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                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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                                    FORM 10-K

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                 Annual Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

                  For the fiscal year ended December 31, 2001

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                        Commission File Number 333-42147

                              LAS VEGAS SANDS, INC.
               Incorporated pursuant to the Laws of Nevada State

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                 IRS -- Employer Identification No. 04-3010100

        3355 Las Vegas Boulevard South, Room 1A, Las Vegas, Nevada 89109
                                 (702) 414-1000

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

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

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months,  and (2) has been subject to such filing  requirements
for the past 90 days. Yes |X| No | |

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 this
Form 10-K. [ ]

The aggregate  market value of voting stock held by  nonaffiliates of registrant
as of April 1, 2002 was $0.

The Company had 1,000,000 shares of Common Stock outstanding as of April 1,
2002.

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                              Las Vegas Sands, Inc.

                                Table of Contents

                                     Part I
Item 1.  Business .................................................1
Item 2.  Properties...............................................21
Item 3.  Legal Proceedings........................................21
Item 4.  Submission of Matters to a Vote of Security Holders......22

                               Part II

Item 5.  Market for Registrant's Common Equity and Related
         Stockholder Matters .....................................23
Item 6.  Selected Financial Data..................................24
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations .....................25
Item 7A. Quantitative and Qualitative Disclosures about
         Market Risk .............................................35
Item 8.  Financial Statements and Supplementary Data..............36
Item 9.  Changes In and Disagreements With Accountants On
         Accounting and Financial Disclosure .....................75

                              Part III

Item 10. Directors and Executive Officers of the Registrant.......76
Item 11. Executive Compensation...................................77
Item 12. Security Ownership of Certain Beneficial Owners and
         Management ..............................................79
Item 13. Certain Relationships and Related Transactions...........80

                                                       Part IV
Item 14. Exhibits, Financial Statement Schedules and Reports on
         Form 8-K ................................................84
         Signatures...............................................88


















































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                                     PART I

ITEM 1. -- BUSINESS

General

     Las Vegas Sands,  Inc.  ("LVSI") and its  subsidiaries  (collectively,  the
"Company") own and operate the Venetian Casino Resort (the "Casino  Resort"),  a
Renaissance Venice-themed resort situated at one of the premier locations on the
Las Vegas  Strip (the  "Strip").  The Casino  Resort is located  across from The
Mirage and the Treasure Island Hotel and Casino.  The Casino Resort includes the
first and only all-suites hotel on the Strip with 3,036 suites (the "Hotel");  a
gaming facility of approximately 116,000 square feet (the "Casino"); an enclosed
retail,  dining and entertainment  complex of approximately 445,000 net leasable
square feet (the "Mall"); and a meeting and conference facility of approximately
500,000 square feet (the "Congress Center").

     The Casino Resort is physically connected to the approximately 1.15 million
square foot Sands Expo and  Convention  Center (the "Expo  Center"),  one of the
largest  facilities in the United States  specifically  designed for trade shows
and conventions.  Management believes that the combined facilities of the Casino
Resort and the Expo Center  (which is  separately  owned by an  affiliate of the
Company) is one of the largest hotel and meeting complexes in the United States.

     LVSI was  incorporated  in 1988 under the laws of the State of  Nevada.  In
April 1989,  LVSI  acquired  the Sands Hotel and Casino (the  "Sands")  from MGM
Grand.  LVSI  owned and  operated  the Sands  from  April 1989 to June 1996 when
operations  ceased to begin  demolition  of the Sands  and  construction  of the
Casino Resort. Ground breaking for the Casino Resort occurred in April 1997, the
entire Casino Resort (excluding the Mall) opened on May 4, 1999, the Mall opened
on June 19, 1999 and  substantial  completion  of the entire  Casino  Resort was
achieved on November 12, 1999.

     LVSI is the  managing  member  and  owner of 100% of the  common  equity of
Venetian Casino Resort, LLC ("Venetian").  Venetian is the owner and operator of
the Hotel and Congress Center, and the owner of the Casino. Under a casino lease
(the "Casino  Lease"),  Venetian  leases the Casino to LVSI,  which conducts all
gaming operations in the Casino Resort. Grand Canal Shops Mall Subsidiary,  LLC,
an indirect  subsidiary of LVSI (the "New Mall  Subsidiary"),  owns and operates
the Mall.

     The Casino Resort was  developed on a stand-alone  basis as the first phase
of a  two-phase  development.  In the  second  phase of the  development,  it is
contemplated  that another similarly sized themed resort (the "Phase II Resort")
will be constructed and developed by a wholly-owned, indirect subsidiary of LVSI
(the "Phase II Subsidiary").

     The  executive  offices  of LVSI are  located  at 3355 Las Vegas  Boulevard
South,  Room 1A,  Las  Vegas,  Nevada  89109 and its  telephone  number is (702)
414-1000.

     This  Annual   Report  on  Form  10-K  contains   certain   forward-looking
statements.  See "Item 7 -  Management's  Discussion  and  Analysis of Financial
Condition and Results of Operations - Special Note  Regarding  Forward - Looking
Statements."

The Casino Resort

     The Hotel

     The Hotel  presently has 3,036 single and multiple  bedroom suites situated
in a 35-story,  three-winged tower rising above the Casino. The lobby features a
65-foot domed ceiling decorated with Venetian-themed  fresco-style  paintings, a
main  passageway  formed  by a  barrel-vaulted  ceiling  carried  on  ornamental
columns, and a replica of the unique three dimensional-style marble floors found
in Venetian palaces.

     A typical Hotel suite approximates 655 to 735 square feet,  consisting of a
raised sleeping area and bathroom and a sunken  living/working area. The suite's
bi-level configuration creates a multi-function living space in which guests can
sleep, work and entertain and includes two queen-size beds or one king-size bed,
a writing  desk,  dual-line  speaker  phones,  a fax machine and a sitting area.
Approximately 318 of the suites are of larger size for use by gaming customers.

     The Casino Resort's  average daily room rates increased to $196 in the year
ended December 31, 2001 from $182 in 2000.  Gross room revenues  during the year
ended December 31, 2001 were $204.2  million,  representing an increase of $11.9
million when compared to $192.3 million during 2000.  During 2001, the occupancy
rate for available guestrooms in the Hotel was 94.6%.









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     The Hotel leases space to eight  restaurants  that are located  adjacent to
the Casino and five other food outlets located in a  Venetian-style  market food
court located at the casino level of the Hotel. Live entertainment is offered at
the 50,000 square foot  entertainment  complex,  "C2K".  In addition,  the Hotel
provides a variety of  amenities  for its guests,  including a  state-of-the-art
health spa, operated by Canyon Ranch, with massage and treatment rooms, exercise
and fitness areas.  The Hotel features an outdoor  swimming  complex  (including
three pools,  spas,  pool bars and cabanas)  surrounded  by gardens,  waterways,
fountains and sculptures.

     In addition to the Congress Center, the Hotel includes approximately 63,000
square feet of exhibition hall space that was completed in October 2001 and that
currently houses various art exhibits in conjunction with the Guggenheim  Museum
in New York. The Hotel has been designed to accommodate additional expansion; in
2001, the Company began  construction of a 1,000-room  hotel tower on top of the
Casino Resort's  existing  parking garage and a 1,000 parking space expansion of
the garage. See " - New Developments - Phase IA Addition".

     The Casino

     The Casino has 116,000 square feet of gaming space and is situated adjacent
to the Hotel lobby.  The Casino floor is accessible from each of the Hotel,  the
Mall, the Congress Center, the Expo Center and the Strip. The Casino is marketed
to attract a broad base of patrons,  with a specific  focus on frequent  premium
gaming customers.  The Company markets the Casino directly to this gaming market
segment  using  database-marketing   techniques,   slot  clubs  and  traditional
incentives such as reduced room rates and  complimentary  meals and suites.  The
Company offers "high roller" gaming  customers  premium suites and special hotel
services.

