National
Indian Gaming Commission (the "NIGC") has approved the management agreement for Class II gaming at the planned facility. Class II gaming includes games of chance such as bingo,
pull-tabs, tip jars and punch boards (and electronic or computer-aided versions of such games), and non-banked card games. The FIGR and Station may also pursue approval of
Class III gaming, which would permit casino-style gaming, at the planned

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facility.
Class III gaming would require an approved compact with the State of California and approval by the NIGC of a modification to the existing management agreement, or a new management
agreement, permitting Class III gaming.

During
2010, the Bureau of Indian Affairs of the U.S. Department of the Interior (the "BIA") accepted approximately 254 acres of land owned by Station into trust on behalf of the FIGR
for the development of the project by Station and the FIGR.

The
timing and feasibility of the project are dependent upon the receipt of the necessary governmental and regulatory approvals. Prior to obtaining third-party financing, Station will
contribute significant financial support to the project, even though there can be no assurances as to when or if the necessary approvals will be obtained.



Station has entered into development and management agreements with the North Fork Rancheria of Mono Indians (the "Mono"), a federally
recognized Native American tribe located near Fresno, California, pursuant to which, Station, or, following the Effective Date, the Company, will assist the Mono in developing, financing and operating
a gaming and entertainment facility to be located in Madera County, California. The management agreement has a term of seven years from the opening of the facility and provides for a management fee of
24% of the facility's net income.

In
2008, the Mono and the State of California entered into a tribal-state Class III gaming compact. The compact is subject to approval by the California Legislature and, if
approved, will regulate gaming the Mono's proposed gaming and entertainment project to be developed on the site. No assurances can be provided as to whether the California Legislature will approve the
compact.

As
currently contemplated, the facility will include slot machines, table games, restaurants, a hotel and entertainment amenities. Development of the project is subject to certain
governmental and regulatory approvals, including, but not limited to, approval by the California Legislature of the gaming compact with the State of California, the DOI accepting the land into trust
on behalf of the Mono and approval of the management agreement by the NIGC.

The
timing of this type of project is difficult to predict, and is dependent upon the receipt of the necessary governmental and regulatory approvals. Prior to obtaining third-party
financing, Station, or the Company or its subsidiaries as successor to Station, will contribute significant financial support to the project, even though there can be no assurances as to when, or if,
the necessary approvals will be obtained.



Station has entered into development and management agreements with the Mechoopda Indian Tribe of Chico Rancheria, California (the
"MITCR"), a federally recognized Native American tribe, pursuant to which, Station, or, following the Effective Date, the Company, will assist the MITCR in developing, financing and operating a gaming
and entertainment facility to be located in Butte County, California. Under the terms of the development agreement, Station has advanced approximately $11.9 million toward the development of
this project through December 31, 2010, which was expected to be repaid from the proceeds of the project financing or from the MITRC's gaming revenues. As a result of the continued economic
downturn and thus the revised expected
potential of the project, Station does not expect to proceed with the development of this project, and has written off the associated long-term asset.

Intellectual Property

Station uses a variety of trade names, service marks, trademarks, patents and copyrights in its operations and believes that they have
all the licenses necessary to conduct their continuing operations. Station has registered several service marks, trademarks, patents and copyrights with the United States

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Patent
and Trademark Office or otherwise acquired the licenses to use those which are material to conduct their business. Station owns patents and patent applications with expiration dates ranging
from 2018 to 2028 relating to technologies that allow Station to track the wagering activities and geographic location of its players. Station also owns patents relating to unique casino games.
Station also files copyright applications to protect its creative artworks, which are often featured in property branding, as well as its distinctive website content. We will acquire all rights to
Station intellectual property in the Restructuring Transactions.

Seasonality

Station's cash flows from operating activities are seasonal in nature. Their operating results are traditionally the strongest in the
first quarter and the fourth quarter, and traditionally the weakest during the third quarter.

Competition

The Acquired Casinos face competition from all other casinos and hotels in the Las Vegas area, including to some degree, from each
other. In addition, the Acquired Casinos face competition from all smaller non-restricted gaming locations and restricted gaming locations (locations with 15 or fewer slot machines) in the
greater Las Vegas area. As of December 31 2010, there were approximately 1,400 restricted gaming locations with approximately 14,000 slot machines. The Acquired Casinos compete with other
hotel/casinos and restricted gaming locations by
focusing on repeat customers and attracting these customers through innovative marketing programs. The Acquired Casinos' value-oriented, high-quality approach is designed to generate
repeat business. Additionally, the Acquired Casinos are strategically located and designed to permit convenient access and ample parking, which are critical factors in attracting local visitors and
repeat patrons. Currently, there are approximately 38 major gaming properties located on or near the Las Vegas Strip, 16 located in the downtown area and several located in other areas of Las Vegas.
Major additions, expansions or enhancements of existing properties or the construction of new properties by competitors, could also have a material adverse effect on the business of the Acquired
Casinos.

The
Acquired Casinos also face competition from 159 non-restricted gaming locations in the Clark County area primarily targeted to the local and the repeat visitor markets.
Some of these competitors have completed construction or expansions and other existing competitors have projects under construction. Although the Acquired Casinos have competed strongly in these
marketplaces, there can be no assurance that additional capacity will not have a negative impact on our business.

In
1997, the Nevada legislature enacted Senate Bill 208. This legislation identified certain gaming enterprise districts wherein casino gaming development would be permitted throughout
the Las Vegas valley and established more restrictive criteria for the establishment of new gaming enterprise districts. Station believes the growth in gaming supply in the Las Vegas locals' market
has been, and will continue to be, limited by the provisions of Senate Bill 208.

To
a lesser extent, the Acquired Casinos compete with gaming operations in other parts of the state of Nevada, such as Reno, Laughlin and Lake Tahoe, and other gaming markets throughout
the United States and in other parts of the world, with state sponsored lotteries, on-and-off-track wagering on horse and other races, card rooms, online gaming and
other forms of legalized gambling. The gaming industry also includes land-based casinos, dockside casinos, riverboat casinos, racetracks with slots and casinos located on Native American
land. There is intense competition among companies in the gaming industry, some of which have significantly greater resources than we will. Several states are currently considering legalizing casino
gaming in designated areas. Legalized casino gaming in such states and on Native American land will result in strong competition and could adversely affect our operations, particularly to the extent
that such gaming is conducted in areas close to our operations.

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Native American gaming in California, as it currently exists, has had little, if any impact on Station's Nevada operations to date, although there are no
assurances as to future impact. In total, the State of California has signed and ratified Tribal-State Compacts with 67 Native American tribes. Currently there are 58 Native American casinos in
operation in the State of California. These Native American tribes are allowed to operate slot machines, lottery games, and banking and percentage games (including "21") on Native American lands. A
banking game is one in which players compete against the licensed gaming establishment rather than against one another. A percentage game is one in which the house does not directly participate in the
game, but collects a percentage from it which may be computed from the amount of bets made, winnings collected, or the amount of money changing hands. It is not certain if any expansion of Native
American gaming in California will affect our Nevada operations given that visitors from California make up Nevada's largest visitor market. Increased competition from Native American gaming may
result in a decline in our revenues and may have a material adverse effect on our business.

Regulation and Licensing



The ownership and operation of casino gaming facilities and the manufacture and distribution of gaming devices in Nevada are subject
to: (i) the Nevada Gaming Control Act and the rules and regulations promulgated thereunder (collectively, the "Nevada Act"); and (ii) various local ordinances and regulations. Our gaming
operations in Nevada will be subject to the licensing and regulatory control of the Nevada Gaming Commission (the "Nevada Commission"), the Nevada State Gaming Control Board (the "Nevada Board"), the
City of Las Vegas, the Clark County Liquor and Gaming Licensing Board (the "Clark County Board"), the City of North Las Vegas, the City of Henderson and certain other local regulatory agencies. The
Nevada Commission, Nevada Board, City of Las Vegas, Clark County Board, City of North Las Vegas, City of Henderson, and certain other local regulatory agencies are collectively referred to as the
"Nevada Gaming Authorities".

The
laws, regulations and supervisory procedures of the Nevada Gaming Authorities are based upon declarations of public policy which are concerned with, among other things:
(i) the prevention of unsavory or unsuitable persons from having a direct or indirect involvement with gaming at any time or in any capacity; (ii) the establishment and maintenance of
responsible accounting practices and procedures; (iii) the maintenance of effective controls over the financial practices of licensees, including the establishment of minimum procedures for
internal controls and the safeguarding of assets and revenues, providing reliable record keeping and requiring the filing of periodic reports with the Nevada Gaming Authorities; (iv) the
prevention of cheating and fraudulent practices; and (v) providing a source of state and local revenues through taxation and licensing fees. Changes in such laws, regulations and procedures
could have an adverse effect on our gaming operations.

Our
direct and indirect subsidiaries that will conduct gaming operations in Nevada are required to be licensed by the Nevada Gaming Authorities. The gaming licenses require the periodic
payment of fees and taxes and are not transferable. NP Boulder LLC ("New Boulder"), NP Palace LLC ("New Palace"), NP Red Rock LLC ("New Red Rock"), NP Sunset LLC
("New Sunset"), NP Tropicana LLC ("New Tropicana"), NP Fiesta LLC ("New Fiesta"), NP Gold Rush LLC ("New Gold Rush"), NP Lake Mead LLC ("New Lake Mead"), NP
LML LLC ("New LML"), NP Magic Star LLC ("New Magic Star"), NP Rancho LLC "New Rancho"), NP Santa Fe LLC ("New Santa Fe"), NP Texas LLC ("New Texas")
and NP River Central LLC ("New River Central") have applied for licenses to conduct non-restricted gaming operations. Our ownership in New Tropicana will be held through NP Landco
Holdco LLC, which has applied for registration as an intermediary company and for licensing as a member and manager of New Tropicana. Town Center Amusements, Inc., a Limited Liability
Company ("TCAI") has been licensed to conduct non-restricted gaming operations at Barley's Casino & Brewing Company ("Barley's"), a micro brewery and casino located in Henderson,
Nevada. Greens Café, LLC ("GC") has been licensed to conduct non-restricted gaming operations at The Greens, a restaurant and bar located in Henderson,

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Nevada
and Sunset GV, LLC ("SGV") has been licensed to conduct non-restricted gaming operations at Wildfire Lanes, formerly Renata's Supper Club, a casino located in Henderson,
Nevada. A license to conduct "non-restricted" operations is a license to conduct an operation of (i) at least 16 slot machines, (ii) any number of slot machines together with
any other game, gaming device, race book or sports pool at one establishment, (iii) a slot machine route, (iv) an inter-casino linked system, or (v) a mobile gaming system. Our
ownership in TCAI, GC and SGV will be held through an intermediary company known as NP Green Valley LLC ("New Green Valley"), which has applied for registration as an intermediary
company and for licensing as a member and manager of TCAI, GC and SGV. We will also own a minority interest in Fiesta Palms, LLC, d.b.a. Palms Casino through Palms Station, LLC, which is
registered with the Nevada Commission as an intermediary company.

We
have applied to the Nevada Gaming Authorities to be found suitable to own the equity interests in our licensed and registered subsidiaries and to be registered by the Nevada
Commission as a publicly traded corporation for purposes of the Nevada Act (a "Registered Corporation"). Once we become a Registered Corporation, we will be required to periodically submit detailed
financial and operating reports to the Nevada Commission and provide any other information that the Nevada Commission may require. Substantially all material loans, leases, sales of securities and
similar financing transactions by us and our licensed or registered subsidiaries must be reported to or approved by the Nevada Commission and/or the Nevada Board.

The
Nevada Gaming Authorities may investigate any individual who has a material relationship to, or material involvement with, a Registered Corporation or its licensed subsidiaries, in
order to determine whether such individual is suitable or should be licensed as a business associate of a Registered Corporation or a gaming licensee. Officers, directors and certain key employees of
our licensed subsidiaries must file applications with the Nevada Gaming Authorities and may be required to be licensed or found suitable by the Nevada Gaming Authorities. Our officers, directors and
key employees who are actively and directly involved in gaming activities of our licensed subsidiaries may be required to be licensed or found suitable by the Nevada Gaming Authorities. The Nevada
Gaming
Authorities may deny an application for licensing for any cause that they deem reasonable. A finding of suitability is comparable to licensing, and both require submission of detailed personal and
financial information followed by a thorough investigation. The applicant for licensing or a finding of suitability must pay all the costs of the investigation. Changes in licensed positions must be
reported to the Nevada Gaming Authorities and, in addition to their authority to deny an application for a finding of suitability or licensure, the Nevada Gaming Authorities have jurisdiction to
disapprove a change in corporate position.

If
the Nevada Gaming Authorities were to find an officer, director or key employee unsuitable for licensing or unsuitable to continue to have a relationship with us or our licensed
subsidiaries, the companies involved would have to sever all relationships with such person. In addition, the Nevada Commission may require our licensed subsidiaries to terminate the employment of any
person who refuses to file the appropriate applications. Determinations of suitability or questions pertaining to licensing are not subject to judicial review in Nevada.

If
it were determined that the Nevada Act was violated by a licensed subsidiary, the gaming licenses it holds could be limited, conditioned, suspended or revoked, subject to compliance
with certain statutory and regulatory procedures. In addition, the Company, the licensed subsidiaries and the persons involved could be subject to substantial fines for each separate violation of the
Nevada Act at the discretion of the Nevada Commission. Further, a supervisor could be appointed by the Nevada Commission to operate Palace Station, Boulder Station, Texas Station, Sunset Station,
Santa Fe Station, Red Rock, Fiesta Rancho, Fiesta Henderson, Wild Wild West, Wildfire Rancho, Barley's, Gold Rush, Wildfire Boulder, The Greens, Lake Mead Casino and Wildfire Lanes and, under certain
circumstances, earnings generated during the supervisor's appointment (except for the reasonable rental value of the premises) could be forfeited to the State of Nevada. Limitation, conditioning or
suspension of the gaming licenses of the licensed subsidiaries

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or
the appointment of a supervisor could (and revocation of any such gaming license would) have a material adverse affect on our gaming operations.

Any
beneficial owner of our voting or non-voting securities, regardless of the number of shares owned, may be required to file an application, may be investigated, and may be
required to obtain a finding of suitability as a beneficial owner of our securities if the Nevada Commission has reason to believe that such ownership would otherwise be inconsistent with the declared
policies of the State of Nevada. If the beneficial owner of our voting or nonvoting securities who must be found suitable is a corporation, partnership, limited partnership, limited liability company
or trust, it must submit detailed business and financial information, including a list of its beneficial owners, to the Nevada Board. The applicant must pay all costs of investigation incurred by the
Nevada Gaming Authorities in conducting any such investigation.

The
Nevada Act provides that persons who acquire beneficial ownership of more than 5% of the voting or non-voting securities of a Registered Corporation must report the
acquisition to the
Nevada Commission. The Nevada Act also requires that beneficial owners of more than 10% of the voting securities of a Registered Corporation must apply to the Nevada Commission for a finding of
suitability within thirty days after the Chairman of the Nevada Board mails the written notice requiring such filing. An "institutional investor," as defined in the Nevada Commission's regulations,
which acquires beneficial ownership of more than 10%, but not more than 25% of our voting securities may apply to the Nevada Commission for a waiver of such finding of suitability if such
institutional investor holds the voting securities for investment purposes only. An institutional investor that has obtained a waiver may, in certain circumstances, hold up to 29% of our voting
securities and maintain its waiver for a limited period of time. An institutional investor shall not be deemed to hold voting securities for investment purposes unless the voting securities were
acquired and are held in the ordinary course of business as an institutional investor and not for the purpose of causing, directly or indirectly, the election of a majority of the members of our Board
of Managers, any change in our corporate charter, bylaws, management policies or our operations, or any of our gaming affiliates, or any other action which the Nevada Commission finds to be
inconsistent with holding our voting securities for investment purposes only. Activities which are not deemed to be inconsistent with holding voting securities for investment purposes only include:
(i) voting on all matters voted on by stockholders; (ii) making financial and other inquiries of management of the type normally made by securities analysts for informational purposes
and not to cause a change in our management, policies or operations; and (iii) such other activities as the Nevada Commission may determine to be consistent with such investment intent.

Any
person who fails or refuses to apply for a finding of suitability or a license within thirty days after being ordered to do so by the Nevada Commission, or the Chairman of the Nevada
Board, may be found unsuitable. The same restrictions apply to a record owner if the record owner, after request, fails to identify the beneficial owner. Any equity holder who is found unsuitable and
who holds, directly or indirectly, any beneficial ownership of the common equity of a Registered Corporation beyond such period of time as may be prescribed by the Nevada Commission may be guilty of a
criminal offense. We will be subject to disciplinary action if, after we receive notice that a person is unsuitable to be an equity holder or to have any other relationship with us or our licensed or
registered subsidiaries, we (i) pay that person any dividend or interest upon our securities, (ii) allow that person to exercise, directly or indirectly, any voting right conferred
through securities held by that person, (iii) pay remuneration in any form to that person for services rendered or otherwise, or (iv) fail to pursue all lawful efforts to require such
unsuitable person to relinquish his securities including, if necessary, the immediate purchase of said securities (a) in the case of Station Holdco, for the price specified by the relevant
gaming authority or, if no such price is specified, the fair market value as determined by Station Holdco's board of managers, or (b) in the case of Station Voteco, for no consideration. In the
case of Station Holdco, this price would be payable in cash or, at the election of Station Holdco's board of managers, with a promissory note, maturing in not more than 10 years after delivery
of the note and no earlier than 71/2 years from the Effective Date, bearing interest at the applicable rate set forth by the Internal Revenue Service for obligations of at least nine
years.

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Additionally,
the Clark County Board has the authority to approve all persons owning or controlling the stock of any corporation controlling a gaming license.

The
Nevada Commission may, in its discretion, require the holder of any debt security of a Registered Corporation to file applications, be investigated and be found suitable to own the
debt security of a Registered Corporation if the Nevada Commission has reason to believe that such ownership would
otherwise be inconsistent with the declared policies of the State of Nevada. If the Nevada Commission determines that a person is unsuitable to own such security, then pursuant to the Nevada Act, the
Registered Corporation can be sanctioned, including the loss of its approvals, if without the prior approval of the Nevada Commission, it: (i) pays to the unsuitable person any dividend,
interest, or any distribution whatsoever; (ii) recognizes any voting right by such unsuitable person in connection with such securities; (iii) pays the unsuitable person remuneration in
any form; or (iv) makes any payment to the unsuitable person by way of principal, redemption, conversion, exchange, liquidation or similar transaction.

We
will be required to maintain a current membership interest ledger in Nevada, which may be examined by the Nevada Gaming Authorities at any time. If any securities are held in trust by
an agent or by a nominee, the record holder may be required to disclose the identity of the beneficial owner to the Nevada Gaming Authorities. Failure to make such disclosure may be grounds for
finding the record holder unsuitable. We are also required to render maximum assistance in determining the identity of the beneficial owner. The Nevada Commission has the power to require any
membership interest certificates we may issue to bear a legend indicating that the securities are subject to the Nevada Act. We do not know whether the Nevada Commission will impose such a requirement
on us.

We
may not make a public offering of our securities without the prior approval of the Nevada Commission if the securities or proceeds therefrom are intended to be used to construct,
acquire or finance gaming facilities in Nevada, or to retire or extend obligations incurred for such purposes.

Changes
in control of the Company through merger, consolidation, stock or asset acquisitions (including stock issuances in connection with restructuring transactions), management or
consulting agreements, or any act or conduct by a person whereby such person obtains control, may not occur without the prior approval of the Nevada Commission. Entities seeking to acquire control of
a Registered Corporation must satisfy the Nevada Board and the Nevada Commission that they meet a variety of stringent standards prior to assuming control of such Registered Corporation. The Nevada
Commission may also require controlling equity holders, officers, managers and other persons having a material relationship or involvement with the entity proposing to acquire control, to be
investigated and licensed as part of the approval process relating to the transaction.

The
Nevada legislature has declared that some corporate acquisitions opposed by management, repurchases of voting securities and corporate defense tactics affecting Nevada corporate
gaming licensees, and Registered Corporations that are affiliated with those operations, may be injurious to stable and productive corporate gaming. The Nevada Commission has established a regulatory
scheme to ameliorate the potentially adverse effects of these business practices upon Nevada's gaming industry and to further Nevada's policy to: (i) assure the financial stability of corporate
gaming licensees and their affiliates; (ii) preserve the beneficial aspects of conducting business in the corporate form; and (iii) promote a neutral environment for the orderly
governance of corporate affairs. Approvals are, in certain circumstances, required from the Nevada Commission before a Registered Corporation can make exceptional repurchases of voting securities
above the current market price thereof and before a corporate acquisition opposed by management can be consummated. The Nevada Act also requires prior approval of a plan of
re-capitalization proposed by the Registered Corporation's Board of Directors or similar governing entity in response to a tender offer made directly to the
Registered Corporation's equity holders for the purpose of acquiring control of the Registered Corporation.

License
fees and taxes, computed in various ways depending on the type of gaming or activity involved, are payable to the State of Nevada and to the counties and cities in which the
Nevada licensee's

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respective
operations are conducted. Depending upon the particular fee or tax involved, these fees and taxes are payable either monthly, quarterly or annually and are based upon either: (i) a
percentage of the gross revenues received; (ii) the number of gaming devices operated; or (iii) the number of table games operated. A live entertainment tax is also paid by casino
operations where entertainment is furnished in connection with admission charges, the serving or selling of food or refreshments or the selling of any merchandise. Nevada licensees that hold a license
as an operator of a slot route, or manufacturer's or distributor's license also pay certain fees and taxes to the State of Nevada.

Any
person who is licensed, required to be licensed, registered, required to be registered, or is under common control with such persons (collectively, "Licensees"), and who proposes to
become involved in a gaming venture outside of Nevada, is required to deposit with the Nevada Board, and thereafter maintain, a revolving fund in the amount of $10,000 to pay the expenses of
investigation by the Nevada Board of their participation in such foreign gaming. The revolving fund is subject to increase or decrease at the discretion of the Nevada Commission. Thereafter, licensees
are required to comply with certain reporting requirements imposed by the Nevada Act. Licensees are also subject to disciplinary action by the Nevada Commission if they knowingly violate any laws of
the foreign jurisdiction pertaining to the foreign gaming operation, fail to conduct the foreign gaming operation in accordance with the standards of honesty and integrity required of Nevada gaming
operations, engage in activities or enter into associations that are harmful to the State of Nevada or its ability to collect gaming taxes and fees, or employ, contract with or associate with a person
in the foreign operation who has been denied a license or finding of suitability in Nevada on the grounds of unsuitability or whom a court in the state of Nevada has found guilty of cheating. The loss
or restriction of our gaming licenses in Nevada would have a material adverse effect on our business and could require us to cease gaming operations in Nevada.



The sale of alcoholic beverages at Palace Station, Wildfire Rancho and Santa Fe Station is subject to licensing control and regulation
by the City of Las Vegas. Red Rock, Boulder Station and Wild Wild West are subject to liquor licensing control and regulation by the Clark County Board. Texas Station and Fiesta Rancho are subject to
liquor licensing control and regulation by the City of North Las Vegas. Sunset Station, Green Valley Ranch, Fiesta Henderson, Barley's, Gold Rush, Wildfire Boulder, The Greens, Lake Mead Casino and
Wildfire Lanes are subject to liquor licensing control and regulation by the City of Henderson. All liquor licenses are revocable and are not
transferable. The agencies involved have full power to limit, condition, suspend or revoke any such license, and any such disciplinary action could (and revocation would) have a material adverse
effect on the operations of our licensed subsidiaries.



The terms and conditions of management contracts and the operation of casinos and all gaming on land held in trust for Native American
tribes in the United States are subject to the Indian Gaming Regulatory Act of 1988 (the "IGRA"), which is administered by the National Indian Gaming Commission (the "NIGC") and the gaming regulatory
agencies of tribal governments. The IGRA is subject to interpretation by the NIGC and may be subject to judicial and legislative clarification or amendment.

The
IGRA established three separate classes of tribal gamingClass I, Class II and Class III. Class I gaming includes all traditional or social
games solely for prizes of minimal value played by a tribe in connection with celebrations or ceremonies. Class II gaming includes games such as bingo, pull-tabs, punchboards,
instant bingo (and electronic or computer-aided versions of such games) and non-banked card games (those that are not played against the house), such as poker. Class III gaming is
casino-style gaming and includes banked table games such as blackjack, craps and roulette, and gaming machines such as slots, video poker, lotteries and pari-mutuel wagering, a system of
betting under which wagers are placed in a pool, management receives a fee from the pool, and the remainder of the pool is split among the winning wagers.

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The
IGRA requires NIGC approval of management contracts for Class II and Class III gaming as well as the review of all agreements collateral to the management contracts.
The NIGC will not approve a management contract if a director or a 10% shareholder of the management company: (i) is an elected member of the governing body of the Native American tribe which
is the party to the management contract; (ii) has been or subsequently is convicted of a felony or gaming offense; (iii) has knowingly and willfully provided materially important false
information to the NIGC or the tribe; (iv) has refused to respond to questions from the NIGC; or (v) is a person whose prior history, reputation and associations pose a threat to the
public interest or to effective gaming regulation and control, or create or enhance the chance of unsuitable activities in gaming or the business and financial arrangements incidental thereto. In
addition, the NIGC will not approve a management contract if the management company or any of its agents have attempted to unduly influence any decision or process of tribal government relating to
gaming, or if the management company has materially breached the terms of the management contract or the tribe's gaming ordinance or resolution, or a trustee, exercising the skill
and due diligence that a trustee is commonly held to, would not approve the management contract. A management contract can be approved only after the NIGC determines that the contract provides, among
other things, for: (i) adequate accounting procedures and verifiable financial reports, which must be furnished to the tribe; (ii) tribal access to the daily operations of the gaming
enterprise, including the right to verify daily gross revenues and income; (iii) minimum guaranteed payments to the tribe, which must have priority over the retirement of development and
construction costs; (iv) a ceiling on the repayment of such development and construction costs and (v) a contract term not exceeding five years and a management fee not exceeding 30% of
net revenues (as determined by the NIGC); provided that the NIGC may approve up to a seven year term and a management fee not to exceed 40% of net revenues if the NIGC is satisfied that the capital
investment required, and the income projections for the particular gaming activity require the larger fee and longer term. There is no periodic or ongoing review of approved contracts by the NIGC. The
only post-approval action that could result in possible modification or cancellation of a contract would be as the result of an enforcement action taken by the NIGC based on a violation of
the law or an issue affecting suitability.

The
IGRA prohibits all forms of Class III gaming unless the tribe has entered into a written agreement with the state that specifically authorizes the types of Class III
gaming the tribe may offer (a "tribal-state compact"). These tribal-state compacts provide, among other things, the manner and extent to which each state will conduct background investigations and
certify the suitability of the manager, its officers, directors, and key employees to conduct gaming on Native American lands.

Title
25, Section 81 of the United States Code states that "no agreement shall be made by any person with any tribe of Indians, or individual Indians not citizens of the United
States, for the payment or delivery of any money or other thing of value... in consideration of services for said Indians relative to their lands... unless such contract or agreement be executed and
approved" by the Secretary or his or her designee. An agreement or contract for services relative to Native American lands which fails to conform with the requirements of Section 81 is void and
unenforceable. All money or other things of value paid to any person by any Native American or tribe for or on his or their behalf, on account of such services, in excess of any amount approved by the
Secretary or his or her authorized representative will be subject to forfeiture. We intend to comply with Section 81 with respect to any other contract to manage casinos located on Native
American land in the United States.

Native
American tribes are sovereign nations with their own governmental systems, which have primary regulatory authority over gaming on land within the tribes' jurisdiction. Therefore,
persons engaged in gaming activities, including Station, are subject to the provisions of tribal ordinances and regulations on gaming. These ordinances are subject to review by the NIGC under certain
standards established by the IGRA. The NIGC may determine that some or all of the ordinances require amendment, and those additional requirements, including additional licensing requirements, may be
imposed on us.

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Several bills have been introduced in Congress that would amend the IGRA. While there have been a number of technical amendments to the IGRA, to date there have
been no material changes. Any amendment of the IGRA could change the governmental structure and requirements within which tribes could conduct gaming, and may have an adverse effect on our results of
operations or impose additional regulatory or operational burdens.



If we become involved in gaming operations in any other jurisdictions, such gaming operations will subject us and certain of our
officers, managers, key employees, equityholders and other affiliates ("Regulated Persons") to strict legal and regulatory requirements, including mandatory licensing and approval requirements,
suitability requirements, and ongoing regulatory oversight with respect to such gaming operations. Such legal and regulatory requirements and oversight will be administered and exercised by the
relevant regulatory agency or agencies in each
jurisdiction (the "Regulatory Authorities"). We and the Regulated Persons will need to satisfy the licensing, approval and suitability requirements of each jurisdiction in which we seek to become
involved in gaming operations. These requirements vary from jurisdiction to jurisdiction, but generally concern the responsibility, financial stability and character of the owners and managers of
gaming operations as well as persons financially interested or involved in gaming operations. In general, the procedures for gaming licensing, approval and finding of suitability require the Company
and each Regulated Person to submit detailed personal history information and financial information to demonstrate that the proposed gaming operation has adequate financial resources generated from
suitable sources and adequate procedures to comply with the operating controls and requirements imposed by law and regulation in each jurisdiction, followed by a thorough investigation by such
Regulatory Authorities. In general, the Company and each Regulated Person must pay the costs of such investigation. An application for any gaming license, approval or finding of suitability may be
denied for any cause that the Regulatory Authorities deem reasonable. Once obtained, licenses and approvals may be subject to periodic renewal and generally are not transferable. The Regulatory
Authorities may at any time revoke, suspend, condition, limit or restrict a license, approval or finding of suitability for any cause that they deem reasonable. Fines for violations may be levied
against the holder of a license or approval and in certain jurisdictions, gaming operation revenues can be forfeited to the state under certain circumstances. There can be no assurance that we will
obtain all of the necessary licenses, approvals and findings of suitability or that our officers, managers, key employees, other affiliates and certain other stockholders will satisfy the suitability
requirements in one or more jurisdictions, or that such licenses, approvals and findings of suitability, if obtained, will not be revoked, limited, suspended or not renewed in the future.

Failure
by us to obtain, or the loss or suspension of, any necessary licenses, approval or findings of suitability would prevent us from conducting gaming operations in such jurisdiction
and possibly in other jurisdictions, which may have an adverse effect on our results of operations. We may be required to submit detailed financial and operating reports to Regulatory Authorities.

Environmental Matters

Compliance with federal, state and local laws enacted for the protection of the environment to date had no material effect upon
Station's capital expenditures, earnings or competitive position and we do not anticipate any material adverse effects in the future based on the nature of our future operations.

Employees

We currently have no employees. Upon consummation of the Restructuring Transactions, the employees of STN and the Acquired Casinos will
become our employees. As of December 31, 2010, Station had approximately 12,224 employees in Nevada, which includes Green Valley Ranch, Aliante Station, Barley's, The Greens and Wildfire Lanes.
None of the Acquired Casinos are currently subject to

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any
collective bargaining agreement or similar arrangement with any union. However, union activists have actively sought to organize employees at certain of the Acquired Casinos in the past, and we
believe that such efforts are ongoing at this time.

Managers

The Company will be managed by a Board of Managers. The members of the Board of Managers have been selected due to, among other things,
their experience and expertise in the gaming industry and other business ventures. Membership on the Board of Managers is not expected to require the full professional time of the individuals serving
on the board. As such, the members of the Company's Board of Managers may, from time to time, be engaged in other business endeavors, including but not limited to those business endeavors in which
they are currently involved, aside from their commitments to the Company. None of the members of the Company's Board of Managers are currently involved in other businesses that are in direct
competition with the Company. See "Item 10. Directors, Executive Officers and Corporate Governance" for details on the members of the Board of Managers and certain of their past and present
business endeavors.

Financial Information

Please refer to "Item 6. Selected Financial Data" and "Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations" for information about revenues, operating results and total assets and liabilities, and to "Item 8. Financial Statements and Supplementary
DataStation Casinos, Inc. Consolidated Financial Statements" included in this Annual Report on Form 10-K.

ITEM 1A.    RISK FACTORS.

The following risk factors should be considered carefully in addition to the other information contained in this Annual Report on
Form 10-K. This Annual Report on Form 10-K contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially
from those contained in the forward-looking statements. The following risk factors set forth the risks that we believe are material to our business, financial condition, assets, operations and equity
interests. If any of the following risks actually occur, our business, financial condition and results of operations could be materially and adversely affected.

Risks Related to our Business

We will not acquire Station's assets and commence operations unless the Restructuring Transactions are consummated.

Our ability to operate is dependent upon, among other things, consummation of the Restructuring Transactions and our acquisition of
Station's assets. Although we believe that the Effective Date will occur, there can be no assurance as to timing, or as to whether the Effective Date will occur at all. If the Effective Date does not
occur, it is unclear what would happen to the Acquired Casinos and whether we would be able to successfully develop, prosecute, confirm and consummate an alternative plan of reorganization with
respect to the Chapter 11 Cases that would be acceptable to the Bankruptcy Court or the holders of claims and equity interests. Finally, if the Effective Date has not occurred by
June 30, 2011, certain of Station's creditors could be entitled to foreclosure on their security interests.

The bankruptcy filing has had a negative impact on Station's image and may negatively impact our business going forward.

As a result of their Chapter 11 Cases, Station has been the subject of negative publicity which has had an impact on its image.
This negative publicity may have an effect on the terms under which some customers and suppliers are willing to continue to do business with us and could materially adversely affect

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our
business, financial condition, future business prospects and results of operations. The impact of this negative publicity cannot be accurately predicted or quantified.

There is doubt about the ability of Station to continue as a going concern.

The audited consolidated financial statements of Station contained elsewhere in this Annual Report on Form 10-K have
been prepared assuming that Station will continue as a going concern. However, the report of the independent registered public accounting firm on the financial statements of Station as of and for the
year ended December 31, 2010 includes an explanatory paragraph describing the existence of substantial doubt about the ability of Station to continue as a going concern. This report, as well as
the uncertainty regarding the eventual outcome of the Plan may adversely impact Station's relationships with vendors, ability to attract customers to its casino properties, attract and retain key
executive employees and maintain and promote its properties, which could materially adversely affect our results of operations.

Station has incurred operating losses in recent fiscal periods. Unless we are able to improve the results of operations of the assets that we acquire in the
Restructuring Transactions, we may be unable to generate sufficient cash flows to meet our debt obligations and finance all operating expenses, working capital needs and capital expenditures.

Station incurred operating losses of $209.1 million, $1.2 billion and $3.2 billion for the years ended
December 31, 2010, 2009 and 2008, respectively. We may incur operating losses in the future. Following the consummation of the Restructuring Transactions, we may be unable to generate
sufficient revenues and cash flows to service our debt obligations as they come due, finance capital expenditures and meet our operational needs. Any one of these failures may preclude us from, among
other things:



Further,
our failure to generate sufficient revenues and cash flows could lead to cash flow and working capital constraints, which may require us to seek additional working capital. We
may not be able to obtain such working capital when it is required. Further, even if we were able to obtain additional working capital, it may only be available on unfavorable terms. For example, we
may be required to take on additional debt, the interest costs of which could adversely affect our results of operations and financial condition. If any such required capital is obtained in the form
of equity, the percentage ownership of the Company of the holders of the then-outstanding Units could be diluted.

Limited
liquidity and working capital may also restrict our ability to maintain and update the Acquired Casinos, which could put us at a competitive disadvantage to casinos offering more
modern and better maintained facilities.

We may face potential successor liability for liabilities of Station not provided for in the Plan. If we are determined to be liable for obligations of Station
our business, financial condition and results of operations may be materially and adversely affected.

We may be subject to certain liabilities of Station not provided for in the Plan. Such liabilities may arise in a number of
circumstances, including those where:



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If
we are determined to be subject to such liabilities, it could materially adversely affect our business, financial condition and results of operations.

Our future financial results will be affected by the adoption of fresh-start reporting and may not reflect historical trends.

We were formed for the purpose of acquiring substantially all of the assets of Station pursuant to the Plan. We will operate our
business with a different capital structure than Station's capital structure. The Propco Restructuring and Opco Acquisition will result in the Company becoming a new reporting entity and adopting
fresh-start reporting in accordance with Accounting Standards Codification ("ASC") 852-10-15. As required by
fresh-start reporting, the Company will cause Station's assets and liabilities to be adjusted to fair value, and certain assets and liabilities not previously recognized in Station's financial
statements will be recognized under fresh-start reporting. Because the Propco Restructuring and Opco Acquisition have not been consummated, fresh-start reporting has not yet been adopted and the
consolidated financial statements included in this Annual Report on Form 10-K do not give effect to any adjustments in the carrying values of assets or liabilities that will be
recorded upon implementation of the Plan under fresh-start reporting rules. Accordingly, our financial condition and results of operations from and after the Effective Date will not be comparable to
the financial condition and results of operations reflected in Station's historical consolidated financial statements.

The GVR Acquisition may not be consummated, which could adversely affect our business.

The GVR Acquisition is not a condition precedent to the effectiveness of the Plan, and is anticipated to occur on or subsequent to the
Effective Date. It is possible, however, that the GVR Acquisition will not occur as planned, or at all, in which case we would not own Green Valley Ranch. If we do not own Green Valley Ranch, the
scale of our overall operations will be smaller than we currently anticipate, which could adversely affect our business, financial condition and results of operations.

Our business will be sensitive to reductions in discretionary consumer spending as a result of downturns in the economy.

Consumer demand for casino hotel properties, such as the Acquired Casinos, is sensitive to downturns in the economy and the
corresponding impact on discretionary spending on leisure activities. Changes in discretionary consumer spending or consumer preferences brought about by factors such as perceived or actual general
economic conditions and customer confidence in the economy, unemployment, the current housing and credit crisis, the impact of high energy and food costs, the potential for continued bank failures,
perceived or actual changes in disposable consumer income and wealth, effects or fears of war and future acts of terrorism could further reduce customer demand for the amenities that we offer and
materially and adversely affect our business and results of operations. The current housing crisis and economic slowdown in the United States has resulted in significant unemployment in our key
markets and a significant decline in the amount of tourism and spending in Las Vegas. This decline has adversely affected Station, and may continue to adversely affect our financial condition, results
of operations and cash.

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The economic downturn may be protracted in our key markets and may continue to negatively impact our revenues and other operating results.

The Acquired Casinos draw a substantial number of customers from the Las Vegas valley, as well as certain geographic areas, including
Southern California, Arizona and Utah. The economies of these areas have been, and may continue to be, negatively impacted due to a number of factors, including the credit crisis and a decrease in
consumer confidence levels. The resulting severe economic downturn and adverse conditions in the local markets have negatively affected Station's operations, and may continue to negatively affect our
operations in the future. Based on information from the Las Vegas Convention and Visitors Authority, gaming revenues in Clark County for the year ended December 31, 2010 increased 0.8% from the
level in the comparable period of the prior year. Las Vegas gaming revenues and operators were severely negatively impacted by the economic downturn and there can be no assurance that gaming revenues
will not decrease in future periods. In addition, the residential real estate market in the United States, and in particular Las Vegas, has experienced a significant downturn due to declining real
estate values. Individual consumers are experiencing higher delinquency rates on various consumer loans and defaults on indebtedness of all kinds have increased. In addition, the Las Vegas and our
other target markets continue to experience and high rates of unemployment. All of these factors have materially and adversely affected Station's results of operations. Further declines in real estate
values in Las Vegas and the United States and continuing credit and liquidity concerns could continue to have an adverse affect on our results of operations. Although Station and other gaming
companies have experienced a decrease in revenues, certain costs remain fixed or even increase resulting in decreased earnings or net losses. Gaming and other leisure activities that we will offer
represent discretionary expenditures and participation in such activities have been particularly adversely impacted as a result of the economic downturn because consumers have less disposable income
to spend on discretionary activities. The current economic condition has adversely affected consumer spending at Station's gaming operations and related facilities and may continue to adversely affect
our business.

Furthermore,
other uncertainties, including national and global economic conditions, other global events, or terrorist attacks or disasters in or around Southern Nevada could have a
significant adverse effect on our business, financial condition and results of operations. The Acquired Casinos use significant amounts of electricity, natural gas and other forms of energy. While no
shortages of energy have been experienced, the substantial increase in the cost of electricity, natural gas and gasoline in the United States has negatively affected Station's operating results. As we
will be a highly leveraged company, if adverse regional and national economic conditions persist or worsen, the decreased revenues from the Acquired Casinos attributable to decreases in consumer
spending levels may result in a failure to satisfy additional financial and other restrictive covenants to which we are subject under our indebtedness that is outstanding following the Effective Date.
Furthermore, due to the existing uncertainty in the capital and credit markets, we may not be able to refinance our then-existing debt or obtain additional credit facilities on terms
acceptable to us or at all.

We will depend on the Las Vegas locals and repeat visitor markets as our key markets. As a result, we may not be able to attract a sufficient number of guests
and gaming customers to make our operations profitable.

Station's operating strategies emphasize attracting and retaining customers from the Las Vegas local and repeat visitor market. All of
the Acquired Casinos are dependent upon attracting Las Vegas residents. We cannot be sure that we will be able to attract a sufficient number of guests, gaming customers and other visitors in Nevada
to make our operations profitable. In addition, Station's strategy of growth through master-planning of its casinos for future expansion, was developed, in part, based on projected population growth
in Las Vegas. During the economic downturn, the Las Vegas valley has not experienced population growth at the expected rates or at the same rates as it experienced prior to the economic downturn.
There can be no assurance that population growth in Las Vegas will return to levels that justify future development, additional casinos or expansion of the Acquired Casinos or that we will be able to

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successfully
adapt our business strategy to the current economic downturn or any further economic slowdown.

We will face substantial competition in the gaming industry and may experience a loss of market share.

The Acquired Casinos face competition from all other casinos and hotels in the Las Vegas area including, to some degree, from each
other. In addition, the Acquired Casinos face competition from all smaller non-restricted gaming locations and restricted gaming locations (locations with 15 or fewer slot machines) in the
greater Las Vegas area, including those that primarily target the local and repeat visitor markets. Major additions, expansions or enhancements of existing properties or the construction of new
properties by competitors, could also have a material adverse effect on the business of the Acquired Casinos. For further details on competition in the gaming industry that will affect our business,
see "Item 1. BusinessCompetition."

To
a lesser extent, the Acquired Casinos compete with gaming operations in other parts of the state of Nevada, such as Reno, Laughlin and Lake Tahoe, and other gaming markets in the
United States and in other parts of the world, with state sponsored lotteries, on-and-off-track pari-mutuel wagering, a system of betting under which
wagers are placed in a pool, management receives a fee from the pool, and the remainder of the pool is split among the winning wagers, card rooms and other forms of legalized gambling. The gaming
industry also includes land-based casinos, dockside casinos, riverboat casinos, racetracks with slots and casinos located on Native American land. There is intense competition among
companies in the gaming industry, some of which have significantly greater resources than we will. Several states are currently considering legalizing casino gaming in designated
areas. Legalized casino gaming in such states and on Native American land will result in strong competition that could adversely affect our operations, particularly to the extent that such gaming is
conducted in areas close to our operations.

We may incur losses that are not adequately covered by insurance which may harm our results of operations.

Although we will maintain insurance customary and appropriate for our business, we cannot assure you that insurance will be available
or adequate to cover all loss and damage to which our business or our assets might be subjected. The lack of adequate insurance for certain types or levels of risk could expose us to significant
losses in the event that a catastrophe occurred for which we are underinsured. Any losses we incur that are not adequately covered by insurance may decrease our future operating income, require us to
find replacements or repairs for destroyed property and reduce the funds available for payments of our obligations.

We will be subject to litigation in the ordinary course of our business. An adverse determination with respect to any such disputed matter could result in
substantial losses.