     The  Casino  and its  adjacent  amenities,  including  several  "signature"
restaurants,  are stylized to resemble a Venetian  "palazzo," with architectural
and interior design features  representative  of Venice's  Renaissance  era. The
ceiling in the table  games area  features  fresco-style  paintings  of Venetian
palaces.  The gaming  facilities  include  approximately  2,124 slot machines of
various  denominations,  including popular  multi-property,  linked  progressive
games. A high-end slot area, with a private lounge, provides slot customers with
premium slot products and services.  The Casino's  approximately 122 table games
(excluding  baccarat tables) feature the traditional  games of blackjack,  craps
and  roulette,  Asian games,  such as "Pai Gow" and "Pai Gow Poker," and popular
progressive  table games,  such as "Caribbean  Stud Poker" and "Let It Ride." In
addition,  the Casino offers gaming customers an upscale  sportsbook room and an
upscale  gaming  salon with 10 baccarat  tables.  The gaming  salon is specially
designed for  premium,  "high  roller"  gaming,  with  baccarat,  blackjack  and
roulette,  direct  access to private  cash-out  windows  at the Casino  cage and
direct access to the Casino's credit department.

      The Mall

     The Mall offers approximately 445,000 net leasable square feet of shopping,
dining and  entertainment  space  located:  (i) on two levels  within the Casino
Resort's main structure,  between the Casino level and the Hotel tower; and (ii)
in a separate  approximately  38,000  square foot retail  annex  adjacent to the
Casino Resort's main structure and directly  accessible from the Strip. The Mall
includes eight restaurants,  six food court outlets,  three specialty food shops
and 58 retail  stores.  Visitors  and  guests  can  enter the Mall from  several
different directions,  including from the Strip via a moving sidewalk,  from the
main gaming area of the Casino via escalators,  from the Expo Center through the
Congress Center, from a cross-over bridge across the Strip and directly from the
Hotel.

     The Mall offers an array of quality dining  experiences,  including upscale
restaurants that offer international and American regional cuisines.  The Mall's
retail  offerings  include  exclusive  showcase  boutiques,  popular  brand name
mid-priced stores and themed entertainment concepts.  Luxury tenants in the Mall
include  Mikimoto,  Movado,  Burberry and Jimmy Choo. The restaurants and stores
are set along an approximately one-quarter mile Venetian-themed  streetscape and
front on the  Venetian-themed  canal  running  its  length;  they are grouped in
"piazza"-style  settings.  Store and restaurant  facades are designed to project
the Venetian theme.

     In 2001, the Mall leased  approximately  95% of its gross leasable space at
an average of approximately  $100 per leasable square foot.  Additional  tenants
and increased  proceeds from rents raised Mall revenues to $33.5 million in 2001
from $29.9 million in 2000. The average term of a lease in the Mall is 10 years.











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     The Expo Center and the Congress Center

     With over 1.15  million  gross  square feet of exhibit  and meeting  space,
including  four exhibit halls and 20 meeting  rooms,  the  separately  owned and
operated Expo Center is one of the largest trade show and convention  facilities
in the United States (as measured by net leasable  square  footage).  As part of
the Casino  Resort,  the Company  owns and  operates  the  Congress  Center,  an
approximately  500,000 gross square foot meeting and  conference  facility which
links the Expo Center and the rest of the Casino  Resort.  The  Congress  Center
includes an approximately 80,000 square foot column-free "Venetian Ballroom," an
approximately  13,500 square foot "Palazzo Ballroom" and a meeting complex of 42
individual  rooms which can be combined to create  three  additional  ballrooms.
Together,  the Expo Center and the  Congress  Center  offer  nearly 1.65 million
square feet of state-of-the-art exhibition and meeting facilities,  which can be
configured to provide 108 meeting rooms or accommodate  large-scale  multi-media
events.  The Company is also  planning to add 150,000  square feet of additional
meeting  and  conference   facility  space  to  the  Casino  Resort.  See  "-New
Developments - Phase IA Addition."

     Management  markets the Congress Center to complement the operations of the
Expo Center by target marketing the Congress Center for business conferences and
upscale business events  typically held during the mid-week period.  The Company
markets the  Congress  Center to generate  room-night  demand and drive  average
daily  room rates  during the  weekday  move-in/move-out  phases of Expo  Center
events.  The Company's  goal is to draw from  attendees  and  exhibitors at Expo
Center events and from attendees of Congress  Center events to maintain  weekday
room-night demand at the Hotel from this higher budget market segment, when room
demand  would  otherwise  be derived from the lower budget tour and travel group
market segment.

     In  2001,   approximately  1,039,000  visitors  attended  trade  shows  and
conventions  at the Expo Center during 110 show days.  The Expo Center hosted 17
events on the 2001 Trade Show Week 200 list of the  largest  trade  shows in the
United  States in 2001,  including the Spring and Fall Western Shoe Show and JCK
Jewelry Show, as well as the convention of National  Association of Broadcasters
and the  Automotive  Service  Industry  Association  Week,  each of  which  were
multiple location events.

     It  should be noted  that the  Company  has no  ownership  of or  financial
interest in the Expo Center or Interface Group-Nevada,  Inc. ("Interface"),  the
owner of the Expo Center, and does not exercise any control over the business or
management  of the  Expo  Center  or  Interface.  All of the  capital  stock  of
Interface is beneficially owned by Sheldon G. Adelson, the principal stockholder
of  the  Company  (the  "Principal   Stockholder").   See  "Item  13  -  Certain
Relationships  and  Related  Transactions  - Possible  Conflicts  of  Interest."
Relationships and Related Transactions - Possible Conflicts of Interest."

     Venetian,  the New Mall  Subsidiary and Interface are parties to an Amended
and Restated Reciprocal Easement,  Use and Operating Agreement (the "Cooperation
Agreement") which, among other things,  provides for the integrated operation of
all the facilities.  Under the Cooperation  Agreement,  Interface,  the New Mall
Subsidiary  and  Venetian  allocate  expenses  shared by the Expo Center and the
Casino Resort.  In addition,  the Company and Interface jointly market the Hotel
and Casino,  the Mall, the Congress Center and the Expo Center.  The Cooperation
Agreement provides that until December 31, 2010, Interface will use commercially
reasonable efforts to have the Hotel designated as the "headquarters  hotel" for
trade show and  convention  events at the Expo Center,  and the Company will use
commercially  reasonable  efforts to promote the use and  occupancy  of the Expo
Center. In order to obtain the Casino Resort's "headquarters hotel" designation,
the Company has agreed with Interface that, except under certain  circumstances,
trade  shows of the type  generally  held at the Expo Center will not be held in
the Congress Center. It should be noted that trade show and convention promoters
are under no obligation to select the Casino Resort as the "headquarters  hotel"
for their events. See "Item 13 - Certain  Relationships and Related Transactions
- Cooperation Agreement."

Business and Marketing Strategy

     The  Company's   primary  business   objective  is  to  provide  a  premium
destination  casino  resort  experience  in order to drive  superior  returns on
invested  capital and to increase asset value.  To achieve this  objective,  the
Company:  (i) operates a "must-see"  destination resort at a premier location at
the  heart  of  the  Strip;   (ii)   captures   premium  room  rates  through  a
differentiated  superior  all-suites  product;  (iii) drives hotel occupancy and
casino utilization  through the link to the Expo Center and the Congress Center;
(iv) caters to a higher-budget  customer mix by offering a unique combination of
assets and  facilities;  (v) leverages the Casino Resort's  premium  co-branding
strategy to drive revenues; and (vi) targets premium gaming customers.









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      Operate a "Must-See" Destination Casino Resort at the Heart of the Las
      Vegas Strip

     The  Casino  Resort,  with its  extensive  theming,  dining,  shopping  and
entertainment,  is a "must-see"  destination  located at the heart of the Strip.
The Casino Resort is designed and operated to provide visitors with the sense of
being  surrounded  by  the  festivity  and  splendor  of  Renaissance   Venice's
architecture,  music,  art and history.  The  Venetian-themed  setting along the
Casino Resort's frontage on the Strip includes waterways,  gondolas and replicas
of Venetian landmarks, such as the Doge's Palace, the Rialto Bridge, the Ca Doro
and  the  Campanile  Tower.  The  Mall  features  a  one-quarter  mile  Venetian
streetscape,  with intimate "piazza"-style settings. A 630-foot canal runs along
the  Venetian  streetscape,  with  gondolas and  waterside  cafes and crossed by
authentically styled Venetian bridges.

     The Casino Resort has  approximately  740 feet of frontage on the east side
of the Strip and is located  next to  Harrah's  and across from some of the most
visited casino resorts and attractions on the Strip,  including The Mirage,  the
Treasure Island Hotel and Casino and The Forum Shops at Caesars Palace Hotel.

     Capture Premium Room Rates through Differentiated All-Suites Product

     The Hotel offers the first and only  all-suites  product  with  first-class
services and  facilities  on the Strip.  The typical  Hotel suite ranges in size
from approximately 655 square feet to 735 square feet (compared to approximately
360 to 400 square feet on average for a standard room in competing facilities on
the Strip), and consists of a sunken  living/working  area and a raised sleeping
area  with a marble  bathroom;  each area has its own  television  entertainment
center.  Each suite  living/working  area  includes a sitting area and a writing
desk and offer business amenities such as dual-line speakerphones, a fax machine
and dataport access.  The bathrooms are oversized,  featuring a separate bathtub
and shower,  dual sinks and a telephone.  In addition,  the Hotel offers  larger
suites, including the "Presidential" and penthouse suites.

     In 2001,  the Hotel was awarded the Exxon  Mobil "Four Star  Award,"  Conde
Nast's "Best 100 Hotels in the World," AAA's "Four  Diamond  Award" and Meetings
and Convention Magazine's Prestigious "Gold Key Award" for meeting hotels in the
United  States.  In  management's  experience,  business  and leisure  travelers
consider suites desirable, superior accommodations.  For business travelers, the
Hotel's  suites,   which  accommodate  informal  business  meetings  and  social
gatherings,  offer  guests  a  unique,  single  location  in  which  to work and
entertain in close proximity to the Expo Center and the Strip. Leisure travelers
appreciate  both the  Hotel's  spacious  suites and  extensive  facilities.  The
Company believes that the all-suites  format,  together with the Casino Resort's
many other unique attributes, results in a highly differentiated resort product,
allows for premium  pricing on rooms and provides a competitive  advantage  over
other Strip hotel/casino properties and resorts.

     The Company's mix of hotel sales is as follows:  group and convention  room
sales are 39%,  casino  customers  19%,  wholesale  9% and free and  independent
travelers 33% of total sales.  The Hotel's average daily room rates were $196 in
2001.

     Drive Hotel  Occupancy and Casino  Utilization  through Link to Expo Center
     and Congress Center

     The Casino  Resort is the first  themed  entertainment  resort in Las Vegas
designed  specifically  to  accommodate  large-scale  trade shows,  conventions,
conferences  and  meetings.  The Expo  Center and the  Congress  Center  provide
recurring,  predictable demand for mid-week room nights from business travelers.
The Company's  diverse business model draws convention  attendees from all parts
of the United  States and the world.  In  connection  with 110 show days  during
2001,  approximately  1,039,000 visitors attended trade shows and conventions at
the Expo  Center.  The  Hotel  had a  mid-week  occupancy  rate of 92.2% in 2001
(compared to an 81.6%  mid-week  average  occupancy  rate on the Strip),  due in
large part to the Casino Resort's trade show and convention  business.  Pursuant
to the  Cooperation  Agreement,  the owner of the Expo Center markets the Casino
Resort to promoters of Expo Center  trade show  conventions  and other events as
the "headquarters  hotel" for such events. The Casino Resort offers attendees of
events at the Expo  Center and the  Congress  Center the most  convenient  hotel
accommodations in Las Vegas.















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     Cater  to a  Higher-Budget  Customer  Mix by  Offering  Unique  Assets  and
     Facilities

     Management  markets  the Casino  Resort to attract  higher-budget  business
travelers  and free and  independent  travelers,  resulting  in a  higher-budget
customer  mix both on weekdays  and on  weekends.  By  appealing to customers in
these  upscale  market  segments,  the Company  has reduced its  reliance on the
lower-budget tour and travel market. Management believes that business travelers
typically  pay more for rooms  and  spend  more on  entertainment  than  weekday
customers in other categories, such as tour groups. Management believes that the
Casino  Resort's  Congress  Center,  its central  location  adjacent to the Expo
Center at the heart of the Strip,  and its all-suites  hotel product all combine
to allow it to compete  effectively for the  higher-budget  mid-week trade show,
convention and meeting attendees.  On both weekdays and weekends, the all-suites
product  at the Hotel  appeals to free and  independent  leisure  travelers  and
"high-roller"  gaming  customers,  also  segments of the travel market who spend
more on rooms and entertainment.

     Leverage the Casino Resort's Premium Co-Branding Strategy to Drive Revenues

     The  Company  expects  to build upon  awareness  of the  Venetian  brand by
continuing to attract a unique collection of "signature" restaurant concepts and
premier  global retail  brands to the Casino  Resort.  This strategy  allows the
Company  to focus on its core  competency  of  providing  first-class  hotel and
meeting  facilities while attracting  additional guests and foot traffic because
of its own brand name and its concentration of other premier brands.  The Casino
Resort has been designed such that foot traffic from the Strip, the Expo Center,
the Congress Center and the Hotel are funneled through the Casino floor in order
to attract  and  retain a broad base of Casino  patrons.  The  Company  seeks to
maximize  guest spending from the Casino  Resort's  target markets by offering a
concentration of fine restaurants,  exclusive boutiques, the Canyon Ranch health
spa and the 50,000 square foot entertainment complex,  "C2K". Several well-known
restaurateurs operate "signature"  restaurants on the premises, such as Emeril's
Delmonico and Wolfgang  Puck's Postrio,  and the Mall includes luxury  retailers
such as Mikimoto and  Burberry.  In  addition,  the Casino  Resort  includes the
Guggenheim Las Vegas Museum and the Guggenheim Hermitage Museum (the "Guggenheim
Museum  Projects"),  which house  various art exhibits in  conjunction  with the
Guggenheim  Museum in New York.  The  co-branding  strategy  enhances the Casino
Resort's appeal to the higher budget room guests.  Moreover, the Casino captures
gaming  revenues  from:  (i) foot traffic  generated by Expo Center and Congress
Center events;  (ii) Hotel guests;  (iii) foot traffic generated by shoppers and
diners at the Mall;  (iv)  visitors  attracted  to the Casino  Resort's  unique,
Venetian-themed  facilities;  and  (v)  the  Guggenheim  Museum  Projects.  This
world-class  combination of offerings and attractions drives Hotel utilization -
a high-margin  revenue source - through increased  occupancy and premium average
daily room  rates.  The  Casino  Resort's  premier  location  on the Strip,  its
extensive  theming  as well as its  established  and  growing  concentration  of
premium  brands is an  effective  strategy  for  continued  revenue  growth  and
awareness of the Venetian brand.

     Target Premium Gaming Customers

     Management  believes that the Casino Resort's  all-suites  product,  themed
atmosphere and high-end  amenities,  including  premium  restaurants  and shops,
offer  gaming  customers a unique Las Vegas  experience.  The  Company  actively
markets the Casino to frequent  premium gaming  customers.  In  particular,  the
Company  seeks to attract  "high roller"  gaming  customers by offering  premium
suites and  special  hotel  services.  Because of the  all-suites  format in the
Hotel,  the Casino Resort is able to offer many gaming  customers  complementary
suites  (considered  premium  accommodations in Las Vegas) during high occupancy
periods,  such as weekends  and  holidays,  when they would not be offered  such
suites by the  Company's  competitors.  The Casino  Resort is the first and only
all-suites  resort on the Strip with  facilities  and  amenities  designed  from
inception to attract and serve premium gaming customers.