We will be, from time to time, during the ordinary course of operating our businesses, subject to various litigation claims and legal
disputes, including contract, lease, employment and regulatory claims as well as claims made by visitors to our properties. In addition, there are litigation risks inherent in any construction or
development of any of the Acquired Casinos. Certain litigation claims may not be covered entirely or at all by our insurance policies or our insurance carriers may seek to deny coverage. In addition,
litigation claims can be expensive to defend and may divert our attention from the operations of our businesses. Further, litigation involving visitors to our properties, even if without merit, can
attract adverse media attention. As a result, litigation can have a material adverse effect on our businesses and, because we cannot predict the outcome of any action, it is possible that adverse
judgments or settlements could significantly reduce our earnings or result in losses.

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We may incur delays and budget overruns with respect to future construction projects. Any such delays or cost overruns may have a material adverse effect on
our operating results.

Station is currently providing funding for the proposed gaming facilities for the Federated Indians of Graton Rancheria and the North
Fork Rancheria of Mono Indians (collectively, the "Native American Tribes"). We will evaluate expansion opportunities as they become available, and we may in the future develop projects in addition to
the proposed facilities for the Native American Tribes.

Construction
projects, such as the proposed gaming facilities for the Native American Tribes, entail significant risks, including the following:



any
of which can give rise to delays or cost overruns.

The
anticipated costs and construction periods are based upon budgets, conceptual design documents and construction schedule estimates prepared by Station in consultation with its
architects and contractors. Construction, equipment, staffing requirements, problems or difficulties in obtaining any of the requisite licenses, permits, allocations or authorizations from regulatory
authorities can increase the cost or delay the construction or opening of each of the proposed facilities or otherwise affect the project's planned design and features. We cannot be sure that we will
not exceed the budgeted costs of these projects or that the projects will commence operations within the contemplated time frame, if at all. Budget overruns and delays with respect to expansion and
development projects could have a material adverse impact on our results of operations.

We may experience difficulty integrating operations of acquired companies and developed properties and managing our overall growth which could have a material
adverse effect on our operating results.

We may not be able to manage the operations of Station including, the recently opened Gun Lake Casino, the proposed projects with the
Native American Tribes and future acquired companies or developed properties effectively, or realize any of the anticipated benefits of the acquisitions, including streamlining operations or gaining
efficiencies from the elimination of duplicative functions. The integration of other companies as assets will require continued dedication of management resources and may temporarily distract
attention from our day-to-day business.

In
addition, because we plan to continue to pursue expansion and acquisition opportunities, we face significant challenges not only in managing and integrating the recently opened Gun
Lake facility and the proposed projects with the Native American Tribes, but also managing our expansion projects and any other gaming operations we may acquire in the future. Management of these new
projects will require increased managerial resources, and we intend to continue our efforts to enhance our gaming management team. However, there can be no assurances that we will succeed in doing so.
Failure to manage our growth effectively could have a material adverse effect on our operating results.

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We will be dependent upon Fertitta Entertainment, a newly formed entity controlled by Frank J. Fertitta III and Lorenzo J. Fertitta, to operate the Acquired
Casinos pursuant to long term management contracts. The success of our operations will depend on the ability of Fertitta Entertainment's ability to effectively manage our assets and operations.

Under the Plan, we will enter into Management Agreements with subsidiaries of Fertitta Entertainment. The Management Agreements will
have a scheduled term of 25 years following the Effective Date and will have limited rights of termination. Pursuant to the Management Agreements, subsidiaries of Fertitta Entertainment will
have significant discretion in the management and operation of the Acquired Casinos. The manager under the Management Agreements will receive a base management fee equal to two percent of the gross
revenues attributable to the managed properties and an incentive management fee equal to five percent of positive earnings before interest, taxes, depreciation and amortization ("EBITDA") of the
managed properties.

The
success of the Acquired Casinos and, in turn, our business, will be substantially dependent upon Fertitta Entertainment and its affiliates. Subject to limited restrictions, Fertitta
Entertainment and its affiliates will be permitted to manage the operations of other gaming companies and the officers and employees of Fertitta Entertainment and its affiliates will not be required
to devote their full time and attention to managing the Acquired Casinos. There can be no assurance that Fertitta Entertainment will be successful at managing and operating the Acquired Casinos or
that the terms of the Fertitta Entertainment management agreements will be in our best interests.

We will rely on key personnel of Fertitta Entertainment, the loss of the services of whom could materially and adversely affect our results of operations.

Our ability to operate successfully and competitively will be dependent, in part, upon the continued services of certain of Station's
officers and key employees, including but not limited to Frank J. Fertitta III. All of our executive officers, other than Thomas M. Friel, our Executive Vice President, Chief Accounting Officer and
Treasurer, will be employees of Fertitta Entertainment. In the event that Fertitta Entertainment and its affiliates cease to manage the Acquired Properties or these officers and/or employees leave
Fertitta Entertainment, we might not be able to find suitable replacements. We believe that the loss of the services of these officers and/or employees, including through the termination of the
Management Agreements, could have a material adverse effect on our results of operations.

Unionization organization activities could disrupt our business by discouraging patrons from visiting our properties, causing labor disputes or work stoppages,
and, if successful, could significantly increase our labor costs.

None of the Acquired Casinos is currently subject to any collective bargaining agreement or similar arrangement with any union.
However, union activists have actively sought to organize employees at certain of the Acquired Casinos in the past, and we believe that such efforts are ongoing at this time. Accordingly, there can be
no assurance that the Acquired Casinos will not ultimately be unionized. Union organization efforts that may occur in the future could cause disruptions to the Acquired Casinos and discourage patrons
from visiting our properties and may cause us to incur significant costs, any of which could have a material adverse effect on our results of operations and financial condition. In addition, union
activities may result in labor disputes, including work stoppages, which could have a material adverse effect on our business, financial condition and results of operation. Furthermore, unfavorable
union contract settlements or collective bargaining agreements, should they be entered into, could cause significant increases in our labor costs, which could have a material adverse effect on the
business of the Acquired Casinos and our financial condition and results of operation.

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Work stoppages, labor problems and unexpected shutdowns may limit our operational flexibility and negatively impact our future profits.

Any work stoppage at one or more of the Acquired Casinos, including any construction projects which may be undertaken, could require us
to expend significant funds to hire replacement workers, and qualified replacement labor may not be available at reasonable costs, if at all. Strikes and work stoppages could also result in adverse
media attention or otherwise discourage customers from visiting the Acquired Casinos. Strikes and work stoppages involving laborers at any construction project which may be undertaken could result in
construction delays and increases in construction costs. As a result, a strike or other work stoppage at one of the Acquired Casinos or any construction project could have an adverse effect on the
business of the Acquired Casinos and our financial condition and results of operations. There can be no assurance that we will not experience a strike or work stoppage at one or more of the Acquired
Casinos or any construction project in the future.

In
addition, any unexpected shutdown of one of the Acquired Casinos or any construction project could have an adverse effect on the business of the Acquired Casinos and our results of
operations. There can be no assurance that we will be adequately prepared for unexpected events, including political or regulatory actions, which may lead to a temporary or permanent shutdown of any
of the Acquired Properties.

We will regularly pursue new gaming acquisition and development opportunities and may not be able to recover our investment or successfully expand to
additional locations.

We will regularly evaluate and pursue new gaming acquisition and development opportunities in existing and emerging jurisdictions.
These opportunities may take the form of joint ventures. To the extent that we decide to pursue any new gaming acquisition or development opportunities, our ability to benefit from such investments
will depend upon a number of factors including:



Most
of these factors are beyond our control. Therefore, we cannot be sure that we will be able to recover our investment in any new gaming development opportunities or acquired
facilities, or successfully expand to additional locations.

Station
has invested, and we will likely continue to invest, in real property in connection with the pursuit of expansion opportunities. These investments are subject to the risks
generally incident to the ownership of real property, including:



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The
development of such properties will also be subject to restrictions under our secured credit facilities. We cannot be sure that we will be able to recover our investment in any such
properties or be able to prevent incurring investment losses.

We will be subject to extensive state and local regulation and licensing and gaming authorities will have significant control over our operations which could
have an adverse effect on our business.

Our ownership and operation of gaming facilities will be subject to extensive regulation by the states, counties and cities in which we
will operate. These laws, regulations and ordinances vary from jurisdiction to jurisdiction, but generally concern the responsibility, financial stability and character of the owners and managers of
gaming operations as well as persons financially interested or involved in gaming operations. As such, our gaming regulators can require us to disassociate ourselves from suppliers or business
partners found unsuitable by the regulators or, alternatively, cease operations in that jurisdiction. In addition, unsuitable activity on our part or on the part of our domestic or foreign
unconsolidated affiliates in any jurisdiction could have a negative effect on our ability to continue operating in other jurisdictions. Holders of Units who fail to obtain any licenses,
authorizations, qualifications or findings of suitability, as may be required by Nevada Gaming authorities, will not be entitled to exercise any rights of ownership with respect to or receive any
income from the Units. For a summary of gaming and other regulations that will affect our business, see "Item 1. BusinessRegulation and Licensing." The regulatory environment in
any particular jurisdiction may change in the future and any such change could have a material adverse effect on our results of operations. In addition, we are subject to various gaming taxes, which
are subject to possible increase at any time. Increases in gaming taxation could also adversely affect our results.

Changes to the gaming tax laws could have an adverse effect on results of operations by increasing the cost of operating our business.

The gaming industry represents a significant source of tax revenue, particularly to the State of Nevada and its counties and
municipalities. From time to time, various state and federal legislators and officials have proposed changes in tax law, or in the administration of such law, affecting the gaming industry. The Nevada
Legislature meets every two years and when special sessions are called by the Governor. The Nevada legislative session began on February 7, 2011. There have been no specific proposals during
the legislative session to increase gaming taxes, however there are no assurances an increase in gaming taxes will not be proposed and passed by the Nevada Legislature. An increase in the gaming tax
could have a material adverse effect on our results of operations.

Risks Related to our Substantial Indebtedness

We expect to have significant indebtedness upon the Effective Date. Such substantial indebtedness could make it difficult or impossible for us to meet our debt
service obligations and finance our operating expenses, working capital needs and capital expenditures.

We will be a highly leveraged company. Immediately after the Effective Date, we expect our indebtedness to include approximately
$2.4 billion under various term loans and $175.0 million available under revolving credit facilities, some of which may be drawn on the Effective Date. The ability to make these payments
will be significantly impacted by general economic, financial, competitive and other factors beyond our control.

Our
substantial indebtedness could:



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Our indebtedness will impose restrictive financial and operating covenants that will limit our flexibility in operating our business and may adversely affect
our ability to compete or engage in favorable business or financing activities.

The Propco Credit Agreement, Opco Credit Agreement, GVR Term Loan and Restructured Land Loan will contain a number of covenants that
will impose significant operating and financial restrictions on us, including restrictions on our and our subsidiaries' ability to, among other things:



In
addition, our credit agreements will contain certain financial covenants, including minimum interest coverage ratio, total leverage ratio and maximum capital expenditures.

As
a result of these covenants, we are limited in the manner in which we conduct our business, and we may be unable to engage in favorable business activities or finance future
operations or capital needs. The restrictions caused by such covenants could also place us at a competitive disadvantage to less leveraged competitors.

A
failure to comply with the covenants contained in the secured credit facilities or other indebtedness that we may incur in the future could result in an event of default, which, if not
cured or waived, could result in the acceleration of the indebtedness and have a material adverse affect on our business, financial condition and results of operations. In the event of any default
under the Propco Credit Agreement, Opco

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Credit
Agreement, GVR Term Loan or Restructured Land Loan or other indebtedness, the lenders thereunder:



If
we are unable to repay these amounts, the lenders under the Propco Credit Agreement, Opco Credit Agreement, GVR Term Loan or Restructured Land Loan or other indebtedness could proceed
against the collateral granted to them to secure that indebtedness, which will include substantially all of our assets. If the indebtedness under the Propco Credit Agreement, Opco Credit Agreement,
GVR Term Loan or Restructured Land Loan or other indebtedness were to be accelerated, there can be no assurance that our assets would be sufficient to repay such indebtedness in full. Moreover, in the
event that such indebtedness is accelerated, there can be no assurance that we will be able to refinance it on acceptable terms, or at all.

Conditions in the financial system and the capital and credit markets may negatively affect our ability to raise capital to fund capital expenditures, pursue
proposed development, expansion or acquisition opportunities or refinance our significant indebtedness.

Our businesses will be capital intensive. For the Acquired Casinos to remain attractive and competitive we must periodically invest
significant capital to keep the properties well-maintained, modernized and refurbished. Similarly, future construction and development projects, including but not limited to proposed
gaming facilities for the Native American Tribes, and acquisitions of other gaming operations could require significant additional capital. We will rely on earnings and cash flow from operations to
finance our business, capital expenditures, development, expansion and acquisitions and, to the extent that we cannot fund such expenditures from cash generated by operations, funds must be borrowed
or otherwise obtained. We will also be required in the future to refinance our outstanding debt. Our ability to effectively operate and grow our business may be constrained if we are unable to borrow
additional capital or refinance existing borrowings on reasonable terms.

The
credit, financial and equity markets have experienced disruption that has had a dramatic impact on the availability and cost of capital and credit. While the United States and other
governments have enacted legislation and taken other actions to help alleviate these conditions, there is no assurance that such steps will have the effect of easing the conditions in credit and
capital markets. We are unable to predict the likely duration or severity of the current disruption in the capital and credit markets and we have no assurance that we will have further access to
credit or capital markets at desirable times or at rates that we would consider acceptable, and the lack of such funding could have a material adverse effect on our business, results of operations and
financial condition and our ability to service our indebtedness.

Our ability to service all of our indebtedness depends on our ability to generate cash flow, which is subject to factors that are beyond our control.

Our ability to make scheduled payments on or to refinance our debt obligations depends on our financial condition and operating
performance, which is subject to general economic, financial, competitive and other factors that are beyond our control. Station's performance has been significantly impacted by general economic and
financial conditions, which has affected its cash flows from operating activities and its ability to pay the principal, premium, if any, and interest on its indebtedness.

In
addition, a further deterioration in the economic performance of the casino properties may cause us to reduce or delay investments and capital expenditures, or to sell assets. In the
absence of such

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operating
results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations.

Risks Related to our Units

Unless we are considered a "publicly traded corporation" under the Nevada Gaming Control Act, each of our equityholders must be found suitable by the Nevada
Gaming Authorities or we may be required to sever all relationships with such equityholder.

After we become a "publicly traded corporation" under the Nevada Gaming Control Act, persons who acquire beneficial ownership of more
than 5% of our voting securities will be required to report their acquisition to the Nevada Gaming Authorities and persons who acquire beneficial ownership of more than 10% of our voting securities
will be required to apply to the Nevada Gaming Authorities for a finding of suitability. Notwithstanding these provisions, under the Nevada Gaming Control Act, the Nevada Gaming Authorities may at any
time, in their discretion, require the holder of any of our securities to file applications, be investigated and be found suitable to own our securities if they have reason to believe that the
security ownership would be inconsistent with the declared policies of Nevada. We anticipate that, so long as we are a "publicly traded corporation" under the Nevada Gaming Control Act, the Nevada
Gaming Authorities will require only our equityholders having beneficial ownership of more than 10% of our voting securities to be found suitable.

If
we do not become, or cease to be, a "publicly traded corporation" under the Nevada Gaming Control Act, or if required by the Nevada Gaming Authorities, each of our equityholders would
be required to be found suitable by the Nevada Gaming Authorities. If any equityholder fails to be found suitable, we may be required to sever all relationships, including through redemption of
shares, with such equityholder, which may have a material adverse effect on our business and our equityholders. In addition, such holders of Units who fail to obtain any necessary licenses,
authorizations, qualifications or findings of suitability will not be entitled to exercise any rights of ownership with respect to or receive any income from the Units.

A public market for our Units may not develop which would affect the liquidity and pricing of our Units.

We have not issued any Units. Therefore, there is currently no established public trading market for our Units, and there are no plans,
proposals, arrangements or understandings with any person with regard to the development of a trading market in our Units. The liquidity of any market for our Units will depend, among other things,
upon the number of holders of our Units, our financial performance, and the market for similar securities, none of which can be determined or predicted. Our Units are not and will not be listed for
trading on any national securities exchange. Therefore, we cannot provide assurances that an active trading market will develop, or if a market develops, what the liquidity or pricing characteristics
of that market will be.

We may, but are not required to, make distributions to enable our members to pay tax on income that is attributable to their ownership interest in us and do
not plan to make other distributions.

Our operational documents provide that we will, where possible, but do not require us to, make distributions to our members in respect
of our taxable income that they recognize as a result of their ownership in the Company. However, the making of such distributions will be subject to the availability of funds and compliance with the
restrictions contained in our debt agreements. There can be no assurance that we will make such distributions. In addition, even if we do make tax distributions, we do not plan to pay any other
dividends or make any other distributions on our Units in the foreseeable future. In addition, restrictive covenants of the Propco Credit Agreement, the Opco Credit Agreement and GVR Term Loan will
restrict the ability of the respective obligors to pay dividends. Therefore, you should not expect to receive any distributions in the foreseeable future from your Units.

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Members of our Board of Managers are likely to devote some of their time to other businesses, which could have a negative impact on the Company's management.

Members of our Board of Managers will not be required to commit their full time to the Company's affairs, which could create a conflict
when allocating their time between Company matters and their other commitments. It is expected that all of the members of the Company's Board of Managers will be engaged in several other business
endeavors aside from their commitments to the Company. In addition, members of our Board of Managers will not be obligated to devote any specific number of hours to the Company's affairs. If the other
business affairs of members
of our Board of Managers require them to devote more time to such affairs, it could limit their ability to devote time to the Company's affairs and could have a negative impact on the quality of the
Company's governance. We cannot assure the holders of Units that these time conflicts will be resolved in the Company's favor.

Potential conflicts of interest may exist, or may arise, based on debt and management interests of the principal equityholders of Station Holdco.

Pursuant to the governance structure of Station Holdco, its directors will primarily be persons designated by FI Station Investor or
the Mortgage Lenders. In addition, many major actions require approval of a majority of the directors designated by FI Station Investor and a majority of the directors designated by the Mortgage
Lenders. FI Station Investor and the Mortgage Lenders may have interests that are different than, or in addition to, equity holders of Station Holdco, which could adversely affect such equity holders.

In
addition to being an equity holder of Station Holdco, affiliates of Fertitta Entertainment will be the managers of the Propco Properties, Opco Assets and Green Valley Ranch. The
interests of Fertitta Entertainment, in its capacity as an affiliate of the managers of the Propco Properties, the Opco Assets and Green Valley Ranch, may be different from, or in addition to, the
interests of other equity holders of Station Holdco. For example, since the affiliates of Fertitta Entertainment that manages the Propco Properties, Opco Assets and Green Valley Ranch will be
compensated for its management services based on the revenue and EBITDA achieved by the Propco Properties, Opco Assets and Green Valley Ranch, Fertitta Entertainment may have an incentive to support
the growth of the revenue and EBITDA of the Propco Properties, Opco Assets and Green Valley Ranch even if doing so would require increased leverage and interest service obligations for the Propco
Properties, Opco Assets or Green Valley Ranch. Under certain circumstances, the imposition of increased leverage and interest service obligations on the Propco Properties, Opco Assets or Green Valley
Ranch could adversely affect the equity value of the Company.

The
Mortgage Lenders or affiliates thereof are lenders under the Company's credit facilities. Therefore, they may have an incentive for the Company to act or omit to act, in each case,
in a manner that enhances the ability of the Company to service its indebtedness or the Mortgage Lenders to recover on the Company's credit facilities, rather than seeking to maximize the value of the
equity of the Company.

ITEM 1B.    UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2.    PROPERTIES.

The Company does not currently own any property; however, upon the Effective Date, we expect to acquire from Station all of the casino
properties and the land that it owns or leases, other than the Wild Wild West unless the property lease is renegotiated, as well as Green Valley Ranch. We are currently in negotiations regarding the
terms of the Wild Wild West property lease, however, the Company can provide no assurance that it will be able to reach an agreement with the lessor.

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Following
the Effective Date, substantially all of the property that we will own or lease will be subject to liens to secure borrowings under the Propco Credit Agreement, Opco Credit
Agreement, Restructured Land Loan and GVR Term Loan.

Palace
Station, which Station opened in 1976 and completed a series of expansions through 1991, is situated on approximately 30 acres that Station owns located on the west side of Las
Vegas, Nevada.

Boulder
Station, which Station opened in 1994 and was expanded in 1995, is situated on approximately 54 acres located on the east side of Las Vegas, Nevada. Station owns 27 acres and
leases the remaining 27 acres from KB Enterprises, a company owned by the Frank J. Fertitta and Victoria K. Fertitta Revocable Family Trust (the "Related Lessor"). Frank J. Fertitta, Jr. and Victoria
K. Fertitta are the parents of Frank J. Fertitta III, Chairman, Chief Executive Officer and President of Station and Lorenzo J. Fertitta, Vice Chairman of Station. The lease has a maximum term of
65 years, ending in June 2058. The lease provides for monthly payments of $222,933 through May 2018. In June 2013, and every ten years thereafter, the rent will be adjusted to the product of
the fair market value of the land and the greater of (i) the then prevailing annual rate of return for comparably situated property or (ii) 8% per year. In no event will the rent for any
period be less than the immediately preceding period. In June 2018, and every ten years thereafter, the rent will be adjusted by a cost of living factor. Pursuant to the ground lease, we will have an
option, exercisable at five-year intervals with the next option in June 2013, to purchase the land at fair market value. We believe that the terms of the ground lease are as fair to us as
could be obtained from an independent third party.

Texas
Station, which Station opened in 1995 and completed two master planned expansions through 2000, is situated on approximately 47 acres located in North Las Vegas, Nevada. Station
leases this land from Texas Gambling Hall & Hotel, Inc., a company owned by the Related Lessor. The lease has a maximum term of 65 years, ending in July 2060. The lease provides
for monthly rental payments of $337,417 through June 2010. In July 2010, and every ten years thereafter, the rent will be adjusted to the product of the fair market value of the land and the greater
of (i) the then prevailing annual rate of return being realized for owners of comparable land in Clark County or (ii) 8% per year. The July 2010 adjustment was deferred. In July 2015,
and every ten years thereafter, the rent will be adjusted by a cost of living factor. In no event will the rent for any period be less than the immediately preceding period. Pursuant to the ground
lease, we will have an option, exercisable at five-year intervals with the next option in May 2015, to purchase the land at fair market value. We believe that the terms of the ground lease
are as fair to us as could be obtained from an independent third party.

Sunset
Station, which Station opened in 1997 and completed two expansions through 2005, is situated on approximately 82 acres that Station owns located in Henderson, Nevada.

Santa
Fe Station, which Station purchased in 2000 and completed three master-planned expansions though 2007, is situated on approximately 39 acres that Station owns located on the
northwest side of Las Vegas, Nevada.

Red
Rock, which Station opened in 2006 and completed two master-planned expansions through 2007, is situated on approximately 64 acres that Station owns located on the northwest side of
Las Vegas, Nevada.

Green
Valley Ranch, which opened in 2001 and completed a master-planned expansion in 2006, is situated on approximately 40 acres in Henderson, Nevada.

Fiesta
Rancho, which Station purchased in 2001 and was expanded in 2004, is situated on approximately 25 acres that Station owns in North Las Vegas, Nevada.

Fiesta
Henderson, which Station purchased in 2001 and completed two master-planned expansions through 2007, is situated on approximately 46 acres that Station owns in Henderson, Nevada.

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Station
also has acquired or is under contract to acquire approximately 106 acres of land on which Wild Wild West is located and the surrounding area, of which approximately 77 acres
have been acquired as of December 31, 2010. Station purchased the Wild Wild West in 1998. In December 2008, Station amended the lease and purchase agreement for the 19-acre parcel
of land on which the Wild Wild West is located. Under the amended agreement, Station has an option to purchase the land on or before December 28, 2011 for a purchase price of
$36 million. The amended lease also includes options to purchase the land in July 2023, 2044 and 2065 for a purchase price equal to fair market value as of July 2022, 2043 and 2064,
respectively. In March 2011, Station was notified by the lessor that the lease had been terminated. We are currently in negotiations regarding possible modification to this lease, however, we can
provide no assurance that it will be able to reach an agreement with the lessor.

Wildfire
Rancho, which Station purchased in 2003, is situated on approximately five acres that Station owns in Las Vegas, Nevada.

Wildfire
Boulder, which Station purchased in 2004, is situated on approximately two acres that Station owns in Henderson, Nevada.

Gold
Rush, which Station purchased in 2004, is situated on approximately one acre that Station owns in Henderson, Nevada.

Lake
Mead Casino, which Station purchased in 2006, is situated on approximately three acres in Henderson, Nevada.

Barley's,
The Greens and Wildfire Lanes, each located in Henderson, Nevada, lease the land and buildings used in their operations. Station opened Barley's in 1996 and purchased The
Greens in 2005 and Wildfire Lanes in 2007.

In
November 2007, Station entered into a financing transaction with respect to its corporate office building with a third-party real estate investment firm pursuant to which Station sold
the corporate office building for approximately $70 million and subsequently entered into a lease with the purchaser for an initial period of 20 years with four options to extend the
lease, each option for an extension of five years. Such arrangements are generally referred to as "sale-leaseback" transactions. An event of default under the lease for the corporate
office building occurred on October 26, 2009 as a result of the Chapter 11 Case not being dismissed within 90 days following the filing thereof, entitling the landlord to exercise
its remedies thereunder, including, among other things, termination of the lease and acceleration of contractual rents. Station and the landlord subsequently amended the lease to reduce the basic
annual rent during the initial term of the lease commencing with the rent period that began on September 1, 2010, and the amended lease was approved by the Bankruptcy Court. In the first four
years of the remaining initial term of the lease, following the effective date of the lease amendment, the basic annual rent will be reduced as follows: (a) in lease year 4 (the 12 month
period commencing on September 1, 2010) the basic annual rent will be reduced from $5.4 million to $2.9 million; (b) in lease year 5 the basic annual rent will be reduced
from $5.5 million to $2.9 million; (c) in lease year 6 the basic annual rent will be reduced from $5.6 million to $3.1 million; and (d) in lease year 7 the
basic annual rent will be reduced from $5.6 million to $3.2 million. In lease years 8 through year 20, the basic annual rent will be increased by an amount equal to the greater of 1.25%
of the prior lease year basic annual rent or (ii) the percentage increase in the CPI over the lease year immediately preceding the applicable lease year in question, provided, however, that in
no event shall such percentage be greater than 2% of the prior lease year basic annual rent. The lease also contains two options for Station to repurchase the corporate office building, one option at
the end of the fifth year of the lease term and a second option at the end of the tenth year of the lease term, which is considered continuing involvement under the authoritative guidance for
accounting for sale-leaseback transactions involving real estate. Because of this continuing involvement, the corporate office lease is being accounted for as a financing transaction, with
the sales proceeds recorded as a liability and the lease payments recorded as interest expense. In addition, the corporate office building is included within property and equipment, net of
depreciation, on Station's consolidated balance sheets. The amendment

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did
not change the terms of the two options to repurchase the building. The amended lease was assumed by the Company with the authorization of the Bankruptcy Court.

Station
currently owns eight additional sites which have been acquired for potential gaming projects, consisting of 253 acres in the Las Vegas valley, 772 acres in Northern California
and 200 acres in Reno, Nevada. We expect to acquire these sites on the Effective Date.

ITEM 3.    LEGAL PROCEEDINGS.

The Company is not a party to any litigation. However, Station and Green Valley Ranch were from time to time subject to litigation
relating to routine matters incidental to its
business. Litigation claims against STN will be satisfied pursuant to the Plan and will not be assumed by us. Litigation claims against subsidiaries of STN that are not currently Debtors are expected
to be addressed in the Plan following such time as such subsidiaries file voluntary chapter 11 cases with the Bankruptcy Court. We expect to be subject to other claims from time to time
following the Effective Date in connection with our business and operations.

ITEM 4.    (REMOVED AND RESERVED)

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PART II

ITEM 5.    MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

We have not yet issued any Units. Therefore, there is currently no established public trading market for our Units, and there are no
plans, proposals, arrangements or understandings with any person with regard to the development of a trading market for our Units. On the Effective Date, there will be outstanding membership Units. We
have not agreed with any security holder to register any of our Units for sale by any security holder. Our Units are being issued pursuant to the Plan, and none of our Units are being publicly offered
by us.

Holders

We have not yet issued any Units. On the Effective Date, we anticipate that there will be one holder of record of our Voting Units and
one holder of record of our Non-Voting Units.

Dividends

Our operational documents permit, but do not require, us to make distributions to our members in respect of our taxable income that
they recognize as a result of their ownership in the company. There can be no assurance that we will make such distributions. In addition, even if we do make tax distributions, we do not plan to pay
any other dividends or make any other distributions on our Units in the foreseeable future. In addition, restrictive covenants of our debt instruments and other agreements will restrict the ability of
the respective obligors to pay dividends. Therefore, you should not expect to receive any distributions in the foreseeable future from your Units.

Securities authorized for issuance under equity compensation plans

We currently do not have any compensation plans.

ITEM 6.    SELECTED FINANCIAL DATA

Station Casinos LLC

The Company was formed for the purpose of acquiring substantially all of the assets of Station pursuant to the Plan. In addition, the
Company anticipates acquiring substantially all of the assets of GVR pursuant to the GVR Asset Purchase Agreement. We expect the Restructuring Transactions to be completed by June 30, 2011, at
which time we will acquire the Acquired Casinos. The Company has conducted no business other than in connection with the Chapter 11 Cases and has no material assets or liabilities. See
"Item 1. BusinessIntroduction." As the Company has no operations, the following selected financial data relates to Station.

The
historical financial results of Station are not indicative of our current financial condition or our future results of operations. Our future results of operations will be subject to
significant business, economic, regulatory and competitive uncertainties and contingencies, some of which are beyond our control.

Station

On November 7, 2007, STN completed its Merger as described further under "Item 1. BusinessChapter 11
Reorganization". The Merger resulted in a greater than 50% change in control of Station and was a "business combination" for accounting purposes, requiring Fertitta Colony Partners LLC ("FCP"),
Fertitta Partners, LLC ("Fertitta Partners"), FCP VoteCo LLC ("FCP Voteco") and their respective

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owners
(the "Investors"), pursuant to the accounting guidance for business combinations, to record the acquired assets and assumed liabilities at their fair market values as of the acquisition date,
resulting in a new basis of accounting. As a result, the selected consolidated financial data presented for 2007 is presented for two periods: January 1, 2007 through November 7, 2007
(the "Predecessor Period") and
November 8, 2007 through December 31, 2007 (the "Successor Period"). The Predecessor Period and the year ended December 31, 2006 reflect the historical accounting basis in
Station's assets and liabilities, while the years ended December 31, 2010, 2009 and 2008 and the Successor Period reflect the push down of the Investors' new basis to its consolidated financial
statements.

In
the table below, we provide Station's selected consolidated historical financial data as of and for the periods indicated. The selected consolidated financial data presented below as
of and for the fiscal years ended December 31, 2010, 2009 and 2008, the Successor Period and the Predecessor Period, and as of and for the fiscal year ended December 31, 2006 have been
derived from Station's consolidated financial statements which, except for 2007 and 2006, are contained elsewhere in this Annual Report on Form 10-K.

The
selected consolidated financial data set forth below are qualified in their entirety by, and should be read in conjunction with, "Item 7. Management's Discussion and Analysis
of Financial Condition and Results of OperationsStation" and "Item 8. Financial Statements and Supplementary DataStation Casinos, Inc. Consolidated Financial
Statements" included in this Annual Report on Form 10-K. This

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selected
consolidated financial data may not be indicative of our future performance, including changes that will occur as a result of the Restructuring Transactions such as changes in capitalization.

Successor

PredecessorPeriod from
November 8, 2007
Through
December 31,
2007

Period from
January 1, 2007
Through
November 7,
2007

For the
Year
Ended
December 31,
2006 (a)For the Year Ended December 31,2010

2009

2008(in thousands)

(in thousands)Operating Results:Net revenues

$
944,955

$
1,062,149

$
1,298,151

$
209,711

$
1,237,284

$
1,339,024Operating costs and expenses, excluding the following items (b):


856,473


965,006


1,095,535


460,703


939,091


978,445Development (c)


12,642


6,261


3,398


375


3,089


9,036Preopening (d)


3,630


5,753


10,198


1,170


5,859


29,461Merger transaction costs (e)














156,500


2,526Asset impairments (f)


262,020


1,276,861


3,343,247





16,631


Write-downs and other charges, net (g)


18,347


16,677


57,800


958


(1,346
)

2,368Management agreement/lease terminations (h)


898


4,130


4,825





3,825


1,053Operating (loss) income


(209,055
)

(1,212,539
)

(3,216,852
)

(253,495
)

113,635


316,135Gain on dissolution of joint venture (i)


124,193














(Losses) earnings from joint
ventures (j)


(248,495
)

(127,643
)

17,020


5,875


34,247


41,854Operating (loss) income and earnings (losses) from joint ventures


(333,357
)

(1,340,182
)

(3,199,832
)

(247,620
)

147,882


357,989Gain (loss) on early retirement of
debt (k)





40,348





(20,311
)




Change in fair value of derivative instruments


(42
)

23,729


(23,057
)

(30,686
)




Interest expense, net


(171,291
)

(317,393
)

(426,956
)

(66,019
)

(220,873
)

(178,537
)(Loss) income before income taxes and reorganization items


(504,690
)

(1,593,498
)

(3,649,845
)

(364,636
)

(72,991
)

179,452Reorganization items, net (l)


(82,748
)

(375,888
)










(Loss) income before income taxes


(587,438
)

(1,969,386
)

(3,649,845
)

(364,636
)

(72,991
)

179,452Income tax benefit (provision)


21,996


289,872


381,345


26,736


15,335


(69,240
)Net (loss) income

$
(565,442
)
$
(1,679,514
)
$
(3,268,500
)
$
(337,900
)
$
(57,656
)
$
110,212Balance Sheet Data:Total assets

$
3,954,143

$
4,276,832

$
5,831,636

$
8,988,666




$
3,716,696Long-term debt (including current) (m)


5,921,755


5,922,058


5,782,153


5,171,149





3,468,828Stockholders' (deficit) equity


(2,886,248
)

(2,335,388
)

(677,324
)

2,571,062





(186,858
)


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ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Station Casinos LLC



Since our formation in August 2010, we have had no operations. We were formed for the purpose of acquiring substantially all of the
assets of Station pursuant to the Plan. In addition, we anticipate acquiring substantially all of the assets of Green Valley Ranch pursuant to the GVR Asset Purchase Agreement. We expect the
Restructuring Transactions to be completed by June 30, 2011, at which time we will acquire the Acquired Casinos. Accordingly, the management's discussion and analysis of financial condition and
results of operations that follows is for the Company and Station on an individual basis.

Upon
the Effective Date, we will:



Upon
emergence, we intend to have approximately 100 Voting Units and 100 Non-Voting Units issued and outstanding. Station Voteco will be the only member of the Company
entitled to vote on any matters to be voted on by the members of the Company. Station Holdco, as the holder of our issued and outstanding Non-Voting Units, will not be entitled to vote on
any matters to be voted on by the members of the Company, but will be the only member of the Company entitled to receive distributions as determined by our Board of Managers out of funds legally
available therefor and, in the event of our liquidation, dissolution or winding up is entitled to all of the Company's assets remaining after payment of liabilities. Under the Equityholders Agreement,
in certain circumstances, holders of interests in Station Holdco will have the preemptive right to purchase or subscribe to any equity interests to be sold or issued by Station Holdco on the same
terms and conditions as such equity interests are being offered and sold or issued to third parties.

Upon
the Effective Date, we will adopt fresh-start reporting in accordance with ASC 852-10-15 as it relates to the Plan. As a result, the value of Stations'
assets, including intangible assets, and liabilities will be adjusted to their fair values on our consolidated balance sheet. In addition, upon the Effective Date, we will account for the GVR
Acquisition in accordance with ASC 805Business Combinations resulting in the value of the Green Valley Ranch assets acquired, including intangible assets, and liabilities assumed being
recorded at the acquisition date fair values on our consolidated balance sheet. The historical consolidated financial results of Station are not indicative of our current financial condition or our
future results of operations following the Effective Date. Our future results of operations will be subject to these events and other significant business, economic, regulatory and competitive
uncertainties and contingencies, some of which are beyond our control.



Our cash flows will be affected by a variety of factors, many of which are outside of our control, including regulatory issues,
competition, financial markets and other general business conditions. We

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believe
that we will have sufficient liquidity through available cash, availability under our credit agreements and cash flow from the Acquired Casinos to fund our cash requirements and capital
expenditures for at least twelve months after the Effective Date. We will endeavor to fund capital expenditures for maintenance of our properties through our operating results. However, we cannot
assure you that we will generate sufficient income and liquidity to meet all of our liquidity requirements and other obligations as our results for future periods are subject to numerous uncertainties
which may result in liquidity problems, which could affect our ability to meet our obligations while attempting to meet competitive pressures or adverse economic conditions.

The
following is a description of the expected debt arrangements following the Effective Date, including the estimated principal amounts outstanding. These estimates are based on the
terms of the Plan and the current understanding with respect to the reorganization of Station. The terms of the debt may be subject to change as the reorganization of Station and acquisition of Green
Valley Ranch are finalized and implemented, and the changes may be substantial. For example, the amount of the debt financing that will be required will depend on a number of factors, including the
amount of cash Station holds as of the Effective Date after payment of reorganization expenses and the estimated cash needs going forward.



On the Effective Date, the Company, as borrower, is expected to enter into the Propco Credit Agreement consisting of a term loan
facility in the principal amount of $1.6 billion (the "Propco Term Loan") and a revolving credit facility in the amount of $100 million, which revolving credit facility will increase to
$150 million upon prepayment of $50 million of outstanding principal amount under the Propco Term Loan on the closing date thereof (the "Propco Revolver"). The initial maturity date of
the Propco Credit Agreement will be on the fifth anniversary of the Effective Date but may be extended for two additional one-year periods, subject to the absence of defaults, accuracy of
representations and warranties, payment of a 1.00% extension fee for each extension, and pro forma compliance with the total leverage and interest coverage ratios, and, in the case of the second
extension of maturity, a total leverage ratio of less than 6.20 to 1.00. Interest shall accrue on the principal balance at the rate per annum, as selected by the Company, of not more than LIBOR plus
3.00% or base rate plus 2.00% for the first three years of the term; LIBOR plus 3.50% or base rate plus 2.50% for the fourth and fifth year; LIBOR plus 4.50% or base rate plus 3.50% in the sixth year
if the Company elects to exercise the first optional extension of the maturity of the loans; and LIBOR plus 5.50% or base rate plus 4.50% for the seventh year if the Company elects to exercise the
second optional extension of the maturity of the loans. Base rate will be subject to a floor equal to one-month LIBOR plus 1.00%. Additionally, the Company will be subject to a fee of
0.50% for the unfunded portion of the Propco Revolver.

The
Propco Credit Agreement is expected to contain certain financial and other covenants. These will include a minimum interest coverage ratio and total leverage ratio beginning eighteen
months following the Effective Date. The Propco Credit Agreement also will provide for maximum capital expenditures not to exceed $50 million in 2011 and $70 million in each of 2012,
2013, 2014, 2015, 2016 and 2017. The Company will not be required to make principal payments prior to maturity of the Propco Credit Agreement other than (a) quarterly prepayments of 75% of
excess cash flow if the total leverage ratio is equal to or greater than 6.00:1.00, 50% of excess cash flow if the total leverage ratio is less than 6.00:1.00 but greater than or equal to 4.00:1.00,
or 25% if the total leverage ratio is less than 4.00:1.00 subject, in each case, to maintenance of minimum liquidity of $10.0 million; (b) prepayments with proceeds of certain asset
sales, events of loss, incurrence of debt and equity issuances, and (c) prepayments of the Propco Revolver of unrestricted cash in excess of $15.0 million (which will not permanently
reduce the revolving loan commitment).

The
Propco Credit Agreement will be guaranteed by all subsidiaries of the Company except NP Opco Holdings LLC ("Opco Holdings") and its subsidiaries (including NP Opco LLC
("Opco")), NP Landco Holdco LLC and its subsidiaries (including Landco), NP IP Holdings LLC ("IP Holdco") until such time

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as
IP Holdco becomes a wholly owned subsidiary of the Company and each other subsidiary of the Company that is designated as an unrestricted subsidiary pursuant to the terms of the Propco Credit
Agreement (each such entity and its subsidiaries, a "Propco Credit Agreement Unrestricted Subsidiary"). The Propco Credit Agreement will be secured by a pledge of the Company's equity (including
equity held by Station Holdco and Station Voteco in the Company), together with all tangible and intangible assets of the Company and its subsidiaries (other than (i) any assets of IP Holdco,
(ii) liens prohibited by applicable gaming laws, (iii) equity issued by, and any assets of, Opco or its subsidiaries, (iv) equity issued by, or any property of, Landco and its
subsidiaries and (v) any assets of any other Propco Credit Agreement Unrestricted Subsidiary). The loan documents for the Propco Credit Agreement (the "Propco Loan Documents") contain a number
of covenants that, among other things, restrict, subject to certain exceptions, the ability of the Company, Station Voteco, Station Holdco and each direct and indirect subsidiary of the Company (other
than Propco Credit Agreement Unrestricted Subsidiaries) to incur additional indebtedness; create liens on assets; dispose of assets; make investments and acquisitions; engage in certain transactions
with affiliates, pay dividends, engage in mergers and fundamentally change its business. The Propco Credit Agreement is expected to contain certain events of default including, among other things,
nonpayment of principal when due; nonpayment of interest, fees or other amounts after a five business day grace period; material inaccuracy of representations and warranties; violation of covenants
(subject, in the case of certain covenants, to certain grace periods); cross-default; bankruptcy events; certain Employee Retirement Income Security Act ("ERISA") events; material judgments; and a
change of control. The Propco Loan Documents will provide that, following termination of the management agreements which may be effected upon a default by affiliates of Fertitta Entertainment
(including certain specified defaults under the Propco Credit Agreement) or foreclosure by the Propco Lenders, the Company and Fertitta Entertainment will provide full transition services to the
Propco Lenders and their designees.



On the Effective Date, a subsidiary of the Company, Opco, as borrower, will enter into the Opco Credit Agreement consisting of
(a) a term loan facility in the principal amount of $430 million (the "Opco Term Loan"), (b) a term loan facility in the principal amount of $25 million with respect to
which interest may be paid in kind (i.e. capitalized as principal) for the first five years of the term of the Opco Credit Agreement (the "PIK Term Loan") and (c) a new "super priority"
revolving credit facility in the maximum amount of $25 million, the availability of which will be subject to standard closing and continuing conditions (the "Opco Revolver"). In addition, Opco
shall have the option, after the first anniversary of the Effective Date, to solicit lending commitments to increase the amount of the Opco Revolver by up to an additional $25 million. The
initial maturity date will be on the fifth anniversary of the Effective Date but may be extended for two additional one-year periods, subject to the absence of defaults, accuracy of
representations and warranties, and payment of 1.00% extension fee for each extension, and pro forma compliance with the
total leverage and interest coverage ratios. Interest shall accrue on the principal balance other than the PIK Term Loan at the rate per annum, as selected by Opco, of not more than LIBOR plus 3.00%
or base rate plus 2.00% for the first three years of the term; LIBOR plus 3.50% or base rate plus 2.50% for the fourth and fifth year; LIBOR plus 4.50% or base rate plus 3.50% for the sixth year if
the Company elects to exercise the first optional extension of the maturity of the loans; and LIBOR plus 5.50% or base rate plus 4.50% for the seventh year if Opco elects to exercise the second
optional extension of the maturity of the loans. Interest shall accrue on the principal balance of the PIK Term Loan at the rate per annum, as selected by Opco, of not more than LIBOR plus 3.50% or
base rate plus 2.50% for the first five years of the term; LIBOR plus 4.50% or base rate plus 3.50% for the sixth year if the Company elects to exercise the first optional extension of the maturity of
the loans; and LIBOR plus 5.50% or base rate plus 4.50% for the seventh year if Opco elects to exercise the second optional extension of the maturity of the loans. Base rate will be subject to a floor
equal to one-month LIBOR plus 1.00%. Additionally, Opco will be subject to a fee of 0.50% for the unfunded portion of the Opco Revolver.