The Las Vegas Market

     Las Vegas is one of the fastest-growing and largest  entertainment  markets
in the  country.  Las Vegas hotel  occupancy  rates are among the highest of any
major market in the United  States.  According to the Las Vegas  Convention  and
Visitors Authority (the "LVCVA"),  the number of visitors traveling to Las Vegas
has increased at a steady and significant  rate for the last ten years from 21.3
million  visitors in 1991 to 35.0 million  visitors in 2001,  a compound  annual
growth rate of 5.1%.  In addition,  the  population  of Las Vegas has grown from
approximately  821,000 in 1991 to  approximately  1,486,000  in 2001, a compound
annual growth rate of 6.1%. Management believes that the growth in the Las Vegas
market has been enhanced by a dedicated program of the LVCVA and major Las Vegas
hotels to promote Las Vegas as an exciting  vacation and  convention  site,  the
increased  capacity of McCarran  International  Airport and the  introduction of
large, themed destination resorts in Las Vegas.








                                    5
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     Las Vegas as a Trade Show, Convention and Meeting Destination

     In 2001,  according to the LVCVA, Las Vegas was the most popular trade show
destination  (with a 25% market  share of the Trade Show Week 200 Shows in terms
of net square footage) and the fourth most popular convention destination in the
United States.  In 1991,  approximately 1.8 million persons attended trade shows
and conventions in Las Vegas and spent  approximately $1.5 billion. In 2001, the
number of trade show and  convention  attendees had increased to 4.0 million and
the amount spent by trade show and convention  attendees was approximately  $4.8
billion.

     Trade  shows are held for the  purpose  of  getting  sellers  and buyers of
products or services together in order to conduct  business.  Trade shows differ
from conventions in that trade shows typically  require  substantial  amounts of
space for exhibition purposes and participant circulation. Conventions generally
are  gatherings  of  companies  or groups that  require  less space for breakout
meetings and general meetings of the overall group. Las Vegas offers trade shows
and conventions a unique  infrastructure for handling the world's largest shows,
including  the  concentration  of 48,000 hotel rooms  located on the Strip,  two
convention  centers  (the Expo Center and the Las Vegas  Convention  Center (the
"LVCC")) with a total of approximately 4.0 million square feet of convention and
exhibition space, convenient air service from major cities throughout the United
States  and other  countries,  and  significant  entertainment  attractions.  In
addition  to the Expo  Center and the LVCC,  The MGM Grand  Hotel and Casino has
constructed a conference  and meeting  facility of  approximately  300,000 gross
square feet,  the Mirage has recently added 100,000 gross square feet of meeting
space and Mandalay Bay has begun  construction of an  approximately  1.8 million
square foot convention  center with an estimated  completion date of early 2003.
Management  believes  that Las Vegas will  continue  to evolve as the  country's
preferred trade show and convention destination.

     Expanding Hotel Market

     During 2001, Las Vegas was among the most popular vacation  destinations in
the United States. Las Vegas has experienced a period of rapid hotel development
with the number of hotel and motel rooms in Las Vegas increasing by 65% over the
last 10 years,  from 76,879 in 1991 to 126,610 in 2001. The Company expects that
the  concentration  of quality  themed  casino  hotels and resorts will increase
visitor interest in Las Vegas as a business event and vacation destination, and,
as a result, increase overall demand for hotel rooms, gaming and entertainment.

     Growth of Las Vegas Retail Sector and Non-Gaming Revenue Expenditures

     In order to draw additional  visitors,  an increasing number of destination
resorts are  developing  non-gaming  entertainment  to  complement  their gaming
activities.  According to the LVCVA,  while gaming  revenues have increased from
$4.2 billion in 1991 to $7.6 billion in 2001 (a compound  annual  growth rate of
6.1%), non-gaming tourist revenues increased from $10.2 billion to $23.8 billion
over the same period (a compound annual growth rate of 8.8%).  The newer,  large
themed Las Vegas  destination  resorts have been  designed to capitalize on this
growth by providing  better quality hotel rooms at higher rates and by providing
expanded  shopping,  dining and entertainment  opportunities to their patrons in
addition to gaming.

     Infrastructure Improvements

     Clark   County  and   metropolitan   Las  Vegas  have   completed   several
infrastructure  improvements  to accommodate the increase in travel to Las Vegas
by all modes of transportation.  According to the LVCVA, in 2001 visitors to Las
Vegas arrived by the  following  methods of  transportation:  45% by air; 40% by
auto; 8% by recreational vehicle; and 7% by bus.

     McCarran International Airport Expansion

     During  the past five  years,  the  facilities  of  McCarran  International
Airport have been expanded to accommodate  the increased  number of airlines and
passengers that it services. The number of passengers traveling through McCarran
International Airport has increased from 20.2 million in 1991 to 35.2 million in
2001. Long-term expansion plans for McCarran  International  Airport provide for
additional  runway and related areas (a new runway was completed in October 1997
and a new terminal and additional gates were completed in 1998).

Competition

     The casino/hotel industry is highly competitive.  Strip hotels compete with
other  hotels on the Strip and with other  hotels in  downtown  Las  Vegas.  The
Casino  Resort also  competes  with a large number of hotels and motels near Las
Vegas. Many of the Company's  competitors are subsidiaries or divisions of large
public  companies and may have greater  financial and other  resources  than the
Company.







                                     6
<PAGE>

     Hotel/Casino Properties

     Competitors  of the Casino Resort  include new themed resorts on the Strip,
such as The Bellagio,  Mandalay Bay and Paris. In August 2001,  Steve Wynn filed
his  plans for La Reve with the Clark  County  Planning  Commission.  La Reve is
intended to be a 2,500-room resort on the site of the former Desert Inn on Sands
Avenue across from the site of the  anticipated  Phase II Resort.  Management is
not aware of any other new significant  developments of casino properties in Las
Vegas in the near future.  The Casino  Resort may also compete with the Phase II
Resort,  to the extent its business is not  complementary  to that of the Casino
Resort.

     The Company  believes that themed resorts are generally more  successful at
generating  higher traffic volumes and higher revenues and operating income than
the large-scale  non-themed  properties in Las Vegas.  Themed resorts compete on
the basis of the quality of theming,  as well as on more traditional bases, such
as quality of rooms,  pricing and location.  Themed resorts tend to be clustered
on the Strip,  creating  a  critical  mass of  entertainment  experiences  which
generate  significant  traffic  for  the  themed  resorts  as a  group,  thereby
capturing  a larger  portion  of the Las Vegas  hotel  and  gaming  market  than
non-themed  properties.  The Company believes that the existence of other themed
resorts in close  proximity to the Casino  Resort  directly  benefits the Casino
Resort.  The  Casino  Resort is part of a cluster  of themed  properties,  which
includes The Mirage,  the Treasure Island Hotel and Casino, The Bellagio and The
Forum Shops at Caesars Palace Hotel,  and may in the future also include La Reve
and the Phase II Resort.

     In addition to the advantages of being a centrally-located,  themed resort,
the Cooperation  Agreement and the Casino  Resort's  direct  connection with the
Expo Center provide the Casino Resort with a unique tie-in to one of the premier
trade  show  and  convention   facilities  in  the  United  States.  With  these
competitive  advantages,  the  Casino  Resort  is  positioned  to  appeal to the
mid-week meeting, trade show and convention market composed of customers who pay
higher  average  room rates and have higher  average  travel  budgets than other
categories of weekday customers, such as tour groups.

     The  hotel-casino  operation of the Casino  Resort also  competes,  to some
extent,  with other  hotel-casino  facilities  in Nevada and in  Atlantic  City,
hotel/casino and other resort facilities elsewhere in the country and the world,
Internet gaming web sites and state lotteries. In addition,  certain states have
legalized, and others may legalize, casino gaming in specific areas. The passage
of the Indian  Gaming  Regulatory  Act in 1988,  for  example,  has led to rapid
increases in Native American gaming  operations.  Such  proliferation  of gaming
venues could  significantly and adversely affect the business of the Company. In
particular,  the  legalization  of casino  gaming in or near major  metropolitan
areas, such as New York, Los Angeles,  San Francisco and Boston,  from which the
Company attracts customers, could have a material adverse effect on the business
of the Company.  In October 2001, the New York  legislature  approved a bill for
expanded  casino  gaming on Native  American  reservations  in that  state.  The
expansion of gaming in New York could also have a material adverse effect on the
business of the Company.