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The
Opco Credit Agreement is expected to contain certain financial and other covenants. These will include a maximum total leverage ratio and a minimum interest coverage ratio that will
commence on the earlier of eighteen months after the Effective Date or the date on which aggregate investments by Opco deemed to have been made due to the designation of restricted subsidiaries as
unrestricted subsidiaries exceed $10 million. The Opco Credit Agreement also will provide for maximum capital expenditures not to exceed $35 million in 2011, $40 million in each
of 2012 and 2013, $45 million in each of 2014 and 2015 and $50 million in each of 2016 and 2017. Opco will not be required to make principal payments prior to the maturity of the Opco
Credit Agreement other than (a) commencing with the fiscal year ended December 31, 2011, annual prepayments of 75% of excess cash flow if the total leverage ratio is equal to or greater
than 3.50:1.00, 50% of excess cash flow if the total leverage ratio is less than 3.50:1.00 but greater than or equal to 2.50:1.00, or 25% of excess cash flow if the total leverage ratio is less than
2.50:1.00, subject, in each case, to maintenance of certain reserves not to exceed of $3.0 million; (b) prepayments with proceeds of certain asset sales, events of loss, incurrence of
debt and equity issuances and (c) prepayments of the Opco Revolver of unrestricted cash in excess of $7.5 million (which will not permanently reduce the revolving loan commitment).

The
Opco Credit Agreement will be guaranteed by Opco Holdings and all subsidiaries of Opco except unrestricted subsidiaries. The Opco Credit Agreement will be secured by a pledge of Opco
equity, together with all tangible and intangible assets of Opco Holdings, Opco and its subsidiaries (other than property of unrestricted subsidiaries and subject to limitations required by applicable
gaming laws). The loan documents for the Opco Credit Agreement contain a number of covenants that, among other things, restrict, subject to certain exceptions, the ability of Opco and each restricted
direct and indirect subsidiary thereof to incur additional indebtedness; create liens on assets; make investments and acquisitions; engage in certain transaction with affiliates, pay dividends, engage
in mergers and fundamentally change its business. The Opco Credit Agreement is expected to contain certain events of default including, among other things, nonpayment of principal when due; nonpayment
of interest, fees or other amounts after a five business day grace period; material inaccuracy of representations and warranties; violation of covenants (subject, in the case of certain covenants, to
certain grace periods);
cross-default; bankruptcy events; certain ERISA events; material judgments; and a change of control (as defined therein). The loan documents will provide that, following termination of the management
agreements which may be effected upon a default by affiliates of Fertitta Entertainment (including certain specified defaults under the Opco Credit Agreement) or foreclosure by the Opco Lenders, the
Company and Fertitta Entertainment will provide full transition services to the Opco Lenders and their designees.



On the Effective Date, a subsidiary of Propco Landco, CV PropCo, LLC ("CV Propco"), as borrower, is expected to enter into the
Restructured Land Loan. The initial maturity date is expected to be the fifth anniversary of the Effective Date. Interest will accrue on the principal balance at the rate per annum of LIBOR plus 3.50%
for the first five years. All interest on the Restructured Land Loan would be paid in kind (i.e., capitalized as principal under the Restructured Land Loan) for the first five years. CV Propco
would have two options to extend the maturity date for an additional year to be available subject to absence of default, payment of up to 1.00% extension fee for each year, a step-up in
interest rate to not more than LIBOR plus 4.50% (in year 6) and not more than LIBOR plus 5.50% (in year 7). Interest accruing in years 6 and 7 shall be paid in cash. There is no schedule
minimum amortization prior to final stated maturity, but the Restructured Land Loan will be subject to mandatory prepayments with excess cash. The Restructured Land Loan would be guaranteed by all
subsidiaries of CV Propco and secured by a pledge of CV Propco equity and all tangible and intangible assets of CV Propco and its subsidiaries, principally consisting of land located on the southern
end of Las Vegas Boulevard at Cactus Avenue and land surrounding Wild Wild West. Documentation is expected to include customary representations, warranties, covenants, and events of default. The land
carry costs of CV Propco are expected to be supported by the Company under a Support Agreement that provides for advances from the Company to

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CV
Propco to fund taxes, insurance premiums and other land carry costs (excluding debt service) payable by CV Propco. The Restructured Land Loan is expected to provide that, following the termination
of management agreements which may be effected upon a default by affiliates of Fertitta Entertainment (including certain specified defaults under the Propco Credit Agreement) or foreclosure by the
Propco Lenders, the Company and Fertitta Entertainment would provide full transition services to the CV Propco lenders and their designees.



GVR Purchaser, as borrower, has entered into a commitment letter for the GVR Term Loan, of which $205 million is expected to be
a first lien term loan and $70 million of
which is expected to be a second lien term loan. The maturity date of the first lien term loan is expected to be the fifth anniversary of the loan closing date and the maturity date of the second lien
term loan is expected to be the sixth anniversary of the loan closing date. The first lien term loan is expected to have scheduled quarterly minimum amortization payments in the amount of one percent
per annum. We do not expect that there will be scheduled minimum amortization of the second lien term loan prior to final stated maturity. The GVR Term Loan is expected to be subject to customary
mandatory prepayments, including sale of equity or debt and excess cash flow. The lenders and GVR are expected to enter into a customary Intercreditor agreement. Interest is expected to accrue on the
first lien term loan at the rate per annum of LIBOR plus 5.25% and interest is expected to accrue on the second lien term loan at the rate per annum of LIBOR plus 9.25%, in each case subject to a
minimum LIBOR rate of 1.75%. The GVR Term Loan is expected to be guaranteed by all subsidiaries of GVR and its immediate parent company, GVR Holdco 1 LLC and secured by first lien and second
lien pledges of GVR equity, together with first and second priority liens on all tangible and intangible assets of GVR and its subsidiaries.



Since our formation on August 9, 2010, we have had no operations.



We currently do not have any off-balance sheet obligations.



We currently do not have any contractual obligations.

Station



Station is a gaming and entertainment company that currently owns and operates ten major hotel/casino properties (two of which are 50%
owned) under the Station and Fiesta brand names and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area. Station owns and operates Palace Station,
Boulder Station, Texas Station, Sunset Station, Santa Fe Station, Red Rock, Fiesta Rancho, Fiesta Henderson, Wild Wild West, Wildfire Rancho, Wildfire Boulder, Gold Rush and Lake Mead Casino. Station
also owns a 50% interest in Green Valley Ranch, Aliante Station, Barley's, The Greens and Wildfire Lanes. Station also manages Gun Lake Casino.

Station's
operating results are greatly dependent on the level of gaming revenue generated at its properties. A substantial portion of Station's operating income is generated from the
gaming operations, more specifically slot play. Station uses the non-gaming revenue departments to drive customer traffic to its properties. The majority of Station's revenue is cash based
through customers wagering with cash or paying for non-gaming amenities with cash or credit card. Because Station's business is capital intensive,

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Station
relies heavily on the ability of its properties to generate operating cash flow to repay debt financing, fund maintenance capital expenditures and provide excess cash for future development.



The accompanying consolidated financial statements for Station have been prepared assuming that Station will continue as a going
concern. As discussed in Note 1 to Station's consolidated financial statements, Station commenced the Chapter 11 Case on July 28, 2009. The pending Chapter 11 Case raises
substantial doubt about Station's ability to continue as a going concern. Station's consolidated financial statements do not include any adjustments (except as described below) to reflect the possible
future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.



On July 28, 2009, the Debtors filed voluntary petitions in the Bankruptcy Court under chapter 11 of title 11 of the
United States Code. On February 10, 2010, GV Ranch Station, Inc., a wholly-owned subsidiary of Station Casinos, Inc. that manages and owns 50% of Green Valley Ranch, filed a
voluntary petition in the Bankruptcy Court under chapter 11 of title 11 of the United States Code.

On
July 28, 2010, the Debtors filed the Plan and Disclosure Statement (the "Disclosure Statement"). The Bankruptcy Court entered an order approving the Disclosure Statement on
July 29, 2010. The Bankruptcy Court entered an order confirming the Plan on August 27, 2010.

On
March 9, 2011, the GVR Purchaser, an indirect subsidiary of the Company, and GVR entered into the GVR Asset Purchase Agreement pursuant to which, the GVR Purchaser will
purchase substantially all of the assets and assume certain specified liabilities of GVR for $500 million through a prepackaged plan of reorganization. The GVR Asset Purchase Agreement is
subject to, among other things, the bankruptcy court entering a confirmation order confirming the chapter 11 plan of reorganization of GVR.

On
March 22, 2011, the subsidiaries of STN that are sellers under the Asset Purchase Agreement and Station's 50%-owned joint ventures GVR and Aliante commenced a solicitation of
approvals for the Subsidiary Plan to implement and facilitate the sale and related restructuring transactions described in the Asset Purchase Agreement, the GVR Asset Purchase Agreement and a
reorganization of Aliante pursuant to which its lenders would receive the equity of Aliante in exchange for their claims. We expect that the Subsidiary Chapter 11 Cases will be filed in the
second quarter of 2011.

This
report is not intended to be, and should not in any way be construed as, a solicitation of votes on the Plan or the Subsidiary Plan. The Plan and the Disclosure Statement have been
filed with the Bankruptcy Court and were filed with the Securities and Exchange Commission by Station on its Current Report on Form 8-K dated July 28, 2010, which is publicly
available at http://www.sec.gov. Station concluded its solicitation of acceptance of the Plan and received its confirmation from the Bankruptcy Court on August 27, 2010. Although the Plan was
confirmed by the Bankruptcy Court on August 27, 2010, there can be no assurance that the transactions contemplated by the Asset Purchase Agreement or the Plan will be consummated.

The
Debtors continue to conduct their businesses as debtors-in-possession under the jurisdiction of the Bankruptcy Court and in accordance with applicable
provisions of the Bankruptcy Code and the orders of the Bankruptcy Court.

Please
refer to our discussion under "Item 1. BusinessChapter 11 Reorganization" and "Restructuring Transactions" for a more detailed discussion
of the Chapter 11 Case and Restructuring Transactions.

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The following discussion and analysis should be read in conjunction with "Item 6. Financial InformationSelected Financial
DataStation" and "Item 8. Financial Statements and Supplementary DataStation Casinos, Inc. Consolidated Financial Statements" included in this Annual Report on
Form 10-K.



The following table highlights the results of operations for Station as compared to prior years (dollars in thousands):

Year Ended
December 31,
2010

Percent
change

Year Ended
December 31,
2009

Percent
change

Year Ended
December 31,
2008Net revenuestotal

$
944,955


(11.0
)%
$
1,062,149


(18.2
)%
$
1,298,151Major Las Vegas Operations (a)


886,647


(8.6
)%

970,521


(17.5
)%

1,176,394Management fees (b)


22,394


(57.3
)%

52,447


(27.6
)%

72,405Other Operations and Corporate (c)


35,914


(8.3
)%

39,181


(20.6
)%

49,352Operating (loss) incometotal

$
(209,055
)

82.8
%
$
(1,212,539
)

62.3
%
$
(3,216,852
)Major Las Vegas Operations (a)


36,017


116.7
%

(216,002
)

88.0
%

(1,799,158
)Management fees (b)


22,394


(57.3
)%

52,447


(27.6
)%

72,405Other Operations and Corporate (c)


(267,466
)

74.5
%

(1,048,984
)

29.6
%

(1,490,099
)Cash flows (used in) provided by:Operating activities

$
(4,564
)

96.4
%
$
(126,677
)

(347.3
)%
$
51,222Investing activities


(14,969
)

88.5
%

(130,280
)

50.7
%

(264,249
)Financing activities


(303
)

98.1
%

(15,914
)

(102.8
)%

574,699


---



Consolidated net revenues for the year ended December 31, 2010 decreased 11.0% to $945.0 million as compared to
$1.06 billion in 2009. Similarly, combined net revenues from Station's Major Las Vegas Operations decreased 8.6% to $886.6 million for the year ended December 31, 2010 as compared
to $970.5 million for the year ended December 31, 2009. Consolidated net revenues for the year ended December 31, 2009 decreased 18.2% to $1.06 billion as compared to
$1.30 billion in 2008. Similarly, combined net revenues from Station's Major Las Vegas Operations decreased 17.5% to $970.5 million for the year ended December 31, 2009 as
compared to $1.18 billion for the year ended December 31, 2008.

During
the years ended December 31, 2010, 2009 and 2008, Station experienced an overall decrease in revenues across all of its properties as a result of the ongoing economic
weakness in Las Vegas and across the United States. High unemployment, weak consumer confidence levels and depressed real estate values have continued to negatively impact the economic climate in the
Las Vegas area and are expected to continue in 2011.

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Station's consolidated operating loss of $209.1 million for the year ended December 31, 2010 improved significantly as
compared to its consolidated operating loss of $1.21 billion for the year ended December 31, 2009. The improvement of $1.00 billion is primarily due to a $1.01 billion
decrease in asset impairment charges recognized during 2010 compared to 2009. Asset impairment charges are discussed in more detail below.

Station's
consolidated operating loss of $1.21 billion for the year ended December 31, 2009 decreased significantly as compared to its consolidated operating loss of
$3.22 billion for the year ended December 31, 2008. The decrease is primarily the result of a decrease in operating costs and expenses in 2009 compared to 2008, most notably a
$2.11 billion decrease in asset impairment charges and other write-downs, partially offset by the decline in net revenues during 2009.

The
following table highlights Station's various sources of revenues and expenses as compared to prior years (dollars in thousands):

Year Ended
December 31,
2010

Percent
change

Year Ended
December 31,
2009

Percent
change

Year Ended
December 31,
2008Casino revenues

$
699,401


(8.5
)%
$
764,639


(16.7
)%
$
918,120Casino expenses


289,168


(10.9
)%

324,373


(10.2
)%

361,255Margin


58.7
%




57.6
%




60.7
%Food and beverage revenues

$
163,215


(14.1
)%
$
189,917


(17.0
)%
$
228,858Food and beverage expenses


107,311


(8.2
)%

116,932


(23.6
)%

153,018Margin


34.3
%




38.4
%




33.1
%Room revenues

$
73,454


(10.7
)%
$
82,282


(22.2
)%
$
105,718Room expenses


32,321


(5.4
)%

34,182


(14.6
)%

40,029Margin


56.0
%




58.5
%




62.1
%Other revenues

$
59,086


(8.7
)%
$
64,732


(12.2
)%
$
73,745Other expenses


19,979


(0.7
)%

20,121


(27.6
)%

27,774Selling, general and administrative expenses

$
219,479


(4.2
)%
$
229,200


(8.5
)%
$
250,614Percent of net revenues


23.2
%




21.6
%




19.3
%Corporate expense

$
34,899


5.7
%
$
33,018


(8.4
)%
$
36,029Percent of net revenues


3.7
%




3.1
%




2.8
%(Losses) earnings from joint ventures

$
(248,495
)

(94.7
)%
$
(127,643
)

(850.0
)%
$
17,020


Casino.Casino revenues decreased 8.5% to $699.4 million for the year ended December 31, 2010 as compared to
$764.6 million for
the year ended December 31, 2009. The $65.2 million decrease in casino revenues during 2010 is due primarily to a 7.0% decrease in slot revenue and a 20.3% decrease in table game
revenues. Casino revenues decreased 16.7% to $764.6 million for the year ended December 31, 2009 as compared to $918.1 million for 2008. The $153.5 million decrease in
casino revenues during 2009 was due primarily to a 17.1% decrease in slot revenue and a 16.3% decrease in table game revenues. These decreases in casino revenues are primarily due to the continuation
of the general economic slowdown discussed above.

Casino
expenses decreased 10.9% to $289.2 million for the year ended December 31, 2010 as compared to $324.4 million for the year ended December 31, 2009. The
$35.2 million decrease in expenses is due primarily to a decrease of $6.6 million in costs related to complimentary slot play, food, beverage,

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rooms,
entertainment and merchandise, decreased payroll expense of $5.5 million, decreased promotional expense of $15.2 million, decreased gaming taxes and licenses of
$1.7 million primarily resulting from lower gaming revenues, and a net decrease in other casino expenses of $6.2 million. Casino expenses decreased 10.2% to $324.4 million for the
year ended December 31, 2009 as compared to $361.3 million for 2008. The $36.9 million decrease in casino expenses during 2009 is due primarily to a decrease of
$21.6 million in costs related to complimentary slot play, food, beverage, rooms, entertainment and merchandise, decreased payroll expense of $12.6 million, decreased gaming taxes and
licenses of $13.6 million primarily resulting from lower gaming revenues, and a net decrease in other casino expenses of $5.0 million, partially offset by an increase in promotional
expenses of $15.9 million.

The
casino operating margin for the year ended December 31, 2010 increased to 58.7% as compared to 57.6% for 2009. The casino operating margin for the year ended
December 31, 2009 decreased to 57.6% as compared to 60.7% for the year ended December 31, 2008.

Food and Beverage.Food and beverage revenues decreased 14.1% to $163.2 million for the year ended December 31, 2010 as
compared to
2009 primarily due to the conversion of several owned outlets to leased outlets. The number of restaurant guests served decreased 22.1% for the year ended December 31, 2010 compared to 2009
primarily for the same reason. Food and beverage expenses decreased 8.2% for the year ended December 31, 2010 as compared to 2009 primarily due to the decreased number of restaurant guests
served. The food and beverage margin for the year ended December 31, 2010 decreased 4.1% as compared to 2009, primarily as a result of increases in the cost of food and beverage commodities.
The average guest check for the year ended December 31, 2010 increased by approximately 1.4% as compared to 2009 primarily due to the closure of lower priced restaurants.

Food
and beverage revenues decreased 17.0% for the year ended December 31, 2009 as compared to 2008 due to the conversion of owned outlets to leased outlets as well as reduced
hours of operation at various owned food outlets due to the general economic slowdown discussed above. The number of restaurant guests served decreased 20.3% for the year ended December 31,
2009 compared to 2008 as a result of these same factors. Food and beverage expenses decreased 23.6% for the year ended December 31, 2009 as compared to 2008 due to the decrease in the number of
restaurant guests served, an overall decrease in Station's food and beverage costs as a result of efficiency efforts and reduced payroll expenses due to reduced staffing and reduced hours of
operation. The food and beverage margin for the year ended December 31, 2009 increased 5.3% as compared to 2008, primarily due to the efficiency efforts that have decreased food and beverage
costs. The average guest check for the year ended December 31, 2009 increased by approximately 3.2% as compared to 2008 due primarily to the closure of lower priced restaurants and an increase
in selected menu prices.

Room.The following table shows key information about Station's hotel operations:

Year Ended
December 31,
2010

Percent
change

Year Ended
December 31,
2009

Percent
change

Year Ended
December 31,
2008Room revenues

$
73,454


(10.7
)%
$
82,282


(22.2
)%
$
105,718Room expenses


32,321


(5.4
)%

34,182


(14.6
)%

40,029Margin


56.0
%




58.5
%




62.1
%Occupancy


80
%




83
%




88
%Average daily rate

$
62


(7.5
)%
$
67


(21.2
)%
$
85Revenue per available room

$
50


(10.7
)%
$
56


(25.3
)%
$
75


The
year over year decreases in room revenues for the years ended December 31, 2010 and 2009, respectively, are primarily due to the continued economic slowdown discussed above,
and the decreases in room expenses for the same periods are due mainly to lower occupancy levels. Since many of Station's room-related costs are fixed, decreases in room revenues typically
result in decreased margins.

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Other.Other revenues primarily include income from gift shops, bowling, entertainment, leased outlets and the spa. Other revenues
decreased 8.7% for
the year ended December 31, 2010 as compared to 2009, and other revenues decreased 12.2% for the year ended December 31, 2009 as compared to 2008. The decreases in other revenues are
primarily the result of reduced customer spending in these areas as a result of the general economic slowdown discussed above.

Management Fees.Station is the managing partner for Green Valley Ranch, Aliante Station, Barley's, The Greens and Wildfire Lanes and
earns a
management fee equal to 2% of revenues and approximately 5% of EBITDA from Green Valley Ranch and Aliante Station and 10% of EBITDA from Barley's, The Greens and Wildfire Lanes. Station also managed
Thunder Valley on behalf of the United Auburn Indian Community and received a management fee equal to 24% of net income (as defined in the management agreement) until the management agreement expired
in June 2010. During 2010 Station did not recognize management fee revenue from Green Valley Ranch and Aliante Station due to debt-related cash restrictions in place at those properties.
As a result, management fees for the year ended December 31, 2010 decreased to $22.4 million compared to $52.4 million for 2009. For the year ended December 31, 2009,
management fees decreased to $52.4 million from $72.4 million for 2008 as a result of an overall decrease in revenues at Station's managed properties due to the general economic slowdown
discussed above.

Selling, General and Administrative ("SG&A").SG&A expenses decreased $9.7 million, or 4.2%, for the year ended
December 31, 2010 as
compared to 2009, and SG&A as a percentage of net revenues increased to 23.2% for the year ended December 31, 2010 compared to 21.6% in 2009. The decrease in SG&A expenses during 2010 is
primarily due to a decrease of $2.2 million in utilities, a decrease of $2.0 million in consulting and outside services expense, a decrease of $1.7 million in taxes and licenses,
a decrease of $1.7 million in payroll and benefits and a net decrease of $3.1 million in other SG&A expenses, partially offset by a decrease of $1.0 million in the gain on net
deferred compensation assets. SG&A expenses decreased $21.4 million, or 8.5%, for the year ended December 31, 2009 as compared to 2008 due to Station's cost savings initiatives which
reduced payroll expense and health benefit costs company-wide. In addition, SG&A expenses were lower in 2009 as compared to 2008 as a result of efficiency efforts which resulted in
reductions in advertising, security expense, and maintenance expense of $7.8 million, $1.1 million and $3.4 million, respectively, compared to 2008 levels. SG&A as a percentage of
net revenues increased to 21.6% for the year ended December 31, 2009 compared to 19.3% in 2008 due to lower net revenues.

Corporate Expense.Corporate expense increased 5.7% to $34.9 million for the year ended December 31, 2010 as compared to
$33.0 for the
year ended December 31, 2009. The $1.9 million increase is primarily related to an increase of $1.3 million in insurance expense, an increase of $1.0 million in payroll and
benefits and a net increase of $1.1 million in various other corporate expenses, partially offset by a decrease of $1.5 million in legal expense. Corporate expense decreased to
$33.0 million for the year ended December 31, 2009 as compared to $36.0 for the year ended December 31, 2008. The decrease was primarily related to reduced payroll expense and
health benefit costs resulting from cost savings initiatives.

Development and Preopening Expense.Development and preopening expense includes costs to identify potential gaming opportunities and
other
development opportunities, and expenses incurred prior to the opening of projects under development. The primary components of such costs are payroll, travel, legal expenses and milestone payments.
Development and preopening expense for the years ended December 31, 2010, 2009, and 2008 were $16.3 million, $12.0 million and $13.6 million, respectively. The increase in
development and preopening expenses during the year ended December 31, 2010 compared to 2009 was primarily due to a $3.2 million increase in milestone expenses related to the Gun Lake
project and the forgiveness of $2.0 million in Gun Lake project advances, partially offset by a $0.9 million decrease in other development and preopening expenses. The decrease in
development and preopening expenses during the year ended December 31, 2009 compared to 2008 was due primarily to higher expenses incurred

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during
2008 related to the Aliante project, partially offset by a $4.0 million milestone payment during 2009 related to the Gun Lake project.

Depreciation and Amortization.Depreciation and amortization decreased 26.0% to $153.3 million for the year ended December 31,
 2010
compared to $207.2 million for the year ended December 31, 2009. Depreciation expense decreased by approximately $16.2 million during 2010 compared to 2009, primarily as a result
of a decrease in the total carrying value of Station's depreciable assets due to asset impairment charges recognized during 2009. Amortization expense decreased by approximately $37.7 million
during 2010 as compared to 2009 primarily as a result of the intangible asset related to Station's management agreement with Thunder Valley becoming fully amortized in June 2010. Depreciation and
amortization decreased 8.7% to $207.2 million for the year ended December 31, 2009 compared to $226.8 million for the year ended December 31, 2008. This decrease was due
primarily to reductions in amortization expense of approximately $20.8 million related to lower finite-lived intangible asset balances resulting from the impairment of customer relationship
intangibles in the fourth quarter of 2008, as well as finite-lived assets that became fully amortized during late 2008, partially offset by a slight increase in depreciation expense as a result of
additions to property and equipment.

Asset Impairments.The Plan as confirmed by the Bankruptcy Court on August 27, 2010 reflects a reorganization value of
approximately
$2.6 billion, which is significantly less than the carrying value of Station's net assets that are subject to the plan. Station determined that this constituted an indicator of asset impairment
and therefore Station reviewed substantially all of its assets for impairment during the third quarter of 2010. As a result of Station's impairment review, Station recognized asset impairments
totaling $262.0 million, consisting of the following:



For
the year ended December 31, 2009, Station recorded asset impairments totaling $1.28 billion, primarily as a result of the ongoing recession which resulted in decreased
projected cash flow estimates, decreased valuation multiples for gaming assets due to the current market conditions and higher discount rates resulting from turmoil in the credit markets. Asset
impairments recognized during the year ended December 31, 2009 consisting of the following:



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In
the year ended December 31, 2008, Station recognized asset impairments totaling $3.34 billion. These impairments were primarily a result of the ongoing recession which
resulted in decreased projected cash flow estimates, decreased valuation multiples for gaming assets due to weak market conditions and higher discount rates resulting from turmoil in the credit
markets, as well as the impact of Station's economic condition on its ability to secure adequate financing for future capital projects and changes in the anticipated use of certain land parcels.
Impairments recognized during the year ended December 31, 2008 consisted of the following:



Write-downs and Other Charges, net.For the year ended December 31, 2010, write-downs and other charges, net were
$19.2 million and
consisted of the following:



For
the year ended December 31, 2009, write-downs and other charges, net were $20.8 million and consisted of the following:



In
the year ended December 31, 2008, write-downs and other charges, net were $62.6 million and consisted of the following:



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(Losses) Earnings From Joint Ventures.Station owns a 50% interest in various joint ventures including Green Valley Ranch and Aliante
Station, and a
6.7% interest in a joint venture that owns the Palms Casino Resort. Station's share of the (losses) earnings from these joint ventures were $(248.5) million, $(127.6) million and $17.0 million
for the years ended December 31, 2010, 2009, and 2008, respectively. The $120.9 million increase in losses from joint ventures for the year ended December 31, 2010 as compared to
the year ended December 31, 2009 is due primarily to increased impairment charges recognized by certain of Station's 50% owned joint ventures. During the year ended December 31, 2010,
losses from joint ventures included a charge of $233.3 million representing Station's 50% share of asset impairment losses at Aliante Station. During the year ended December 31, 2009,
losses from joint ventures included a charge of $124.9 representing Station's 50% share of asset impairment losses recognized by the Rancho Road joint venture. The $144.6 million decrease in
Station's earnings from joint ventures for the year ended December 31, 2009 as compared to the year ended December 31, 2008 is due primarily to the 2009 impairment charges, as well as
operating losses at Aliante Station, which opened in November 2008, and a decrease in operating results at Green Valley Ranch due to the general economic slowdown discussed above.

Gain on Dissolution of Joint Venture.During 2010, the Rancho Road and Richfield Homes joint ventures disposed of substantially all of
their assets
and were dissolved. At the date of dissolution, the carrying value of the investment in Rancho Road was a deficit of $124.2 million as a result of accumulated losses in excess of the
investment. Upon dissolution, Station removed this deficit carrying value from its books and recognized a gain. Prior to Richfield Homes' disposal of its assets, Station's carrying value was
$19.8 million. During 2010 Station recognized a $16.3 million impairment of its investment in Richfield Homes, which resulted in a carrying value equal to the $3.5 million cash
distribution Station received from the disposal of Richfield Homes' assets. As a result, Station recognized no gain or loss upon the dissolution of the Richfield Homes joint venture.

Interest Expense.Interest expense, net of capitalized interest, decreased 62.2% to $104.6 million for the year ended
December 31, 2010
as compared to $276.6 million for the year ended December 31, 2009. Gross interest expense decreased 60.9% to $115.8 million for the year ended December 31, 2010 as
compared to $295.8 million for the year ended December 31, 2009. Interest expense, net of capitalized interest, decreased 27.1% to $276.6 million for the year ended
December 31, 2009 as compared to $379.3 million for the year ended December 31, 2008. Gross interest expense decreased 27.4% to $295.8 million for the year ended
December 31, 2009 as compared to $407.5 million for the year ended December 31, 2008.

The
year over year decreases in interest expense are due primarily to the accounting treatment under ASC Topic 852,Reorganizations("ASC
Topic 852"), whereby interest expense is recognized only to the extent that it will be paid during the bankruptcy proceeding or that it is probable that it will be an allowed claim. As a result of the
filing of the Chapter 11 Case on July 28, 2009, Station stopped accruing interest for the senior notes, the senior subordinated notes and the mezzanine financings. Had Station recognized
the additional contractual interest expense, interest expense for 2010 and 2009, respectively, would have been $315.3 million and $127.1 million higher than what was recorded.
Capitalized interest for the year ended December 31, 2010 was $10.1 million compared to $16.0 million for the year ended December 31, 2009. The decrease was due primarily
to the decrease in the weighted average cost of capital during 2010 as a result of the cessation of interest accruals on a portion of the debt as discussed above. Capitalized interest for the year
ended December 31, 2009 was $16.0 million compared to $27.1 million for the year ended December 31, 2008. The higher capitalized interest during 2008 was primarily due to
interest being capitalized on equity contributions to Aliante Station during the construction of the project.

Interest and Other Expense from Joint Ventures.For the years ended December 31, 2010, 2009, and 2008, Station recorded
$66.7 million,
$40.8 million and $47.6 million, respectively, in interest and other expense related to its unconsolidated joint ventures. The $25.9 million increase in interest and other

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expense
from joint ventures for the year ended December 31, 2010 compared to the year ended December 31, 2009 relates primarily to recording Station's 50% share of the loss that resulted
from the early termination of Green Valley Ranch's interest rate swap in March 2010. Prior to the termination of this interest rate swap, the liability was carried at fair value, which incorporated
nonperformance risk adjustments related to credit risks of both counterparties in accordance with ASC Topic 815,Derivatives and Hedging. Upon early
termination of the swap, fair value accounting for the swap was discontinued and the carrying value of the liability was increased to a fixed termination settlement amount which does not incorporate
nonperformance risk adjustments. The $6.8 million decrease in interest and other expense from joint ventures for the year ended December 31, 2009 compared to the year ended
December 31, 2008 relates primarily to decreased expense related to changes in the fair values of the interest rate swaps of the joint ventures, partially offset by increased interest at
Aliante Station as a result of interest being capitalized during 2008 related the development of the property.

Change in Fair Value of Derivative Instruments.During the year ended December 31, 2010, Station recorded losses of $42,000
related to an
interest rate swap not designated as a hedge for accounting purposes, which expired in November 2010. During the year ended December 31, 2009, Station recorded gains of $23.7 million
related primarily to the change in fair value of its derivative instruments not designated as hedges for accounting purposes during the period prior to the Chapter 11 petition date. As a result
of the Chapter 11 Case, certain interest rate swaps were reclassified to liabilities subject to compromise in accordance with ASC Topic 852, and therefore post-petition changes in
the expected amount of the allowed claims for these interest rate swaps was recognized in the reorganization items line on Station's consolidated statement of operations. The post-petition
change in fair value of derivative instruments included in reorganization items for the years ended December 31, 2010 and 2009 were expenses of $2.6 million and $80.8 million,
respectively, and the amount in 2009 was primarily due to the reversal of pre-petition nonperformance adjustments that were previously included in the carrying values of these swaps.
During the year ended December 31, 2008, Station recorded losses of $23.1 million related primarily to the change in fair value of its derivative instruments not designated as hedges for
accounting purposes. Fluctuations in interest rates can cause the fair value of our derivative instruments to change each reporting period.

Gain on Early Retirement of Debt.In January 2009, a wholly-owned subsidiary of Station purchased $40.0 million in aggregate
principal amount
of its outstanding $700 million 67/8% Senior Subordinated Notes and $8.0 million in aggregate principal amount of its outstanding $450 million 61/2%
Senior Subordinated Notes for approximately $1.5 million plus approximately $1.4 million in accrued interest. As a result, Station recorded a gain on early retirement of debt of
approximately $40.3 million during the year ended December 31, 2009, representing the difference between the reacquisition price and the net carrying amount of the extinguished debt
based on the face amount of the associated debt adjusted for the related unamortized discount and debt issuance costs.



The following liquidity and capital resources discussion contains certain forward-looking statements with respect to Station's
business, financial condition, results of operations, dispositions, acquisitions, expansion projects and its subsidiaries, which involve risks and uncertainties that cannot be predicted or quantified,
and consequently, actual results may differ materially from those expressed or implied herein. Such risks and uncertainties include, but are not limited to, completion of Station's reorganization
plan, financial market risks, the ability to maintain existing management, integration of acquisitions, competition within the gaming industry, the cyclical nature of the hotel business and gaming
business, economic conditions, regulatory matters and litigation and other risks described in its filings with the Securities and Exchange Commission. In addition, construction projects entail
significant risks, including shortages of materials or skilled labor, unforeseen regulatory problems, work stoppages, weather interference, floods and unanticipated cost increases. The anticipated
costs and construction periods are based on budgets,

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conceptual
design documents and construction schedule estimates. There can be no assurance that the budgeted costs or construction period will be met. All forward-looking statements are based on
Station's current expectations and projections about future events.



The persistence of weak economic conditions in the United States and particularly in Las Vegas, including depressed real estate values,
significant unemployment and low consumer confidence levels adversely affected Station's net revenues and gross margin during 2010, and these trends are expected to continue into 2011.

During
the year ended December 31, 2010, cash used in operating activities was approximately $4.6 million, as compared to cash used in operating activities of
$126.7 million for the year ended December 31, 2009, reflecting a year over year decrease in cash used in operating activities of $122.1 million. The improvement in cash flows
from operations resulted primarily from a decrease of $40.4 million in additions to restricted cash, a decrease of $95.1 million in cash paid for interest and a $10.1 million
increase in other operating cash inflows, partially offset by an increase of $23.5 million in cash used for reorganization items.

During
the year ended December 31, 2010, restricted cash increased by $119.0 million due primarily to restrictions placed on cash by the lenders of the CMBS Loans and the
Bankruptcy Court, partially
offset by restricted cash released in connection with the DIP financing. The decrease in cash paid for interest during 2010 was primarily due to the previously discussed cessation of interest payments
on certain portions of debt.

As
of December 31, 2010, Station had $165.4 million in cash and cash equivalents, of which approximately $83.5 million is in its casino cages to be used for the
day-to-day operations of its properties and the remaining $81.9 million is to be used for general corporate purposes.

In
connection with the filing of the Chapter 11 Case, on July 31, 2009, STN entered into an unsecured, subordinated administrative priority DIP Credit Agreement among the
Company, as borrower, Vista Holdings, LLC, a non-debtor subsidiary of Station ("Vista Holdings"), as administrative agent and lender, and the lenders party thereto. The DIP Credit
Agreement, as amended, provided for a $185 million revolving credit facility that was funded on a committed basis for so long as Vista Holdings had cash and cash equivalents on hand in an
amount in excess of $100 million and on a discretionary basis thereafter. The proceeds of the loans incurred under the DIP Credit Agreement were used for working capital and other general
corporate purposes of Station and were available for intercompany loans to its subsidiaries during the pendency of the Chapter 11 Case. Advances under the DIP Credit Agreement bear interest at
a rate equal to 2.5% plus LIBOR. The DIP Credit Agreement matured on August 10, 2010, and at December 31, 2010, $172.0 million in advances remained outstanding under the DIP
Credit Agreement.

STN's
obligations under the DIP Credit Agreement will be an administrative expense claim in the Chapter 11 Case havingpari passupriority with other administrative expense claims, provided that repayment of the loan by STN shall be subordinate to the full repayment of the lenders under Station's prepetition Credit Agreement. In
addition, STN's obligations under the DIP Credit Agreement may be accelerated following certain events of default, including (without limitation) the conversion of any of the Chapter 11 Cases
to a case under chapter 7 of the Bankruptcy Code or the appointment of a trustee pursuant to chapter 11 of the Bankruptcy Code.

Also,
in connection with the filing of the Chapter 11 Case, on July 31, 2009, STN entered into an Unsecured Revolving Loan Promissory Note in favor of Past
Enterprises, Inc., a non-debtor subsidiary of Station ("Past Enterprises"), pursuant to which Past Enterprises provides to STN an unlimited revolving credit facility (the "Past
Revolving Loan") at an interest rate of 2.78% per annum, the proceeds of which will be used for working capital and other general corporate purposes of Station and will be available for

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intercompany
loans to its subsidiaries. The Past Revolving Loan matures on the earlier of (i) demand, or (ii) July 31, 2011, and provides for a default rate of interest of 4.78%
if principal or interest due thereunder is not paid when due. At December 31, 2010, the outstanding balance due under the Past Revolving Loan totaled $289.3 million. Station still has
the ability to borrow under the Past Revolving Loan, and there is no limit on its borrowings under the Past Revolving Loan.

In
July 2010, Gun Lake completed a $165 million third-party construction financing facility ("Gun Lake Financing"), which Station assisted them in obtaining in connection with the
Gun Lake Development Agreement. A subsidiary of Station, SC Michigan, LLC ("SC Michigan"), provided $15 million of cash collateral to secure a limited completion guaranty and keep well
obligation in connection with the Gun Lake Financing. The $15 million remains property of SC Michigan unless it is used to satisfy the completion guaranty requirements in the Gun Lake
Financing, at which time it will be converted to a loan payable by Gun Lake to SC Michigan. SC Michigan deposited the $15 million into a restricted cash account under the control of the lenders
to the Gun Lake Financing. As a result, in July 2010 MPM received approximately $42.8 million representing a partial repayment of project advances. Of the $42.8 million, SC Michigan
received $39.3 million and used all of these funds to purchase funded debtor-in-possession loans made to Station by Past Enterprises (the "SC Michigan Revolving Loan").
At December 31, 2010, the outstanding balance due under the SC Michigan Revolving Loan totaled $39.3 million. The remainder of advances on the Gun Lake project is expected to be repaid
from the operations of the project, which opened on February 10, 2011.

STN's
obligations under the Past Revolving Loan and SC Michigan Revolving Loan will be an administrative expense claim in the Chapter 11 Case having pari passu priority with other
administrative expense claims, provided that repayment of the loan by STN shall be subordinate to the full repayment of the lenders under Station's prepetition Credit Agreement.

During
the year ended December 31, 2010, total capital expenditures were approximately $34.5 million for maintenance capital expenditures and various other projects.
Capital expenditures for 2010 were $30.1 million lower than the prior year period, primarily due to reduced capital spending in response to current market conditions. Station classifies items
as maintenance capital to differentiate replacement type capital expenditures such as new slot machines from investment type capital expenditures to drive future growth such as an expansion of an
existing property. In contrast to normal repair and maintenance costs that are expensed when incurred, items Station classifies as maintenance capital are expenditures necessary to keep its existing
properties at their current levels and are typically replacement items due to the normal wear and tear of its properties and equipment as a result of use and age.

In
addition to capital expenditures, during the year ended December 31, 2010, Station paid approximately $16.0 million in reimbursable advances for its Native American
development projects.

During
2010 Station also paid approximately $3.5 million in equity contributions to joint ventures and $3.2 million in principal payments on its debt, including
$2.5 million in quarterly payments on the Term Loan (as defined below) and $0.7 million on other debt.



During the year ended December 31, 2009, cash flows used in operating activities were approximately $126.7 million, as
compared to cash flows provided by operating activities of $51.2 million for the year ended December 31, 2008, reflecting a year over year decrease in cash flows from operations of
$177.9 million. This decrease resulted primarily from a $152.5 million increase in operating loss, net of noncash items and reorganization costs, an increase in restricted cash of
$145.4 million, and cash used for reorganization items of $59.8, partially offset by a decrease of $190.8 million in cash paid for interest. The weakening Las Vegas and U.S. economies,
the decline in real estate values, the credit crisis, increased unemployment and a decrease in consumer confidence levels adversely affected Station's net revenues and

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operating
margin. In addition, Station's estimated future cash flows have been impacted by these same factors, resulting in the significant asset impairment charges recorded in the year ended
December 31, 2009. The increase in restricted cash requirements for the year ended December 31, 2009 is due primarily to additional collateral required for Station's treasury management
function, restrictions placed on cash by lenders of the CMBS Loans, and restrictions placed on cash by the Bankruptcy Court. Cash used in investing activities during the year ended December 31,
2009 decreased by $134.0 million compared to 2008 primarily as a result of a $107.5 decrease in capital expenditures due to the economic slowdown, and a decrease in cash contributions to joint
ventures of $33.4 million. Cash paid for interest during the year ended December 31, 2009 decreased by $190.8 million compared to the year ended December 31, 2008 primarily
as a result of Station's election not to make the scheduled interest payments on its senior and senior subordinated notes and a portion of its CMBS loans in 2009 as described above.

At
December 31, 2009, Station had no borrowing availability under it Revolver but had $25.3 million of availability under its DIP Credit Agreement. In addition, subsequent
to December 31, 2009, the DIP Credit Agreement facility was increased to $185 million. At December 31, 2009 Station had $185.2 million in cash and cash equivalents, of
which approximately $81.5 million was in its casino cages to be used for the day-to-day operations of its properties with the remaining $103.7 million to be used
for general corporate purposes.

During
the year ended December 31, 2009, total capital expenditures were approximately $64.6 million for maintenance capital expenditures and various other projects.
Capital expenditures for the year ended December 31, 2009 were $107.5 million lower than the prior year capital expenditures of $172.1 million due to reduced capital spending in
2009 in response to current market conditions.

In
addition to capital expenditures, during the year ended December 31, 2009, Station paid approximately $19.3 million in advances for its Native American development
projects and paid approximately $24.3 million in cash equity contributions to joint ventures.



Station's primary cash requirements for 2011 are expected to include (i) approximately $55 million to $75 million
for maintenance and other capital expenditures, (ii) payments related to its existing and potential Native American projects and (iii) expenses related to the Chapter 11 Case.
Station's liquidity and capital resources for 2011 are expected to be significantly affected by the Chapter 11 Case and completion of the restructuring of its indebtedness. At this time it is
not possible to predict with certainty the effect the Chapter 11 Case and the restructuring will have on its business or various creditors. Station's future results depend upon successfully
implementing, on a timely basis, a restructuring of its indebtedness. Station's operations and relationship with its customers, employees, regulators, vendors and agents may be adversely affected by
the filing of the Chapter 11 Case. As a result of the filing of the Chapter 11 Case, Station expects to continue to incur, among other things, increased costs for professional fees and
similar expenses. In addition, the filing of Station may make it more difficult to retain and attract management and other key personnel and requires senior management to spend a significant amount of
time and effort dealing with the financial reorganization instead of focusing on the operations of its business.

Stations'
cash flow may be affected by a variety of factors, many of which are outside its control, including regulatory issues, competition, financial markets and other general business
conditions. Station cannot assure you that it will possess sufficient income and liquidity to meet all of its liquidity requirements and other obligations. Although Station believes that cash flows
from operations and borrowings under the Past Revolving Loan will be adequate to meet its financial and operating obligations in 2011, the results for future periods are subject to numerous
uncertainties. Station may encounter liquidity problems, which could affect its ability to meet its obligations while attempting to meet competitive pressures or adverse economic conditions.

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As of December 31, 2010, Station has certain off-balance sheet arrangements that affect its financial condition,
liquidity and results of operations, including interest rate swaps with a combined notional amount of $250 million.

The
following table summarizes Station's contractual obligations and commitments (amounts in thousands):

Contractual obligationsLong-term
debt (a)

Operating
leases (b)

Other long-term
obligations (c)

Total contractual
cash obligationsPayments due by year2011

$
6,218,333

$
6,854

$
15,870

$
6,241,0572012


250,434


6,831


50


257,3152013


152,174


6,742


50


158,9662014


115,107


6,724


50


121,8812015


111,740


6,724





118,464Thereafter


175,692


294,214





469,906Total

$
7,023,480

$
328,089

$
16,020

$
7,367,589


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As further discussed in Note 21 to the Station Casinos, Inc. Consolidated Financial Statements in this Annual Report on
Form 10-K, on January 1, 2007 Station adopted the provisions of the accounting guidance for uncertainty in income taxes. Station had $8.8 million of unrecognized tax
benefits as of December 31, 2010. Due to the inherent uncertainty of the underlying tax positions, it is not possible to assign the liability as of December 31, 2010 to any particular
years in the table.



Station does not believe that inflation has had a significant impact on its revenues, results of operations or cash flows in the last
three fiscal years.

Critical Accounting Policies



Station prepares its consolidated financial statements in conformity with accounting principles generally accepted in the United
States. Certain of its accounting policies, including the determination of slot club program liability, the estimated useful lives assigned to assets, asset impairment, insurance reserves, bad debt
expense, derivative instruments, purchase price allocations made in connection with acquisitions and the calculation of income tax liabilities, require that Station apply significant judgment in
defining the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. These judgments are based on Station's
historical experience, terms of existing contracts, observance of trends in the gaming industry and information available from other outside sources. There can be no assurance that actual results will
not differ from Station's estimates. To provide an understanding of the methodology Station applies, its significant accounting policies and basis of presentation are discussed below, as well as where
appropriate in this discussion and analysis and in the notes to Station's consolidated financial statements.



Station's Boarding Pass and Amigo Club player rewards programs (the "Programs") allow customers to redeem points earned from their
gaming activity at all Station and Fiesta properties for complimentary slot play, food, beverage, rooms, entertainment and merchandise. At the time redeemed, the retail value of complimentaries under
the Programs is recorded as revenue with a corresponding offsetting amount included in promotional allowances. The cost associated with complimentary food, beverage, rooms, entertainment and
merchandise redeemed under the Programs is recorded in casino costs and expenses on Station's consolidated statements of operations.

Under
the Programs, customers are able to accumulate points over time that they may redeem at their discretion under the terms of the Programs. The estimated cost to provide points is
expensed as the points are earned and is included in casino costs and expenses in Station's consolidated statements of operations. To arrive at the estimated cost associated with outstanding points
under the Programs, various estimates and assumptions are made regarding incremental costs of the benefits, historical breakage/forfeiture rates and an estimate of the mix of goods and services
Station believes, based on
past customer redemption patterns, will be redeemed. At December 31, 2010 and 2009, $8.4 million and $6.1 million, respectively, were accrued for the cost of anticipated Program
redemptions.



Station is currently self-insured up to certain stop loss amounts for workers' compensation and general liability costs.
Insurance claims and reserves include accruals of estimated settlements for known claims, as well as accruals of estimates for claims incurred but not reported. At December 31, 2010 and 2009,
Station had total self-insurance accruals reflected in its consolidated balance sheets of $4.1 million and $3.6 million, respectively. Effective July 1, 2008, Station
is no longer self-insured for medical costs. In

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estimating
these accruals, Station evaluated historical loss experience and made judgments about the expected levels of costs per claim. Station believe changes in medical costs, trends in claims of
its employee base, accident frequency and severity and other factors could materially affect the estimate for these liabilities. Station continually monitors changes in employee demographics, incident
and claim type and evaluates its insurance accruals and adjusts its accruals based on its evaluation of these qualitative data points.



From time to time Station enters into derivative instruments, typically in the form of interest rate swaps, in order to manage interest
rate risks associated with its current and future borrowings. Station has adopted the accounting guidance for derivative instruments and hedging activities, as amended, to account for its interest
rate swaps. The accounting guidance requires Station to recognize its derivative instruments as either assets or liabilities in its consolidated balance sheet at fair value. The accounting for changes
in fair value (i.e. gains or losses) of a derivative instrument agreement depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of
hedging relationship. Additionally, the difference between amounts received and paid under such agreements, as well as any costs or fees, is recorded as a reduction of, or an addition to, interest
expense as incurred over the life of the agreement.

For
derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is reported as a component of other
comprehensive income (loss) and the ineffective portion is recorded in the consolidated statement of operations. Derivative instruments that are designated as fair value hedges and qualify for the
"shortcut" method
under accounting for derivative instruments and hedging activities, as amended, are allowed an assumption of no ineffectiveness. As such, there is no impact on the consolidated statement of operations
from the changes in the fair value of the hedging instrument. Instead, the fair value of the instrument is recorded as an asset or liability on Station's consolidated balance sheet with an offsetting
adjustment to the carrying value of the related debt. For those derivative instruments that are not designated as hedges for accounting purposes, the change in fair value is recorded in the
consolidated statement of operations in the period of change.

Fluctuations
in interest rates can cause the fair value of Station's derivative instruments to change each reporting period. While Station attempts to predict such movements in interest
rates and the impact on derivative instruments, such estimates are subject to a large degree of variability which could have a significant impact on its consolidated financial statements.



Property and equipment are initially recorded at cost. Depreciation and amortization are computed using the straight-line
method over the estimated useful lives of the assets or the term of the capitalized lease, whichever is less. Costs of major improvements are capitalized, while costs of normal repairs and maintenance
are charged to expense as incurred.

Station
must make estimates and assumptions when accounting for capital expenditures. Whether an expenditure is considered a maintenance expense or a capital asset is a matter of
judgment. Station classifies items as maintenance capital to differentiate replacement type capital expenditures such as a new slot machine from investment type capital expenditures to drive future
growth such as an expansion of an existing property. In contrast to normal repair and maintenance costs that are expensed when incurred, items Station classifies as maintenance capital are
expenditures necessary to keep its existing properties at their current levels and are typically replacement items due to the normal wear and tear of its properties and equipment as a result of use
and age. Station's depreciation expense is highly dependent on the assumptions Station makes about its assets' estimated useful lives. Station determines the estimated useful

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lives
based on its experience with similar assets, engineering studies and its estimate of the usage of the asset. Whenever events or circumstances occur which change the estimated useful life of an
asset, Station accounts for the change prospectively.

Station
evaluates its property and equipment and other long-lived assets for impairment in accordance with the accounting guidance in the Impairment or Disposal of
Long-Lived Assets Subsections of ASC 360-10. For assets to be held and
used, Station reviews fixed assets for impairment whenever indicators of impairment exist. If an indicator of impairment exists, Station compares the estimated future cash flows of the asset, on an
undiscounted basis, to the carrying value of the asset. If the undiscounted cash flows exceed the carrying value, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying
value, impairment is measured based on fair value compared to carrying value, with fair value typically based on a discounted cash flow model or market comparables, when available. For assets to be
disposed of, Station recognizes the asset to be sold at the lower of carrying value or fair value less costs of disposal. Fair value for assets to be disposed of is generally estimated based on
comparable asset sales, solicited offers or a discounted cash flow model.



Station accounts for goodwill and other intangible assets in accordance with ASC Topic 350, Intangibles-Goodwill and Other.



Station tests its goodwill for impairment annually during the fourth quarter of each year, and between annual test dates whenever
events or circumstances make it more likely than not that an impairment may have occurred. Impairment testing for goodwill is performed at the reporting unit level, and each of its 100% owned casino
properties is considered to be a reporting unit. Station's annual goodwill impairment testing utilizes a two step process. In the first step, Station compares the fair value of each reporting unit
with its carrying amount, including goodwill. The fair value of each reporting unit is estimated using the expected present value of future cash flows along with value indications provided by the
current valuation multiples of comparable publicly traded companies. If the fair value of the reporting unit exceeds its carrying amount, then goodwill of the reporting unit is not considered
impaired. If the carrying value of the reporting unit exceeds its fair value, then the goodwill of the reporting unit is considered to be impaired, and Station proceeds to the second step of the
goodwill impairment test. In the second step, Station determines the implied fair value of the reporting unit's goodwill by allocating the fair value of the reporting unit determined in step one to
the assets and liabilities of the reporting unit, as if the reporting unit had been acquired in a business combination. If the carrying value of the reporting unit's goodwill exceeds the implied fair
value of that goodwill, an impairment loss is recognized in an amount equal to that excess.



Station's indefinite-lived intangible assets include brands and certain license rights. The fair value of brands is estimated using a
derivation of the income approach to valuation, based on estimated royalties saved through ownership of the assets, utilizing market indications of fair value. Station tests its indefinite-lived
intangible assets for impairment annually during the fourth quarter of each year, and whenever events or circumstances make it more likely than not that an impairment may have occurred. Station's
annual impairment test of indefinite-lived intangible assets consists of a comparison of the estimated fair value of the intangible asset with its carrying amount. If the carrying amount of the
intangible asset exceeds its estimated fair value, an impairment loss is recognized in an amount equal to that excess. Indefinite-lived intangible assets are not amortized unless it is determined that
their useful life is no longer indefinite. Station periodically reviews its indefinite-lived assets to determine whether events and circumstances continue to support an indefinite useful life. If it
is determined that an indefinite-lived intangible asset has

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a
finite useful life, then the asset is tested for impairment and is subsequently accounted for as a finite-lived intangible asset.



Station's finite-lived intangible assets include customer relationship and management contract intangibles. Finite-lived intangible
assets are amortized over their estimated useful lives, and Station periodically evaluates the remaining useful lives of these intangible assets to determine whether events and circumstances warrant a
revision to the remaining period of amortization. Station reviews its finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that their carrying amounts may
not be recoverable.

The
customer relationship intangible asset refers to the value associated with Station's rated casino guests. The initial fair value of the customer relationship intangible asset was
based on the projected net cash flows associated with these casino guests. Prior to the annual impairment test for the year ended December 31, 2008, Station had utilized the income forecast
approach as its basis for amortization of the customer relationships intangible assets. The percentage of annual amortization applied each year utilizing the income forecast approach was based on
expected future net cash flows associated with Station's rated casino guests and an expected attrition rate. Station believed this approach better reflected the pattern in which the economic benefits
of the intangible asset were consumed. The attrition rate was determined in part quantitatively using historical customer data and qualitatively based on the consistency of its rated casino guests
which is predominantly Las Vegas local residents as opposed to out of town customers. Subsequent to Station's annual impairment testing for
the year ended December 31, 2008, these intangible assets are being amortized ratably over their estimated useful lives as the expected pattern of consumption no longer accommodates the income
forecast approach.

The
customer relationship intangible asset is reviewed for impairment whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Increased
competition within the gaming industry or a downturn in the economy could have an impact on Station's customer relationship intangible asset. Declines in customer spending which would impact the
expected future cash flows associated with Station's rated casino guests, declines in the number of visitations which could impact the expected attrition rate of its rated casino guests or an erosion
of operating margins associated with rated casino guest could cause the carrying value of the customer relationship asset to exceed the fair value. In this event an impairment based on the difference
between the estimated fair value and the carrying value would be recognized.

Management
contract intangible assets refer to the value associated with management agreements under which Station provides management services to various casino properties, including
casinos operated by joint ventures in which Station holds a 50% equity interest, and certain Native American casinos that Station has developed or are currently under development. The fair values of
these management contract intangibles are established using discounted cash flow techniques based on estimated future cash flows expected to be received in exchange for providing management services.
Management contract intangible assets are amortized ratably over their expected useful lives. Station begins amortizing management contract intangible assets when the property begins operations and
management fees are being earned.

Station
evaluates its finite-lived intangible assets and other long-lived assets for impairment in accordance with the accounting guidance in the Impairment or Disposal of
Long-Lived Assets Subsections of ASC 360-10. For assets to be held and used, Station reviews long-lived assets for impairment whenever indicators of impairment
exist. If an indicator of impairment exists, Station compares the estimated future cash flows of the asset, on an undiscounted basis, to the carrying value of the asset. If the undiscounted cash flows
exceed the carrying value, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying value, impairment is measured based on fair value compared to carrying value, with

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fair
value typically based on a discounted cash flow model or market comparables, when available. For assets to be disposed of, Station recognizes the asset to be sold at the lower of carrying value
or fair value less costs of disposal. Fair value for assets to be disposed of is generally estimated based on comparable asset sales, solicited offers or a discounted cash flow model.

Inherent
in the calculation of fair values are various estimates. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from Station's
estimates. If Station's ongoing estimates of future cash flows are not met, Station may have to record additional impairment charges in future accounting periods. Estimates of cash flows are based on
the current regulatory, political and
economic climates, recent operating information and budgets of the various properties where Station conducts operations. These estimates could be negatively impacted by changes in federal, state or
local regulations, economic downturns, or other events affecting various forms of travel and access to Station's properties.



Station incurs certain costs associated with development and management agreements entered into with Native American Tribes (the
"Tribes"). In accordance with the accounting guidance in ASC Topic 970,Real EstateGeneral, costs for the acquisition and related
development of the land and the casino facilities are capitalized as long-term assets until such time as the assets are transferred to the Tribe, at which time a long term receivable is
recognized.

In
accordance with the accounting guidance for capitalization of interest costs, Station capitalizes interest to the project once a "Notice of Intent" (or the equivalent) to transfer the
land into trust, signifying that activities are in progress to prepare the asset for its intended use, has been issued by the United States Department of the Interior ("DOI").

Station
earns a return on the costs incurred for the acquisition and development of the projects. Due to the uncertainty surrounding the estimated cost to complete and the collectability
of the stated return, Station accounts for the return earned on Native American Development Costs using the cost recovery method described in ASC Subtopic 360-20, Real Estate Sales.Under the cost
recovery method, recognition of the return is deferred until the gaming facility is complete and transferred to the
Tribe and the resulting receivable has been repaid. Repayment of the advances and the return typically is funded from a refinancing by the Tribe, from the cash flows of the gaming facility or both.

Station
evaluates its Native American Development Costs for impairment in accordance with the accounting guidance in the Impairment or Disposal of Long-Lived Assets
Subsections of ASC Topic 360-10. Station evaluates each project for impairment whenever events or changes in circumstances indicate that the carrying amount of the project might not be
recoverable, taking into consideration all available information. Among other things, Station considers the status of the project, any contingencies, the achievement of milestones, any existing or
potential litigation, and regulatory matters when evaluating its Native American projects for impairment. If an indicator of impairment exists, Station compares the estimated future cash flows of the
asset, on an undiscounted basis, to the carrying value of the asset. If the undiscounted expected future cash flows exceed the carrying value, no impairment is indicated. If the undiscounted expected
future cash flows do not exceed the carrying value, then impairment is measured based on the difference between fair value and the carrying value.



Station is subject to income taxes in the U.S. and files a consolidated federal income tax return. Station accounts for income
taxes in accordance with the guidance for accounting for income taxes. That guidance requires the recognition of deferred tax assets, net of applicable reserves, related to net operating loss
carry-forwards and certain temporary differences.

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Effective
January 1, 2007, Station adopted the authoritative accounting guidance for accounting for uncertainty in income taxes. The accounting guidance contains a
two-step approach to recognizing and measuring uncertain tax positions accounted for in accordance with the authoritative guidance for accounting for income taxes. The first step is to
evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including
resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon settlement.

Station's
income tax returns are subject to examination by tax authorities. Station regularly assessses the potential outcome of these examinations in determining the adequacy of its
provision for income taxes and its income tax liabilities. To determine necessary reserves, Station must make assumptions and judgments about potential actions by taxing authorities, partially based
on past experiences. The estimate of the potential outcome for any uncertain tax issue is highly judgmental, and Station believes it has adequately provided for any reasonable and foreseeable outcomes
relating to uncertain tax matters. When actual results of tax examinations differ from its estimates or when potential actions are settled differently than Station expected, Station adjusts the income
tax provision and its tax reserves in the current period. The provision for income taxes includes the impact of reserve provisions and changes to reserves that are considered appropriate, as well as
the related net interest.



In December 2010, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2010-28, IntangiblesGoodwill and Other (Topic
350), When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying
Amounts("ASU 2010-28"). Under the amended guidance, for reporting units with zero or negative carrying amounts, an entity is required to perform Step 2 of the goodwill impairment test if
it is more likely than not that a goodwill impairment exists. In determining whether it is more likely than not that a goodwill impairment exists, an entity should consider whether there are any
adverse qualitative factors indicating that an impairment may exist. The qualitative factors are consistent with the existing guidance which requires that goodwill of a reporting unit be tested for
impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount.
ASU 2010-28 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2010. Early adoption is not permitted. Station does not expect
adoption of the new guidance to have a material effect on its consolidated financial statements.

In
April 2010, the FASB issued ASU No. 2010-16,EntertainmentCasinos (Topic 924): Accruals for Casino Jackpot Liabilities, a
consensus of the FASB Emerging Issues Task Force.This guidance clarifies that an entity should not accrue jackpot liabilities (or portions thereof) before a jackpot is won if
the entity can avoid paying that jackpot. Jackpots should be accrued and charged to revenue when an entity has the obligation to pay the jackpot. The guidance applies to both base and progressive
jackpots. The guidance is effective for reporting periods beginning after December 15, 2010. Since Station's existing accounting policy for accrual of jackpot liabilities is consistent with the
new guidance, the adoption of this guidance will have no impact on Station's consolidated financial statements.

In
January 2010, the FASB issued ASU No. 2010-06,Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value
Measurements.This guidance clarifies and extends the disclosure requirements about recurring and nonrecurring fair value measurements. The guidance is effective for reporting
periods beginning after December 15, 2009. Accordingly, Station adopted the new guidance in the first fiscal quarter of 2010. The adoption of this new guidance did not have a material impact on
Station's consolidated financial statements.

A
variety of proposed or otherwise potential accounting guidance is currently under study by standard-setting organizations and certain regulatory agencies. Because of the tentative and
preliminary

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nature
of such proposed accounting guidance, Station have not yet determined the effect, if any, that the implementation of such proposed accounting guidance would have on Station's consolidated
financial statements.

ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates, foreign currency
exchange rates and commodity prices. Our primary exposure to market risk will be interest rate risk associated with our long-term debt that is expected to bear interest based on floating
rates. The interest on the Propco Credit Agreement, Opco Credit Agreement, GVR Term Loan and Restructured Land Loan, each to be entered into on the Effective Date, is expected to be based on a the
LIBOR rate or base rate (both of which are floating) plus a stated amount. (See Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationStation
Casinos LLCLiquidity and Capital Resources).

Based
upon assumed borrowings of $1.7 billion outstanding under our Propco Credit Agreement, a hypothetical 100 basis point (1%) change in interest rates would result in an annual
interest expense change of up to approximately $17.0 million. Based upon assumed borrowings of $460.7 million outstanding under our Opco Credit Agreement, a hypothetical 100 basis point
(1%) change in interest rates would result in an annual interest expense change of up to approximately $4.6 million. Based upon assumed borrowings of $105.0 million outstanding under the
Restructured Land Loan, a hypothetical 100 basis point (1%) change in interest rates would result in an annual interest expense change of up to approximately $1.0 million. Based upon assumed
borrowings of $275.0 outstanding under the GVR Term Loan, a hypothetical 100 basis point (1%) change in interest rates would result in an annual interest expense change of up to approximately
$27.5 million.

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ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

EXPLANATORY NOTE

Since our formation in August 2010, we have had no operations. We were formed for the purpose of acquiring substantially all of the
assets of Station pursuant to the Plan. In addition, we anticipate acquiring substantially all of the assets of Green Valley Ranch pursuant to the
GVR Asset Purchase Agreement. We expect the Restructuring Transactions to be completed by June 30, 2011, at which time we will acquire the Acquired Casinos. Accordingly, the consolidated
financial statements that follow are for Station.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



PageReport of Independent Registered Public Accounting Firm

70Consolidated Balance Sheets

71Consolidated Statements of Operations

72Consolidated Statements of Stockholders' (Deficit) Equity

73Consolidated Statements of Cash Flows

74Notes to Consolidated Financial Statements

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Report of Independent Registered Public Accounting Firm

To
the Board of Directors and Stockholders of Station Casinos, Inc.:

We
have audited the accompanying consolidated balance sheets of Station Casinos, Inc. and subsidiaries (the "Company") as of December 31, 2010 and 2009, and the related
consolidated statements of operations, stockholders' deficit, and cash flows for each of the three years in the period ended December 31, 2010. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We
conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company's internal control over financial
reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and 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 consolidated financial position of the Company at December 31, 2010 and
2009, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2010, in conformity with U.S. generally accepted accounting
principles.

The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 1, on July 28, 2009,
the Company and certain of its affiliates filed voluntary petitions in the United States Bankruptcy Court for the District of Nevada in Reno, Nevada under chapter 11 of title 11 of the United
States Code. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters also are described in Note 1. The
consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of
liabilities that may result from the outcome of this uncertainty.

/s/
Ernst & Young, LLP

Las
Vegas, Nevada
March 31, 2011

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Table of Contents

STATION CASINOS, INC.        (Debtor and Debtor-In Possession)        CONSOLIDATED BALANCE SHEETS        (amounts in thousands, except per share data)

December 31,2010

2009ASSETSCurrent assets:Cash and cash equivalents

$
165,357

$
185,193Restricted cash


278,329


174,361Receivables, net


24,104


49,878Inventories


7,093


9,794Prepaid gaming tax


15,901


16,293Prepaid expenses and other current assets


18,783


13,903Total current assets


509,567


449,422Property and equipment, net


2,505,763


2,723,683Restricted cash, noncurrent


15,006


Goodwill


124,313


184,699Intangible assets, net (includes Intangible assets of consolidated variable interest entity of $24,000 and $24,000)


272,524


293,235Land held for development


240,836


305,617Investments in joint ventures


5,516


10,489Native American development costs (includes Native American development costs of consolidated variable interest entity of $22,978 and $53,649)


184,975


213,774Other assets, net


95,643


95,913Total assets

$
3,954,143

$
4,276,832LIABILITIES AND STOCKHOLDERS' DEFICITCurrent liabilities:Current portion of long-term debt (includes Current portion of long-term debt of consolidated variable interest entity of $35 and $39)

$
242,366

$
242,347Accounts payable


10,266


14,905Construction contracts payable


516


741Accrued interest payable (includes Accrued interest payable of consolidated variable interest entity of $120 and $0)


22,399


2,341Accrued expenses and other current liabilities


92,268


91,676Total current liabilities


367,815


352,010Long-term debt, less current portion (includes Long-term debt, less current portion, of consolidated variable interest entity of $5,343 and $5,714)


8,659


9,341Deferred income taxes, net


108,551


116,691Investments in joint ventures, deficit


344,767


143,048Other long-term liabilities, net


12,778


7,021Total liabilities not subject to compromise


842,570


628,111Liabilities subject to compromise


5,997,821


5,984,109Total liabilities


6,840,391


6,612,220Commitments and contingenciesStockholders' deficit:Common stock, par value $0.01; authorized 10,000 shares; 41.7 shares issued





Non-voting common stock, par value $0.01; authorized 100,000,000 shares; 41,674,838 shares issued


417


417Additional paid-in capital


2,964,648


2,951,031Accumulated other comprehensive income (loss)


43


(922
)Accumulated deficit


(5,849,683
)

(5,285,914
)Total Station Casinos, Inc. stockholders' deficit


(2,884,575
)

(2,335,388
)Noncontrolling interest


(1,673
)

Total stockholders' deficit


(2,886,248
)

(2,335,388
)Total liabilities and stockholders' deficit

$
3,954,143

$
4,276,832


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

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STATION CASINOS, INC.        (Debtor and Debtor-In Possession)        CONSOLIDATED STATEMENTS OF OPERATIONS        (amounts in thousands)

Year Ended
December 31, 2010

Year Ended
December 31, 2009

Year Ended
December 31, 2008Operating revenues:Casino

$
699,401

$
764,639

$
918,120Food and beverage


163,215


189,917


228,858Room


73,454


82,282


105,718Other


59,086


64,732


73,745Management fees


22,394


52,447


72,405Gross revenues


1,017,550


1,154,017


1,398,846Promotional allowances


(72,595
)

(91,868
)

(100,695
)Net revenues


944,955


1,062,149


1,298,151Operating costs and expenses:Casino


289,168


324,373


361,255Food and beverage


107,311


116,932


153,018Room


32,321


34,182


40,029Other


19,979


20,121


27,774Selling, general and administrative


219,479


229,200


250,614Corporate


34,899


33,018


36,029Development and preopening


16,272


12,014


13,596Depreciation and amortization


153,316


207,180


226,816Impairment of goodwill


60,386


181,785


2,594,992Impairment of other intangible assets


4,704


255,263


327,326Impairment of other assets


196,930


839,813


420,929Write-downs and other charges, net


19,245


20,807


62,6251,154,010


2,274,688


4,515,003Operating loss


(209,055
)

(1,212,539
)

(3,216,852
)(Losses) earnings from joint ventures


(248,495
)

(127,643
)

17,020Gain on dissolution of joint venture


124,193





Operating loss and (losses) earnings from joint ventures


(333,357
)

(1,340,182
)

(3,199,832
)Other (expense) income:Interest expense, net (contractual interest for the years ended December 31, 2010 and December 31, 2009 was $419,853 and $403,673, respectively)


(104,582
)

(276,591
)

(379,313
)Interest and other expense from joint ventures


(66,709
)

(40,802
)

(47,643
)Change in fair value of derivative instruments


(42
)

23,729


(23,057
)Gain (loss) on early retirement of debt





40,348


(171,333
)

(253,316
)

(450,013
)Loss before income taxes and reorganization items


(504,690
)

(1,593,498
)

(3,649,845
)Reorganization items


(82,748
)

(375,888
)

Loss before income taxes


(587,438
)

(1,969,386
)

(3,649,845
)Income tax benefit


21,996


289,872


381,345Net loss


(565,442
)

(1,679,514
)

(3,268,500
)Less: net loss applicable to noncontrolling interest


(1,673
)




Net loss applicable to Station Casinos, Inc. stockholders

$
(563,769
)
$
(1,679,514
)
$
(3,268,500
)


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

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Table of Contents

STATION CASINOS, INC.        (Debtor and Debtor-In-Possession)        CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY        (amounts in
thousands)

Non-voting
common
stock

Additional
paid-in
capital

Accumulated
other
comprehensive
income (loss)

Accumulated
deficit

Total
stockholders'
(deficit)
equity

Noncontrolling
interest

Total Station
Casinos, Inc.
stockholders'
(deficit)
equityBalances, December 31, 2007

$
417

$
2,920,526

$
(11,981
)
$
(337,900
)
$
2,571,062

$



2,571,062Share-based compensation expense





14,445








14,445





14,445Purchase price adjustment





1,978








1,978





1,978Interest rate swap market value adjustment, net of tax








(1,937
)




(1,937
)




(1,937
)Unrealized loss on available-for-sale securities, net of tax








(695
)




(695
)




(695
)Amortization of unrecognized pension and postretirement benefit plan liabilities, net of tax








6,323





6,323





6,323Net loss











(3,268,500
)

(3,268,500
)




(3,268,500
)Balances, December 31, 2008

$
417

$
2,936,949

$
(8,290
)
$
(3,606,400
)
$
(677,324
)
$


$
(677,324
)Share-based compensation expense





14,082








14,082





14,082Interest rate swap market value adjustment, net of tax








6,429





6,429





6,429Unrealized gain on available-for-sale securities, net of tax








123





123





123Amortization of unrecognized pension and postretirement benefit plan liabilities, net of tax








816





816





816Net loss











(1,679,514
)

(1,679,514
)




(1,679,514
)Balances, December 31, 2009

$
417

$
2,951,031

$
(922
)
$
(5,285,914
)
$
(2,335,388
)
$


$
(2,335,388
)Share-based compensation expense





13,617








13,617





13,617Interest rate swap market value adjustment, net of tax








1,985





1,985





1,985Unrealized loss on available-for-sale securities, net of tax








(80
)




(80
)




(80
)Amortization of unrecognized pension and postretirement benefit plan liabilities, net of tax








(940
)




(940
)




(940
)Net loss











(565,442
)

(565,442
)

(1,673
)

(563,769
)Balances, December 31, 2010

$
417

$
2,964,648

$
43

$
(5,851,356
)
$
(2,886,248
)
$
(1,673
)
$
(2,884,575
)


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

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STATION CASINOS, INC.        (Debtor and Debtor-In-Possession)        CONSOLIDATED STATEMENTS OF CASH FLOWS        (amounts in thousands)

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Cash flows from operating activities:Net loss

$
(565,442
)
$
(1,679,514
)
$
(3,268,500
)Adjustments to reconcile net loss to net cash provided by operating activities:Depreciation and amortization


153,316


207,180


226,816Change in fair value of derivative instruments


42


(23,729
)

23,057Impairment of goodwill


60,386


181,785


2,594,992Impairment of other intangible assets


4,704


255,263


327,326Impairment of other assets


196,930


839,813


420,929Write-downs and other charges, net


19,245


20,807


62,625Share-based compensation


13,381


14,083


14,445Loss from joint ventures


315,203


168,445


30,623Gain on dissolution of joint ventures


(124,193
)




Amortization of debt discount and issuance costs


1,955


23,272


37,761Gain on early retirement of debt





(40,348
)

Reorganization items


82,748


375,888


Changes in assets and liabilities:Restricted cash


(118,974
)

(159,400
)

(13,995
)Receivables, net


25,774


(5,776
)

6,409Inventories and prepaid expenses


4,523


6,793


1,677Due from unconsolidated affiliate





(250
)

(5,011
)Deferred income taxes


(17,262
)

(285,376
)

(384,128
)Accounts payable


(4,645
)

1,395


(2,968
)Accrued interest


21,348


83,955


(8,074
)Accrued expenses and other current liabilities


698


(31,369
)

(11,368
)Other, net


8,507


(19,819
)

(1,394
)Total adjustments


643,686


1,612,612


3,319,722Net cash provided by (used in) operating activities before reorganization items


78,244


(66,902
)

51,222Net cash used for reorganization items


(82,808
)

(59,775
)

Net cash (used in) provided by operating activities


(4,564
)

(126,677
)

51,222Cash flows from investing activities:Capital expenditures


(34,530
)

(64,594
)

(172,051
)Proceeds from sale of land, property and equipment


871


636


2,368Investments in joint ventures, net


(3,509
)

(24,343
)

(57,752
)Distributions in excess of earnings from joint ventures


6,112


2,118


2,855Construction contracts payable


(225
)

(8,687
)

(13,723
)Native American development costs


(16,007
)

(19,337
)

(14,876
)Proceeds from repayment of Native American development costs


42,806





Other, net


(10,487
)

(16,073
)

(11,070
)Net cash used in investing activities


(14,969
)

(130,280
)

(264,249
)


74

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Table of Contents

STATION CASINOS, INC.

(Debtor and Debtor-In-Possession)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(amounts in thousands)

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Cash flows from financing activities:Borrowings under Credit Agreement with maturity dates less than three months, net








335,137Proceeds from the issuance of Land Loan








250,000Borrowings under Term Loan with maturity dates greater than three months


2,870





Payments on land loan





(7,968
)

Payments under Term Loan with maturity dates greater than three months


(2,500
)

(2,500
)

(2,500
)Redemption of senior subordinated notes





(1,460
)

Debt issuance costs





(460
)

(7,638
)Other, net


(673
)

(3,526
)

(300
)Net cash (used in) provided by financing activities


(303
)

(15,914
)

574,699Cash and cash equivalents:(Decrease) increase in cash and cash equivalents


(19,836
)

(272,871
)

361,672Balance, beginning of year


185,193


458,064


96,392Balance, end of year

$
165,357

$
185,193

$
458,064Supplemental cash flow disclosures:Cash paid for interest, net of $10,078, $15,989 and $27,087 capitalized

$
77,016

$
166,211

$
345,920Supplemental disclosure of non-cash items:Capital expenditures financed by debt

$


$


$
4,514Debt settlement in land sale

$


$
4,000

$



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

75

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Table of Contents

STATION CASINOS, INC.        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Summary of Significant Accounting Policies and Basis of Presentation



Station Casinos, Inc. (the "Company", "Station", "we", "our", "ours" or "us"), a Nevada corporation, is a gaming and
entertainment company that currently owns and operates ten major hotel/casino properties (two of which are 50% owned) under the Station and Fiesta brand names and eight smaller casino properties
(three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. The accompanying consolidated financial statements include the
accounts of Station and its wholly owned subsidiaries and MPM Enterprises, LLC (which is 50% owned by Station and required to be consolidated). Investments in all other 50% or less owned
affiliated companies are accounted for under the equity method. All significant intercompany accounts and transactions have been eliminated.



On November 7, 2007, the Company completed a going private transaction that was sponsored by Frank J. Fertitta III
and Lorenzo J. Fertitta and certain affiliates of Colony Capital, LLC ("Colony") (such going private transaction is referred to herein as, the "Merger"). In connection with the Merger,
the Company's subsidiary, FCP PropCo, LLC ("Propco"), and certain other subsidiaries of the Company that directly or indirectly own interests in Propco (the "Propco Debtors") entered into a
mortgage loan and related mezzanine financings in an aggregate principal amount of $2.475 billion (the "CMBS Loans"). The CMBS Loans were secured by substantially all fee and leasehold real
property comprising Palace Station, Boulder Station, Sunset Station and Red Rock (collectively, the "Propco Properties"). In addition, the Company, as borrower, entered into a $900 million
senior secured credit agreement (the "Credit Agreement") which was secured by substantially all of the assets of the Company and its subsidiaries, other than Propco and the Propco Debtors. The
Company's $450 million 6% senior notes due April 1, 2012, $400 million 73/4% senior notes due August 15, 2016, $450 million 61/2%
senior subordinated notes due February 1, 2014, $700 million 67/8% senior subordinated notes due March 1, 2016 and $300 million 65/8% senior
subordinated notes due March 15, 2018 (collectively, "Senior and Senior Subordinated Notes") remained outstanding following consummation of the Merger. On February 7, 2008, a wholly
owned, indirect subsidiary of the Company ("Landco"), as borrower, entered into a $250 million delay-draw term loan collateralized by land located on the southern end of
Las Vegas Boulevard at Cactus Avenue and land surrounding Wild Wild West in Las Vegas, Nevada (the "Land Loan").

The
Merger and related transactions left the Company highly leveraged. Shortly thereafter, the economy in the United States sharply declined, consumer spending deteriorated and the
credit markets severely contracted. Foreclosure and unemployment rates in Nevada sharply increased, becoming among the highest in the United States, and many planned construction projects for new
casinos in Nevada were delayed or cancelled, causing further deterioration of the Las Vegas economy and reduced discretionary consumer spending by Las Vegas residents. The Company was
severely impacted by the economic downturn due to the fact all of its owned casinos are located in Las Vegas and its properties have historically attracted customers from the Las Vegas
valley. In addition, the value of real estate in Nevada significantly eroded as a result of the deterioration of the economy.

Due
to the economic conditions following the Merger, including the credit crisis and a decrease in consumer confidence levels, the Company experienced a significant reduction in
revenues. Although the Company engaged in cost reductions, reductions in workforce and other efforts to mitigate the impact of the decline in revenues, the results of operations of the Company were
materially and adversely impacted

76

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Table of Contents

STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies and Basis of Presentation (Continued)

by
the economic downturn and its ability to service its debt obligations was impaired. In addition, the decline in real estate values in Nevada adversely affected the value of the Company's assets.
The resulting deterioration of the Company's results of operations and asset values, coupled with the
Company's high leverage and the general unavailability of credit, negatively impacted the Company's ability to service its outstanding indebtedness or otherwise raise capital for restructuring.

As
a result, on July 28, 2009, STN and its affiliates FCP Holding Inc., FCP VoteCo, LLC, Fertitta Partners, LLC, FCP MezzCo Parent, LLC, FCP MezzCo
Parent Sub, LLC, FCP MezzCo Borrower VII, LLC, FCP MezzCo Borrower VI, LLC, FCP MezzCo Borrower V, LLC, FCP MezzCo Borrower IV, LLC, FCP
MezzCo Borrower III, LLC, FCP MezzCo Borrower II, LLC, FCP MezzCo Borrower I, LLC, FCP PropCo, LLC, Northern NV Acquisitions, LLC,
Tropicana Station, LLC, River Central, LLC and Reno Land Holdings, LLC (collectively, the "Debtors") filed voluntary petitions in the United States Bankruptcy Court for the
District of Nevada in Reno, Nevada (the "Bankruptcy Court") under Chapter 11 of the Bankruptcy Code. These cases are being jointly administered under the caption In re Station
Casinos, Inc., et al Debtors Case No. 09-52470 (the "Chapter 11 Case").



On August 27, 2010, the Bankruptcy Court entered an order confirming the Debtors' joint plan of reorganization (the "Plan").
Under the Plan, Station Casinos LLC ("New Station"), a designee of German American Capital Corporation and JP Morgan Chase Bank, N.A., as holders of $1.8 billion in CMBS Loans (the
"Mortgage Lenders"), is expected to acquire the Propco Properties and certain related assets in satisfaction of the Mortgage Lenders' existing secured claims against Propco. In conjunction with these
transfers to the Company, under the Plan: (i) New Station's voting units are expected to be issued to Station Voteco LLC, which is expected to be owned by designees of the Mortgage
Lenders and an entity owned by Frank J. Fertitta III, our Chief Executive Officer, President and a member of our Board of Directors, and Lorenzo J. Fertitta, a member of our Board of
Directors, (ii) New Station's non-voting units are expected to be issued to Station Holdco LLC ("Station Holdco"), which is expected to be owned by the Mortgage Lenders,
FI Station Investor LLC, a newly formed limited liability company owned by affiliates of Frank J. Fertitta III and Lorenzo J. Fertitta ("FI Station
Investor"), and the holders of the Senior and Senior Subordinated Notes; and (iii) New Station is expected to enter into a new credit agreement (the "Propco Credit Agreement") with the Mortgage
Lenders consisting of a term loan facility in the principal amount of $1.6 billion and a revolving credit facility in the amount of $100 million, which revolving credit facility will
increase to $150 million upon the prepayment of $50 million of outstanding principal amount under the term loan (the transactions described in clauses (i) through (iii)
collectively referred to herein as, the "Propco Restructuring").

In
addition, Station Holdco will issue two classes of warrants to the Mortgage Lenders permitting the Mortgage Lenders to purchase a total of 5% of the non-voting equity of
Station Holdco at exercise prices based upon a multiple of the share value of Station Holdco on the Effective Date (as defined herein) of the Plan (the "Mortgage Lender Warrants"). The Mortgage
Lenders will sell to FI Station Investor one of the classes of warrants with the right to purchase up to 2.5% of the non-voting equity (the "Fertitta Warrants") and will transfer
the remaining 2.5% of the Mortgage Lender Warrants to holders of the mezzanine portion of the CMBS Loans. On or about the Effective Date, FI Station Investor is expected to assign the Fertitta
Warrants to an affiliate of Colony. The Mortgage Lender Warrants will have a per unit exercise price equal to two and one-half times the value of the non-voting units on the
Effective Date that will increase by 15% on each of the third through seventh anniversaries of the Effective Date. The Fertitta

77

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Table of Contents

STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies and Basis of Presentation (Continued)

Warrants
will have a per unit exercise price equal to three times the value of the non-voting units on the Effective Date that will increase by 15% on each of the third through seventh
anniversaries of the Effective Date. For purposes of determining the exercise price of the Mortgage Lender Warrants and the Fertitta Warrants, the per unit value of the non-voting units
will be determined based on a total equity value of Station Holdco equal to $200 million, plus the amount of any additional equity issued or capital contributions made as of the Effective Date,
plus the amount of any reduction in the debt agreed to by the Mortgage Lenders in exchange for Station Holdco equity (the "Plan Value"). The Mortgage Lender Warrants and the Fertitta Warrants may only
be exercised following the earlier of (i) the six and one-half year anniversary of the Effective Date and (ii) the occurrence of a capital raising transaction by Station
Holdco that involves a determination of the equity value of Station Holdco (other than the transactions contemplated by the Plan) and expire on the seventh anniversary of the Effective Date.

In
addition, pursuant to the terms of the Plan, the Company and certain of its subsidiaries have entered into an Asset Purchase Agreement dated as of June 7, 2010, as amended (the
"Asset Purchase Agreement") with FG Opco Acquisitions LLC, an entity that is currently owned in whole or in part by Fertitta Entertainment LLC, which is owned by affiliates of
Frank J. Fertitta III and Lorenzo J. Fertitta ("Fertitta Entertainment"), and the Mortgage Lenders and will be owned by the New Station upon consummation of the transactions contemplated
by the Asset Purchase Agreement (the "Opco Purchaser"). Pursuant to the terms of the Asset Purchase Agreement, the Opco Purchaser will acquire substantially all of the assets of the Company and
certain of its subsidiaries, including Santa Fe Station, Texas Station, Fiesta Henderson, Fiesta Rancho and interests in certain Native American gaming projects (the "Opco Assets"), for a purchase
price of $772 million, consisting of the following: (i) an amount in cash equal to $317 million, subject to adjustment pursuant to the terms of the Asset Purchase Agreement; and
(ii) $455 million in aggregate principal amount of term loans, subject to adjustment pursuant to the terms of the Asset Purchase Agreement (together with a $25 million revolving
credit facility, the "Opco Credit Agreement") (the transactions described in this paragraph, collectively referred to herein as the "Opco Acquisition"). The lenders under the Opco Credit Agreement
will be the same lenders as under Station's existing Credit Agreement.

Pursuant
to the terms of the Plan, the proceeds of the sale of the Opco Assets will be distributed to secured creditors of STN in full satisfaction of their claims against Station. The
Plan also provides that certain general unsecured creditors of STN ("Opco Unsecured Creditors") will receive warrants (the
"Unsecured Creditor Warrants") exercisable for 2.5% of the total equity of Station Holdco. The Unsecured Creditor Warrants will have a per unit exercise price equal to two and one-half
times the value of the non-voting units on the Effective Date that will increase by 15% on each of the third through seventh anniversaries of the Effective Date. For purposes of
determining the exercise price of the Unsecured Creditor Warrants, the per unit value of the non-voting units will be determined based on the Plan Value. The Unsecured Creditor Warrants
may only be exercised following the earlier of (i) the six and one-half year anniversary of the Effective Date and (ii) the occurrence of a capital raising transaction by
Station Holdco that involves a determination of the equity value of Station Holdco (other than the transactions contemplated by the Plan), and expire on the seventh anniversary of the Effective Date.

In
addition, Opco Unsecured Creditors that are "accredited investors" (as defined in the Securities Act of 1933, as amended) will have an opportunity to participate in a rights offering
("Rights Offering") under which they may subscribe for and purchase their pro rata share of 15% of the equity interests of Station Holdco for an aggregate amount of $35.3 million. The Rights
Offering may be increased to fund (i) the payment of $50 million pay-down under the Propco Credit Agreement, (ii) a portion of the Opco

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Acquisition
and (iii) the acquisition of Green Valley Ranch, Aliante Station, or any other material gaming operations located with a 100-mile radius of Las Vegas, provided
that the aggregate purchase price payable for additional units so offered in the Rights Offering will not exceed $64.7 million. Certain affiliates of Fidelity Management & Research
Company, Oaktree Capital Management, L.P. and Serengeti Asset Management, LP (the "Put Parties") will purchase at least one-half of the equity interests of Station Holdco
offered pursuant to the Rights Offering and have committed to purchase the remainder of the equity interests of Station Holdco offered pursuant to the Rights Offering on or before June 30,
2011, to the extent that such equity interests are not purchased by other Opco Unsecured Creditors (the "Equity Put"). In consideration for their agreement to purchase equity interests that are not
purchased by other Opco Unsecured Creditors, the Put Parties will receive a $3 million cash payment on the Effective Date and reimbursement of expenses in an amount of up to
$1.7 million.