     Trade Show and Convention Facilities

     The Expo Center,  the Congress Center and Las Vegas generally  compete with
trade show and convention  facilities  located in and around major U.S.  cities,
including  Atlanta,  Chicago,  New York and Orlando.  Within Las Vegas, the Expo
Center and the Congress  Center compete with the LVCC,  which is located off the
Strip and currently has 3.3 million gross square feet of convention  and exhibit
facilities, including over 1.0 million square feet of new meeting and exhibition
space that was added in 2001 (the  "LVCC  Expansion").  The MGM Grand  Hotel and
Casino has also opened a new  conference and meeting  facility of  approximately
300,000  square feet, the Mirage has recently added 100,000 gross square feet of
meeting space and Mandalay Bay has begun  construction of an  approximately  1.8
million square foot convention  center. The conference and meeting facilities at
these hotel/resorts are the Congress Center's primary competition.  The LVCC and
Mandalay Bay are expected to be the primary  competitors of the Expo Center.  To
the  extent  that  any of the  competitors  of the  Casino  Resort  can  offer a
hotel/casino   experience  that  is  integrated  with  substantial  trade  show,
convention,  conference and meeting facilities,  the Casino Resort's competitive
advantage  in  attracting  trade  show and  convention  meeting  and  conference
attendees could be adversely affected.

     Mall

     The Mall competes with both themed resorts,  which offer  shopping,  dining
and entertainment  opportunities to their patrons,  and other retail malls in or
near Las Vegas.  The  Mall's  direct  competition  includes  The Forum  Shops at
Caesars Palace and The Desert  Passage Shops at the Aladdin.  The Forum Shops at
Caesars Palace may undergo  additional  expansions in the future.  The Mall also
competes  with The Fashion Show Mall, a more  traditional  mall located near the
Casino Resort which is currently undergoing an expansion that will almost double
its size.  In the future,  the Mall may also  compete  with the planned  retail,
dining and  entertainment  facilities  in the Phase II Resort.  Mandalay  Resort
Group had also announced,  but has since suspended,  the development of a retail
center near its new Mandalay Bay Resort.


                                       7
<PAGE>

Advertising and Marketing

     The Company advertises in many types of media, including television, radio,
newspapers, magazines and billboards, to promote general market awareness of the
Casino Resort as a unique vacation,  business and convention  destination due to
its first-class hotel, casino,  retail stores and restaurants.  The Mall tenants
also pursue  their own  general  advertising  and  promotional  activity,  which
benefits the Mall. The Company  actively  engages in direct  marketing  which is
targeted at specific market segments, such as the meeting,  convention and trade
show market and the premium gaming market,  and database marketing which focuses
on high-frequency,  high-margin market segments such as the "high-roller" gaming
market.  The Company uses a preview center featuring a full-scale model suite in
the Expo Center to market Casino Resort and Expo Center events.

Agreements Relating to the Casino Resort

     As of December 31, 1999, construction of the Casino Resort and the Mall was
complete and  virtually  all  construction  costs had been paid.  The Company is
currently  involved in various  lawsuits,  has asserted  various  claims against
various  parties,  and has had  various  claims  asserted  against it by various
parties,  in connection with the construction of the Casino Resort.  The Company
is  vigorously  pursuing  these claims and  vigorously  defending  itself in all
relevant legal proceedings. See "Item 3 - Legal Proceedings."

     Construction   Management  Contract  and  Construction  Manager's  Contract
     Guaranty

     The  construction  of the  principal  components  of the Casino  Resort was
undertaken by Lehrer McGovern Bovis, Inc. (the "Construction  Manager") pursuant
to a construction  management  agreement and certain  amendments  thereto (as so
amended, the "Construction  Management Contract").  The Construction  Management
Contract  established  a final  guaranteed  maximum  price (the "Final  GMP") of
$645.0 million,  so that, subject to certain exceptions  (including an exception
for  cost  overruns  due to  "scope  changes"),  the  Construction  Manager  was
responsible  for any costs of the work  covered by the  Construction  Management
Contract in excess of $645.0 million. The Construction  Management Contract also
established  a  required  "substantial  completion"  date (the date on which the
construction  of the Casino  Resort was  sufficiently  complete,  including  the
receipt of necessary permits,  licenses and approvals, so that all components of
the  Casino  Resort  could be open to the  general  public)  of April  21,  1999
(subject to extensions on account of "scope changes" and force majeure  events),
with a per-day liquidated damages penalty for failure to meet such deadline.

     The Company paid the Construction Manager a construction  management fee of
1 1/2% of the Final GMP, payable in monthly installments.

     The  obligations  of  the  Construction   Manager  under  the  Construction
Management Contract were guaranteed by Bovis, Inc.  ("Bovis"),  the Construction
Manager's  direct parent at the time the  Construction  Management  Contract was
entered into (such guaranty,  the "Bovis Guaranty").  Bovis's  obligations under
the  Bovis  Guaranty  were  guaranteed  by  The  Peninsula  and  Oriental  Steam
Navigation  Company  ("P&O"),  a British  public  company  and the  Construction
Manager's ultimate parent at the time the Construction  Management  Contract was
entered  into  (such  guaranty,  the  "P&O  Guaranty").   With  respect  to  the
Construction  Manager's obligation to complete construction on schedule: (i) for
the first 30 days of any delay in such scheduled  completion,  the  Construction
Manager solely (and not Bovis or P&O) is liable for liquidated damages; (ii) for
the 90-day period  thereafter and subject to certain  conditions and exceptions,
only the insurers under the LD Policy  described below (and not the Construction
Manager,  Bovis or P&O),  are  liable  for  liquidated  damages;  and  (iii) the
Construction  Manager,  Bovis and P&O are liable for  liquidated  damages to the
extent,  if any, that the Construction  Manager missed the required  deadline by
more than 120 days.

     Liquidated Damages Insurance

     The  Construction  Manager  obtained,  on behalf of the Company (and at the
Company's expense), a liquidated damages insurance policy (the "LD Policy"). The
LD Policy covers (with certain exceptions)  liquidated damages for delays of not
less  than one month and not more  than  four  months in  achieving  substantial
completion  beyond the date  substantial  completion was required to be achieved
under the Construction Management Contract. See "Item 3 - Legal Proceedings."

     Cooperation Agreement

     The  Casino  Resort  (excluding  the Mall),  the Mall and the Expo  Center,
respectively,  though separately owned, are integrally-related components of one
facility.  In order to  establish  terms for the  integrated  operation of these
components,  Venetian (as owner of the Hotel,  Casino and Congress Center),  the
New Mall  Subsidiary  (as owner of the Mall) and Interface (as owner of the Expo
Center)  are  parties  to the  Cooperation  Agreement.  See  "Item 13 -  Certain
Relationships and Related Transactions - Cooperation Agreement."




                                       8
<PAGE>

      Mall Management Contract

     The New Mall  Subsidiary  has entered  into an  agreement  with Forest City
Enterprises  ("Forest City"), a subsidiary of Forest City Ratner Enterprises,  a
leading developer and manager of retail and commercial real estate developments,
whereby  Forest City manages the Mall and supervises and assists in the creation
of an  advertising  and  promotional  program and a marketing plan for the Mall.
Forest City is also  responsible  for,  among  other  things,  preparation  of a
detailed  plan for the routine  operation  of the Mall,  collection  and deposit
procedures for rents and other tenant  charges,  supervision of maintenance  and
repairs and, on an annual basis, preparation of a detailed budget (including any
anticipated  extraordinary  expenses and capital expenditures) for the Mall. The
term of the  management  contract is five years from June 19, 1999, the date the
Mall opened to the public. Forest City currently receives a management fee of 2%
of all gross rents received from the operation of the Mall, provided that Forest
City  receives a minimum fee of $450,000 per year.  Beginning in June 2002,  the
minimum fee will  increase to $600,000 per year.  Forest City is not  affiliated
with the Principal Stockholder or any of his affiliates.

HVAC Services Agreement and Related Documents

     Atlantic Pacific Las Vegas, LLC (the "HVAC Provider") is a Delaware limited
liability  company and is owned by an indirect  subsidiary of Sempra  Energy,  a
utility holding company.