Claimants
with respect to the Land Loan are expected to enter into an amended and restated credit agreement related to the Land Loan (the "Restructured Land Loan"). Pursuant to the terms
of the Restructured Land Loan, the principal outstanding is expected to be reduced to $105 million in exchange for warrants to purchase 60% of the outstanding equity interests of Landco
exercisable for nominal consideration (the "Landco Warrants" and together with the Mortgage Lender Warrants, the Fertitta Warrants and the Unsecured Creditor Warrants, the "Warrants").

On
March 9, 2011, Station GVR Acquisition, LLC (the "GVR Purchaser"), an indirect subsidiary of New Station, and Green Valley Ranch Gaming, LLC (the "GVR Seller")
entered into an Asset Purchase Agreement (the "GVR Asset Purchase Agreement"), pursuant to which the GVR Purchaser will purchase substantially all of the assets and assume certain specified
liabilities of the GVR Seller for $500 million through a prepackaged plan of reorganization (the "GVR Acquisition"). The consummation of the transactions contemplated by the GVR Asset Purchase
Agreement is subject to,
among other things, the bankruptcy court entering a confirmation order confirming the chapter 11 plan of reorganization of the GVR Seller.

On
March 22, 2011, the subsidiaries of the Company that are sellers under the Asset Purchase Agreement and the Company's 50%-owned joint ventures the GVR Seller and Aliante
Gaming, LLC ("Aliante") commenced a solicitation of approvals for a prepackaged plan of reorganization (the "Subsidiary Plan") to implement and facilitate the sale and related restructuring
transactions described in the Asset Purchase Agreement, the GVR Asset Purchase Agreement and a reorganization of Aliante, pursuant to which its lenders would receive the equity of Aliante and
$45 million in secured loans in exchange for their claims. We expect that the Chapter 11 cases for such subsidiaries (the "Subsidiary Chapter 11 Cases") will be filed in the
second quarter of 2011.

Following
consummation of the Plan it is expected that New Station and its subsidiaries will enter into long-term management contracts with affiliates of Fertitta
Entertainment to manage the Propco Properties and the Opco Assets (the "Management Agreements"). The Propco Restructuring, the Opco Acquisition, the GVR Acquisition, the issuance of the Warrants, the
Rights Offering, the Equity Put, entry into the Management Agreements and the Restructured Land Loan are referred to herein collectively as the "Restructuring Transactions."

Although
the Plan was confirmed by the Bankruptcy Court on August 27, 2010, consummation of the Plan is subject to the satisfaction of certain conditions precedent, including
among other things, (i) the Bankruptcy Court shall have authorized the assumption and rejection of certain contracts of the Debtors, (ii) all documents necessary to implement the
Restructuring Transactions contemplated by the Plan,

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including
but not limited to the equityholders agreement to be entered into upon emergence from bankruptcy among the Company, its equityholders and its subsidiaries (the "Equityholders Agreement"),
the Opco Credit Agreement, the Propco Credit Agreement, the Restructured Land Loan and the Warrants, shall be in form and substance reasonably acceptable to the Debtors, and (iii) all necessary
regulatory approvals, including but not limited to necessary approvals of the Nevada Gaming Authorities (as defined herein), will have been obtained (the date upon which the actions described in
clauses (i) through (iii) are completed is referred to herein as the "Effective Date"). The Company currently expects that the Effective Date will occur by June 30, 2011, although the
Company cannot assure you that the required regulatory approvals will be obtained, that conditions to consummation of the Plan will be satisfied by that date, or at all, or that the Company will be
successful in implementing the Plan in the form contemplated, or at all.

This
report is not intended to be, and should not in any way be construed as, a solicitation of votes on the Subsidiary Plan. There can be no assurance that a sufficient percentage or
number of lenders will accept the Subsidiary Plan or that the Bankruptcy Court will confirm such plan. In addition, if the Subsidiary Plan is not accepted, confirmed or consummated, there can be no
assurance that the Company will be able to successfully develop, prosecute, confirm and consummate a plan of
reorganization that is acceptable to the Bankruptcy Court and to the creditors, equity holders and other parties in interest of the GVR Seller and Aliante.

Following
the consummation of the Plan, the Company and certain of the other Debtors will be dissolved and, except to the extent set forth in the Plan, none of New Station, Fertitta
Entertainment, FI Station Investor nor any of their respective affiliates will succeed to the assets or liabilities of the Company or the other Debtors.

This
report is not intended to be, and should not in any way be construed as, a solicitation of votes on the Plan. The Plan and the Disclosure Statement have been filed with the
Bankruptcy Court and were filed with the Securities and Exchange Commission by the Company on its Current Report on Form 8-K dated July 28, 2010, which is publicly available
at http://www.sec.gov. The Company concluded its solicitation of acceptance of the Plan and received its confirmation from the Bankruptcy Court on August 27, 2010. Although the Plan was
confirmed by the Bankruptcy Court on August 27, 2010, there can be no assurance that the transactions contemplated by the Asset Purchase Agreement or the Plan will be consummated.

The
Debtors continue to conduct their businesses as debtors-in-possession under the jurisdiction of the Bankruptcy Court and in accordance with applicable
provisions of the Bankruptcy Code and the orders of the Bankruptcy Court.



Accounting Standards Codification ("ASC") Topic 852,Reorganizations("ASC
Topic 852") provides accounting guidance for financial reporting by entities in reorganization under the Bankruptcy Code including companies in chapter 11, and generally does not change
the manner in which financial statements are prepared. The consolidated financial statements have been prepared on a going-concern basis, which assumes continuity of operations, realization of assets
and satisfaction of liabilities in the ordinary course of business. The Chapter 11 Cases create substantial doubt about Station's ability to continue as a going concern. The accompanying
consolidated financial statements do not reflect any adjustments relating to the recoverability of assets and the classification of liabilities that might result from the outcome of these
uncertainties. In addition, the plan of reorganization could materially change the

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amounts
and classifications reported in the consolidated financial statements, and the accompanying consolidated financial statements do not give effect to any adjustments to the carrying values of
assets
or amounts of liabilities that might be necessary as a consequence of confirmation of the plan of reorganization.

Station's
ability to continue as a going concern is contingent upon, among other things, its ability to (i) generate sufficient cash flow from operations; and (ii) obtain
confirmation of a plan of reorganization under the Bankruptcy Code. In the event Station's restructuring activities are not successful and it is required to liquidate, the Company will be required to
adopt the liquidation basis of accounting. Under the liquidation basis of accounting, assets are stated at their estimated net realizable values and liabilities are stated at their estimated
settlement amounts.

ASC
Topic 852 requires that the financial statements for periods subsequent to the filing of the Chapter 11 Case distinguish transactions and events that are directly
associated with the reorganization from the ongoing operations of the business. As a result, revenues, expenses, realized gains and losses, and provisions for losses that can be directly associated
with the reorganization and restructuring of the business were reported separately as reorganization items in the statements of operations beginning in the quarter ended September 30, 2009. ASC
Topic 852 also requires that the balance sheet distinguish pre-petition liabilities subject to compromise from both those pre-petition liabilities that are not subject
to compromise and from post-petition liabilities, and requires that cash used for reorganization items be disclosed separately in the statement of cash flows. Station adopted ASC
Topic 852 on July 28, 2009 and has segregated those items as outlined above for all reporting periods subsequent to such date.



As a result of the filing of the Chapter 11 Cases, Station is now periodically required to file various documents with (and
provide certain information to) the Bankruptcy Court, including statements of financial affairs, schedules of assets and liabilities, and monthly operating reports in forms prescribed by federal
bankruptcy law, as well as certain financial information on an unconsolidated basis. Such materials will be prepared according to requirements of federal bankruptcy law. While they accurately provide
then-current information required under federal bankruptcy law, they are nonetheless unconsolidated, unaudited, and prepared in a format different from that used in Station's financial
statements filed under the securities laws. Accordingly, we believe that the substance and format do not allow meaningful comparison with our regular publicly disclosed financial statements. Moreover,
the materials filed with the Bankruptcy Court are not prepared for the purpose of providing a basis for an investment decision relating to Station's securities, or for comparison with other financial
information filed with the Securities and Exchange Commission.



In connection with the filing of the Chapter 11 Case, on July 31, 2009, the Company entered into a $150 million
unsecured, subordinated administrative priority debtor in possession credit agreement (the "DIP Credit Agreement") among the Company, as borrower, Vista Holdings, LLC (a non-debtor
subsidiary of the Company) as administrative agent (the "Administrative Agent") and lender, and the lenders party thereto. The DIP Credit Agreement provided for a $150 million revolving credit
facility to be funded on a committed basis for so long as Vista Holdings, LLC had cash and cash equivalents on hand in an amount in excess of $100 million. During the three months ended
March 31, 2010, the DIP Credit

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Agreement
was amended to increase the facility to $185 million. The proceeds of the loans incurred under the DIP Credit Agreement were used for working capital and other general corporate
purposes of the Company and were be available for intercompany loans to its subsidiaries during the pendency of the Chapter 11 Case. The DIP Credit Agreement matured on August 10, 2010,
and at December 31, 2010 $172 million in advances remained outstanding under the DIP Credit Agreement.

The
Company's obligations under the DIP Credit Agreement are an administrative expense claim in the Chapter 11 Case havingpari
passupriority with other administrative expense claims, provided that repayment of the loan by the Company shall be subordinate to the full repayment of the lenders under the
Company's prepetition Credit Agreement.

The
Company's obligations under the DIP Credit Agreement may be accelerated following certain events of default, including (without limitation) the conversion of any of the
Chapter 11 Case to a case under chapter 7 of the Bankruptcy Code or the appointment of a trustee pursuant to chapter 11 of the Bankruptcy Code.

Also,
in connection with the filing of the Chapter 11 Case, on July 31, 2009, the Company entered into an Unsecured Revolving Loan Promissory Note in favor of Past
Enterprises, Inc. (a non-debtor subsidiary of the Company), pursuant to which Past Enterprises provides to the Company an unlimited revolving credit facility (the "Past Revolving
Loan") at an interest rate of 2.78% per annum, the proceeds of which will be used for working capital and other general corporate purposes of the Company and will be available for intercompany loans
to its subsidiaries. We still have the ability to borrow under the Past Revolving Loan, and there is no limit on the Company's borrowings under the Past Revolving Loan.

The
Past Revolving Loan matures on the earlier of (i) demand, or (ii) July 31, 2011, and provides for a default rate of interest of 4.78% if principal or interest due
thereunder is not paid when due. At
December 31, 2010, the outstanding balance due under the Past Revolving Loan totaled $289.3 million. In July 2010, SC Michigan, LLC and MPM Enterprises, LLC received
approximately $42.8 million representing a partial repayment of advances on the Gun Lake project. SC Michigan, LLC, a wholly owned subsidiary of Station, received $39.3 million of
the $42.8 million and used all of these funds to purchase funded debtor-in-possession loans made to the Company by Past Enterprises (the "SC Michigan Revolving Loan"). At December 31,
2010, the outstanding principal balance due under the SC Michigan Revolving Loan totaled $39.3 million.

The
Company's obligations under the Past Revolving Loan and the SC Michigan Revolving Loan will be administrative expense claims in the Chapter 11 Case having pari passupriority with other
administrative expense claims, provided that repayment of the loan by the Company shall be subordinate to the full
repayment of the lenders under the Company's prepetition Credit Agreement.



On November 7, 2007, the Company completed the Merger with FCP Acquisition Sub, a Nevada corporation ("Merger Sub"), pursuant to
which Merger Sub merged with and into the Company with the Company continuing as the surviving corporation. The Merger was completed pursuant to the Agreement and Plan of Merger (the "Merger
Agreement"), dated as of February 23, 2007 and amended as of May 4, 2007, among the Company, Fertitta Colony Partners LLC, a Nevada limited liability company ("FCP"), and Merger
Sub.

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As
a result of the Merger, 24.1% of the issued and outstanding shares of non-voting common stock of the Company are owned by Fertitta Partners LLC, a Nevada limited
liability company ("Fertitta Partners"), which is owned by affiliates of Frank J. Fertitta III, Chairman, Chief Executive Officer and President of Station, affiliates of
Lorenzo J. Fertitta, Vice Chairman of Station, affiliates of Blake L. Sartini and Delise F. Sartini, and certain officers and other members of management of the Company. The
remaining 75.9% of the issued and outstanding shares of non-voting common stock of the Company are owned by FCP Holding, Inc., a Nevada corporation ("FCP HoldCo") and a wholly-owned
subsidiary of FCP. FCP is owned by an affiliate of Colony Capital, LLC ("Colony"), affiliates of Frank J. Fertitta III and Lorenzo J. Fertitta and certain officers and
other members of management. Substantially simultaneously with the consummation of the Merger, shares of voting common stock of Station were issued for nominal consideration to FCP VoteCo LLC,
a Nevada limited liability company ("FCP VoteCo"), which is owned equally by Frank J. Fertitta III, Lorenzo J. Fertitta and Thomas J. Barrack, Jr., the Chairman and
Chief Executive Officer of Colony.

At
the effective time of the Merger, each outstanding share of our common stock, including any rights associated therewith (other than shares of our common stock owned by FCP, Merger
Sub, FCP HoldCo, Fertitta Partners or any wholly-owned subsidiary of the Company or shares of our common stock held in treasury by us) was cancelled and converted into the right to receive $90 in
cash, without interest. Following the consummation of the Merger, the Company is privately owned through FCP HoldCo, Fertitta Partners and FCP VoteCo. Station common stock ceased trading on the New
York Stock Exchange at market close on November 7, 2007, and is no longer listed on any exchange or quotation system. The Company's voting common stock is registered pursuant to
Section 12(g) of the Securities Exchange Act of 1934, as amended.

The
Merger resulted in a greater than 50% control of the Company and was a "business combination" for accounting purposes, requiring FCP, Fertitta Partners, FCP VoteCo and their
respective owners (the "Investors"), pursuant to the accounting guidance for business combinations, to record the acquired assets and assumed liabilities at their fair market values as of the
acquisition date, resulting in a new basis of accounting. As a result of the Securities and Exchange Commission's rules and guidance regarding "push-down" accounting, the Investors' new
accounting basis in our assets and liabilities is reflected in our consolidated financial statements to the extent that the Investors paid cash for the non-voting common stock of the
Company as of the consummation of the Merger. Management has deemed it impracticable to determine the individual investors' carryover basis in the shares and has accordingly computed the carryover
basis based on the pro rata portion of book value of Station prior to the Merger. For accounting periods subsequent to the Merger, the consolidated financial statements reflect the push down of the
Investors' new basis of accounting.



The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States
requires management to make estimates and assumptions for items such as slot club program liability, self-insurance reserves, bad debt reserves, estimated useful lives assigned to our
assets, asset impairment, derivative instruments, purchase price allocations made in connection with acquisitions and the calculation of the income tax liabilities, that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual
results may differ from those estimates.

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Cash and cash equivalents include cash on hand at our properties, as well as investments purchased with an original maturity of
90 days or less. As a result of the Chapter 11 Case, the Bankruptcy Court has imposed certain limitations on the use of the Debtors' cash and cash equivalents.



Restricted cash includes cash reserves required in connection with the Company's financing transactions, treasury management
activities, the CMBS Loans, letter of credit collateralization and regulatory reserves for race and sports book operations, and restrictions placed on our cash by the Bankruptcy Court.



Receivables, net consist primarily of casino, hotel and other receivables, which are typically non-interest bearing.
Receivables are initially recorded at cost, and an allowance for doubtful accounts is maintained to reduce receivables to their carrying amount, which approximates fair value. The allowance is
estimated based on a specific review of customer accounts, historical collection experience, the age of the receivable and other relevant factors. Accounts are written off when management deems the
account to be uncollectible, and recoveries of accounts previously written off are recorded when received. Management does not believe that any significant concentrations of credit risk existed as of
December 31, 2010.



Inventories are stated at the lower of cost or market. Cost is determined on a weighted-average basis.



The carrying value of our cash and cash equivalents, restricted cash, receivables and accounts payable approximates fair value
primarily because of the short maturities of these instruments. For debt with short-term maturities, the fair value approximates the carrying amount. The fair value of our publicly traded
debt securities is based on quoted market prices on or about December 31, 2010, however since all of these debt securities are classified as liabilities subject to compromise as a result of the
Chapter 11 Case, they are carried at the expected amount of the allowed claims, which approximates the face value of the securities.



Property and equipment are initially recorded at cost. Depreciation and amortization are computed using the straight-line
method over the estimated useful lives of the assets or the term of the capitalized lease, whichever is less. Costs of major improvements are capitalized, while costs of normal repairs and maintenance
are charged to expense as incurred.

We
must make estimates and assumptions when accounting for capital expenditures. Whether an expenditure is considered a maintenance expense or a capital asset is a matter of judgment. We
classify items as maintenance capital to differentiate replacement type capital expenditures such as a new slot

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machine
from investment type capital expenditures to drive future growth such as an expansion of an existing property. In contrast to normal repair and maintenance costs that are expensed when
incurred, items we classify as maintenance capital are expenditures necessary to keep our existing properties at their current levels and are typically replacement items due to the normal wear and
tear of our properties and equipment as a result of use and age. Our depreciation expense is highly dependent on the assumptions we make about our assets' estimated useful lives. We determine the
estimated useful lives based on our experience with similar assets, engineering studies and our estimate of the usage of
the asset. Whenever events or circumstances occur which change the estimated useful life of an asset, we account for the change prospectively.



We evaluate our property and equipment and other long-lived assets for impairment in accordance with the accounting
guidance in the Impairment or Disposal of Long-Lived Assets Subsections of ASC 360-10. For assets to be held and used, we review fixed assets for impairment whenever
indicators of impairment exist. If an indicator of impairment exists, we compare the estimated future cash flows of the asset, on an undiscounted basis, to the carrying value of the asset. If the
undiscounted cash flows exceed the carrying value, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying value, impairment is measured based on fair value compared to
carrying value, with fair value typically based on a discounted cash flow model or market comparables, when available. For assets to be disposed of, we recognize the asset to be sold at the lower of
carrying value or fair value less costs of disposal. Fair value for assets to be disposed of is generally estimated based on comparable asset sales, solicited offers or a discounted cash flow model.
As of December 31, 2010 and 2009, our consolidated financial statements reflect all adjustments required under the guidance for accounting for the impairment or disposal of
long-lived assets.

See
Notes 4, 6, 7 and 15 for discussions of impairment charges recorded during the years ended December 31, 2010, 2009 and 2008 related to property and equipment and other
long-lived assets.



We capitalize interest costs associated with debt incurred in connection with major construction projects. Interest capitalization
ceases once the project is substantially complete or no longer undergoing construction activities to prepare it for its intended use. When no debt is specifically identified as being incurred in
connection with such construction projects, we capitalize interest on amounts expended on the project at our weighted average cost of borrowings. Interest capitalized was approximately
$10.1 million, $16.0 million, and $27.1 million, for the years ended December 31, 2010, 2009, and 2008, respectively.



We account for goodwill and other intangible assets in accordance with ASC Topic 350, IntangiblesGoodwill and Other("ASC
Topic 350"). See Note 5 for a discussion of impairment charges recorded for the years
ended December 31, 2010, 2009 and 2008 related to goodwill and intangible assets.

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We test our goodwill and indefinite-lived intangible assets for impairment annually during the fourth quarter of each year, and
whenever events or circumstances make it more likely than not that an impairment may have occurred. Impairment testing for goodwill is performed at the reporting unit level, and each of our 100% owned
casino properties is considered to be a reporting unit. Our annual goodwill impairment testing utilizes a two step process. In the first step, we compare the fair value of each reporting unit with its
carrying amount, including goodwill.. If the fair value of the reporting unit exceeds its carrying amount, then goodwill of the reporting unit is not considered impaired. If the carrying value of the
reporting unit exceeds its fair value, then the goodwill of the reporting unit is considered to be impaired, and we proceed to the second step of the goodwill impairment test. In the second step, we
determine the implied fair value of the reporting unit's goodwill by allocating the fair value of the reporting unit determined in step one to the assets and liabilities of the reporting unit, as if
the reporting unit had been acquired in a business combination. If the carrying value of the reporting unit's goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized
in an amount equal to that excess.



Our indefinite-lived intangible assets include brands and certain license rights. The fair value of brands is estimated using a
derivation of the income approach to valuation, based on estimated royalties saved through ownership of the assets. The fair value of license rights is estimated using market indications of fair
value. We test our indefinite-lived intangible assets for impairment annually during the fourth quarter of each year, and whenever events or circumstances make it more likely than not that an
impairment may have occurred. Our annual impairment test of indefinite-lived intangible assets consists of a comparison of the estimated fair value of the intangible asset with its carrying amount. If
the carrying amount of the intangible asset exceeds its estimated fair value, an impairment loss is recognized in an amount equal to that excess. Indefinite-lived intangible assets are not amortized
unless it is determined that their useful life is no longer indefinite. We periodically review our indefinite-lived assets to determine whether events and circumstances continue to support an
indefinite useful life. If it is determined that an indefinite-lived intangible asset has a finite useful life, then the asset is tested for impairment and is subsequently accounted for as a
finite-lived intangible asset. For the years ended December 31, 2010, 2009, and 2008, none of our indefinite-lived intangible assets were deemed to have a finite useful life.



Our finite-lived intangible assets include customer relationship and management contract intangibles. Finite-lived intangible assets
are amortized over their estimated useful lives, and we periodically evaluate the remaining useful lives of these intangible assets to determine whether events and circumstances warrant a revision to
the remaining period of amortization. We review our finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be
recoverable.

The
customer relationship intangible asset refers to the value associated with our rated casino guests. The initial fair value of the customer relationship intangible asset was based on
the projected net cash flows associated with these casino guests. Prior to the annual impairment test for the year ended December 31, 2008, we had utilized the income forecast approach as our
basis for amortization of the customer relationships intangible assets. The percentage of annual amortization applied each year utilizing

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the
income forecast approach was based on expected future net cash flows associated with our rated casino guests and an expected attrition rate. We believed this approach better reflected the pattern
in which the economic benefits of the intangible asset were consumed. The attrition rate was determined in part quantitatively using historical customer data and qualitatively based on the consistency
of our rated casino guests which is predominantly Las Vegas local residents as opposed to out of town customers. Subsequent to our annual impairment testing for the year ended December 31,
2008, these intangible assets are being amortized ratably over their estimated useful lives as the expected pattern of consumption no longer accommodates the income forecast approach.

The
customer relationship intangible asset is reviewed for impairment whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Increased
competition within the gaming industry or a downturn in the economy could have an impact on our customer relationship intangible asset. Declines in customer spending which would impact the expected
future cash flows associated with our rated casino guests, declines in the number of visitations which could impact the expected attrition rate of our rated casino guests or an erosion of our
operating margins associated with our rated casino guest could cause the carrying value of the customer relationship asset to exceed the fair value. In this event an impairment based on the difference
between the estimated fair value and the carrying value would be recognized.

Management
contract intangible assets refer to the value associated with management agreements under which we provide management services to various casino properties, including casinos
operated by joint ventures in which we hold a 50% equity interest, and certain Native American casinos that we have developed or are currently under development. The fair values of these management
contract intangibles are established using discounted cash flow techniques based on estimated future cash flows
expected to be received in exchange for providing management services. Management contract intangible assets are amortized ratably over their expected useful lives. We begin amortizing management
contract intangible assets when the property begins operations and management fees are being earned.

We
evaluate our finite-lived intangible assets and other long-lived assets for impairment in accordance with the accounting guidance in the Impairment or Disposal of
Long-Lived Assets Subsections of ASC 360-10. For assets to be held and used, we review long-lived assets for impairment whenever indicators of impairment
exist. If an indicator of impairment exists, we compare the estimated future cash flows of the asset, on an undiscounted basis, to the carrying value of the asset. If the undiscounted cash flows
exceed the carrying value, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying value, impairment is measured based on fair value compared to carrying value, with fair
value typically based on a discounted cash flow model or market comparables, when available. For assets to be disposed of, we recognize the asset to be sold at the lower of carrying value or fair
value less costs of disposal. Fair value for assets to be disposed of is generally estimated based on comparable asset sales, solicited offers or a discounted cash flow model.

Inherent
in the calculation of fair values are various estimates. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from our estimates.
If our ongoing estimates of future cash flows are not met, we may have to record additional impairment charges in future accounting periods. Our estimates of cash flows are based on the current
regulatory, political and economic climates, recent operating information and budgets of the various properties where we conduct operations. These estimates could be negatively impacted by changes in
federal, state or local regulations, economic downturns, or other events affecting various forms of travel and access to our properties.

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We incur certain costs associated with development and management agreements entered into with Native American Tribes (the "Tribes").
In accordance with the guidance for accounting for costs and initial rental operations of real estate projects, costs for the acquisition and related development of the land and the casino facilities
are capitalized as long-term assets until such time as the assets are transferred to the Tribe at which time a long term receivable is recognized.

In
accordance with the accounting guidance for capitalization of interest costs, we capitalize interest to the project once a "Notice of Intent" (or the equivalent) to transfer the land
into trust, signifying that activities are in progress to prepare the asset for its intended use, has been issued by the United States Department of the Interior ("DOI").

We
earn a return on the costs incurred for the acquisition and development of the projects based upon the costs incurred over the development period of the project. In accordance with
the guidance for accounting for sales of real estate, we recognize the return when the facility is complete and collectability of the receivable is assured. Due to the uncertainty surrounding the
estimated cost to complete and the collectability of the stated return, we defer the return until the gaming facility is complete and transferred to the Tribe and the resulting receivable has been
repaid. Repayment of the resulting advances would be from a refinancing by the Tribe, from the cash flow from the gaming facility or both.

We
evaluate our Native American Development Costs for impairment in accordance with the accounting guidance in the Impairment or Disposal of Long-Lived Assets Subsections of
ASC 360-10. We evaluate each project for impairment whenever events or changes in circumstances indicate that the carrying amount of the project might not be recoverable, taking
into consideration all available information. Among other things, we consider the status of the project, any contingencies, the achievement of milestones, any existing or potential litigation, and
regulatory matters when evaluating our Native American projects for impairment. If an indicator of impairment exists, we compare the estimated future cash flows of the asset, on an undiscounted basis,
to the carrying value of the asset. If the undiscounted expected future cash flows exceed the carrying value, no impairment is indicated. If the undiscounted expected future cash flows do not exceed
the carrying value, then impairment is measured based on the difference between fair value and the carrying value. See Note 8 for a discussion of impairment charges recorded during the year
ended December 31, 2009 related to Native American projects.



Debt issuance costs incurred in connection with the issuance of long-term debt are capitalized and amortized to interest
expense over the expected terms of the related debt agreements and are included in other assets, net on our consolidated balance sheets. In connection with the Chapter 11 Case, in 2009 we wrote
off certain debt issuance costs related to debt that is subject to compromise.



We expense advertising costs the first time the advertising takes place. Advertising expense, which is generally included in selling,
general and administrative expenses on the accompanying consolidated statement of operations, was approximately $13.7 million, $13.7 million, and $18.3 million for the years ended
December 31, 2010, 2009, and 2008, respectively.

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1. Summary of Significant Accounting Policies and Basis of Presentation (Continued)



Preopening expenses are expensed as incurred. The construction phase of a major project typically covers a period of 12 to
24 months. The majority of preopening costs are incurred in the three months prior to opening. We incurred preopening expenses of approximately $3.6 million, $5.8 million, and
$10.2 million during the years ended December 31, 2010, 2009, and 2008, respectively.



From time to time we enter into derivative instruments, typically in the form of interest rate swaps, in order to manage interest rate
risks associated with our current and future borrowings. We have adopted the authoritative guidance for accounting for derivative instruments and hedging activities, as amended, to account for our
interest rate swaps. The accounting guidance requires us to recognize our derivative instruments as either assets or liabilities in our consolidated balance sheet at fair value. The accounting for
changes in fair value (i.e. gains or losses) of a derivative instrument agreement depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the
type of hedging relationship. Additionally, the difference between amounts received and paid under such agreements, as well as any costs or fees, is recorded as a reduction of, or an addition to,
interest expense as incurred over the life of the agreement.

For
derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is reported as a component of other
comprehensive income (loss) and the ineffective portion is recorded in the consolidated statement of operations. Derivative instruments that are designated as fair value hedges and qualify for the
"shortcut" method under the accounting for derivative instruments and hedging activities, as amended, are allowed an assumption of no ineffectiveness. As such, there is no impact on the consolidated
statement of operations from the changes in the fair value of the hedging instrument. Instead, the fair value of the instrument is recorded as an asset or liability on our consolidated balance sheet
with an offsetting adjustment to the carrying value of the related debt. For those derivative instruments that are not designated as hedges for accounting purposes, the change in fair value is
recorded in the consolidated statement of operations in the period of change (See Note 12).

Fluctuations
in interest rates can cause the fair value of our derivative instruments to change each reporting period. While we attempt to predict such movements in interest rates and
the impact on derivative instruments, such estimates are subject to a large degree of variability which could have a significant impact on our consolidated financial statements.



We recognize as casino revenues the net win from gaming activities, which is the difference between gaming wins and losses. All other
revenues are recognized as the service is provided. Additionally, our Boarding Pass and Amigo Club player rewards programs (the "Programs") allow customers to redeem points earned from their gaming
activity at all Station and Fiesta properties for complimentary slot play, food, beverage, rooms, entertainment and merchandise. At the time redeemed, the retail value of complimentaries under the
Programs is recorded as revenue with a corresponding offsetting amount included in promotional allowances. The cost associated with complimentary food, beverage, rooms, entertainment and merchandise
redeemed under the Programs is recorded in casino costs and expenses on our consolidated statements of operations. The estimated departmental costs of providing such

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1. Summary of Significant Accounting Policies and Basis of Presentation (Continued)

promotional
allowances are included in casino costs and expenses and consist of the following (amounts in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Food and beverage

$
62,764

$
77,194

$
84,843Room


6,735


8,142


7,548Other


1,957


2,873


3,596Total

$
71,456

$
88,209

$
95,987


We
also record a liability for the estimated cost of the outstanding points under the Programs that we believe will ultimately be redeemed. At December 31, 2010 and 2009,
$8.4 million and $6.1 million, respectively, were accrued for the cost of anticipated Program redemptions. The estimated cost of the outstanding points under the Programs is calculated
based on the total number of points earned but not yet achieving necessary redemption levels, converted to a redemption value times the average cost. The redemption value is estimated based on the
average number of points needed to convert to rewards. The average cost is the incremental direct departmental cost for which the points are anticipated to be redeemed. When calculating the average
cost we use historical point redemption patterns to determine the redemption distribution between gaming, food, beverage, rooms, entertainment and merchandise as well as potential breakage.

Management
fee revenues earned under our management agreements are recognized when the services have been performed, the amount of the fee is determinable, and collectability is
reasonably assured.



We have entered into various related party transactions, which consist primarily of lease payments related to ground leases at Boulder
Station and Texas Station. We paid approximately $6.7 million, $6.7 million, and $6.5 million for the years ended December 31, 2010, 2009, and 2008, respectively, in
connection with these related party ground lease transactions.

Additionally,
we have purchased tickets to events held by Zuffa, LLC ("Zuffa") which is the parent company of the Ultimate Fighting Championship and is owned by Frank J.
Fertitta III and Lorenzo J. Fertitta. For the years ended December 31, 2010, 2009 and 2008, we made payments to Zuffa for approximately $0.5 million, $0.7 million, and
$0.7 million, respectively, for ticket purchases to, and closed circuit viewing fees of, Ultimate Fighting Championship events. In addition, in September 2008 Zuffa and a wholly-owned
subsidiary of the Company entered into a month-to-month license agreement whereby Zuffa has the rights to a previously unused portion at Palace Station for general office and
administrative use. Payments received by the Company related to this license agreement totaled approximately $22,000 and $21,000 for the years ended December 31, 2009, and 2008, respectively.
There were no payments received from Zuffa under this license agreement during the year ended December 31, 2010. In January 2009, Station subleased its leased aircraft to Zuffa for a period of
six months. Payments received by Station in connection with this sublease approximated the amount Station paid for leasing the aircraft, and totaled approximately $0.8 million.

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1. Summary of Significant Accounting Policies and Basis of Presentation (Continued)



Effective January 1, 2006, we adopted the accounting guidance for share-based payments, utilizing the modified prospective
application. Under the modified prospective application, the accounting guidance applies to new awards and awards that were outstanding on December 31, 2005 that are subsequently modified,
repurchased or cancelled. Under the modified prospective application, compensation cost recognized in the year ended December 31, 2006 and subsequent periods includes compensation cost of all
share-based payments granted prior to, but not
yet vested as of January 1, 2006, based on the grant-date fair value estimated in accordance with the original provisions of the accounting guidance, and compensation cost for all
share-based payments granted subsequent to January 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of the accounting guidance for share-based
payments, as revised.

Equity Awards.Upon consummation of the Merger, FCP and Fertitta Partners issued Class B Units to an affiliate of Frank J.
Fertitta
III, Lorenzo J. Fertitta and certain officers of the Company. During the year ended December 31, 2008, Class B units that were previously issued upon consummation of the Merger
were transferred to certain officers and management of the Company. Pursuant to the accounting guidance for share-based payments, the unearned share-based compensation related to the Class B
Units is amortized to compensation expense over the requisite service period (immediate to five years). The share-based expense for these awards was based on the estimated fair market value of the
Class B Units at the date of grant applied to the total number of Class B Units that were anticipated to fully vest and then amortized over the vesting period.

Also
upon consummation of the Merger, FCP and Fertitta Partners issued Class C Units to certain officers and management of the Company. During the year ended December 31,
2008, additional Class C units were issued to certain management of the Company. Pursuant to the accounting guidance for share-based payments, the unearned share-based compensation related to
the Class C Units is amortized to compensation expense over the requisite service period (five years). The share-based expense for these awards was based on the estimated fair market value of
the Class C Units at the date of grant, applied to the total number of Class C Units that were anticipated to fully vest and then amortized over the vesting period.



The accounting guidance for disclosures about segments of an enterprise and related information requires separate financial information
be disclosed for all operating segments of a business. We believe we meet the "economic similarity" criteria established by the accounting guidance and as a result, we aggregate all of our properties
into one operating segment. All of our properties offer the same products, cater to the same customer base, are all located in the greater Las Vegas, Nevada area, have the same regulatory and tax
structure, share the same marketing techniques and are all directed by a centralized management structure.



In December 2010, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2010-28, IntangiblesGoodwill and Other
(Topic 350), When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying
Amounts("ASU 2010-28").

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1. Summary of Significant Accounting Policies and Basis of Presentation (Continued)

Under
the amended guidance, for reporting units with zero or negative carrying amounts, an entity is required to perform Step 2 of the goodwill impairment test if it is more likely than not
that a goodwill impairment exists. In determining whether it is more likely than not that a goodwill impairment exists, an entity should consider whether there are any adverse qualitative factors
indicating that an impairment may exist. The qualitative factors are consistent with the existing guidance which requires that goodwill of a reporting unit be tested for impairment between annual
tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. ASU 2010-28 is effective for
fiscal years, and interim periods within those years, beginning after December 15, 2010. Early adoption is not permitted. The Company does not expect adoption of the new guidance to have a
material effect on its consolidated financial statements.

In
April 2010, the FASB issued ASU No. 2010-16,EntertainmentCasinos (Topic 924): Accruals for Casino Jackpot
Liabilities, a consensus of the FASB Emerging Issues Task Force.This guidance clarifies that an entity should not accrue jackpot liabilities (or portions thereof) before a
jackpot is won if the entity can avoid paying that jackpot. Jackpots should be accrued and charged to revenue when an entity has the obligation to pay the jackpot. The guidance applies to both base
and progressive jackpots. The guidance is effective for reporting periods beginning after December 15, 2010. Since the Company's existing accounting policy for accrual of jackpot liabilities is
consistent with the new guidance, the adoption of this guidance will have no impact on the Company's financial statements.

In
January 2010, the FASB issued ASU No. 2010-06,Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures
about Fair Value Measurements.This guidance clarifies and extends the disclosure requirements about recurring and nonrecurring fair value measurements. The guidance is
effective for reporting periods beginning after December 15, 2009. Accordingly, the Company adopted the new guidance in the first fiscal quarter of 2010. The adoption of this new guidance did
not have a material impact on the Company's financial statements.

A
variety of proposed or otherwise potential accounting guidance is currently under study by standard-setting organizations and certain regulatory agencies. Because of the tentative and
preliminary nature of such proposed accounting guidance, we have not yet determined the effect, if any, that the
implementation of such proposed accounting guidance would have on our consolidated financial statements.

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2. Receivables, net

Components of receivables are as follows (amounts in thousands):

December 31,2010

2009Casino

$
11,669

$
15,946Hotel


6,686


4,068Management fees


3,246


7,313Income tax





18,655Due from unconsolidated joint ventures


435


5,420Other


12,720


8,71434,756


60,116Allowance for doubtful accounts


(10,652
)

(10,238
)Receivables, net

$
24,104

$
49,878


3. Due from/to Unconsolidated Affiliate

Effective January 1, 2009, a promissory note in the amount of $5.0 million (the "2009 GVR Promissory Note") was executed between GV Ranch Station, Inc. (the
consolidated entity that owns our 50% portion of the GVR Seller and the GVR Seller. The 2009 GVR Promissory Note accrued interest at an annual rate of 5.0% and matured on January 1, 2011. The
2009 GVR Promissory Note is subordinate to the GVR Seller's senior secured debt and interest rate swaps. During the three months ended March 31, 2010, events of default occurred related to the
GVR Seller's senior secured debt and interest rate swaps. As a result, the Company determined the GVR Promissory Note and the related accrued interest may not be recoverable and accordingly, the note
and accrued interest receivable were fully reserved during the three months ended December 31, 2009 and accordingly, the Company recognized a $5.3 million expense in write-downs and
other charges, net in our consolidated statements of operations during the year ended December 31, 2009 to fully reserve this receivable.

4. Property and Equipment

Property and equipment consists of the following (amounts in thousands):

December 31,Estimated life
(years)2010

2009Land



$
413,933

$
426,918Buildings and improvements

10-45


2,161,028


2,200,182Furniture, fixtures and equipment

3-7


574,030


548,816Construction in progress




20,273


82,0623,169,264


3,257,978Accumulated depreciation and amortization




(663,501
)

(534,295
)Property and equipment, net



$
2,505,763

$
2,723,683


Depreciation
expense was $137.1 million, $153.3 million, and $152.1 million, respectively, for the years ended December 31, 2010, 2009, and 2008. At
December 31, 2010 and 2009, substantially all of our property and equipment is pledged as collateral for our long-term debt.

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4. Property and Equipment (Continued)



During the three months ended September 30, 2010, it was determined that a triggering event, as described in the Impairment or
Disposal of Long-Lived Assets Subsections of ASC 360-10, had occurred due to developments in our bankruptcy proceedings. We therefore tested the carrying values of our
property and equipment for recoverability by comparing the sum of the undiscounted estimated future cash flows of each asset group to its carrying value. For those asset groups where the sum of the
undiscounted estimated cash flows did not exceed the carrying value, we measured an impairment based on the excess of carrying value over fair value. Buildings, land, furniture, fixtures and equipment
with carrying amounts totaling $88.1 million were written down to their fair values totaling $21.4 million, resulting in an impairment charge of $66.6 million, which was included
in our condensed consolidated statements of operations. This impairment charge included $65.9 million for property and equipment of Fiesta Rancho and $0.7 million for property and
equipment of other operating properties.

During
the year ended December 31, 2009, we reviewed the carrying values of our property and equipment for impairment because we determined that the Company's restructuring
activities and the continuation of the economic downturn constituted indicators of impairment. As a result, we recorded impairment charges totaling $179.4 million for the year ended
December 31, 2009, related to property and equipment at certain operating subsidiaries, primarily Texas Station.

We
estimate the fair value of property and equipment using a combination of valuation methods including discounted cash flows and estimated prices for similar assets. These methods
typically utilize
inputs that are classified as Level 3 under ASC Topic 820,Fair Value Measurements and Disclosures("ASC Topic 820").

5. Goodwill and Other Intangible Assets

Goodwill primarily represents the excess of total acquisition costs over the fair market value of net assets acquired in the Merger. The changes in the carrying amount of goodwill for
the years ended December 31, 2010 and 2009 are as follows (amounts in thousands):

Year ended December 31, 2010Balance at
beginning of
the year

Changes during
the year

Balance at
end of the
yearGoodwill

$
2,986,993

$


$
2,986,993Accumulated impairment losses


(2,802,294
)

(60,386
)

(2,862,680
)Goodwill, net of accumulated impairment losses

$
184,699

$
(60,386
)
$
124,313




Year ended December 31, 2009Balance at
beginning of
the year

Changes during
the year

Balance at
end of the
yearGoodwill

$
2,986,993

$


$
2,986,993Accumulated impairment losses


(2,620,509
)

(181,785
)

(2,802,294
)Goodwill, net of accumulated impairment losses

$
366,484

$
(181,785
)
$
184,699


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5. Goodwill and Other Intangible Assets (Continued)

Intangible
assets, net as of December 31, 2010 and 2009 consist of the following:

December 31, 2010Estimated
life
(years)

Gross
Carrying
Amount

Accumulated
Amortization

Accumulated
Impairment
Losses

Net
Carrying
AmountBrands

Indefinite

$
214,791

$


$
(115,237
)
$
99,554License rights

Indefinite


4,531





(4,190
)

341Customer relationships

15


268,961


(18,942
)

(241,363
)

8,656Management contracts

3-20


521,464


(127,957
)

(229,534
)

163,973Other

1


8,654


(8,654
)




$
1,018,401

$
(155,553
)
$
(590,324
)
$
272,524




December 31, 2009Estimated
life
(years)

Gross
Carrying
Amount

Accumulated
Amortization

Accumulated
Impairment
Losses

Net
Carrying
AmountBrands

Indefinite

$
214,791

$


$
(115,237
)
$
99,554License rights

Indefinite


4,531








4,531Customer relationships

15


268,961


(18,297
)

(240,849
)

9,815Management contracts

3-20


521,464


(112,595
)

(229,534
)

179,335Other

1


8,654


(8,654
)




$
1,018,401

$
(139,546
)
$
(585,620
)
$
293,235


The
intangible asset for customer relationships refers to the value associated with our rated casino guests. The Company amortizes its finite-lived intangible assets ratably over their
estimated useful lives. The aggregate amortization expense for those assets that are amortized under the provisions of ASC Topic 350 was approximately $16.0 million,
$53.8 million, and $74.5 million for the years ended December 31, 2010, 2009, and 2008, respectively. Estimated annual amortization expense for intangible assets for the years
ended December 31, 2011, 2012, 2013, 2014, and 2015 is anticipated to be approximately $3.8 million, $4.2 million, $23.8 million, $23.8 million, and
$23.8 million, respectively.



During the three months ended September 30, 2010, we determined that a triggering event, as described in ASC Topics 350
and 360, had occurred due to developments in our bankruptcy proceedings, and we therefore tested our goodwill and intangible assets for impairment. We determined that certain of these assets were
impaired and we recognized impairment charges in our consolidated statements of operations as described in more detail below.

We
tested the goodwill of each of our reporting units for impairment by comparing the carrying value of each reporting unit, including goodwill, with its fair value. For reporting units
where carrying value exceeded fair value, we measured the implied fair value of the reporting unit's goodwill by allocating the fair value of the reporting unit to the assets and liabilities of the
unit, as if the reporting unit had been acquired in a business combination. Where the carrying value of a reporting unit's goodwill exceeded its implied fair value, we recognized an impairment loss in
an amount equal to that excess. During the three

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5. Goodwill and Other Intangible Assets (Continued)

months
ended September 30, 2010, goodwill of our Santa Fe Station and Boulder Station reporting units with a carrying amount of $184.7 million was written down to its implied fair value
of $124.3 million, resulting in an impairment charge of $60.4 million. As a result of these interim goodwill impairment charges recognized during the three months ended
September 30, 2010, our annual goodwill impairment testing as of October 1, 2010 resulted in no additional impairment charges. The fair value of each reporting unit is estimated using
the expected present value of future cash flows along with value indications provided by the current valuation multiples of comparable publicly traded companies, which are generally classified as
Level 3 inputs under ASC Topic 820.