     Thermal  energy  (i.e.,  heating and air  conditioning)  is provided to the
Casino Resort and the Expo Center by the HVAC Provider using certain heating and
air  conditioning-related  and  other  equipment  (the  "HVAC  Equipment").   In
addition,  the HVAC  Provider  provides  the Company  with other  energy-related
services.  The central HVAC facility (the "HVAC Plant") is located on land owned
by the Company,  which land and HVAC Plant have been leased to the HVAC Provider
for a nominal annual rent. The HVAC Equipment is owned by the HVAC Provider, and
the HVAC Provider has been granted appropriate  easements and other rights so as
to be able to use the HVAC Plant and the HVAC Equipment to supply thermal energy
to the Casino Resort and the Expo Center (and, potentially, other buildings), so
long as such  easements do not  materially  interfere with the operations of the
Casino  Resort and the Expo  Center.  The HVAC  Provider  paid all costs  ("HVAC
Costs") in connection with the purchase and  installation of the HVAC Equipment,
which costs  totaled $70 million.  The HVAC  Provider has entered into  separate
service  contracts  (collectively,  the "HVAC  Service  Agreements")  with:  (i)
Venetian; (ii) Interface;  and (iii) the New Mall Subsidiary,  for the provision
of heat and cooling  requirements at agreed-to rates. The charges payable by all
users include a fixed component that enables the HVAC Provider to recover 85% of
the HVAC Costs over the initial term of the service contracts,  with interest at
a fixed annual rate of 7.1%. In addition,  the users reimburse the HVAC Provider
for the  annual  cost of  operating  and  maintaining  the  HVAC  Equipment  and
providing  certain other energy  related  services,  and pay the HVAC Provider a
management  fee of $500,000  per year.  Each user is  allocated a portion of the
total  agreed-to  charges and fees through its service  contract,  which portion
includes  paying  100% of the  cost of  services  in  connection  with  the HVAC
Equipment  relating  solely  to  such  user.  Each  user is not  liable  for the
obligations of the other users; provided,  however, that the New Mall Subsidiary
is liable for the obligations of each Mall tenant.  The HVAC Service  Agreements
expire  in 2009,  at which  time the  users  will  have the  right,  but not the
obligation,  to collectively  either extend the term of their agreements for two
consecutive  periods  of five  years  each or  purchase  the HVAC  Equipment  in
accordance with purchase provisions set forth in the HVAC Service Agreements.

Agreements Relating to the Phase II Resort

     The Casino Resort was  developed on a stand-alone  basis as the first phase
of a planned two-phase development.  In the second phase of the development,  it
is  contemplated  that the Phase II  Subsidiary  will  construct and develop the
Phase II Resort,  which also is planned to be a themed resort. In the event that
the Phase II Resort is not constructed, the Casino Resort has all the attributes
and  facilities to continue to operate as a stand-alone  resort.  See "Item 13 -
Certain   Relationships  and  Related   Transactions  -  Possible  Conflicts  of
Interest."

     On October 19, 2001, Venetian entered into a five-year lease (the "Phase II
Lease") with the Phase II  Subsidiary  for use of the land on which the Phase II
Resort will  ultimately  be built (the "Phase II Land").  Under the terms of the
Phase II Lease,  Venetian  pays the Phase II  Subsidiary  $8.0 million of annual
rent for use of the  Phase II Land.  The  Company  is  considering  constructing
150,000  square feet of convention  center space on the Phase II Land. See "-New
Developments - Phase IA Addition. "










                                       9
<PAGE>

     Construction  of the Phase II Resort would require that the Company  and/or
the Phase II Subsidiary incur additional indebtedness. It is contemplated that a
portion of the proceeds of such  indebtedness  would be used to pay off existing
indebtedness   of  the  Phase  II   Subsidiary   that  has  been  used  to  fund
pre-development  expenses for the Phase II Resort. See "Management's  Discussion
and Analysis of Financial  Condition  and Results of  Operations - Liquidity and
Capital Resources - Aggregate  Indebtedness and Fixed Payment Obligations to the
HVAC  Provider."  Upon repayment of such  indebtedness,  the Phase II Subsidiary
would have the right to terminate the Phase II Lease.  If the Phase II Resort is
constructed on the Phase II Land, the following  additional  agreements may also
be entered into by the Phase II  Subsidiary,  on the one hand,  and the Company,
Venetian and the New Mall Subsidiary, on the other hand:

     Phase II Casino Lease

     If the  Phase II Resort  is  constructed,  in order to avoid the need for a
separate  gaming  license  for the Phase II  Subsidiary,  LVSI or  Venetian  may
operate  the casino for the Phase II Resort  pursuant  to a lease (the "Phase II
Casino Lease").  The Phase II Casino Lease may have terms substantially  similar
to the Casino Lease.  The Company or Venetian,  as the case may be, may agree to
operate  the  casino in the Phase II Resort  and the  Casino in a  substantially
similar  manner,  and the Company or Venetian,  as the case may be, may agree to
have common gaming and  surveillance  operations  in such casinos  (based on pro
rata allocations of operating costs).

     Phase II HVAC Services Agreement

     The Cooperation  Agreement  permits the owner of the Phase II Land to enter
into an HVAC  Services  Agreement to receive HVAC  services from the HVAC Plant.
Any such agreement would have to be on terms  satisfactory to the HVAC Provider.
See "Item 13 - Certain  Relationships  and Related  Transactions  -  Cooperation
Agreement."

     Phase I - Phase II Joint Operation Arrangements

     With  respect  to the  future  development  of the  Phase  II  Resort,  the
Cooperation  Agreement  provides that, prior to the commencement of construction
of the Phase II Resort,  Venetian must approve the plans and  specifications for
any  portions of the Phase II Resort that will connect with or adjoin the Casino
Resort.  Additionally,  prior to such  construction,  Venetian  and the Phase II
Subsidiary must agree in good faith, and upon commercially reasonable terms, on:
(i) appropriate  mutual operating  covenants for the Casino Resort and the Phase
II Resort;  (ii) joint  marketing and  advertising  of the Casino Resort and the
Phase II Resort; (iii) certain shared casino operations at the Casino Resort and
the Phase II Resort;  (iv) the sharing of customer  information  with respect to
the Casino Resort and the Phase II Resort; (v) the joint purchasing of insurance
for the  Casino  Resort and the and the Phase II Resort;  (vi)  shared  security
operations  for the Casino  Resort and the Phase II Resort;  and (vii) any other
matters  that  would be of mutual  benefit in owning  and  operating  the Casino
Resort and the Phase II Resort.

Regulation and Licensing

     The ownership  and  operation of casino  gaming  facilities in the State of
Nevada  are  subject  to the  Nevada  Gaming  Control  Act and  the  regulations
promulgated  thereunder  (collectively,  the  "Nevada  Act") and  various  local
regulations.  The Company's gaming  operations are also subject to the licensing
and   regulatory   control  of  the  Nevada  Gaming   Commission   (the  "Nevada
Commission"),  the Nevada Gaming Control Board (the "NGCB") and the Clark County
Liquor and Gaming  Licensing  Board (the "CCLGLB" and,  together with the Nevada
Commission and the NGCB, the "Nevada Gaming Authorities").

     The laws,  regulations  and  supervisory  procedures  of the Nevada  Gaming
Authorities  are based upon  declarations  of public  policy that 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  fiscal  affairs  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) the establishment of a source of state and local
revenues  through  taxation  and  licensing  fees.  Any  change  in  such  laws,
regulations and procedures  could have an adverse effect on the Company's gaming
operations or on the operation of the Casino Resort.











                                   10
<PAGE>

     The Company is required to be licensed by the Nevada Gaming  Authorities to
operate a casino, and is currently so licensed.  The gaming license requires the
periodic  payment of fees and taxes and is not  transferable.  The  Company  was
registered   by  the  Nevada   Commission  as  a   publicly-traded   corporation
("Registered  Corporation")  and as  such,  must  periodically  submit  detailed
financial and operating reports to the Nevada Gaming Authorities and furnish any
other information that the Nevada Gaming Authorities may require.  No person may
become a stockholder  of, or receive any percentage of profits from, the Company
without  first   obtaining   licenses  and  approvals  from  the  Nevada  Gaming
Authorities.  The  Company  operates  the Casino  pursuant  to the Casino  Lease
between LVSI and Venetian,  which provides for a fixed monthly  rental  payment.
The Company possesses all state and local government  registrations,  approvals,
permits  and  licenses  required  in order for the  Company  to engage in gaming
activities at the Casino Resort.

     The Nevada Gaming  Authorities  may  investigate  any  individual who has a
material  relationship to, or material involvement with, the Company or Venetian
to  determine  whether  such  individual  is suitable or should be licensed as a
business  associate of a gaming  licensee.  Officers,  directors and certain key
employees  of the Company must file  applications  and be licensed by the Nevada
Gaming Authorities

     The Nevada Gaming  Authorities  may deny an application  for licensing or a
finding  of  suitability  for any cause  they  deem  reasonable.  A  finding  of
suitability  is  comparable to  licensing;  both require  submission of detailed
personal and financial  information  followed by a thorough  investigation.  The
applicant for licensing or a finding of  suitability,  or the gaming licensee by
whom the  applicant is employed or for whom the applicant  serves,  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 a corporate position.

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

     The Company is required to submit periodic detailed financial and operating
reports to the Nevada  Commission.  Substantially  all material  loans,  leases,
sales of securities and similar  financing  transactions  by the Company must be
reported to or approved by the Nevada Commission.

     If it were determined that the Nevada Act was violated by the Company,  the
registration  and gaming  licenses it then holds could be limited,  conditioned,
suspended  or  revoked,   subject  to  compliance  with  certain  statutory  and
regulatory  procedures.  In addition, the Company 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 the Casino  Resort  and,  under
certain  circumstances,  earnings generated during the supervisor's  appointment
(except for the reasonable rental value of the Casino Resort) could be forfeited
to the State of Nevada.  Limitation,  conditioning  or  suspension of any gaming
registration or license or the appointment of a supervisor could (and revocation
of any gaming license would)  materially  adversely affect the gaming operations
of the Company.

     Any beneficial holder of the Company's voting securities, regardless of the
number of shares owned, may be required to file an application, be investigated,
and have  their  suitability  as a  beneficial  holder of the  Company's  voting
securities  determined if the Nevada  Commission has reason to believe that such
ownership  would  otherwise be  inconsistent  with the declared  policies of the
State of Nevada.  The applicant must pay all costs of investigation  incurred by
the Nevada Gaming Authorities in conducting any such investigation.

     The  Nevada  Act  requires  any  person  who  acquires  more than 5% of the
Company's voting securities to report the acquisition to the Nevada  Commission.
The Nevada Act requires that beneficial owners of more than 10% of the Company's
voting  securities  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.  Under certain  circumstances,  an  "institutional
investor"  as defined in the Nevada Act,  which  acquires  more than 10% but not
more  than 15% of the  Company's  voting  securities,  may  apply to the  Nevada
Commission  for a waiver of such finding of  suitability  if such  institutional
investor  holds  the  voting  securities  only  for  investment   purposes.   An
institutional  investor shall not be deemed to hold voting  securities  only for








                                       11
<PAGE>

investment  purposes unless the voting  securities were acquired and are held in
the ordinary course of business as an  institutional  investment and not for the
purpose of causing,  directly or  indirectly,  the election of a majority of the
members of the board of directors of the  Company,  any change in the  Company's
corporate charter, bylaws, management,  policies or operations of the Company or
any of its gaming  affiliates,  or any other action which the Nevada  Commission
finds to be inconsistent  with holding the Company's voting  securities only for
investment  purposes.  Activities  that are not deemed to be  inconsistent  with
holding voting securities only for investment  purposes  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 its  management,  policies or  operations;
and (iii) such other  activities  as the Nevada  Commission  may determine to be
consistent  with such  investment  intent.  If the  beneficial  holder of voting
securities who must be found suitable is a corporation, partnership or trust, it
must submit  detailed  business and  financial  information  including a list of
beneficial owners.

     Under a  provision  of the Nevada  Act,  under  certain  circumstances,  an
"institutional  investor" as defined in the Nevada Act, which intends to acquire
not more  than 15% of any  class of  nonvoting  securities  of a  privately-held
corporation,  limited  partnership or limited  liability  company that is also a
registered holder or intermediary company of the holder of a gaming license, may
apply to the Nevada  Commission  for a waiver of the usual  prior  licensing  or
finding of suitability  requirements if such  institutional  investor holds such
nonvoting  securities only for investment  purposes.  An institutional  investor
shall not be deemed to hold nonvoting  securities  only for investment  purposes
unless the  nonvoting  securities  were  acquired  and are held in the  ordinary
course of business as an institutional  investor,  do not give the institutional
investor  management  authority,  and do not, directly or indirectly,  allow the
institutional investor to vote for the election or appointment of members of the
board of  directors,  a general  partner  or  manager,  cause any  change in the
articles  of  organization,   operating   agreement,   other  organic  document,
management,  polices or  operations,  or cause any other  action that the Nevada
Commission finds to be inconsistent with holding  nonvoting  securities only for
investment  purposes.  Activities  that are not deemed to be  inconsistent  with
holding  nonvoting   securities  only  for  investment  purposes  include:   (i)
nominating  any candidate for election or  appointment  to the entity's board of
directors or  equivalent in connection  with a debt  restructuring;  (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 the
entity's management,  polices or operations;  and (iii) such other activities as
the Nevada  Commission  may  determine  to be  consistent  with such  investment
intent. If the beneficial holder of nonvoting securities who must be licensed or
found suitable is a corporation,  partnership or trust,  it must submit detailed
business and financial  information  including a list of beneficial  owners. The
applicant is required to pay all costs of investigation.

     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 to be  unsuitable.  The same
restrictions apply to a record owner if the record owner,  after request,  fails
to identify the beneficial owner. Any stockholder found to be unsuitable and who
holds, directly or indirectly, any beneficial ownership of the common stock of a
Registered  Corporation  beyond such period of time as may be  prescribed by the
Nevada Commission may be guilty of a criminal offense. The Company is subject to
disciplinary  action if, after it receives notice that a person is unsuitable to
be a stockholder  or to have any other  relationship  with the Company,  it: (i)
pays that person any dividend or interest upon voting securities of the Company;
(ii) allows that person to exercise,  directly or  indirectly,  any voting right
conferred through securities held by that person; (iii) pays remuneration in any
form to that person for services rendered or otherwise;  or (iv) fails to pursue
all lawful  efforts to require such  unsuitable  person to relinquish his voting
securities for cash at fair market value. Additionally, the CCLGLB has taken the
position that it has the authority to approve all persons  owning or controlling
the stock of any corporation holding a gaming license.

     The Nevada  Commission  may, in its  discretion,  require the holder of any
debt  security  of  a  Registered   Corporation  to  file  an  application,   be
investigated  and be found suitable to own the debt security of such  Registered
Corporation.  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.






                  12
<PAGE>

     LVSI is required to maintain a current  stock  ledger in Nevada that 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.
A failure to make such  disclosure  may be grounds for finding the record holder
unsuitable.  The  Company is also  required  to  disclose  the  identity  of the
beneficial  owner to the  Nevada  Gaming  Authorities.  A  failure  to make such
disclosure may be grounds for finding the record holder unsuitable.  The Company
is also required to render maximum assistance in determining the identity of the
beneficial  owner.  LVSI stock  certificates  bear a legend indicating that such
securities are subject to the Nevada Act.

     Neither  LVSI nor  Venetian  may make a public  offering of any  securities
without the prior  approval of the Nevada  Commission  if the  securities or the
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.  The  hypothecation  of the Company's  assets and restrictions on
stock in connection  with any public offering also require the prior approval of
the Nevada Commission.  In addition,  the hypothecation of Venetian's assets and
restrictions on stock in respect of any public offering  require the approval of
the Nevada Commission to remain effective.