We
tested our finite-lived intangible assets for impairment by comparing their carrying values with their fair values, and for those with carrying values that exceeded their fair values,
impairment was recognized based on the excess of carrying value over fair value. Customer relationship intangible assets with carrying values totaling $8.6 million were written down to their
fair value of $8.1 million, resulting in an impairment charge of $0.5 million. We estimated the fair value of our customer relationship intangible assets using a discounted cash flow
model based on Level 3 inputs under ASC Topic 820.

During
the year ended December 31, 2010, we decided to discontinue the exclusivity arrangement associated with one of our indefinite-lived license right intangibles, which had a
carrying value of $1.0 million. As a result, we determined that this asset had become fully impaired and we recorded an impairment charge equal to the carrying value of this asset. In addition,
during our interim impairment testing we determined that a license asset with a carrying value of $3.5 million was impaired, primarily as a result of changes in its potential utilization,
therefore we wrote this asset down to its estimated fair value of $0.3 million and recognized a $3.2 million impairment charge. We estimated the fair value of the license asset based on
solicited offers and comparable asset sales estimates, which are Level 3 inputs under ASC Topic 820



During the year ended December 31, 2009, we determined that the Company's restructuring activities and the continuation of the
economic downturn constituted indicators of impairment, and we therefore tested our finite-lived intangible assets for impairment. As a result, we wrote down certain customer relationship intangible
assets with carrying values totaling
$22.5 million to their fair value of $9.9 million. Likewise, our brands with carrying amounts totaling $129.2 million were written down to their fair values of
$99.6 million. As a result, we recognized impairment losses totaling $12.6 million and $29.7 million, respectively, for our customer relationship and brand intangibles. The
impairment of our brands and customers relationships is the result of the ongoing recession which has resulted in decreased projected cash flow estimates, decreased valuation multiples for gaming
assets due to the current market conditions and higher discount rates resulting from turmoil in the credit markets. The concentration of our customer base in the Las Vegas valley, where the impact of
the recession has been particularly significant, has negatively impacted our projected cash flow estimates.

In
addition, during the year ended December 31, 2009, as a result of decreases in the projected revenue streams for certain of our managed properties, management contract
intangible assets with carrying values totaling $258.7 million were written down to their fair values totaling $45.8 million. The majority of the management contract impairment charge
related to our contracts to manage Green Valley Ranch, Aliante Station, and Gun Lake.

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5. Goodwill and Other Intangible Assets (Continued)

As
a result of our annual goodwill impairment testing for the year ended December 31, 2009, goodwill of certain of our reporting units, primarily Boulder Station, Santa Fe Station
and Sunset Station, with a total carrying amount of $366.5 million was written down to its implied fair value of $184.7 million, resulting in an impairment charge of
$181.8 million.



In conjunction with our annual impairment testing for the year ended December 31, 2008, we determined that an impairment of the
goodwill recorded in conjunction with the Merger of approximately $2.6 billion existed company-wide, which was recorded in impairment of goodwill on our consolidated statements of
operations.

6. Land Held for Development

As of December 31, 2010, we had $240.8 million of land held for development consisting primarily of eleven sites that are owned or leased, which includes 368 acres in the
Las Vegas valley, 772 acres in northern California and 200 acres in Reno, Nevada. The primary gaming-entitled land that we own in the Las Vegas valley consists of 77 acres of land (96 acres including
those leased or under contract) on which the Wild Wild West is located and the surrounding area, 71 acres located at the intersection of Durango Road and the Southern Beltway/Interstate 215 in the
southwest area of Las Vegas, 58 acres also located in southwest Las Vegas at the intersection of Town Center and Interstate 215, 45 acres in the master-planned community of Inspirada located in
Henderson, Nevada, 58 acres located on the southern end of Las Vegas Boulevard at Cactus Avenue, and 30 acres on Boulder Highway at the site formerly known as the Castaways Hotel Casino and Bowling
Center. During the year ended December 31, 2010, options to purchase approximately 10 acres of land near the Wild Wild West expired, and we wrote off the $9.0 million carrying value of
the related asset.

In
December 2008, we amended the lease and purchase agreement for the 19-acre parcel of land on which the Wild Wild West is located. Under the amended agreement, we have an
option to purchase the land for a purchase price of $36 million. The amended lease also includes options to purchase the land in July 2023, 2044 and 2065 for a purchase price equal to fair
market value as of July 2022, 2043 and 2064, respectively. No amounts related to these purchase options have been recorded on our consolidated balance sheets at December 31, 2010 or 2009. In
March 2011, we were notified by the lessor that the lease had been terminated. We are currently in negotiations
regarding possible modifications to this lease, however we can provide no assurance that we will be able to reach an agreement with the lessor.

Our
decision whether to proceed with any new gaming or development opportunity is dependent upon future economic and regulatory factors, the availability of acceptable financing and
competitive and strategic considerations. As many of these considerations are beyond our control, no assurances can be made that we will be able to proceed with any particular project.



During the year ended December 31, 2010, it was determined that a triggering event, as described under the accounting guidance
for impairment or disposal of long-lived assets, had occurred due to developments in our bankruptcy proceedings. As a result, we tested our land held for development by comparing the
estimated future cash flows for each land parcel, on an undiscounted basis, to its carrying value. For certain land parcels, primarily those located in the Las Vegas valley, the carrying value was

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6. Land Held for Development (Continued)

higher.
As a result, we recorded an impairment loss of $114.4 million to write down the carrying value of those parcels totaling $308.6 million to their fair values totaling
$194.1 million. Included in the impairment charge was a $49.6 million write-off of capitalized project costs related to the impaired parcels. The fair value of our land held
for development is estimated using traditional real estate valuation techniques, primarily the sales comparison approach, utilizing inputs classified as Level 3 under ASC Topic 820.

As
a result of the continuing recession and its significant impact on real estate values, we reviewed our land held for development for impairment during the year ended
December 31, 2009 and determined that impairments existed for a number of land parcels in the Las Vegas valley, Reno, Nevada, and northern California. As a result, we recorded impairments
totaling $617.4 million in impairment of other assets in our consolidated statements of operations to write down the carrying value of these parcels totaling $918.2 million to their fair
values totaling $300.9 million.



During the year ended December, 2010, we recognized a $0.1 million gain on disposal of a real estate parcel in the Las Vegas
valley. During the year ended December 31, 2009, we recorded a loss on land disposition of $5.1 million related to a parcel of land in Reno, Nevada that had previously been held for
development.

7. Investments in Joint Ventures

We have various investments in 50% owned joint ventures, and a 6.7% investment in a joint venture that owns the Palms Casino Resort in Las Vegas, Nevada, which are accounted for under
the equity method. Under the equity method, original investments are recorded at cost and adjusted by our share of earnings, losses and distributions of the joint ventures, and the carrying value of
investments may be reduced below zero, resulting in a deficit investment balance, when the investor is committed to provide further financial support for the investee. Our investment balances also
include any fair value adjustments recorded in conjunction with the Merger described in Note 1 and adjustments related to impairment

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7. Investments in Joint Ventures (Continued)

charges.
As of December 31, 2010 and 2009, we have received distributions in excess of our equity earnings. Investments in joint ventures consist of the following (amounts in thousands):

December 31,2010

2009Green Valley Ranch (50.0%) (a)

$


$
4,310Palms Casino Resort (6.7%)





Barley's (50.0%)


4,756


4,852Wildfire Lanes (50.0%)


760


1,257The Greens (50.0%) (b)





70Investments in joint ventures

$
5,516

$
10,489Green Valley Ranch (50.0%) (a)

$
(38,258
)
$
The Greens (50.0%) (b)


(163
)

Aliante Station (50.0%) (c)


(306,346
)
$
(38,389
)Rancho Road and Richfield Homes (50.0%) (d)





(104,659
)Deficit investments in joint ventures

$
(344,767
)
$
(143,048
)


(a)As
a result of the losses recognized by Green Valley Ranch during the years ended December 31, 2010, 2008, and 2009, and animpairment of our joint
venture investment recognized during the year ended December 31, 2009, our investment in Green Valley Ranch at December 31, 2010 reflects a deficit of approximately $38.3 million.(b)As
a result of the operating losses recognized by The Greens during the year ended December 31, 2010 and distributions in excess of equity earnings,
our investment in The Greens at December 31, 2010 reflects a deficit of approximately $0.2 million, which is recorded as a long-term liability on our consolidated balance
sheets.(c)As
a result of the ongoing losses of Aliante Station, including impairment losses of approximately $466.5 million recognized by Aliante Station
during 2010, and an impairment of our joint venture investment recognized during 2008, our investment in Aliante Station at December 31, 2010 and December 31, 2009 reflects a deficit of
approximately $306.3 million and $38.4 million, respectively.(d)As
a result of the significant decline in real estate values in the Las Vegas valley, Rancho Road recorded an impairment charge related to its land held for
development during the year ended December 31, 2009, and our investment in Rancho Road at December 31, 2009 reflects a deficit of approximately $104.7 million. Effective
January 1, 2010, Richfield Homes joint venture was formed by the members of Rancho Road, and certain assets of Rancho Road were contributed to Richfield Homes. During the three months ended
December 31, 2010, we recorded an impairment charge of $16.3 million related to our investment in Richfield Homes. In early November 2010, Rancho Road and Richfield Homes disposed of
substantially all of their assets. In connection with the asset disposal, the Company received a distribution of $3.5 million. These entities were dissolved during the three months ended
December 31, 2010, and as a result of the deficit carrying value of our investment in Rancho Road, we recognized a gain on disposal for the


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7. Investments in Joint Ventures (Continued)

year
ended December 31, 2010 of $124.2 million. We recognized no gain or loss upon the dissolution of Richfield Homes joint venture.


As
a result of the Merger, our investments in joint ventures balance as of December 31, 2007 differed from our ownership equity in these investments by $217.3 million due
to the allocation of the purchase price to these investment accounts. Differences between our investments in joint ventures balance and the Company's underlying equity in the joint ventures
attributable to land, goodwill and indefinite-lived intangible assets are not amortized. Differences attributable to depreciable assets and finite-lived intangible assets are amortized based on the
estimated useful lives of the related assets and recorded in earnings from joint ventures on our consolidated statement of operations. During the years ended December 31, 2009 and 2008, we
recorded approximately $0.1 million and $2.8 million, respectively, of depreciation and amortization related to these assets. As a result of the depreciation and amortization expense
recorded during the years ended December 31, 2009 and 2008, and impairment losses recorded during 2009 discussed below, these differences were fully written off as of December 31, 2009.

On
March 9, 2011, the GVR Purchaser, an indirect subsidiary of New Station, and the GVR Seller entered into the GVR Asset Purchase Agreement, pursuant to which the GVR Purchaser
will purchase substantially all of the assets and assume certain specified liabilities of the GVR Seller for $500 million through a prepackaged plan of reorganization. The consummation the GVR
Asset Purchase Agreement and the proposed plan of reorganization is subject to the acceptance of the plan by the lenders under GVR Seller's first lien credit agreement, and there can be no assurance
as to when or if the necessary approvals will be obtained.

On
March 22, 2011, Aliante Gaming, LLC ("Aliante") launched a solicitation of approvals by the lenders under its credit facility for a plan of reorganization (the "Aliante
Plan") in which each of the lenders under the credit facility would receive its pro rata share of 100% of the equity interests in the reorganized Aliante and its pro rata share of a new
$45 million senior secured credit facility to be entered into upon consummation of the Aliante Plan. If Aliante obtains the requisite approvals of its lenders pursuant to the solicitation of
acceptances of the Aliante Plan, Aliante will seek confirmation of the Aliante Plan chapter 11 of title 11 of the United States Code by the United States Bankruptcy Court for the District of
Nevada in Reno, Nevada. In addition, in connection with the proposed restructuring of Aliante, Aliante and the steering committee of lenders under the Aliante credit facility are in discussions with
third parties regarding a management agreement relating to the operation of Aliante during the pendency of the proposed chapter 11 case and following the consummation of the Aliante Plan.



In connection with our interim impairment testing during the three months ended September 30, 2010, we reviewed the carrying
value of our investments in joint ventures for impairment because we determined that indicators of impairment existed. We compared the estimated future cash flows of the assets, on an undiscounted
basis, to the carrying values of the assets as required by the accounting guidance for impairment or disposal of long-lived assets. As a result, we recorded impairment charges totaling
$16.3 million to reduce the $19.8 million carrying value of our investment in Richfield Homes to its fair value of $3.5 million. The fair values of our investments in joint
ventures were estimated using discounted cash flow techniques based on Level 3 inputs under ASC Topic 820.

During
the year ended December 31, 2009, it was determined that due to the ongoing recession and its impact on our estimated future cash flows from our investments in joint
ventures, a triggering event, as

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7. Investments in Joint Ventures (Continued)

described
under the accounting guidance for the impairment or disposal of long-lived assets, had occurred related to certain of our investments in joint ventures. As a result, we compared
the estimated future cash flows of each of our investments in joint ventures, on an undiscounted basis, to the carrying value. The carrying values for our investments in certain joint ventures,
primarily Green Valley Ranch, were higher and as such, we recorded impairment losses totaling approximately $30.0 million to reduce the carrying values of our investments in these joint
ventures totaling $37.2 million to their fair values totaling $7.2 million.

Summarized
balance sheet information for the joint ventures is as follows (amounts in thousands):

December 31,2010

2009Current assets

$
113,439

$
78,715Property and equipment and other assets, net


1,044,629


1,775,436Current liabilities


1,362,724


492,344Long-term debt and other liabilities


499,990


1,356,243Shareholders' equity


(704,646
)

5,564


Summarized
results of operations for the joint ventures are as follows (amounts in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Net revenues

$
411,861

$
459,688

$
520,203Operating costs and expenses


935,529


736,647


469,973Operating income


(523,668
)

(276,959
)

50,230Interest and other expense, net


(174,934
)

(114,141
)

(128,298
)Net (loss) income

$
(698,602
)
$
(391,100
)
$
(78,068
)


Our
share of the operating (losses) earnings from these joint ventures is shown as a separate line item after operating income on our consolidated statements of operations. For the year
ended December 31, 2010 and 2009, operating losses from joint ventures includes charges of $233.3 million and $124.9 million, respectively, related to recognizing our 50% share of
impairment charges recorded by Aliante Station in 2010 and Rancho Road, LLC and Aliante Station in 2009. Our share of interest and other expense from these joint ventures is shown as a separate
component under other expense on our consolidated statements of operations, which also includes our 50% share of the joint ventures'
mark-to-market valuation of their interest rate swaps that are not designated as hedging instruments. The following table identifies the total equity (losses) earnings from
joint ventures (amounts in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Operating (losses) earnings from joint ventures

$
(248,495
)
$
(127,643
)
$
17,020Interest and other expense from joint ventures


(66,709
)

(40,802
)

(47,643
)Net losses from joint ventures

$
(315,204
)
$
(168,445
)
$
(30,623
)


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8. Native American Development



In April 2003, the Company entered into development and management agreements with the Federated Indians of Graton Rancheria (the
"FIGR"), a federally recognized Native American tribe. Pursuant to those agreements, Station will assist the FIGR in developing and operating a gaming and entertainment project to be located in Sonoma
County, California. The FIGR selected Station to assist them in designing, developing and financing their project, and upon opening Station will manage the facility on behalf of the FIGR. The
management agreement has a term of seven years from the date of the opening of the project. Under the terms of the management agreement, Station will provide training to the FIGR such that they may
assume responsibility for managing the facility upon expiration of the seven-year term of the agreement. Station will receive a management fee equal to 24% of the facility's net income in
years 1 through 4 and 27% of the facility's net income in years 5 through 7. Station will also receive a development fee equal to 2% of the cost of the project upon the opening of the facility.

Under
the agreements, Station has agreed to provide certain advances for the development of the project, including, but not limited to monthly payments to the FIGR, professional fees,
consulting services, mitigation costs and design and pre-construction services fees.

As
described in the record of decision for the environmental impact statement, the project would include approximately 175,000 square feet of casino space, 196,000 square feet of
non-casino space, including a 200-room hotel, banquet and meeting space, spa, fitness center, multiple bars, a food court and various dining options.

In
October 2003, the FIGR entered into a Memorandum of Understanding with the City of Rohnert Park under which the FIGR would provide certain funding to the city, schools and nonprofit
organizations over 20 years in exchange for the city's support of the casino project.

In
August 2005, Station purchased 270 acres of land just west of the Rohnert Park city limits in Sonoma County, California. In March 2006, Station purchased an additional 4.7 acres
adjacent to the previously acquired property. The property purchased is approximately one-quarter mile from Highway 101 and approximately 43 miles from downtown San Francisco. The
site is easily accessible via Wilfred Avenue and Business Park Drive, and will have multiple points of ingress and egress. In March 2008, it was determined that approximately 254 acres of the
270-acre site purchased in August 2005 would be taken into trust, with the remaining 23 acres retained by Station. Over the period of May 2007 through June 2008, Station purchased an
additional 11 acres of land adjacent to the 23 acre site, bringing the total land retained for development by Station to 34 acres.

On
May 7, 2008, the Department of Interior ("DOI") published in the Federal Register a Notice of Final Agency Determination (the "Determination") to take certain land into trust
for the benefit of the FIGR. The publication commenced a thirty-day period in which interested parties could seek judicial review of the Determination. On June 6, 2008, the Stop The
Casino 101 Coalition and certain individuals filed a complaint (the "Complaint") in the United States District Court for the Northern District of California seeking declaratory and injunctive relief
against the DOI and officials of the DOI. The Complaint sought judicial review of the Determination. On November 17, 2008, the federal defendants and the FIGR filed their respective motions to
dismiss the compliant for lack of jurisdiction and failure to state a claim. In response, the plaintiffs filed a motion for leave to amend their complaint which was granted on January 26, 2009.
The DOI and the FIGR filed motions to dismiss the amended complaint on February 20, 2009, and on March 27, 2009, a hearing was held to argue such motions. On April 21, 2009, the
DOI and FIGR's motions to dismiss were granted. On June 8, 2009, the plaintiffs filed an appeal (the

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8. Native American Development (Continued)

"Appeal")
in the United States Court of Appeals for the Ninth Circuit (the "Court of Appeals"), and the DOI agreed to voluntarily stay the taking of the site into trust pending resolution of the
Appeal. The plaintiffs filed their opening briefs on October 26, 2009. On November 4, 2009, the DOI filed an unopposed motion to expedite the oral argument. The DOI and FIGR then filed
their answering briefs on November 25, 2009. The plaintiffs responded by filing reply briefs on December 28, 2009. The court clerk initially rejected the motion to expedite oral
arguments, but following FIGR's motion for reconsideration, the court scheduled oral arguments for April 15, 2010. Oral arguments were heard on April 15, 2010, and on June 3,
2010, the Court of Appeals affirmed the district court's dismissal of the Complaint. On July 19, 2010, the plaintiffs filed a petition for rehearing en banc. The Court of Appeals denied
plaintiffs' petition on August 11, 2010.

On
October 1, 2010, the Bureau of Indian Affairs of the U.S. Department of the Interior (the "BIA") accepted approximately 254 acres of land owned by Station into trust on behalf
of the FIGR for the development of the project by Station and the FIGR. In connection with the development of the project, it is expected that the FIGR will enter into memoranda of understanding with,
among others,
Sonoma County, California and the California Department of Transportation relating to mitigation measures such as contributions toward the costs for infrastructure improvements and public services
required as a result of the development and operation of the planned project.

On
February 19, 2009, a Notice of Availability of a Final Environmental Impact Statement was filed in the Federal Register. On October 15, 2010, the NIGC published notice
in the Federal Register that it had issued the Record of Decision approving the Environmental Impact Statement for the project, thereby completing the environmental process for the project.

On
October 1, 2010, the NIGC informed Station and the FIGR that the NIGC approved the management agreement by and between the FIGR and Station for Class II gaming at the
planned gaming and entertainment facility. Class II gaming includes games of chance such as bingo, pull-tabs, tip jars and punch boards (and electronic or computer-aided versions of
such games), and non-banked card games. A banking game is one in which players compete against the licensed gaming establishment rather than against one another. The FIGR and Station may
also pursue approval of Class III gaming, which would permit casino-style gaming at the planned facility, including banked table games, such as blackjack, craps and roulette, and gaming
machines such as slots, video poker, lotteries and pari-mutuel wagering. Pari-mutuel wagering is a system of betting under which wagers are placed in a pool, management
receives a fee from the pool, and the remainder of the pool is split among the winning wagers. Class III gaming would require an approved compact (a "Class III Gaming Compact") with the
State of California and approval by the NIGC of a modification to the existing management agreement, or a new management agreement permitting Class III, or casino-style, gaming. There can be no
assurances that the project will be able to obtain, in a timely fashion or at all, the approvals from the State of California and the NIGC that are necessary to conduct Class III, or
casino-style, gaming at the facility.

Under
the terms of the development agreement, Station will assist the FIGR in obtaining third-party financing for the project, however we do not expect such financing will be obtained
until shortly before the project is under construction, and as such, the timing of obtaining the financing is uncertain. Prior to obtaining third-party financing, Station will contribute significant
financial support to the project. The Company began capitalizing expenditures toward the project in 2003. Through December 31, 2010, Station has advanced approximately $147.7 million
toward the development of this project, primarily to complete the environmental impact study and secure real estate for the project, which is included in Native American development costs on the
Company's consolidated balance sheets. Funds advanced by Station

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8. Native American Development (Continued)

are
expected to be repaid from the proceeds of the project financing or from the FIGR's gaming revenues. Station's advances to the FIGR bear interest at the rate of prime plus 1.5%. In addition, we
have agreed to pay approximately $11.3 million upon achieving certain milestones, which will not be reimbursed. Through December 31, 2010, approximately $2.0 million of these
payments had been made and were expensed as incurred. The timing and feasibility of the project are dependent upon the receipt of the necessary governmental and regulatory approvals. The Company plans
to continue contributing significant financial support to the project, even though there can be no assurances as to when or if the necessary approvals will be obtained.

The
following table outlines the status at December 31, 2010 of each of the following critical milestones necessary to complete the FIGR project.

As of December 31, 2010Federally recognized as a tribe by the US Government's Bureau of Indian Affairs (BIA)

YesDate of recognition

Recognition was terminated during the 1950's and was restored on December 27, 2000Tribe has possession of or access to usable land upon which the project is to be built

YesStatus of obtaining regulatory and governmental approvals:Tribal-State Compact

Not required for Class II gaming; compact will be pursued for Class III gaming.Approval of gaming compact by DOI

NoApproval of management agreement by NIGC

YesDate

October 1, 2010DOI accepting usable land into trust on behalf of the tribe

YesDate

October 1, 2010Gaming licenses:Type

Class IINumber of gaming devices allowed

N/ACounty agreement

NoOther agreements

Memorandum of Understanding with City of Rohnert ParkDate

October 2003


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8. Native American Development (Continued)



In March 2004 the Company entered into development and management agreements with the North Fork Rancheria of Mono Indians (the
"Mono"), a federally recognized Native American tribe located near Fresno, California. Pursuant to those agreements, we will assist the Mono in developing and operating a gaming and entertainment
facility to be located in Madera County, California. We have purchased, for the benefit of the Mono, a 305-acre parcel of land located on Highway 99 north of the city of Madera. The
management agreement has a term of seven years from the opening of the facility, and under the agreement, Station will provide training to the MITCR such that they may assume responsibility for
managing the facility upon the expiration of the agreement. Station will receive a management fee of 24% of the facility's net income.

As
currently contemplated, the project includes the development of an approximately 472,000 square foot hotel and casino resort and associated facilities, which would include a main
gaming hall, a
200-room hotel, various dining options, retail space and banquet/meeting space. Development of the gaming and entertainment project is subject to certain governmental and regulatory approvals,
including, but not limited to, approval by the California Legislature of the gaming compact with the State of California, the DOI accepting the land into trust on behalf of the Mono and approval of
the management agreement by the NIGC.

On
April 28, 2008, the Mono and the State of California entered into a tribal-state Class III gaming compact permitting casino-style gaming. The compact is subject to
approval by the California Legislature and, if approved, will regulate gaming at the Mono's proposed gaming and entertainment project to be developed on the site. No assurances can be provided as to
whether the California Legislature will approve the compact.

On
August 6, 2010, the BIA published notice in the Federal Register that the environmental impact statement for the Mono's casino and resort project has been finalized and is
available for review. Prior to the land being taken into trust, the BIA must publish a record of decision concerning the environmental impact statement and the Secretary must make the decision that
the land should be taken into trust.

Under
the terms of the development agreement, we have agreed to arrange the financing for the ongoing development costs and construction of the facility. Prior to obtaining third-party
financing, we will contribute significant financial support to the project. Funds advanced by us are expected to be repaid from the proceeds of the project financing or from the Mono's gaming
revenues. We began capitalizing reimbursable advances related to this project in 2003. Through December 31, 2010, we have advanced approximately $16.4 million toward the development of
the project, primarily to complete the environmental impact study and secure real estate for the project, which is included in Native American development costs on the Company's consolidated balance
sheets. Reimbursable advances by Station to the Mono bear interest at the prime rate plus 1.5%. In addition, we have agreed to pay approximately $1.3 million of payments upon achieving certain
milestones, which will not be reimbursed and will be expensed as incurred. Through December 31, 2010, none of these payments had been made. The timing of this type of project is difficult to
predict, and is dependent upon the receipt of the necessary governmental and regulatory approvals. There can be no assurances when, or if, these approvals will be obtained.

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8. Native American Development (Continued)

The
following table outlines the status at December 31, 2010 of each of the critical milestones necessary to complete the Mono project.

As of December 31, 2010Federally recognized as a tribe by the US Government's Bureau of Indian Affairs (BIA)

YesDate of recognition

Terminated in 1961; restored in 1983Tribe has possession of or access to usable land upon which the project is to be built

Yes, Station has acquired usable land for the development of this project on behalf of the Mono.Status of obtaining regulatory and governmental approvals:Tribal-State Compact

Pending ratification by California LegislatureApproval of gaming compact by DOI

NoApproval of management agreement by NIGC

NoDOI accepting usable land into trust on behalf of the tribe

NoGaming licenses:Type

Class III gaming being pursuedNumber of gaming devices allowed

N/A




In January 2004 Station entered into development and management agreements with the Mechoopda Indian Tribe of Chico Rancheria,
California (the "MITCR"), a federally recognized Native American tribe. Pursuant to those agreements, Station agreed to assist the MITCR in developing and operating a gaming and entertainment facility
to be located on a portion of an approximately 650-acre site in Butte County, California, at the intersection of State Route 149 and Highway 99, approximately 10 miles
southeast of Chico, California and 80 miles north of Sacramento, California.

Under
the terms of the development agreement, Station agreed to arrange the financing for the ongoing development costs and construction of the facility. Funds advanced by Station are
expected to be repaid from the proceeds of the project financing or from the MITCR's gaming revenues. Station's advances to the MITCR bear interest at prime plus 2%. Through December 31, 2010,
the Company has advanced approximately $11.9 million toward the development of this project, primarily to complete the environmental assessment and secure real estate for the project, which is
included in Native American development costs on the Company's consolidated balance sheets. In addition, Station agreed to pay approximately $2.2 million of payments upon achieving certain
milestones, which will not be reimbursed. Through December 31, 2010, $50,000 of these payments had been made and were expensed as incurred. As of December 31, 2010, we have discontinued
funding for the development of the facility and anticipate

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8. Native American Development (Continued)

terminating
the development agreement. Given the recent recession and thus the revised expected potential of the project, we have written off the long-term asset associated with this
project.



We manage the Gun Lake Casino in Allegan County, Michigan, which opened in February 2011, on behalf of the
Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians of Michigan, a federally recognized Native American tribe commonly referred to as the
Gun Lake Tribe.

On
November 13, 2003, Station agreed to purchase a 50% interest in MPM Enterprises, LLC, a Michigan limited liability company ("MPM"). MPM has entered into development and
management agreements with the Gun Lake Tribe, pursuant to which MPM agreed to assist the tribe in developing and operating a gaming and entertainment project to be located in Allegan County,
Michigan. Gun Lake Casino, is located on approximately 147 acres on U.S, Highway 131 and 129th Avenue, approximately 25 miles south of Grand Rapids, Michigan and
27 miles north of Kalamazoo, Michigan, and includes approximately 1,400 slot machines, 28 table games and various dining options.

The
Sixth Amended and Restated Management Agreement (the "Gun Lake Management Agreement") has a term of seven years from the opening of the facility and provides for a management fee of
30% of the project's net income to be paid to MPM. Pursuant to the terms of the MPM operating agreement, Station's portion of the management fee is 50% of the first $24 million of management
fees earned, 83% of the next $24 million of management fees and 93% of any management fees in excess of $48 million.

MPM
is considered a variable interest entity under the provisions of ASC Topic 810,Consolidation("ASC Topic 810"). Under the terms of
the MPM Operating Agreement, Station is required to provide the majority of MPM's financing. At December 31, 2010, Station's loans to MPM total approximately $13.6 million and financing
provided by MPM's other members, investors and banks totals approximately $5.4 million. The creditors of MPM have no recourse to the general credit of Station. Based on a qualitative analysis,
we believe Station directs the most significant activities that impact MPM's economic performance and has the right to receive benefits and the obligation to absorb losses that could potentially be
significant to MPM, therefore we believe Station is the primary beneficiary of MPM as defined in ASC Topic 810. As a result, we consolidate MPM in our consolidated financial statements.



During the year ended December 31, 2009, we determined that a total of $13.0 million in advances and capitalized interest
related to the MITCR Native American development agreement was not recoverable, and the carrying value of the project was written down to its fair value, which approximated the fair value of the land.
The fair value of the land is included in land held for development in our consolidated balance sheets at December 31, 2010 and 2009, respectively. The fair value of the land was estimated
using traditional real estate valuation techniques based on Level 3 inputs under ASC Topic 820.

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9. Management Fees

Station is the managing partner for Green Valley Ranch, Aliante Station, Barley's, The Greens and Wildfire Lanes and receive a management fee equal to 2% of net revenues and
approximately 5% of Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") from Green Valley Ranch and Aliante Station and 10% of EBITDA from Barley's, The Greens and Wildfire
Lanes. During the year ended December 31, 2010, Station did not recognize management fee revenue for Green Valley Ranch and Aliante Station due to debt-related cash restrictions in
place at those properties.

Station
previously managed Thunder Valley under a seven-year management agreement with the United Auburn Indian Community which expired in June 2010 and was not renewed.
Under this agreement, Station received a management fee equal to 24% of net income (as defined in the management agreement).

Management
fees are included in net revenues on Station's consolidated statements of operations. Management fees earned under Station's management agreements are recognized in revenue
when the services have been performed, the amount of the fee is determinable, and collectability is reasonably assured.

10. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following (amounts in thousands):

December 31,2010

2009Accrued payroll and related

$
26,416

$
20,973Accrued gaming and related


27,040


25,705Other accrued expenses and current liabilities


38,812


44,998Total accrued expenses and other current liabilities

$
92,268

$
91,676


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11. Long-term Debt and Liabilities Subject to Compromise

Long-term debt consists of the following (amounts in thousands):

December 31,2010

2009CMBS mortgage loan and related mezzanine financings, due November 12, 2010, interest at a margin above LIBOR (5.8% and 5.7% at December 31, 2010
and 2009, respectively) (a)(b)

$
2,475,000

$
2,475,000Land Loan, due February 7, 2011, interest at a margin above LIBOR or Alternate Base Rate (8.5% and 6.5% at December 31, 2010 and 2009,
respectively)


242,032


242,032Revolver, due August 7, 2012, interest at a margin above the Alternate Base Rate or the Eurodollar Rate (5.2% and 5.2% at December 31, 2010 and
2009, respectively) (b)


631,107


628,237Term Loan, due August 7, 2012, interest at a margin above the Alternate Base Rate or the Eurodollar Rate (4.9% and 4.7% at December 31, 2010 and
2009, respectively) (b)


242,500


245,0006% senior notes, interest payable semi-annually, principal due April 1, 2012, callable April 1, 2009 (b)


450,000


450,00073/4% senior notes, interest payable semi-annually, principal due August 15, 2016, callable August 15, 2011 (b)


400,000


400,00061/2% senior subordinated notes, interest payable semi-annually, principal due February 1, 2014, callable February 1,
2009 (b)


442,000


442,00067/8% senior subordinated notes, interest payable semi-annually, principal due March 1, 2016, callable March 1,
2009 (b)


660,000


660,00065/8% senior subordinated notes, interest payable semi-annually, principal due March 15, 2018, callable March 15,
2011 (b)


300,000


300,000Other long-term debt, weighted-average interest of 5.7% and 7.9% at December 31, 2010 and 2009, respectively, maturity dates ranging from 2010 to
2020


79,116


79,789Total long-term debt


5,921,755


5,922,058Current portion of long-term debt


(242,366
)

(242,347
)Long-term debt subject to compromise (b)


(5,670,730
)

(5,670,370
)Total long-term debt, net

$
8,659

$
9,341


(a)Prior
to the maturity date, the CMBS Borrower exercised a one-year extension to extend the maturity date to November 2010 subject to two
additional one-year extensions. The lenders have disputed the effectiveness of the extension.(b)Certain
long-term debts are subject to compromise as a result of the Chapter 11 Case and are classified as liabilities subject to
compromise in our consolidated balance sheet at December 31, 2010 as described below.


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Under bankruptcy law, actions by creditors to collect upon liabilities of the Debtors incurred prior to the Petition Date are stayed
and certain other pre-petition contractual obligations may not be enforced against the Debtors without approval of the Court. In accordance with ASC Topic 852, these liabilities are
classified as liabilities subject to compromise in our consolidated balance sheets as of December 31, 2010 and December 31, 2009, and are adjusted to the expected amount of the allowed
claims, even if they may be settled for lesser amounts. The expected amount of the allowed claims for certain liabilities subject to compromise differ from their prepetition carrying amounts mainly as
a result of the write-off of approximately $185.7 million in debt discounts during the year ended December 31, 2009 and the reversal of approximately $88.6 million in
nonperformance risk adjustments that had previously been included in the pre-petition fair values of the interest rate swap liabilities in accordance with ASC Topic 820. Adjustments to the
claims may result from negotiations, payments authorized by the Court, interest accruals, or other events. It is anticipated that such adjustments, if any, could be material. As of December 31,
2010 and December 31, 2009, respectively, certain pre-petition liabilities included in liabilities subject to compromise have been reduced or increased as a result of the payment of
certain accounts payable and notes payable as allowed by the court, the determination that certain liabilities are no longer subject to compromise, and as a result of non-cash adjustments
of the expected amount of the allowed claims related to interest rate swap liabilities. In addition, during the year ended December 31, 2010, a $6.2 million settlement liability related
to a pre-petition litigation matter was recorded. Liabilities subject to compromise are subject to the treatment set forth in the Joint Plan of Reorganization. Liabilities subject to
compromise are classified separately from long-term obligations and current liabilities on the accompanying consolidated balance sheets.

The
following table summarizes the components of liabilities subject to compromise (in thousands):

December 31,2010

2009CMBS mortgage loan and related mezzanine financings

$
2,475,000

$
2,475,000Revolver and term loan


873,607


873,2376% senior notes


450,000


450,00073/4% senior notes


400,000


400,00061/2% senior subordinated notes


442,000


442,00067/8% senior subordinated notes


660,000


660,00065/8% senior subordinated notes


300,000


300,000Other long-term debt


70,123


70,133Interest rate swaps


144,003


141,793Accrued interest


143,854


142,562Payroll, benefits and related liabilities


30,258


25,330Accounts payable and other liabilities


8,976


4,054Total liabilities subject to compromise

$
5,997,821

$
5,984,109




In accordance with ASC Topic 852, interest expense is recognized only to the extent that it will be paid during the bankruptcy
proceeding or that it is probable that it will be an allowed claim. Currently the

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11. Long-term Debt and Liabilities Subject to Compromise (Continued)

Company
is not accruing interest for the senior notes, the senior subordinated notes or the mezzanine financings. As a result, post-petition interest expense is lower than
pre-petition interest expense. The write-off of debt discounts and deferred debt issue costs related to liabilities subject to compromise also reduces post-petition
interest expense as there are no longer any non-cash amortization charges related to these items.



In connection with the Merger, on November 7, 2007, a number of wholly-owned unrestricted direct and indirect
subsidiaries of Station (collectively, the "CMBS Borrower") entered into a mortgage loan and related mezzanine financings in the aggregate principal amount of $2.475 billion (the
"CMBS Loans"), for the purpose of financing the Merger consideration payable to the Company's stockholders upon consummation of the Merger and paying fees and expenses incurred in connection
with the Merger.

The
CMBS Loans are secured by substantially all fee and leasehold real property comprising Palace Station, Boulder Station, Sunset Station and Red Rock (collectively, the
"CMBS Property") and matured in November 2010. Prior to the 2009 maturity date, the CMBS Borrower exercised a one-year extension to extend the maturity date to November 2010
subject to two additional one-year extensions. The lenders have disputed the effectiveness of the extension. Interest on the CMBS Loans is equal to one-month LIBOR plus
5.3% per annum, which includes an additional 3.0% default rate. As a result of the Chapter 11 Case, interest due on the mezzanine financings is not being remitted to the mezzanine lenders. The
CMBS Borrower is required to hedge the LIBOR interest rate such that it will not exceed 5.5% on a blended basis. As a result, the CMBS Borrower purchased interest rate caps with a
combined notional amount of $1.11 billion and a cap rate of 5.8% for an initial premium of $3.6 million. The initial premium was recorded in other assets and, in accordance with the
authoritative guidance for accounting for derivative instruments and hedging activities, was marked to market at each reporting period. The interest rate caps expired in November 2010. In addition,
the CMBS Borrower entered into an interest rate swap with a notional amount of $1.36 billion in which the borrower paid a fixed rate of approximately 5.3% and received
one-month LIBOR, terminating in November 2012. This interest rate swap was early terminated during the three months ended December 31, 2009 (see
Note 12Derivative Instruments).

The
loan documents for the CMBS Loans (the "CMBS Loan Documents") contain a number of covenants that, among other things, restrict, subject to certain exceptions, each
wholly-owned unrestricted direct and indirect subsidiary's ability to incur additional indebtedness; create liens on assets; engage in mergers or consolidations; sell assets; pay dividends
or make distributions; make investments, loans or advances; make certain acquisitions; engage in certain transactions with affiliates; and fundamentally change its business. The CMBS Loan
Documents also require the CMBS Borrower to fund specific reserves as defined. In addition, the CMBS Loan Documents contain a requirement that if the CMBS Borrower fails to
maintain a minimum lease coverage ratio of 1.15 to 1.00 during two consecutive fiscal quarters, 80% of the funds available following the payment of all amounts and reserves required to be made
pursuant to the CMBS Loan Documents be deposited into an account for the benefit of the lenders instead of permitting distribution of such funds to the Company. As of December 31, 2010,
we were not in compliance with the lease coverage ratio. In a letter dated April 6, 2009 to the CMBS Borrower, certain lenders under the CMBS Loans alleged that the
CMBS Borrower had not calculated the lease coverage ratio in accordance with the CMBS Loan Documents for the quarters ended September 30, 2008 and December 31, 2008 and
further alleged that the CMBS Borrower would not have been in compliance with the minimum lease coverage ratio if the lease coverage ratio had been properly

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11. Long-term Debt and Liabilities Subject to Compromise (Continued)

calculated.
As a result, those lenders instituted a block against the release of 80% of the funds available following the payment of all amounts and reserves due under the CMBS Loans and
instructed our depository bank to hold such funds in a collateral account for the benefit of the lenders. As a result of the Chapter 11 Case, the block against the release of funds increased to
100% of the funds available following the payment of all amounts and reserves due under the CMBS Loans. The total amount deposited in the collateral account in relation to this block was
$179.4 million and $78.7 million at December 31, 2010 and 2009, respectively, which is reflected in restricted cash on our consolidated balance sheets.



On February 7, 2008, CV Propco, LLC, a wholly-owned, indirect unrestricted subsidiary of Station, as
borrower, entered into a $250 million delay-draw term loan which is collateralized by land located on the southern end of Las Vegas Boulevard at Cactus Avenue and land
surrounding Wild Wild West in Las Vegas, Nevada (the "Land Loan"). The Land Loan contains no principal amortization and matured on February 7, 2011. At closing, $200 million was
drawn with the remaining $50 million drawn in June 2008. The proceeds were used to fund a distribution to Station, establish an interest reserve and pay transaction expenses. Borrowings under
the Land Loan bear interest at LIBOR plus 5.5% per annum or at the Alternate Base Rate (as defined in the Land Loan) plus 3.5% per annum, which includes an additional 2% default rate, at the
borrower's election. The borrower is required to hedge the interest rate such that LIBOR will not exceed 6.5%. As a result, the borrower entered into two interest rate swap agreements with notional
amounts of $200 million and $50 million in which the borrower pays a fixed LIBOR rate of 3.0% and 3.7%, respectively, and receives one-month LIBOR. These interest rate swaps
were early terminated in November 2009 (see Note 12Derivative Instruments).

The
Land Loan contains a number of covenants that, among other things, restrict, subject to certain exceptions, the borrower's ability to incur additional indebtedness; create liens on
assets; engage in mergers or consolidations; sell assets; pay dividends or make distributions; make investments, loans or advances; make certain acquisitions; engage in certain transactions with
affiliates; and fundamentally change its business. In addition, the Land Loan requires the borrower to maintain a loan-to-value ratio of no more than 40% and also contains
customary affirmative covenants and certain events of default.

During
the first quarter of 2009, the lenders under the land loan, based on appraisals, indicated their opinion that the value of the collateral had likely decreased to the point that
the loan-to-value ratio was no longer less than 40%, as required under the credit agreement, and thus an event of default had occurred under the credit agreement. As a result
of such event of default, lenders have become entitled to exercise remedies, including, among other things, the ability to declare the land loan and related accrued interest due and payable and to
foreclose on the underlying collateral of the borrower which at December 31, 2010 and 2009 included land with a book value of $116.4 million and $133.2 million, respectively. In
December 2009, the balance of the interest reserve account of $8.2 million was liquidated, and $8.0 million was applied as a principal reduction to the loan with the remainder applied to
the swap termination settlement amount. In addition, the borrower did not make the November 2009 payments or any subsequent payments due on account of interest or the interest rate swap agreements.
There is no recourse to the Company for any portion of the land loan that is not satisfied by the Borrower or the collateral. As a result of the events of default under the Land Loan, the related
outstanding indebtedness has been classified as current in the accompanying consolidated balance sheets at December 31, 2010 and 2009.

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11. Long-term Debt and Liabilities Subject to Compromise (Continued)

Subsequent
to December 31, 2010, we did not make scheduled interest payments totaling $3.4 million on the Land Loan.



In connection with the Merger, Station, as borrower, entered into a new $900 million senior secured credit agreement (the
"Credit Agreement") consisting of a $650 million revolving facility (the "Revolver") and a $250 million term loan (the "Term Loan"). The maturity date for both the Term Loan and the
Revolver is August 7, 2012 subject to a single 15-month extension (as further defined in the Credit Agreement). The Term Loan requires quarterly principal payments of $625,000. The
Revolver contains no principal amortization. Borrowings under the Credit
Agreement bear interest at a margin above the Alternate Base Rate or the Eurodollar Rate (each as defined in the Credit Agreement), as selected by us. The margin above such rates, and the fee on the
unfunded portions of the Revolver, will vary quarterly based on our total debt to Adjusted EBITDA (as defined in the Credit Agreement). As of December 31, 2010, the borrower's margin above the
Eurodollar Rate on borrowings under the Credit Agreement was 4.50%. As of December 31, 2010, the maximum margin for Eurodollar Rate borrowings was 4.50% and the maximum margin for Alternate
Base Rate borrowings was 3.50%. As of December 31, 2010, the fee for any unfunded portion of the Revolver was 0.375%.

The
Credit Agreement contains certain financial and other covenants. These include a minimum interest coverage, a maximum total debt to Adjusted EBITDA (as defined in the Credit
Agreement) ratio and a total senior secured debt to Adjusted EBITDA (as defined in the Credit Agreement) ratio.

For
the quarters ended December 31, 2008, March 31, 2009, June 30, 2009, September 30, 2009, December 31, 2009, March 31, 2010, June 30,
2010, September 30, 2010, and December 31, 2010, we were not in compliance with the financial covenants in the Credit Agreement. In addition, the filing of the Chapter 11 Case
constitutes an event of default under the terms of the Credit Agreement. Notwithstanding such events of default, in connection with the filing of the Chapter 11 Case, on July 28, 2009,
the Company entered into a Second Forbearance Agreement and Second Amendment to the Credit Agreement (the "Forbearance Agreement") with the lenders holding a majority of the commitments under its
Credit Agreement pursuant to which the lenders agreed, among other things, to forbear from exercising their default-related rights, remedies and powers or privileges against certain
subsidiaries that guarantee the Company's obligations under the Credit Agreement. The Forbearance Agreement terminated on January 31, 2010.



The indentures (the "Indentures") governing our $2.3 billion in aggregate principal amount of senior and senior subordinated
notes (the "Notes") contain certain customary financial and other covenants, which limit our and our subsidiaries' ability to incur additional debt. As a result of the filing of the Chapter 11
Case, all amounts outstanding under the Notes have been accelerated and are due and payable.

We
did not make scheduled interest payments on the Company's $450 million 61/2% Senior Subordinated Notes due February 1, 2014 (the
"2014 Subordinated Notes"), $400 million 73/4% Senior Notes due August 15, 2016 (the "2016 Senior Notes"), $700 million
67/8% Senior Subordinated Notes due 2016 (the "2016 Subordinated Notes"), $300 million 65/8% Senior Subordinated Notes due 2018
(the "2018 Subordinated Notes") or $450 million 6% Senior Notes due 2012 (the "2012 Senior Notes") since February 1, 2009. The grace periods with respect to the
payment of interest on the 2014 Subordinated Notes, 2016 Senior Notes,

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11. Long-term Debt and Liabilities Subject to Compromise (Continued)

2016 Subordinated
Notes, 2018 Subordinated Notes and 2012 Senior Notes have expired, resulting in an event of default under the indentures governing such indebtedness. In addition
as a result of the filing of the Chapter 11 Case, the 2014 Subordinated Notes, 2016 Senior Notes, 2016 Subordinated Notes, 2018 Subordinated Notes and
2012 Senior Notes have been accelerated and are due and payable, subject to the bankruptcy stay.



In January 2009, a wholly-owned subsidiary of the Company purchased $40.0 million in aggregate principal amount of
our outstanding $700 million 67/8% Senior Subordinated Notes and $8.0 million in aggregate principal amount of our outstanding $450 million
61/2% Senior Subordinated Notes for approximately $1.5 million plus approximately $1.4 million in accrued interest. As a result, during the three months ended
March 31, 2009, we recorded a gain on early retirement of debt of approximately $40.3 million, which is the difference between the reacquisition price and the net carrying amount of the
extinguished debt including the face amount of the associated debt adjusted for the related unamortized discount and debt issuance costs.



In November 2007, we entered into a sale-leaseback agreement related to our corporate office building with a
third-party real estate investment firm. We sold the corporate office building for approximately $70 million and subsequently entered into a lease with the purchaser for an initial
period of 20 years with four options to extend the lease, each option for an extension of five years. An event of default under the sale leaseback agreement for the corporate office building
occurred on October 26, 2009 as a result of the Chapter 11 Case not being dismissed within 90 days following the filing thereof, entitling the landlord to exercise its remedies
thereunder, including, among other things, termination of the lease and acceleration of contractual rents. Annual lease payments increase approximately 1.2% annually to approximately
$6.7 million in the final year of the original term. The lease also contains two options for us to repurchase the corporate office building, one option at the end of the fifth year of the lease
term and a second option at the end of the tenth year of the lease term, which is considered continuing
involvement under the authoritative guidance for accounting for sale-leaseback transactions involving real estate. Because of this continuing involvement, the sale-leaseback
transaction is being accounted for as a financing transaction, with the sales proceeds recorded as a liability and the lease payments recorded as interest expense. In addition, we continue to include
the corporate office building within property and equipment, net on our consolidated balance sheets and depreciate it according to our policy. In September 2010, this lease was amended to reduce the
annual lease payments by approximately 46%. The annual lease payments for the first 24 months of the amended lease will total approximately $2.9 million and will increase thereafter by
approximately 1.25% annually to approximately $3.8 million in the final year of the original term. The amendment did not change the terms of the two options to repurchase the building. The
amended lease was assumed by the Company with the authorization of the Bankruptcy Court. Minimum lease payments related to this lease for the years ended December 31, 2011, 2012, 2013, 2014,
and 2015, respectively, are approximately $2.9 million, $3.0 million, $3.1 million, $3.2 million, and $3.3 million. During the years ended December 31, 2010,
2009 and 2008, we recorded interest expense related to this lease of approximately $4.6 million, $5.3 million and $5.3 million, respectively.

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11. Long-term Debt and Liabilities Subject to Compromise (Continued)



At December 31, 2010, the estimated aggregate fair value of the Company's long-term debt was approximately
$2.90 billion, compared to its carrying value of $5.92 billion. The estimated fair value of our publicly traded debt securities at December 31, 2010 was based on quoted market
prices on or about December 31, 2010, which is considered a Level 1 input under the fair value measurement hierarchy. The estimated fair values of the Revolver and the Term Loan at
December 31, 2010, were based upon the value of the pending Opco asset purchase transaction, which is considered a Level 3 input under the fair value measurement hierarchy. The fair
value of the CMBS loans at December 31, 2010 was estimated based on the estimated value to be received by the CMBS lenders in the pending restructuring transaction as if the
transaction occurred at December 31, 2010, and utilizes Level 3 inputs under the fair value measurement hierarchy. The estimated fair values of all other long-term debt at
December 31, 2010 were assumed to be equal to the carrying values, and do not reflect any adjustment related to the Company's credit risk or the potential impact of the Chapter 11 Case
on the amounts that are recoverable by creditors.

At
December 31, 2009, the estimated aggregate fair value of the Company's long-term debt was approximately $3.81 billion, compared to its carrying value of
$5.92 billion. The estimated fair value of our publicly traded debt securities at December 31, 2009 was based on quoted market prices on or about December 31, 2009. The estimated
fair values of all other long-term debt at December 31, 2009 were assumed to be equal to the carrying values, and do not reflect any adjustment related to the Company's credit risk
or the potential impact of the Chapter 11 Case on the amounts that are recoverable by creditors.

Scheduled
maturities of long-term debt, excluding liabilities subject to compromise, are as follows (amounts in thousands):

Years ending December 31,2011

$
242,3662012


5,4222013


5892014


3672015


390Thereafter


1,891Total

$
251,025


Long-term
debt included in liabilities subject to compromise is not included in the above table since the scheduled maturities are uncertain as a result of the
Chapter 11 Case.

12. Derivative Instruments

Our objective in using derivatives is to add stability to interest expense and to manage our exposure to interest rate movements or other identified risks. To accomplish this objective,
we primarily use interest rate swaps and interest rate caps as part of our cash flow hedging strategy. Interest rate swaps utilized as cash flow hedges involve the receipt of variable-rate
payments in exchange for fixed-rate payments over the life of the agreements without exchange of the underlying principal amount. We do not use derivative financial instruments for trading
or speculative purposes.

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12. Derivative Instruments (Continued)

At
December 31, 2010 we have a floating-to-fixed interest rate swap with a notional amount of $250 million, which terminated in January 2011, which
effectively converts a portion of our floating-rate debt to a fixed rate. This interest rate swap is not designated as a hedging instrument and as a result, gains or losses resulting from
the change in fair value of this swap are recognized in earnings in the period of the change. Fluctuations in interest rates can cause the fair value of our derivative instruments to change each
reporting period. While we attempt to predict such movements in interest rates and impact on derivative instruments, such estimates are subject to a large degree of variability which could have a
significant impact on our consolidated financial statements. As of December 31, 2010, we paid a weighted-average fixed rate of approximately 3.0% and received one-month
LIBOR which approximated 0.3% on this interest rate swap.

During
the three months ended March 31, 2010, an interest rate swap of one of our 50% owned joint ventures with a notional amount of $430.0 million was early
terminated and as a result, we reclassified the remaining $2.0 million of deferred losses, net of tax, from accumulated other comprehensive income (loss) into operations. As a result of the
termination of this interest rate swap, the carrying amount of the liability was adjusted to the termination settlement amount and a loss was recorded by the joint
venture. Our 50% share of this loss is reflected in interest and other expense from joint ventures in the accompanying consolidated statement of operations.

During
the three months ended December 31, 2009, we early terminated a floating-to-fixed interest rate swap with a notional amount of $1.36 billion.
Prior to termination, this cash flow hedges effectively converted a portion of our floating-rate debt to a fixed rate. This interest rate swap was not designated as a hedging instrument
and as a result, gains or losses resulting from the change in fair value of this swap were recognized in earnings in the period of the change. The estimated expected amount of the allowed claim
related to this interest rate swap is classified in liabilities subject to compromise at December 31, 2009.

Also
during the three months ended December 31, 2009, we early terminated two floating-to-fixed interest rate swaps with a combined notional amount of
$250 million and it became probable that the original forecasted transactions would not occur. Prior to termination, these cash flow hedges effectively converted a portion of our
floating-rate debt to a fixed rate. These interest rate swaps previously qualified and were designated as cash flow hedges, resulting in the effective portion of the gain or loss from the
change in fair value being reported as a component of other comprehensive income (loss). The variable cash flow method was used to measure the ineffectiveness of the hedging relationship. Accordingly,
the calculation of ineffectiveness involved a comparison of the present value of the cumulative change in the expected future cash flows of the variable portion of the interest rate swaps and the
present value of the cumulative change in the expected future variable interest payments designated in the hedging relationship. During the first quarter of 2009, these interest rate swaps were
de-designated as cash flow hedges for accounting purposes. As a result of the termination of these swaps, we reclassified $1.7 million in deferred losses, net of tax, from
accumulated other comprehensive income into earnings. The total termination settlement amount of these swaps is recorded in accrued expenses and other current liabilities at December 31, 2009.

During
the second quarter of 2009, two interest rate swaps of one of our 50% owned joint ventures with notional amounts of $297.8 million were terminated and it became probable
that the original forecasted transactions would not occur. As a result, we reclassified $0.3 million in deferred losses, net of tax, from accumulated other comprehensive income into earnings.

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12. Derivative Instruments (Continued)

Accumulated
other comprehensive loss on our consolidated balance sheets includes deferred gains and losses related to our interest rate swaps that were previously designated as hedging
instruments under the authoritative guidance for accounting for derivative instruments and hedging activities, as well as our proportionate share of our 50% owned joint ventures' deferred gains and
losses on interest rate swaps that were previously designated as hedging instruments.

The
activity in deferred gains (losses) on derivatives included in accumulated other comprehensive loss is as follows (amounts in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Deferred losses on derivatives included in accumulated other comprehensive loss, beginning balance

$
(1,985
)
$
(8,414
)
$
(6,477
)Gains (losses) recognized in other comprehensive loss on derivatives (effective portion), net of tax





1,286


(1,937
)Losses reclassified from other comprehensive income into income (effective portion) in change of fair value of derivative instruments





3,152


Losses reclassified from other comprehensive income into income as a result of the discontinuance of cash flow hedges because it is probable that the
original forecasted transactions will not occur


1,985


1,991


Deferred losses on derivatives included in accumulated other comprehensive loss, ending balance

$


$
(1,985
)
$
(8,414
)


In
accordance with ASC Topic 852, the Debtors' interest rate swap liabilities that are subject to compromise are classified as liabilities subject to compromise in our consolidated
balance sheets as of December 31, 2010 and December 31, 2009. These interest rate swap liabilities are adjusted to the expected amounts of the allowed claims, which are different than
the prepetition carrying amounts of these liabilities as a result of changes in the fair values of these instruments. Gains and losses resulting from adjustments to the carrying values of swap
liabilities subject to compromise are recorded in reorganization items in the accompanying consolidated statements of operations.

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12. Derivative Instruments (Continued)

Presented below are the effects of derivative instruments on our consolidated statements of operations (amounts in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Amounts included in change in fair value of derivative instruments:Gains (losses) from interest rate swaps

$


$
28,019

$
(19,762
)Losses from interest rate cap


(42
)

(121
)

(3,295
)Net gains (losses) for derivatives not designated as hedging instruments


(42
)

27,898


(23,057
)Losses reclassified from other comprehensive income into income (effective portion)





(1,501
)

Losses reclassified from accumulated other comprehensive income into income as a result of the discontinuance of cash flow hedges because it is probable
that the original forecasted transactions will not occur





(2,668
)

Total derivative gains (losses) included in change in fair value of derivative instruments


(42
)

23,729


(23,057
)Amounts included in reorganization items:Losses from interest rate swaps


(2,607
)

(80,790
)

Amounts included in interest and other expense from joint ventures:Gains (losses) for derivatives not designated as hedging instruments


(22,221
)

7,936


(12,328
)Losses reclassified from other comprehensive income into income (effective portion)


(386
)

(3,348
)

Losses reclassified from accumulated other comprehensive income into income as a result of the discontinuance of cash flow hedges because it is probable
that the original forecasted transactions will not occur


(2,667
)

(394
)

Total derivative gains (losses) included in interest and other expense from joint ventures


(25,274
)

4,194


(12,328
)Total derivative losses included in consolidated statements of operations

$
(27,923
)
$
(52,867
)
$
(35,385
)


The
difference between amounts received and paid under our interest rate swap agreements, as well as any costs or fees, is recorded as a reduction of, or an addition to, interest expense
as incurred over the life of the interest rate swaps. The net effect of the interest rate swaps and interest rate cap resulted in an increase in interest expense of approximately $7.0 million,
$77.5 million, and $35.1 million for the years ended December 31, 2010, 2009 and 2008, respectively. In addition, our proportionate share of the net effect of interest rate swaps
of our 50% owned joint ventures is reflected as an increase (decrease) in interest and other expense from joint ventures in our consolidated statements of operations, and totaled

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12. Derivative Instruments (Continued)

approximately
$27.3 million, $10.6 million, and $17.3 million for the years ended December 31, 2010, 2009 and 2008, respectively.

The
fair values of our outstanding derivative instruments are recorded in our consolidated balance sheet as follows (amounts in thousands):

Fair Value atBalance Sheet Classification

December 31,
2010

December 31,
2009Derivatives not designated as hedging instruments:Interest rate swaps:Liabilities subject to compromise(a)


144,003


141,793Accrued expenses and other current liabilities


9,334


8,937Total interest rate swaps not designated as hedging instruments


153,337


150,730Total liability derivatives

$
153,337

$
150,730Interest rate cap:Other assets, net

$


$
42Total asset derivatives

$


$
42


(a)Includes
termination values of interest rate swaps that were terminated during 2009.


13. Commitments and Contingencies



We entered into a ground lease for 27 acres of land on which Boulder Station is located. We lease this land from KB Enterprises, a
company owned by the Frank J. Fertitta and Victoria K. Fertitta Revocable Family Trust (the "Related Lessor"). Frank J. Fertitta, Jr. and Victoria K. Fertitta are the parents of Frank J. Fertitta III,
Chairman, Chief Executive Officer and President of Station and Lorenzo J. Fertitta, Vice Chairman of Station. The lease has a maximum term of 65 years, ending in June 2058. The lease provides
for monthly payments of $222,933 through May 2018. In June 2013, and every ten years thereafter, the rent will be adjusted to the product of the fair market value of the land and the greater of
(i) the then prevailing annual rate of return for comparably
situated property or (ii) 8% per year. In no event will the rent for any period be less than the immediately preceding period. In June 2018, and every ten years thereafter, the rent will be
adjusted by a cost of living factor. Pursuant to the ground lease, we have an option, exercisable at five-year intervals with the next option in June 2013, to purchase the land at fair
market value. Our leasehold interest in the property is subject to a lien to secure borrowings under the CMBS Loan Documents.



We entered into a ground lease for 47 acres of land on which Texas Station is located. We lease this land from Texas Gambling
Hall & Hotel, Inc., a company owned by the Related Lessor. The lease has a

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13. Commitments and Contingencies (Continued)

maximum
term of 65 years, ending in July 2060. The lease provides for monthly rental payments of $337,417 through June 2010 with scheduled adjustments in July 2010, and every ten years
thereafter, to the product of the fair market value of the land and the greater of (i) the then prevailing annual rate of return being realized for owners of comparable land in Clark County or
(ii) 8% per year. The July 2010 adjustment was deferred. In July 2015, and every ten years thereafter, the rent will be adjusted by a cost of living factor. In no event will the rent for any
period be less than the immediately preceding period. Pursuant to the ground lease, we have an option, exercisable at five-year intervals with the next option in May 2015, to purchase the
land at fair market value. Our leasehold interest in the property is subject to a lien to secure borrowings under the Credit Agreement.



We amended the lease and purchase agreement for the 19-acre parcel of land on which the Wild Wild West is located in
December 2008. Under the amended agreement, we have an option to purchase the land on or before December 28, 2011 for a purchase price of $36 million. The amended lease also includes
options to purchase the land in July 2023, 2044 and 2065 for a purchase price equal to fair market value as of July 2022, 2043 and 2064, respectively. No amounts related to these purchase options have
been recorded on our consolidated balance sheets at December 31, 2010 and 2009. Additionally, the annual lease expense was increased from $1.6 million for the year ended
December 31, 2008 to $2.1 million and $2.4 million for the years ended December 31, 2009 and 2010, respectively. In July 2013, and every three years thereafter, the rent
will be adjusted by changes in the consumer price index, not to exceed 12% and shall at no time be decreased. In March 2011, we were notified by the lessor that the lease had been terminated. We are
currently in negotiations regarding possible modifications to this lease, however we can provide no assurance that we will be able to reach an agreement with the lessor.



In connection with the financing of the CMBS Loans, certain Station subsidiaries (the "Operating Subsidiaries") entered into an amended
and restated purchase and sale agreement with a wholly-owned subsidiary of Station, which immediately prior to the closing of the CMBS Loans, assigned its rights and obligations under the amended and
restated purchase and sale agreement to a newly created subsidiary of the Company, the CMBS Borrower. Pursuant to this purchase and sale agreement, the CMBS Property was sold to the CMBS Borrower.
Immediately following the sale, such CMBS Property was leased back to the Company pursuant to a master lease with an initial term of fifteen years and extension terms for an aggregate of ten
additional years. The Company in turn subleased each parcel of the CMBS Property back to the Operating Subsidiaries, with each such sublease having the same term as the master lease. All transactions
related to this lease are intercompany in nature and as such eliminate upon consolidation.



In addition to the leases described above, we also lease certain other buildings and equipment used in our operations, which have
operating lease terms expiring through 2013.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

13. Commitments and Contingencies (Continued)

Future
minimum lease payments required under all non-cancelable operating leases are as follows (amounts in thousands):

Years ending December 31,2011

$
6,8542012


6,8312013


6,7422014


6,7242015


6,724Thereafter


294,214Total

$
328,089


Rent
expense totaled approximately $9.6 million, $9.7 million, and $9.9 million for the years ended December 31, 2010, 2009 and 2008, respectively.

During
the year ended December 31, 2009, the Debtors rejected two operating leases related to unoccupied office space. Under Section 365 of the Bankruptcy Code, the Debtors
may assume, assume and assign, or reject executory contracts and unexpired leases, including real property and equipment leases with the approval of the Bankruptcy Court and under certain other
conditions. Rejection constitutes a court-authorized termination of the lease or contract in question and, subject to certain exceptions, relieves the Debtors of future obligations under such lease or
contract, but creates a pre-petition claim for damages caused by such termination, subject to the Debtors' right to review and contest such claim. Parties whose contracts or leases are
rejected may file claims against the Debtors for damages. Generally, the assumption of an executory contract or unexpired lease requires the Debtors to cure all prior defaults under such executory
contract or unexpired lease, including all pre-petition arrearages, and to provide adequate assurance of future performance. In this regard, the Debtors' financial statements include
amounts classified as "liabilities subject to compromise" that the Bankruptcy Court allowed as claim amounts as a result of the Debtors' rejection of various executory contracts and unexpired leases.
Additional amounts may be included in "liabilities subject to compromise" in future periods if additional executory contracts and unexpired leases are rejected. Conversely, the Debtors would expect
that the assumption of certain executory
contracts and unexpired leases may convert certain liabilities shown in future financial statements as subject to compromise to post-petition liabilities.



In March 2008, in the matter captioned Sparks Nugget, Inc. vs. State ex rel. Department of Taxation, the Nevada Supreme Court
ruled that food and non-alcoholic beverages purchased for use in complimentary meals provided to employees and patrons are not subject to Nevada use tax. We have filed refunds for the
periods from April 2000 through February 2008. The amount subject to these refunds is approximately $15.3 million plus interest. Any amount refunded to us would be reduced by a contingent fee
owed to a third party advisory firm. In April 2008, the Department of Taxation filed a motion for rehearing of the Supreme Court's decision, and in July 2008, the Nevada Supreme Court denied the
Department of Taxation's motion for rehearing. The Department of Taxation subsequently took the position that these purchases are subject to Nevada sales tax. Accordingly, we have not recorded a
receivable related to a refund for the previously paid use tax on these purchases in the accompanying consolidated balance sheets as of December 31, 2010 and December 31, 2009,
respectively. However, we

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

13. Commitments and Contingencies (Continued)

began
claiming this exemption on sales and use tax returns for periods subsequent to February 2008 given the Nevada Supreme Court decision. In March 2010, the Department of Taxation issued a
$12.7 million sales tax assessment, plus interest of $8.2 million, related to these food costs. We have not accrued a liability related to this assessment because we do not believe the
Department of Taxation's position has any merit, and therefore we do not believe it is probable that we will owe this tax. The sales tax assessment and the refund cases have been appealed to the
Administrative Law Judge of the Nevada Department of Taxation and a hearing date has not yet been set.



In December 2006, we entered into an amended and restated operating agreement with FBLV Holding Company LLC ("FBLV"). Pursuant
to the amended and restated operating agreement, the parties contributed approximately 52 acres (with approximately 20 acres contributed by us for our 50% ownership and approximately 32 acres
contributed by FBLV for their 50% ownership) of improved and unimproved real property located along Rancho Road south of Palace Station in Las Vegas, Nevada into a joint venture. Through
December 31, 2010, we contributed an additional $47.2 million to fund the acquisition of additional property as well as design and development costs.

Effective
January 1, 2010, Richfield Homes joint venture was formed by the members of Rancho Road and a portion of the assets of Rancho Road were contributed to Richfield Homes.

In
early November 2010, Rancho Road and Richfield Homes disposed of substantially all of their assets. In connection with the asset disposal, the Company received a distribution of
$3.5 million. These entities were dissolved during late 2010, and as a result of the deficit carrying value of the Company's investment in Rancho Road, a gain of $124.2 million gain was
recognized upon dissolution.



See Note 8 for information regarding commitments and contingencies related to the Company's Native American Development
activities.

14. Stockholders' Equity



We are authorized to issue up to 10,000 shares of voting common stock, $0.01 par value per share. At December 31, 2010, there
were 41.7 shares of voting common stock issued and outstanding. Each holder of issued and outstanding shares of voting common stock is entitled to one vote for each share held of record on each matter
submitted to a vote of stockholders. Holders of our voting common stock have no cumulative voting, conversion or redemption rights. Under the Equityholders Agreement of Station, FCP and Fertitta
Partners, as amended, in certain circumstances, FCP VoteCo, as the holder of Station's voting common stock, shall have the preemptive right to purchase or subscribe to any voting stock to be sold or
issued by Station on the terms and conditions as such voting stock is being offered and sold or issued. Certain actions defined as Major Actions in the Equityholders Agreement of Station, FCP and
Fertitta Partners, as amended, require the approval of Thomas J. Barrack, Jr. and at least one of Frank J. Fertitta III or Lorenzo J. Fertitta. Subject to any preferences that may
be granted to the holders of our preferred stock, each holder of voting common stock is entitled to receive ratably, such dividends as may

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

14. Stockholders' Equity (Continued)

be
declared by our Board of Directors out of funds legally available therefore, as well as any distributions to the stockholders and, in the event of our liquidation, dissolution or winding up is
entitled to share ratably in all our assets remaining after payment of liabilities.



We are authorized to issue up to 100,000,000 shares of non-voting common stock, $0.01 par value per share. At
December 31, 2010, there were 41,674,838 shares of non-voting common stock issued and outstanding. Holders of issued and outstanding shares of non-voting common stock
are not entitled to vote on any matters to be voted on by the stockholders of the Company and are not to be included in determining the number of shares voting or entitled to vote. Holders of our
non-voting common stock have no cumulative voting, conversion or redemption rights. Under the Equityholders Agreement of Station, FCP and Fertitta Partners, as amended, in certain
circumstances, holders of non-voting common stock shall have the preemptive right to purchase or subscribe to any equity interests (other than voting stock) to be sold or issued by Station
on the same terms and conditions as such equity interests are being offered and sold or issued. Subject to any preferences that may be granted to the holders of our preferred stock, each holder of
non-voting common stock is entitled to receive ratably, such dividends as may be declared by our Board of Directors out of funds legally available therefore, as well as any distributions
to the stockholders and, in the event of our liquidation, dissolution or winding up is entitled to share ratably in all our assets remaining after payment of liabilities.



We are authorized to issue up to 10,000 shares of preferred stock, $0.01 par value per share of which none are issued. The Board of
Directors, without further action by the holders of our common stock, may issue shares of preferred stock in one or more series and may fix or alter the rights, preferences, privileges and
restrictions, including the voting rights, redemption provisions (including sinking fund provisions), dividend rights, dividend rates, liquidation rates, liquidation preferences, conversion rights and
the description and number of shares constituting any wholly unissued series of preferred stock. Except as described above, our Board of Directors, without further stockholder approval, may issue
shares of preferred stock with rights that could adversely affect the rights of the holders of our common stock. The issuance of shares of preferred stock under certain circumstances could have the
effect of delaying or preventing a change of control of Station or other corporate action.



ASC Topic 220,Comprehensive Incomerequires companies to disclose other comprehensive
income (loss) and the components of such income (loss). Comprehensive income (loss) is the total of net income (loss) and all other non-stockholder changes in equity, and includes
unrealized gains (losses) on available-for-sale securities and the amortization of unrecognized pension and postretirement benefit plan liabilities. In addition, comprehensive
income (loss) includes recognition of deferred mark-to-market adjustments on interest rate swaps that were previously designated as hedging instruments, as well as our 50%
share of deferred mark-to-market adjustments on interest rate swaps previously designated as

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

14. Stockholders' Equity (Continued)

hedging
instruments at Green Valley Ranch and Aliante Station. Comprehensive loss was computed as follows (amounts in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Net loss

$
(565,442
)
$
(1,679,514
)
$
(3,268,500
)Mark-to-market valuation of interest rate swaps, net of tax


1,985


6,429


(1,937
)Unrealized gain (loss) on available-for-sale securities, net of tax


(80
)

123


(695
)Amortization of unrecognized pension and postretirement benefit plan liabilities, net of tax


(940
)

816


6,323Comprehensive loss

$
(564,477
)
$
(1,672,146
)
$
(3,264,809
)


The
components of accumulated other comprehensive income (loss) are as follows (amounts in thousands):

December 31,2010

2009Mark-to-market valuation of interest rate swaps, net of tax

$


$
(1,985
)Unrealized loss on available-for-sale securities, net of tax


(165
)

(85
)Amortization of unrecognized pension and postretirement benefit plan liabilities, net of tax


208


1,148Accumulated other comprehensive income (loss)

$
43

$
(922
)


The
mark-to-market valuation of interest rate swaps, net of tax, included in accumulated other comprehensive loss at December 31, 2009 relates to our 50%
interest in the mark-to-market valuation of the interest rate swap at Green Valley Ranch that was de-designated as a cash flow hedge during the year ended
December 31, 2009. During the three months ended March 31, 2010, the Green Valley Ranch interest rate swap was terminated and as a result, the remaining balance of deferred losses, net
of tax, in accumulated other comprehensive loss was reclassified to operations.

15. Asset Impairments and Write-downs and Other Charges, Net

Included in our statements of operations for the years ended December 31, 2010, 2009, and 2008 are various pretax charges related to impairments of goodwill, intangible assets and
other assets, as well as write-downs and other charges, net. Write-downs and other charges, net includes gains or losses on asset

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. Asset Impairments and Write-downs and Other Charges, Net (Continued)

disposals,
severance expense and other non-routine transactions. Components of asset impairments and write-downs and other charges, net were as follows:

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Impairment of goodwill (Note 5)

$
60,386

$
181,785

$
2,594,992Impairment of other intangible assets (Note 5)

$
4,704

$
255,263

$
327,326Impairments of other assets:Impairment of land held for development (Note 6)

$
114,378

$
617,383

$
147,968Impairment of investments in joint ventures (Note 7)


16,267


30,003


272,961Impairment of property and equipment (Note 4)


66,647


179,430


Impairment of Native American project costs and related capitalized interest (Note 8)





12,997


Other, net(a)


(362
)




$
196,930

$
839,813

$
420,929Write-downs and other charges, net:Write-off of abandoned projects

$


$
2,362

$
44,576Loss (gain) on disposal of assets, net


534


478


4,546Gain (loss) on land disposition (Note 6)


(74
)

5,091


Severance expense


2,687


2,966


4,972Legal settlement (Note 22)


6,200





Management agreement/lease termination


898


4,130


4,825Reserve for note receivable from unconsolidated affiliate





5,261


Other asset write-offs


9,000





Write-off of debt offering and restructuring fees





519


3,706Write-downs and other charges, net

$
19,245

$
20,807

$
62,625


(a)During
2010, we recorded an impairment loss of $1.0 million related to a license right intangible, and in connection with this impairment, we also
wrote off an associated net liability of approximately $0.4 million.




During the years ended December 31, 2009 and 2008, due to the current economic conditions, we decided to abandon several
projects at our properties that were in the developmental stage. In conjunction with these decisions, the costs incurred to date on such projects were expensed during the years ended
December 31, 2009 and 2008.



During the year ended December 31, 2010, we recognized $0.9 million in lease termination expense, primarily related to
certain restaurant facilities that we leased to third party operators. During the year ended December 31, 2009, we recognized lease termination expense of $3.1 million related to the

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. Asset Impairments and Write-downs and Other Charges, Net (Continued)

termination
of an equipment lease and $1.0 million related to leased office space no longer being utilized. During the year ended December 31, 2008, we recognized expense of
$1.7 million related to termination of various leases related to land adjacent to the current Wild Wild West property and $3.1 million related to leased office space no longer being
utilized.



During the year ended December 31, 2009, we recognized a $5.3 million expense related to a note receivable from an
unconsolidated affiliate that may not be recoverable. See Note 3 for additional information.



Included in write-off of debt offering and restructuring fees is the write-off of fees and costs incurred in
connection the termination of a debt restructuring project for one of our non-Debtor subsidiaries during 2009, and the write-off of cancelled debt offering fees and costs
incurred to launch a private exchange offer in November 2008 that was subsequently terminated in December 2008.



During the year ended December 31, 2010, we wrote off $9 million in other assets as a result of the expiration of certain
land purchase options.

16. Share-Based Compensation

Long-term incentive compensation is provided in the form of non-voting limited liability company membership interests in FCP and Fertitta Partners pursuant to the
Second Amended and Restated Operating Agreement of Fertitta Colony Partners and the Amended and Restated Operating Agreement of Fertitta Partners, respectively (collectively "the Operating
Agreements"). The Operating Agreements allow certain officers and members of management of the Company to participate in the long-term growth and financial success of the Company through
indirect ownership of Class B Units and direct ownership of Class C Units in FCP and Fertitta Partners. The purpose is to promote the Company's long-term growth and
profitability by aligning the interests of the Company's management with the interests of the owners of the Company and by encouraging retention.

Upon
the consummation of the Merger, certain members of management were awarded indirect ownership of Class B Units and direct ownership of Class C Units in each of FCP and
Fertitta Partners. During the Successor Period, 6.9 million Class B Units were granted with a weighted-average grant-date fair value of $44.92, of which 6.4 million
units vested immediately and the remaining units vest equally over five years. In addition, 0.3 million and 1.4 million Class C Units were granted during the year ended
December 31, 2008 and the Successor Period with a weighted average grant-date fair value of $12.43 and $28.54, respectively. The Class C Units vest equally over five years.
The Class C Units include certain call and put provisions as defined in the Operating Agreements, such that under certain circumstances, within ninety days after termination, in certain cases,
of the Class C Unit holder's employment with Station, FCP and Fertitta Partners can call the Class C Units and the employee that holds the Class C Units can put the Class C
Units back to FCP and
Fertitta Partners. The conditions that could result in the employee putting the Class C Units back to FCP and Fertitta Partners are either contingent or within the control of the issuer.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

16. Share-Based Compensation (Continued)

During the year ended December 31, 2008, 0.7 million of the Class B Units that were previously issued upon consummation of the Merger were transferred to certain
officers and management of the Company. These Class B Units grants had a weighted average grant date fair value of $17.65, and vest equally over five years. During the year ended
December 31, 2008, additional Class C Units were issued to certain management of the Company. During the years ended December 31, 2009 and 2010, no Class B Units or
Class C Units were granted.

The
Company determined the fair value associated with these units taking into account the estimated enterprise value of the Company, expected term of the units (5.5 years and
6.0 years for the years ended December 31, 2008 and 2007, respectively), expected volatility based on expected volatility of equity instruments of comparable companies (22% and 30% for
the years ended December 31, 2008 and 2007 respectively) and a risk free rate of 3.33% and 4.01% for the years ended December 31, 2008 and 2007, respectively. The estimated fair value of
the units is being recognized in expense on a straight-line basis over the requisite service periods of the awards.

At
December 31, 2010, we had unearned share-based compensation of approximately $29.2 million associated with Class B Units and Class C Units which is
expected to be recognized over a period of approximately 2.8 years. The Class B Units and the Class C Units are expected to be cancelled as a result of the Chapter 11
proceedings, and the remaining unearned share-based compensation will be recognized upon cancellation.

The
following table represents where recorded share-based compensation expense was classified in the accompanying consolidated statements of operations (amounts in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Total share-based compensation

$
13,617

$
14,083

$
14,445Less compensation costs capitalized


(236
)

(237
)

(234
)Less reimbursed compensation costs








(62
)Share-based compensation recognized as expense

$
13,381

$
13,846

$
14,149Casino expense

$
138

$
89

$
312Selling, general &administrative


1,938


2,264


2,299Corporate


8,173


8,296


8,025Development and preopening


3,132


3,197


3,451Earnings (losses) from joint ventures








62Share-based compensation recognized as expense


13,381


13,846


14,149Tax benefit


(4,683
)

(4,846
)

(4,952
)Share-based compensation expense, net of tax

$
8,698

$
9,000

$
9,197


17. Executive Compensation Plans

We have employment agreements with certain of our executive officers. These contracts provide for, among other things, an annual base salary, supplemental long-term
disability and supplemental life insurance benefits in excess of our normal coverage for employees. In addition, we have adopted a Supplemental Executive Retirement Plan for our Chief Executive
Officer and a Supplemental

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

17. Executive Compensation Plans (Continued)

Management
Retirement Plan for certain key executives as selected by our Board of Directors. Other executive plans include a Deferred Compensation Plan and a Long-Term Stay-On
Performance Incentive Plan. See Note 20 for additional information regarding the Supplemental Executive Retirement Plan and the Supplemental Management Retirement Plan.

18. Reorganization Items, Net

Reorganization items, net represent amounts incurred as a direct result of the Chapter 11 Case and are
presented separately in the consolidated statements of operations. The components of reorganization items are as follows (amounts in thousands):

Year Ended
December 31, 2010

Year Ended
December 31, 2009Professional fees and retainers

$
79,346

$
66,522Write-off of debt discount and debt issuance costs





225,011Adjustment of swap carrying values to expected amounts of allowed claims


2,607


80,790Other


795


3,565Reorganization items, net

$
82,748

$
375,888


Professional
fees include financial, legal and other services directly associated with the reorganization process. Cash payments for the year ended December 31, 2010 and 2009 for
professional fees and retainers and other reorganization items totaled $82.8 million and $59.8 million, respectively. In accordance with ASC 852 on the Petition Date the Company ceased
amortization of debt discounts and deferred debt issuance costs related to the liabilities subject to compromise. Reorganization items, net for the year ended December 31, 2009 includes losses
of $185.7 million and $39.3 million, respectively, representing the write-off of unamortized debt discounts and debt issuance costs related to certain liabilities subject to
compromise. The write-off of these amounts resulted in an adjustment of the net carrying value of the related liabilities to the expected amount of the allowed claims.

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STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

19. Fair Value Measurements

The following table presents information about our financial assets and liabilities measured at fair value on a recurring basis at December 31, 2010, and indicates the fair value
hierarchy of the valuation techniques utilized to determine such fair value (amounts in thousands):

Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)

Significant
Other
Observable
Inputs
(Level 2)

Significant
Unobservable
Inputs
(Level 3)

Balance at
December 31,
2010AssetsInterest rate caps

$


$


$


$
Available-for-sale securities


271








271Total assets measured at fair value on a recurring basis

$
271

$


$


$
271LiabilitiesLiabilities not subject to compromise:Interest rate swap

$


$
397

$


$
397Liabilities subject to compromise:Deferred compensation liabilities


1,194








1,194Total liabilities measured at fair value on a recurring basis

$
1,194

$
397

$


$
1,591


The
fair values of available-for-sale securities and deferred compensation liabilities are based on quoted prices in active markets. The fair values of interest
rate swaps and interest rate caps are based on quoted market prices from various banks for similar instruments. These quoted market prices are based on relevant factors such as the contractual terms
of our interest rate swap agreements and interest rate curves and are adjusted for the non-performance risk of either us or our counterparties, as applicable. Certain interest rate swaps
previously accounted for at fair value have been terminated early, and as a result, are no longer accounted for at fair value on a recurring basis.

20. Retirement Plans

Effective as of November 30, 1994, we adopted the Supplemental Executive Retirement Plan (the "SERP"), which is an unfunded defined benefit plan for the Chief Executive Officer
and President as sole participants. On January 21, 2005, Station amended the SERP (the "First SERP Amendment"). The purpose of the First SERP Amendment was to (i) increase the Early
Retirement Date (as defined in the SERP) for participants from age 45 to age 50, (ii) increase the Normal Retirement Date (as defined in the SERP) for the participants from
age 55 to age 60, (iii) add the President of the Company as a participant, and (iv) include the average annual bonus (in addition to base salary) earned by participants for
the three most recent fiscal years in determining Final Annual Compensation (as defined in the SERP). On November 7, 2007, Station further amended the SERP for the purpose of updating the
"Change of Control" definition and confirming that the Merger would not constitute a "Change of Control" for purposes of the plan. On April 17, 2008, the Company executed the third amendment of
the SERP to

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

20. Retirement Plans (Continued)

increase
the Early Retirement Date (as defined in the SERP) for participants from age 50 to age 60 and increase the Normal Retirement Date (as defined in the SERP) for participants from
age 60 to age 65.

Effective
as of November 30, 1994, we adopted the Supplemental Management Retirement Plan (the "SMRP"), which is an unfunded defined benefit plan. Certain key executives (other
than the Chief Executive Officer and President) as selected by the Board of Directors are able to participate in the SMRP. On November 7, 2007, Station amended the SMRP for the purpose of
updating the "Change of Control" definition under the plan and confirming that the Merger would not constitute a "Change of Control" for purposes of the plan. On April 17, 2008, the Company
executed the second amendment of the SMRP to increase the Early Retirement Date (as defined in the SMRP) for participants from age 55 to age 60 and increase the Normal Retirement Date
(as defined in the SMRP) for participants from age 60 to age 65.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

20. Retirement Plans (Continued)

A
reconciliation of the beginning and ending balances of the pension benefit obligation and fair value of the plan assets and the funded status is as follows (in thousands):

December 31,2010

2009Change in pension benefit obligation:Benefit obligation at beginning of year

$
22,002

$
20,159Service cost


1,707


2,115Interest cost


1,296


1,217Plan amendments





Net actuarial loss (gain)


1,382


(1,318
)Benefits paid





(171
)Benefit obligation at end of year

$
26,387

$
22,002Change in plan assets:Contribution by Station

$


$
171Benefits paid





(171
)Fair value of plan assets at end of year

$


$
Funded status of the plan (underfunded)

$
(26,387
)
$
(22,002
)Unrecognized net actuarial loss





Unrecognized actuarial loss





Net amount recognized

$
(26,387
)
$
(22,002
)Amounts recognized in the consolidated balance sheet consist of:Current liabilities (a)

$
(416
)
$
(293
)Accrued pension costs (a)


(25,651
)

(23,474
)Accumulated other comprehensive income


(320
)

1,765Net amount recognized

$
(26,387
)
$
(22,002
)Weighted average assumptions:Discount rate


5.25
%

5.50
%Salary rate increase


5.00
%

5.00
%


(a)As
a result of the Chapter 11 Case, the current liabilities and the accrued pension costs at December 31, 2010 and 2009 are classified as
liabilities subject to compromise in the accompanying consolidated balance sheets.


131

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STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

20. Retirement Plans (Continued)




The
components of the net periodic pension benefit cost consist of the following (in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Service cost

$
1,707

$
2,115

$
1,850Interest cost


1,296


1,217


1,253Amortization of prior service credit


(63
)

(63
)

(70
)Amortization actuarial losses








92Net periodic pension cost


2,940


3,269


3,125Curtailment charge








(1,525
)Total pension cost

$
2,940

$
3,269

$
1,600


As
a result of the Chapter 11 Case, SERP and SMRP benefit payments were suspended as of July 28, 2009, and we expect the SERP and SMRP to be terminated in connection with
the consummation of the plan of reorganization. As a result, we do not expect to pay any benefits under the SERP or SMRP in the future, however since this expectation is based on assumptions about
future events, actual results may vary significantly from this estimate.



We have a defined contribution 401(k) plan, which covers all employees who meet certain age and length of service requirements and
allows an employer contribution up to 50% of the first 4% of each participating employee's compensation. Plan participants can elect to defer before tax compensation through payroll deductions. These
deferrals are regulated under Section 401(k) of the Internal Revenue Code. In December 2008, we announced that we had elected to suspend the employer contribution effective
January 1, 2009 therefore there were no matching contributions during the years ended December 31, 2010 and 2009, respectively. Our matching contribution was approximately
$3.7 million for the year ended December 31, 2008.

21. Income Taxes

We file a consolidated federal income tax return. For financial reporting purposes, we recorded income tax benefit of $22.0 million, $289.9 million, and
$381.3 million for the years ended December 31, 2010, 2009 and 2008, respectively.

The
benefit for income taxes attributable to net loss consists of the following (amounts in thousands):

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Current

$
(5,469
)
$
(1,217
)
$
(585
)Deferred


(16,527
)

(288,655
)

(380,760
)Total income tax benefit

$
(21,996
)
$
(289,872
)
$
(381,345
)


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Table of Contents

STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

21. Income Taxes (Continued)

The
income tax provision differs from that computed at the federal statutory corporate tax rate as follows:

Year Ended
December 31,
2010

Year Ended
December 31,
2009

Year Ended
December 31,
2008Federal statutory rate


35.0
%

35.0
%

35.0
%Change in valuation allowance


(21.3
)

(15.8
)

(0.9
)Goodwill impairment


(3.6
)

(3.0
)

(23.5
)Vesting of Class B and Class C Units


(0.8
)

(0.2
)

(0.2
)Restructuring costs


(5.3
)

(1.2
)

Other, net


(0.3
)

(0.1
)

Effective tax rate


3.7
%

14.7
%

10.4
%


We
recorded $0, $0, and $2.0 million as increases to contributed capital for certain tax benefits from employee share-based compensation for the years ended December 31,
2010, 2009, and 2008, respectively.

The
tax effects of significant temporary differences representing net deferred tax assets and liabilities are as follows (amounts in thousands):

December 31,2010

2009Deferred tax assets:Accrued vacation, bonuses and group insurance

$
7,429

$
5,656Preopening and other costs, net of amortization


9,756


7,417Accrued benefits


9,653


8,069Capital loss carryover


64,917


Net operating loss carryover


380,286


290,840Financing arrangements


38,688


102,054FICA credits


10,194


7,816Minimum tax credit carryover


20,850


26,087Other deferred tax assets


96,988


41,183Valuation allowance


(468,904
)

(343,714
)Total deferred tax assets


169,857


145,408Deferred tax liabilities:Prepaid expenses and other


(16,287
)

(16,805
)Temporary differences related to property and equipment


(184,247
)

(173,539
)Intangibles


(70,713
)

(74,044
)Other deferred tax liabilities


(1,046
)

Total deferred tax liabilities


(272,293
)

(264,388
)Net

$
(102,436
)
$
(118,980
)


At
December 31, 2010, the Company had an Alternative Minimum Tax ("AMT") credit carryover of approximately $20.9 million. AMT credits are available to be carried forward
indefinitely and may be

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STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

21. Income Taxes (Continued)

utilized
against regular U.S. corporate tax to the extent that they do not exceed computed AMT calculations. The Company expects to utilize all of its AMT credits.

At
December 31, 2010, the Company had a general business credit ("GBC") carryover for U.S. federal income tax purposes of approximately $10.2 million. The GBC carryover
will begin expiring in 2022. The accounting guidance for income taxes requires recognition of a future tax benefit to the extent that realization of such benefit is more likely than not. Otherwise a
valuation allowance is applied. Based on the future reversal of existing temporary differences, the Company believes it will be unable to utilize the GBC carryover on a more likely than not basis and
has recorded a full valuation allowance for this credit in the current year.

As
of December 31, 2010, the Company has a tax net operating loss carryover of approximately $1.11 billion that expires between 2027 and 2030. Management believes that the
realization of a portion of this deferred tax asset is more likely than not based on the future reversal of existing temporary differences. At December 31, 2010 and 2009 a valuation allowance
was established against the portion of net operating loss that is more likely than not unrealizable.

Station
or our subsidiaries file income tax returns for federal purposes only. We are no longer subject to U.S. federal tax examination for years before 2007 except for earlier years
that can be examined as a result of the net operating losses that were carried back.

As
of December 31, 2010 and 2009, unrecognized tax benefits of $3.5 million and $4.1 million, respectively, were recorded as reductions to the U.S. net operating
loss deferred tax asset. As of December 31, 2010 and 2009, unrecognized tax benefits of $5.3 million and $6.2 million, respectively, were recorded in other long term liabilities.
Included in the balance as of December 31, 2010 and 2009 are $4.1 million and $4.2 million, respectively, of uncertain tax benefits that would affect the effective income tax rate
if recognized.

We
recognize accrued interest and penalties related to our unrecognized tax benefits in income tax expense. Our liability for the payment of interest on our unrecognized tax benefits was
reduced to zero as of December 31, 2009 and 2010 because the net operating losses exceed taxable income including the unrecognized tax benefits. We do not anticipate any penalty assessments
associated with our liability for unrecognized tax benefits. In the next twelve months, the Company does not expect the liability for the unrecognized benefits to change significantly.

A
summary of the changes in the gross amount of unrecognized tax benefit is shown below (in millions):

December 31,2010

2009Balance at the beginning of the year

$
10.3

$
8.9Additions based on tax positions related to prior years


0.4


1.4Reductions based on tax positions related to prior years


(1.9
)

Statute expirations





Balance at the end of the year

$
8.8

$
10.3


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Table of Contents

STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

22. Legal Matters

Station and its subsidiaries are defendants in various lawsuits relating to routine matters incidental to their business. As with all litigation, no assurance can be provided as to the
outcome of the following matters and litigation inherently involves significant costs. Following is a summary of key litigation impacting Station.



On February 4, 2008, Josh Luckevich, Cathy Scott and Julie St. Cyr filed a purported class action complaint against the
Company and certain of its subsidiaries in the United States District Court for the District of Nevada, Case No. CV-00141 (the "Federal Court Action"). The plaintiffs are all former
employees of the Company or its subsidiaries. The complaint alleged that the Company and its subsidiaries (i) failed to pay its employees for all hours worked, (ii) failed to pay
overtime, (iii) failed to timely pay wages and (iv) unlawfully converted certain earned wages. The complaint in the Federal Court Action sought, among other relief, class certification
of the lawsuit, compensatory damages in excess of $5,000,000, punitive damages and an award of attorneys' fees and expenses to plaintiffs' counsel.

On
October 31, 2008, the Company filed a motion for judgment on the pleadings. During a hearing on that motion, the United States District Court questioned whether it had
jurisdiction to adjudicate the matter. After briefing regarding the jurisdiction question, on May 16, 2009, the United States District Court dismissed the Federal Court Action for lack of
jurisdiction and entered a judgment in the Company's favor. Subsequently, on July 21, 2009, the plaintiffs filed a purported class action complaint against the Company and certain of its
subsidiaries in the District Court of Clark County, Nevada, Case No. A-09-595614-C (the "State Court Action"). The complaint in the State Court Action
alleged substantially the same claims that were alleged in the complaint in the Federal Court Action.

On
August 19, 2009, the corporate defendants, other than the Company, filed an answer responding to the complaint. Subsequently, on August 27, 2009, the corporate
defendants, other than the Company, filed a motion to stay the State Court Action pending the resolution of the Company's chapter 11 case. That motion was granted on September 30, 2009.

On
or about April 30, 2010, the Company and the plaintiffs reached an agreement to settle all claims asserted or that could have been asserted in the State Court Action. Under the
terms of the settlement:



On
June 17, 2010, the State Court Action was removed to the Bankruptcy Court by agreement of the parties.

On
July 16, 2010, the Bankruptcy Court granted preliminary approval of the settlement, and directed the parties to provide notice to the current and former employees covered by
the State Court Action of

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STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

22. Legal Matters (Continued)

their
right to object to the settlement and/or be excluded therefrom. No objections to the settlement were filed.

On
October 26, 2010, the Bankruptcy Court granted final approval of the settlement. The proceeds referenced in paragraph (b) above were distributed in full on
December 10, 2010.

The
expense related to this legal settlement was accrued during the year ended December 31, 2010 and the related liability is classified in liabilities subject to compromise in
the accompanying consolidated balance sheet.

Pursuant
to the Joint Plan of Reorganization, among other things, general unsecured creditors, including the employees referenced in paragraph (a) above, were to receive warrants
referred to in the Plan as the NPH Warrants. On December 13, 2010, the Company filed a motion with the Bankruptcy Court asking that the Plan be modified so that the Company would not need to
distribute an NPH Warrant worth approximately 13¢ to each of the employees referenced in paragraph (a) above (the "Plan Modification Motion"). On January 21, 2011, the
Bankruptcy Court entered an order granting the relief sought in the Plan Modification Motion.



On July 28, 2009, the Debtors filed voluntary petitions in the Bankruptcy Court under chapter 11 of the Bankruptcy Code.
On February 10, 2010, GV Ranch Station, Inc., a wholly-owned subsidiary of Station Casinos, Inc. that manages and owns 50% of Green Valley Ranch Resort Spa Casino ("Green Valley
Ranch"), filed a voluntary petition in the Bankruptcy Court under chapter 11 of title 11 of the United States Code. The Chapter 11 Case and the GV Ranch Station, Inc.
chapter 11 case are collectively referred to as the "Chapter 11 Cases."

On
July 28, 2010, the Debtors filed the Plan and Disclosure Statement. The Bankruptcy Court entered an order approving the Disclosure Statement on July 29, 2010. The
Bankruptcy Court entered an order confirming the Plan on August 27, 2010.

On
March 9, 2011, the GVR Purchaser an indirect subsidiary of New Station, and the GVR Seller entered into the GVR Asset Purchase Agreement, pursuant to which the GVR Purchaser
will purchase substantially all of the assets and assume certain specified liabilities of the GVR Seller for $500 million through a prepackaged plan of reorganization. The GVR Asset Purchase
Agreement is subject to, among other things, the bankruptcy court entering a confirmation order confirming the chapter 11 plan of reorganization of the GVR Seller.

On
March 22, 2011, the subsidiaries of the Company that are sellers under the Asset Purchase Agreement and the Company's 50%-owned joint ventures the GVR Seller and Aliante
commenced a solicitation of approvals for the Subsidiary Plan to implement and facilitate the sale and related restructuring transactions described in the Asset Purchase Agreement, the GVR Asset
Purchase Agreement and a reorganization of Aliante, pursuant to which its lenders would receive the equity of Aliante and $45 million in secured loans in exchange for their claims. We expect
that the Subsidiary Chapter 11 Cases will be filed in the second quarter of 2011.

This
report is not intended to be, and should not in any way be construed as, a solicitation of votes on the Joint Plan of Reorganization or the plan of reorganization for the Subsidiary
Chapter 11 Cases. The Joint Plan of Reorganization and the Disclosure Statement have been filed with the Bankruptcy Court and

136

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STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

22. Legal Matters (Continued)

were
filed with the Securities and Exchange Commission by the Company on its Current Report on Form 8-K dated July 28, 2010, which is publicly available at
http://www.sec.gov. The Company concluded its solicitation of acceptance of the Joint Plan of Reorganization and received its confirmation from the Bankruptcy Court on August 27, 2010. Although
the Joint Plan of Reorganization was confirmed by the Bankruptcy Court on August 27, 2010, there can be no assurance that the transactions contemplated by the Asset Purchase Agreement or the
Joint Plan of Reorganization will be consummated.

The
Debtors continue to conduct their businesses as debtors-in-possession under the jurisdiction of the Bankruptcy Court and in accordance with applicable
provisions of the Bankruptcy Code and the orders of the Bankruptcy Court.

See
"1. Summary of Significant Accounting Policies and Basis of PresentationChapter 11 Reorganization" and "Restructuring Transactions" for a
further discussion of the Chapter 11 Cases and the Restructuring Transactions.

23. Debtor Condensed Combined Financial Statements

As discussed in Note 1, on July 28, 2009, the Debtors filed voluntary petitions in the Bankruptcy Court under chapter 11 of the Bankruptcy Code, and on
February 10, 2010, GV Ranch Station, Inc., a wholly-owned subsidiary of Station Casinos, Inc. that manages and owns 50% of Green Valley Ranch filed a voluntary petition in the
Bankruptcy Court under chapter 11 of the Bankruptcy Code.

The
following condensed combined balance sheets as December 31, 2010 and December 31, 2009, condensed combined statements of operations for the year ended
December 31, 2010 and for the period July 28, 2009 through December 31, 2009, and condensed combined statements of cash flows for year ended December 31, 2010 and for the
period July 28, 2009 through December 31, 2009 present the post-petition financial condition, results of operations, and cash flows on a combined basis for Station
Casinos, Inc. and its wholly owned subsidiaries that are debtors in the Chapter 11 Cases. The debtor entities included in the following condensed combined financial statements are
Station Casinos, Inc., FCP MezzCo Parent, LLC, FCP MezzCo Parent Sub, LLC, FCP MezzCo Borrower VII, LLC, FCP MezzCo Borrower VI, LLC, FCP MezzCo
Borrower V, LLC, FCP MezzCo Borrower IV, LLC, FCP MezzCo Borrower III, LLC, FCP MezzCo Borrower II, LLC, FCP MezzCo
Borrower I, LLC, FCP PropCo, LLC, Northern NV Acquisitions, LLC, Tropicana Station, LLC, River Central, LLC, Reno Land Holdings, LLC, and GV
Ranch Station, Inc.

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STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

23. Debtor Condensed Combined Financial Statements (Continued)

STATION CASINOS, INC. AND CONSOLIDATED DEBTOR ENTITIES        (Debtor-In-Possession)        CONDENSED COMBINED BALANCE SHEETS        (amounts in thousands, except share data)

December 31,2010

2009ASSETSCurrent assets:Cash and cash equivalents

$
2,105

$
2,283Restricted cash


199,620


95,783Receivables, net


2,662


24,373Inventories


9


12Prepaid expenses and other current assets


10,969


5,567Total current assets


215,365


128,018Property and equipment, net


1,785,439


1,832,068Intangible assets, net


1,785


5,975Land held for development


24,192


24,192Investments in subsidiaries


2,451,828


2,923,274Other assets, net


30,120


69,137Total assets

$
4,508,729

$
4,982,664LIABILITIES AND STOCKHOLDERS' DEFICITCurrent liabilities:Debtor-in-possession financing

$
500,533

$
193,151Accounts payable


540


544Due to affiliates, net


635


Accrued interest payable


542


3,818Accrued expenses and other current liabilities


18,807


22,856Total current liabilities


521,057


220,369Intercompany payables to non-debtors, net


672,030


934,789Investment in joint venture, deficit


38,257


Deferred income tax, net


108,552


123,828Other long-term liabilities, net


5,265


6,957Total liabilities not subject to compromise


1,345,161


1,285,943Liabilities subject to compromise


6,049,816


6,032,109Total liabilities


7,394,977


7,318,052Commitments and contingenciesStockholders' deficit:Common stock, par value $0.01; authorized 10,000 shares; 41.7 shares issued





Non-voting common stock, par value $0.01; authorized 100,000,000 shares; 41,674,838 shares issued


417


417Additional paid-in capital


2,964,648


2,951,031Accumulated other comprehensive income (loss)


43


(922
)Accumulated deficit


(5,849,683
)

(5,285,914
)Total Station Casinos, Inc. stockholders' deficit


(2,884,575
)

(2,335,388
)Noncontrolling interest


(1,673
)

Total stockholders' deficit


(2,886,248
)

(2,335,388
)Total liabilities and stockholders' deficit

$
4,508,729

$
4,982,664


138

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Table of Contents

STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

23. Debtor Condensed Combined Financial Statements (Continued)

STATION CASINOS, INC. AND CONSOLIDATED DEBTOR ENTITIES

(Debtor-In-Possession)

CONDENSED COMBINED STATEMENTS OF OPERATIONS

(amounts in thousands)

For the year
ended
December 31, 2010

For the period
from July 28, 2009
through
December 31, 2009Operating revenues:Other

$
249,938

$
107,344Management fees


22,869


10,537Total revenues


272,807


117,881Operating costs and expenses:Corporate, selling, general and administrative expenses


35,730


4,065Development


5,119


902Depreciation and amortization


49,545


17,972Preopening





92Impairment of intangibles and other assets


6,880


71,023Write-downs and other charges, net


16,589


3,128113,863


97,182Operating income


158,944


20,699Equity in pretax losses of non-debtor subsidiaries


(531,485
)

(1,427,156
)Earnings from joint ventures


2,618


Operating income, equity in pretax losses of non-debtor subsidiaries and earnings from joint ventures


(369,923
)

(1,406,457
)Other (expense) income:Interest expense, net


(89,649
)

(56,073
)Interest and other expenses from joint ventures


(45,076
)

Change in fair value of derivative instruments


(42
)

6,762(134,767
)

(49,311
)Loss before reorganization items and income taxes


(504,690
)

(1,455,768
)Reorganization items, net


(82,748
)

(381,620
)Loss before income taxes


(587,437
)

(1,837,388
)Income tax benefit


21,996


287,822Net loss


(565,442
)

(1,549,566
)Less: net loss applicable to noncontrolling interest


1,673


Net loss

$
(563,769
)
$
(1,549,566
)


139

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Table of Contents

STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

23. Debtor Condensed Combined Financial Statements (Continued)

STATION CASINOS, INC. AND CONSOLIDATED DEBTOR ENTITIES

(Debtor-In-Possession)

CONDENSED COMBINED STATEMENTS OF CASH FLOWS

(amounts in thousands)

For the year
ended
December 31, 2010

For the period
from July 28, 2009
through
December 31, 2009Cash flows from operating activities:Net loss

$
(565,442
)
$
(1,549,566
)Adjustments to reconcile net loss to net cash provided by operating activities:Depreciation and amortization


49,545


17,972Change in fair value of derivative instruments


42


(6,762
)Share-based compensation


13,381


6,178Impairment of intangible and other assets


6,880


71,023Write-downs and other charges, net


16,589


3,128Equity in pretax losses of non-debtor subsidiaries


531,484


1,427,156Losses from joint ventures, net


42,458


Reorganization items


82,748


381,620Changes in assets and liabilities:Restricted cash


(103,837
)

(47,588
)Receivables, net


21,732


(11,804
)Intercompany payables, net


(303,612
)

Inventories, prepaid expenses and other assets


716


(2,328
)Deferred income taxes


(9,976
)

(296,432
)Accounts payable


(11
)

322Accrued interest


1,044


(3,094
)Accrued expenses and other current liabilities


(3,965
)

15,583Other, net


740


33,816Total adjustments


345,958


1,588,790Net cash provided by operating activities before reorganization items


(219,484
)

39,224Net cash used for reorganization items


(82,808
)

(25,449
)Net cash (used in) provided by operating activities


(302,292
)

13,775Cash flows from investing activities:Capital expenditures


(7,172
)

(3,698
)Proceeds from sale of land, property and equipment





615Investments in subsidiaries





(200,282
)Distributions from subsidiaries


3,157


Other, net


(1,613
)

(2,180
)Net cash used in investing activities


(5,628
)

(205,545
)Cash flows from financing activities:Borrowings under DIP Facility


86,609


124,651Borrowings under Unsecured Revolving Loan Promissory Note


220,773


68,500Borrowings under Term Loan with maturity dates less than three months, net


2,870


Payments under Term Loan with maturity dates less than three months


(2,500
)

Other, net


(10
)

(1,255
)Net cash provided by financing activities


307,742


191,896Cash and cash equivalents:(Decrease) increase in cash and cash equivalents


(178
)

126Balance, beginning of period


2,283


2,157Balance, end of period

$
2,105

$
2,283


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STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

24. Subsequent Events

Subsequent to December 31, 2010, we did not make scheduled interest payments totaling $3.4 million on the Land Loan.

In
March 2011, we were notified by the lessor of the Wild Wild West property that the lease had been terminated. We are currently in negotiations regarding possible modifications to this
lease, however we can provide no assurance that we will be able to reach an agreement with the lessor.

We
evaluated all activity of the Company and concluded that no other subsequent events have occurred that would require recognition in the consolidated financial statements or disclosure
in the notes to the consolidated financial statements.

25. Quarterly Financial Information (Unaudited)

Year ended December 31, 2010(amounts in thousands)

First
Quarter (a)

Second
Quarter (b)

Third
Quarter (c)

Fourth
Quarter (d)Net revenues

$
249,371

$
233,575

$
227,048

$
234,961Operating income (loss)


23,492


15,483


(234,243
)

(13,787
)Loss before income taxes


(55,915
)

(57,401
)

(298,316
)

(175,806
)Net loss


(53,533
)

(69,615
)

(265,824
)

(176,470
)




Year ended December 31, 2009(amounts in thousands)

First
Quarter (e)

Second
Quarter (f)

Third
Quarter (g)

Fourth
Quarter (h)Net revenues

$
282,748

$
267,161

$
255,725

$
256,515Operating income (loss)


27,730


15,888


8,543


(1,264,700
)Loss before income taxes


(10,924
)

(75,491
)

(432,597
)

(1,450,374
)Net loss


(33,709
)

(65,331
)

(455,400
)

(1,125,074
)


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STATION CASINOS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

25. Quarterly Financial Information (Unaudited) (Continued)

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Table of Contents

ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A.    CONTROLS AND PROCEDURES

As of the end of the period covered by this Annual Report on Form 10-K, an evaluation was carried out by the
Company's management, with the participation of its Chief Executive Officer and Chief Accounting Officer, of the effectiveness of the Company's disclosure controls and procedures (as defined in
Rule 13a-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")). Based upon this evaluation, the Chief Executive Officer and Chief Accounting Officer concluded that
the Company's disclosure controls and procedures are effective and designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange
Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and that such information is accumulated and communicated to
management, including our Chief Executive Officer and Chief Accounting Officer to allow timely decisions regarding required disclosure. No changes were made to the Company's internal control over
financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) during the last fiscal quarter that materially affected, or are reasonably likely to
materially affect, the Company's internal control over financial reporting. The evaluation conducted did not include an evaluation of Station or Green Valley Ranch.



This annual report does not include a report of management's assessment regarding internal control over financial reporting or an
attestation report of the Company's registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.



During the quarter ended December 31, 2010, there were no changes in our internal control over financial reporting that
materially affected, or are reasonably likely to affect, our internal control over financial reporting.

ITEM 9B.    OTHER INFORMATION



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PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Pursuant to the terms of the Equityholders Agreement, our Board of Managers is expected to consist of up to eight members designated as
follows: (i) FI Station Investor and certain of its affiliates are expected to have the right to designate up to three individuals to serve on the Board of Managers; (ii) the Mortgage
Lenders are expected to have the right to designate up to three individuals to serve on the Board of Managers; and (iii) FI Station Investor and certain of its affiliates are expected to have
the right to designate up to two individuals that qualify as "independent" based upon the listing standards of the New York Stock Exchange to serve as managers, subject to the approval of the Mortgage
Lenders.

Set
forth below are the names, ages, positions and biographical information of the individuals that we expect will be our managers and executive officers. Additional members of the Board
of Managers are
expected to be designated prior to the Effective Date pursuant to the terms of the Equityholders Agreement.

Name

Age

PositionFrank J. Fertitta III (*)


49

Manager, Chief Executive Officer and PresidentMarc J. Falcone


37

Executive Vice President and Chief Financial OfficerThomas M. Friel


47

Executive Vice President, Chief Accounting Officer and TreasurerRichard J. Haskins


47

Executive Vice President, General Counsel and SecretaryKevin L. Kelley (**)


53

Executive Vice President and Chief Operating OfficerScott M Nielson


53

Executive Vice President and Chief Development OfficerLorenzo J. Fertitta (*)


42

ManagerRobert A. Cashell, Jr.


45

ManagerStephen J. Greathouse


59

ManagerJames E. Nave, D.V.M.


66

ManagerRobert E. Lewis


65

Manager


---

Set
forth below is a description of the backgrounds, including business experience, for each of our managers and executive officers.

Frank J. Fertitta III.On the Effective Date, Mr. Fertitta will become a member of the Board of Managers, Chief Executive Offer and
President
of the Company. Mr. Fertitta served as Chairman of the Board of STN since February 1993, Chief Executive Officer since July 1992 and President since July 2008, in each case through the Petition
Date and during the pendency of the Chapter 11 Case. Mr. Fertitta also served as President of STN from 1989 until July 2000. He has held senior management positions since 1985, when he
was named General Manager of Palace Station. He was elected a director of STN in 1986, at which time he was also appointed Executive Vice President and Chief Operating Officer. Mr. Fertitta is
a co-owner of Zuffa, LLC which is the parent company of the Ultimate Fighting Championship, a martial arts promotion organization. The Company believes that Mr. Fertitta's
experience and business expertise in the gaming industry, as well as his position as a principal equityholder of the Company, give him the qualifications and skills to serve as a Manager.

Marc J. Falcone.On the Effective Date, Mr. Falcone will become Executive Vice President and Chief Financial Officer of the
Company and a
Senior Vice President of each subsidiary of the Company. Mr. Falcone has served as Chief Financial Officer of Fertitta Entertainment since November 2010. From June 2008 to October 2010,
Mr. Falcone worked at Goldman Sachs with responsibilities including restructuring focused on the hospitality and gaming sectors under that firm's Whitehall division. From May

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2006
to June 2008 Mr. Falcone was a senior analyst at Magnetar Capital, LLC (an alternative asset management firm), covering the gaming, lodging, leisure, REIT and airline industries.
From May 2002 to June 2006, Mr. Falcone was a Managing Director for Deutsche Bank Securities Inc. covering gaming, lodging and leisure companies and was recognized as one of the
industry's top analysts. Prior to joining Deutsche Bank Securities Inc., Mr. Falcone worked for Bear Stearns & Co., also covering the gaming, lodging, and leisure
industries. Mr. Falcone has contributed to several major industry publications, appeared on CNBC and CNN, and has been quoted in several major newspapers, magazines, and financial publications
worldwide, including the Wall Street Journal, New York Times, Financial Times, USA Today, Fortune, Forbes, Time, Newsweek and Business Week. Mr. Falcone holds a bachelor's degree from Cornell
University's School of Hotel Administration.

Thomas M. Friel.On the Effective Date, Mr. Friel will become Executive Vice President, Chief Accounting Officer and Treasurer of
the Company
and a Senior Vice President and Treasurer of each subsidiary of the Company. Mr. Friel served as Executive Vice President, Chief Accounting Officer and Treasurer of STN since March 2007, in
each case through the Petition Date and during the pendency of the Chapter 11 Case. He served as Vice President of Finance and Corporate Controller of STN from July 1999 to March 2007.
Mr. Friel is a Certified Public Accountant. He is a member of the Board of Directors of Big Brothers and Big Sisters of Southern Nevada.

Richard J. Haskins.On the Effective Date, Mr. Haskins will become Executive Vice President, General Counsel and Secretary of the
Company and
Senior Vice President and Secretary of each subsidiary of the Company. Mr. Haskins served as Executive Vice President and Secretary of STN from July 2004 and served as General Counsel of STN
from April 2002, in each case through the Petition Date and during the pendency of the Chapter 11 Case. He previously served as Assistant Secretary of STN from September 2003 to July 2004, as
Vice President and Associate General Counsel of STN from November 1998 to March 2002 and as General Counsel of Midwest Operations of STN from November 1995 to October 1998. Mr. Haskins is a
member of the American Bar Association, Kansas Bar Association, Missouri Bar Association and Nevada Bar Association.

Kevin L. Kelley.On the Effective Date, Mr. Kelley will become Executive Vice President and Chief Operating Officer of the Company
and
President of each subsidiary of the Company. Mr. Kelley served as Executive Vice President and Chief Operating Officer of STN from January 7, 2008 through the Petition Date and during
the pendency of the Chapter 11 Case. From June 2006 to January 2008, he was employed as Senior Vice President for Las Vegas Sands Corp. From January 2003 to May 2006, he served as President and
Chief Operating Officer of Hard Rock Hotel, Inc. Prior to joining Hard Rock Hotel, Inc., Mr. Kelley served at STN in various capacities from August 1993 to January 2003, most
recently as President of Westside Operations, where he oversaw all operations of STN's five west-side properties.

Scott M Nielson.On the Effective Date, Mr. Nielson will become Executive Vice President and Chief Development Officer of the
Company and
Senior Vice President of each subsidiary of the Company. Mr. Nielson served as Chief Development Officer of STN from July 2004 and as an Executive Vice President of STN since June 1994, in each
case through the Petition Date and through the pendency of the Chapter 11 Case. He served as Chief Legal Officer of STN from March 2002 to July 2004 and General Counsel of STN from 1991 to
March 2002. From 1992 to July 2004, he served as Secretary of STN. From 1991 through June 1994, he served as Vice President of STN. From 1986 to 1991, Mr. Nielson was in private legal practice
as a partner in the Las Vegas firm of Schreck, Jones, Bernhard, Woloson & Godfrey (now Brownstein Hyatt Farber Schreck, LLP), where he specialized in gaming law and land use planning and
zoning. Mr. Nielson is a member of the American Bar Association, the Nevada Bar Association and the International Association of Gaming Attorneys.

Lorenzo J. Fertitta.On the Effective Date, Mr. Fertitta will become a manager of the Board of Managers of the Company.
Mr. Fertitta
served as Vice Chairman of the Board of STN since December 2003 and served as a director since 1991, in each case through the Petition Date and the pendency of the

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Chapter 11
Case. Mr. Fertitta also served as President of STN from July 2000 until June 30, 2008. Mr. Fertitta is a co-owner of Zuffa, LLC which is the
parent company of the Ultimate Fighting Championship and has served as its chairman and chief executive officer since June 2008. From 1991 to 1993, he served as Vice President of STN.
Mr. Fertitta served as President and Chief Executive Officer of Fertitta Enterprises, Inc. from June 1993 to July 2000, where he was responsible for managing an investment portfolio
consisting of marketable securities and real property. Mr. Fertitta served as a member of the Board of Directors of the Nevada Resort Association from 2001 to 2008. Mr. Fertitta served
as a director of the American Gaming Association from December 2005 to May 2008 and as a commissioner on the Nevada State Athletic Commission from November 1996 until July 2000. The Company believes
that Mr. Fertitta's experience and business expertise in the gaming industry, as well as his position as a principal equityholder of the Company, give him the qualifications and skills to serve
as a Manager.

Robert A. Cashell, Jr.On the Effective Date, Mr. Cashell will become a manager of the Board of Managers of the Company.
Mr. Cashell
has been involved in the gaming industry for over 25 years, beginning as a management trainee in 1979 at the Boomtown Hotel & Casino in Northern Nevada. From 1991 to 1998,
Mr. Cashell served as General Manager of the Horseshoe Club in Reno, Nevada. Since 1995, Mr. Cashell has also served as President of Northpointe Sierra, Inc. (formerly Cashell
Enterprises, Inc.), which owns and operates the casinos at the Alamo Casino-Mill City and Alamo Travel Center, each in Northern Nevada. Since 2001, Mr. Cashell has owned and
served as President and Director of Topaz Lodge and Casino in Gardnerville, Nevada. Between 2003 and 2006, Mr. Cashell managed, through Cashell Enterprises, Inc., Sturgeon's Casino in
Northern Nevada for the owners. Similarly, in 2007, Mr. Cashell, through RAC II, LLC, leased and operated the Fitzgerald's Hotel and Casino in Reno, Nevada for a landlord group. From
2000, Mr. Cashell has served as the Chairman of Heritage Bank of Nevada. From April to October, 2006, Mr. Cashell served as President and Chief Operating Officer of Berry Hinckley
Industries in Reno, Nevada. Mr. Cashell received B.A. in Communications from Pepperdine University. The Company believes that Mr. Cashell's experience and business experience in the
gaming industry give him the qualifications and skills to serve as a Manager.

Stephen J. Greathouse.On the Effective Date, Mr. Greathouse will become a manager of the Board of Managers of the Company.
Mr. Greathouse has been involved in the Las Vegas hotel and gaming industry for more than 30 years, and from 1997 to 2005, he served as Senior Vice President of Operations for the
Mandalay Resort Group. Prior to his time at Mandalay Resort Group, in 1997, Mr. Greathouse served as President of Boardwalk Hotel & Casino, Las Vegas, and from 1994 to 1997, he served as
Chief Executive Officer and Chairman of the Board of Alliance Gaming Corporation, (renamed "Bally Technologies, Inc." in 2006). Prior to his time at Bally Technologies, Inc.,
Mr. Greathouse spent 16 years with Harrah's Entertainment, starting as a Race & Sports Book Manager in Reno and working his way up to President, Casino-Hotel Division.
Mr. Greathouse has been a director of Multimedia Games, Inc., a company which designs, manufactures and supplies innovative standalone and networked gaming systems, since April 2009.
Mr. Greathouse previously served as a Commissioner for the Spending and Government Efficiency Commission (SAGE Commission), a privately funded, bi-partisan panel created to review
state government operations that fall under the Executive Branch and to provide the Governor of Nevada with recommendations for streamlining operations, improving customer service, and maximizing the
use of taxpayer dollars. Mr. Greathouse received a B.S. in Business Administration from the University of Missouri-Columbia. The Company believes that Mr. Greathouse's experience and
business expertise in the gaming industry give him the qualifications and skills to serve as a Manager.

James E. Nave, D.V.M.Dr. Nave was appointed to the Board of Directors of Station on December 19, 2007. Dr. Nave had
served as a
director of Station from March 2001 until November 7, 2007 at which time he voluntarily resigned from the Board of Directors upon the consummation of the Merger. During that period, he was the
Chairman of the Audit Committee and served on the Governance and Compensation Committee. He is currently a member of the Audit Committee of Station. Dr. Nave has been an owner of the Tropicana
Animal Hospital since 1974 and has been the owner and manager of multiple veterinary

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hospitals
since 1976. Dr. Nave has also served on the Board of Directors of Bank West of Nevada since 1994, where he also serves as Chairman of the Site Committee. Dr. Nave has served on
the Board of Directors of Western Alliance Bancorporation since 2003, where he also serves as a member of the Audit and Compensation Committees. Dr. Nave is also the Director of International
Affairs for the American Veterinary Medical Association and was the Chairperson of the National Commission for Veterinary Economics Issues from 2001 through July 2007. In addition, Dr. Nave is
a member of the Nevada Veterinary Medical Association, the Western Veterinary Conference and the American Veterinary Medical Association. He is also a member of the Clark County Veterinary Medical
Association, the National Academy of Practitioners and the American Animal Hospital Association. Dr. Nave was a member of the University of Missouri, College of Veterinary Medicine Development
Committee from 1984 to 1992. He was also a member of the Nevada State Athletic Commission from 1988 to 1999 and served as its chairman from 1989 to 1992 and from 1994 to 1996. The Company believes
that Dr. Nave's financial and business expertise, including his diversified background of managing and directing a variety of public and private organizations, give him the qualifications and
skills to serve as a Manager.

Robert E. Lewis.Mr. Lewis served as a director of Station from May 2004 until November 7, 2007 at which time he voluntarily
resigned
from the Board of Directors upon the consummation of the Merger. While a Director of Station, he served on the Audit and Governance and Compensation Committees. Mr. Lewis has served as
president of the Nevada Division of Lewis Operating Corp., a builder and owner of rental communities, shopping centers, office buildings and industrial parks of distinction, since December 1999.
Mr. Lewis became the president of the Nevada Region of Kaufman and Broad Home Corporation upon the merger of Lewis Homes Management Corp. and Kaufman and Broad Home Corporation in January 1999.
He served in that capacity until December 1999. Prior to the merger, Mr. Lewis ran the Nevada operations of the Lewis Homes group of companies and its affiliates for 25 years. He has
served as a director for the National Association of Home Builders and as a director and President of the Southern Nevada Home Builders Association from 1987 to 1988. Mr. Lewis is also on the
Executive Committee and served as Secretary from 1995 to 1997 and Legislative Chairman for the Nevada Development Authority since 1993, He served as the Chairman of the Las Vegas District Council of
the Urban Land Institute from 2002 to 2005 and served on the Clark County Community Growth Task Force from 2004 to 2005 The Company believes that Mr. Lewis's experience and business expertise
give him the qualifications and skills to serve as a Manager.

Section 16(a) Beneficial Ownership Reporting Compliance

None.

Code of Ethics

The Company has not yet adopted a code of ethics that applies to our principal executive officer, principal financial officer and
principal accounting officer. It is anticipated that the Company will adopt such a code of ethics following the Effective Date.

ITEM 11.    EXECUTIVE COMPENSATION

The Board of Managers will have the authority to appoint officers and fix their compensation in accordance with the terms of the
Equityholders Agreement. We currently pay no compensation to the individuals expected to comprise our Board of Managers or to our executive officers. Following the Effective Date, our executive
officers will receive compensation from Fertitta Entertainment or the Company. The compensation payable to our executive officers following the Effective Date has not yet been determined. The Board of
Managers does not yet have any committees. Following the Effective Date, each member of the Board of Managers will receive annual compensation in the amount of $75,000.

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ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The Company was formed to acquire and operate the Propco Properties and the Opco Assets. The Company will have two classes of Units:
Voting Units and Non-Voting Units. As of the date hereof, we have not issued any Units. Upon consummation of the Plan, we intend to issue 100 Voting Units representing 100% of our
outstanding Voting Units to Station Voteco and 100 Non-Voting Units representing 100% of our outstanding Non-Voting Units to Station Holdco.

Name and Address of Beneficial Owner

Voting Units

% of
Voting Units

Non-Voting
Units

% of
Non-Voting
UnitsStation Voteco LLC (a)


100


100





Station Holdco LLC (b)








100


100Named Executive Officers and Managers as a Group (c)


100


100


85


85


---

The
reported ownership of the named executive officers and managers is approximate and is subject to change to the extent that changes are made in the Plan or the related agreements
implementing the Plan.

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ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Mortgage Lenders

Under the Plan, the Company expects to enter into the Propco Credit Agreement with German American Capital Corporation and JPMorgan
Chase Bank, N.A. As discussed in "Item 1. BusinessRestructuring Transactions" the Propco Credit Agreement will consist of $1.6 billion of term loans and a
$100 million revolving credit facility, which revolving credit facility will increase to $150 million upon the prepayment of $50 million of outstanding principal amount under the
term loan on the closing date thereof. In addition, it is expected that affiliates of the Mortgage Lenders will own 50.1% of the Voting Units and approximately 40% of the Non-Voting Units.
In addition, pursuant to the Equityholders Agreement the Mortgage Lenders will have the right to designate up to three individuals to serve on the Company's Board of Managers. The members of our Board
of Managers that are designated by the Mortgage Lenders could be deemed to have a material direct or indirect interest in the Propco Credit Agreement by virtue of their relationship with the Mortgage
Lenders. For a further discussion of the Propco Credit Agreement see "Item 1. BusinessRestructuring Transactions", "Item 1A. Risk FactorsWe expect to have
significant indebtedness upon the Effective Date", "Item 1A. Risk FactorsOur indebtedness will impose restrictive financial and operating covenants that will limit our flexibility
in operating our business" and "Item 7. Financial InformationManagement's Discussion and Analysis of Financial Condition and Results of OperationStation
Casinos LLCLiquidity and Capital ResourcesPropco Credit Agreement." For a further discussion of the Equityholders Agreement see "Item 7. Financial
InformationManagement's Discussion and Analysis of Financial Condition and Results of OperationStation Casinos LLCOverview" and "Item 10.
Directors, Executive Officers and Corporate Governance."

Fertitta Entertainment

Under the Plan, the Company will enter into management agreements with subsidiaries of Fertitta Entertainment, which will expire after
25 years, unless earlier terminated. Fertitta Entertainment is owned by affiliates of Frank J. Fertitta III, our Chief Executive Officer, President and a member of our Board of Managers, and
Lorenzo J. Fertitta, a member of our Board of Managers. In addition, it is expected that affiliates of Fertitta Entertainment will own 49.9% of the
Voting Units and approximately 45% of the Non-Voting Units. Pursuant to the management agreements, affiliates of Fertitta Entertainment will manage and operate the Propco Properties and
the Opco Assets and will receive a base management fee equal to two percent of the gross revenues attributable to the properties and an incentive management fee equal to five percent of earnings
before interest, taxes depreciation and amortization ("EBITDA") with respect to each fiscal year, to the extent such EBITDA is positive.

Boulder Station Lease

Station has entered into a ground lease for 27 acres of land on which Boulder Station is located which the Company will assume in the
Restructuring Transactions. Station leases this land from KB Enterprises, a company owned by the Frank J. Fertitta and Victoria K. Fertitta Revocable Family Trust (the "Related Lessor"). Frank J.
Fertitta, Jr. and Victoria K. Fertitta are the parents of Frank J. Fertitta III and Lorenzo J. Fertitta. See "Item 2. Properties" for details on the Boulder Station lease.

Texas Station Lease

Station entered into a ground lease for 47 acres of land on which Texas Station is located which the Company will assume in the
Restructuring Transactions. Station leases this land from Texas Gambling Hall & Hotel, Inc., a company owned by the Related Lessor. See "Item 2. Properties" for details on the
Texas Station lease.

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Zuffa, LLC

Station has purchased tickets to events held by Zuffa, LLC ("Zuffa") which is the parent company of the Ultimate Fighting
Championship ("UFC") and is owned by Frank J. Fertitta III and Lorenzo J. Fertitta. For the years ended December 31, 2010, 2009 and 2008, Station made payments to Zuffa totaling approximately
$0.5 million, $0.7 million, and $0.7 million, respectively,
for ticket purchases to, and closed circuit viewing fees of, UFC events. In addition, in September 2008 Zuffa and a wholly owned subsidiary of Station entered into a
month-to-month license agreement whereby Zuffa has the rights to a previously unused portion at Palace Station for general office and administrative use. Payments received by
Station related to this license agreement totaled approximately $22,000 and $21,000 for the years ended December 31, 2009 and 2008, respectively. There were no payments received from Zuffa
under this license agreement during the year ended December 31, 2010. In January 2009, Station subleased its leased aircraft to Zuffa for a period of six months. Payments received by Station in
connection with this sublease approximated the amount Station paid for leasing the aircraft, and totaled approximately $0.8 million.

Manager Independence

Our Board of Managers will be composed of Frank J. Fertitta III, Lorenzo J. Fertitta, Robert A. Cashell, Jr., Stephen J. Greathouse,
James E. Nave, D.V.M., Robert E. Lewis and up to two additional members to be appointed by the Mortgage Lenders and FI Station Investor in accordance with the terms of the Equityholders Agreement. At
least two members of the Board of Managers, including Dr. Nave and Mr. Lewis, are expected to be considered "independent" based upon the listing standards of the New York Stock Exchange.

ITEM 14.    PRINCIPAL ACCOUNTING FEES AND SERVICES

We have not incurred principal accounting fees or services during the years ended December 31, 2010 and December 31,
2009.

CERTIFICATIONS

The Chief Executive Officer and the Chief Accounting Officer certifications required by Section 302 of the Sarbanes-Oxley Act of
2002 are filed as exhibits to this Annual Report on Form 10-K for the year ended December 31, 2010.

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PART IV

ITEM 15.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)

1.

Station Casinos, Inc. Consolidated Financial Statements (including related notes to Consolidated Financial Statements) filed in Part II of this report are listed below:Report of Independent Registered Public Accounting FirmErnst & Young LLPConsolidated Balance Sheets as of December 31, 2010 and 2009Years ended December 31, 2010, 2009, and 2008Consolidated Statements of OperationsConsolidated Statements of Stockholders' (Deficit) EquityConsolidated Statements of Cash FlowsNotes to Consolidated Financial Statements2.

None3.

Exhibits


Exhibit
Number

Exhibit Description2.1

First Amended Joint Chapter 11 Plan of Reorganization for Station Casinos, Inc. and Affiliated Debtors dated July 28, 2010. (Incorporated herein by reference to the Company's Form 10 filed on
November 12, 2010)3.1

Articles of Organization of the Company. (Incorporated herein by reference to the Company's Form 10 filed on November 12, 2010)3.2

Amendment to Articles of Organization of the Company. (Incorporated herein by reference to the Company's Form 10 filed on November 12, 2010)10.1

Asset Purchase Agreement, dated as of March 9, 2011, by and between Station GVR Acquisition, LLC and Green Valley Ranch Gaming, LLC. (Incorporated herein by reference to the Company's Current Report on
Form 8-K dated March 10, 2011)21.1

Subsidiaries of the Registrant23.1

Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm31.1

Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2

Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1

Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2

Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


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SIGNATURE

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 signed on its behalf by the undersigned, thereunto duly authorized.

STATION CASINOS LLCDated: March 31, 2011

By:

/s/ FRANK J. FERTITTA III Frank J. Fertitta III Chief Executive Officer and President


Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on
the dates indicated.

Signature

Title

Date/s/ FRANK J. FERTITTA III Frank J. Fertitta III

Chief Executive Officer and President (Principal Executive Officer)
Member of Fertitta Holdco LLC, the manager of Fertitta Entertainment LLC, the member of Station Voteco LLC, the member of the Company

March 31, 2011/s/ MARC J. FALCONE Marc J. Falcone

Executive Vice President and Chief Financial Officer (Principal Financial Officer)

March 31, 2011/s/ THOMAS M. FRIEL Thomas M. Friel

Executive Vice President, Chief Accounting Officer and Treasurer (Principal Accounting Officer)

March 31, 2011


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