     Changes in control of the Company through a merger, consolidation, stock or
asset acquisition,  management or consulting agreement, or any act or conduct by
any person whereby he or she obtains control,  shall not occur without the prior
approval  of the Nevada  Commission.  Entities  seeking to acquire  control of a
Registered   Corporation  must  satisfy  the  NGCB  and  the  Nevada  Commission
concerning a variety of stringent  standards  prior to assuming  control of such
Registered  Corporation.  The Nevada  Commission  may also  require  controlling
stockholders,   officers,   directors  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 of the transaction.

     The  Nevada  legislature  has  declared  that some  corporate  acquisitions
opposed by management,  repurchases of voting  securities and corporate  defense
tactics affecting Nevada 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 operators 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  the  Company  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  recapitalization
proposed by the Company's  board of directors in response to a tender offer made
directly  to the  Registered  Corporation's  stockholders  for the  purposes  of
acquiring control of the Registered Corporation.

     License fees and taxes, computed in various ways depending upon the type of
gaming or  activity  involved,  are  payable to the State of Nevada and to Clark
County,  Nevada.  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 casino
entertainment  tax  also is paid  by the  Company  to the  extent  that  certain
entertainment  is provided in a cabaret,  nightclub,  cocktail  lounge or casino
showroom  in  connection  with the serving or selling of food,  refreshments  or
merchandise.

     Any person who is licensed, required to be licensed,  registered,  required
to be  registered,  or 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 NGCB,  and  thereafter  maintain,  a
revolving fund in the amount of $10,000 to pay the expenses of any investigation
by the NGCB into 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 also  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 any foreign jurisdiction pertaining to such foreign gaming operation, fail to
conduct  such  foreign  gaming  operation in  accordance  with the  standards of
honesty and integrity required of Nevada gaming operations, engage in activities
that are harmful to the State of Nevada or its ability to collect  gaming  taxes
and fees,  or employ a person in such  foreign  operation  who has been denied a
license  or a  finding  of  suitability  in Nevada  on the  ground  of  personal
unsuitability.

     The sale of  alcoholic  beverages  by the  Company on the  premises  of the
Casino Resort is subject to licensing,  control and regulation by the applicable
local  authorities.  The Company has  obtained  Clark  County  gaming and liquor
licenses.  All licenses are  revocable  and are not  transferable.  The agencies
involved  have  full  power to limit,  condition,  suspend  or  revoke  any such
licenses,  and any  such  disciplinary  action  could  (and  revocation  of such
licenses  would)  have a material  adverse  effect  upon the  operations  of the
Company.

                                       13
<PAGE>

New Developments

     Phase IA Addition

     During  2001,  the  Company  began  designing,   planning,  permitting  and
constructing:  (1) an approximately  1,000-room hotel tower on top of the Casino
Resort's  existing  parking garage;  (2) an  approximately  1,000-parking  space
expansion to the parking garage;  and (3)  approximately  150,000 square feet of
additional  convention  center  space on the  Phase II Land  (collectively,  the
"Phase IA Addition").  The Company  anticipates that the additional 1,000 single
and  multiple  bedroom  suites,  designed  in the same  manner  and style as the
Hotel's existing suites,  will meet unserved room demand and provide incremental
casino  revenue  at the  Casino  Resort.  The  Company  also  expects to achieve
additional economies of scale when it completes the Phase IA Addition, including
shared administration, HVAC facility and back-of-the-house functions.

     To date,  the  Company  has  completed  the  design  and has  substantially
completed the foundation and support systems for, the 1,000-room  hotel tower on
top of the existing  parking garage.  Due to the travel  disruption to Las Vegas
during the fourth quarter of 2001, the Company  decided to suspend  construction
of the  Phase  IA  Addition  at  that  time.  Certain  designing,  planning  and
permitting  of the Phase IA Addition  is,  however,  continuing.  The Company is
currently exploring financing alternatives to complete construction of the Phase
IA  Addition,  which it  estimates  will cost  approximately  $225.0  million to
complete.

     Macau Joint Venture

     On February 8, 2002,  the  Government of the Macau  Special  Administrative
Region  of the  People's  Republic  of China  ("Macau")  granted  a  provisional
concession  to operate  casinos in Macau to Galaxy  Casino  Company  Limited,  a
proposed  joint  venture  comprised of a  subsidiary  of the Company (the "Macau
Subsidiary")  and a group of Macau- and Hong Kong-based  investors.  Macau,  the
former  Portuguese  colony  located near Hong Kong,  currently has annual gaming
revenues of approximately  $2.0 to $2.5 billion and is widely regarded as one of
the  fastest  growing  gaming  markets  in the world.  Approximately  10 million
visitors arrived in Macau during 2001, according to the Macau Tourism Board. The
following  factors are  expected to continue to  significantly  improve  Macau's
status as a world-class gaming and resort destination: (i) the increased ease of
access from Hong Kong,  China and Taiwan and other Asian regional gaming markets
(where  casinos are currently  banned);  (ii)  significant  foreign and domestic
investment in new and expanded  gaming  products;  and (iii) the  development of
Disneyland - China and other new resort developments in the Zhuhai province.

     Galaxy Casino Company  Limited was one of three parties  selected for final
negotiations,  out of twenty-one competitors that submitted applications,  to be
considered  for one of the three  casino  licenses  to be granted in Macau.  The
other two parties selected for final  negotiations are a group led by Steve Wynn
and a group led by Stanley Ho, who holds Macau's only existing  casino  license.
The  joint  venture  participants  are  currently   negotiating  joint  venture,
development,  management,  licensing and related  agreements  and the terms of a
binding concession agreement with Macau. The Company expects the agreements with
its joint  venture  partners and Macau to be  completed by April 2002,  although
there  can be no  assurance  that the  joint  venture  will be  entered  into or
successful, or that the concession to operate casinos in Macau will be obtained.

     During the year ended December 31, 2001, the Company  incurred $0.4 million
of expenses  associated  with the Macau joint  venture.  Under the  contemplated
terms of the  agreements  between  the Macau  Subsidiary  and its joint  venture
partners,  neither the Company nor the Macau Subsidiary will be obligated to pay
for  any  of  the  costs  of  constructing   and  developing  the   contemplated
hotel/casino resorts in Macau.

     The Macau  joint  venture  tentatively  plans to build a  500-suite  hotel,
casino and convention  center complex,  with a  Venetian-style  theme similar to
that of the  Company's  Las Vegas  property.  It also has plans to  develop  two
smaller  facilities.  Under the  contemplated  terms of the  Macau  Subsidiary's
agreements with its joint venture partners, the Macau Subsidiary or subsidiaries
thereof (a) will develop and manage the  hotel/casino/convention  center complex
and smaller  facilities,  and will  receive  development  and various  recurring
management  and  licensing  fees and (b) will have an  option  to  acquire a 30%
ownership interest in the complex and smaller  facilities.  The Company believes
that the Macau  opportunity  provides  an  international  platform to expand its
premier Venetian brand and create increased diversification of, and a new source
of significant growth for, its revenue base.











                                       14
<PAGE>

     Internet Gaming and Other New Business Ventures

     The  Company  is  actively  pursuing  the  possibility  of  developing  and
operating an Internet  gaming site and is  currently  exploring  other  business
opportunities   for  expansion,   including   Native  American  gaming  and  the
possibility of operating casino resorts in certain foreign jurisdictions. During
January 2002, the Company  entered into a joint venture  agreement to assess the
feasibility  of developing  and operating an Internet  gaming site,  which would
require a license to operate  the venture  from a  jurisdiction  where  Internet
gaming is legal as well as approval from the Nevada Gaming Authorities. Although
the Company's Internet and other projects are in the exploration stage and there
can be no  assurance  that any of these  ventures  will  prove to be  attractive
opportunities,  or that if  implemented  they will be  successful,  the  Company
intends to continue to explore similar new business opportunities.

Employees

     The Company  directly employs  approximately  4,000 employees in connection
with the  Casino  Resort.  The  Casino  Resort's  employees  are not  covered by
collective  bargaining  agreements.  Most,  but not all,  major  casino  resorts
situated on the Strip have  collective  bargaining  contracts  covering at least
some of the labor force at such sites. The unions currently on the Strip include
the Local 226 of the Hotel  Employees  and  Restaurant  Employees  International
Union (the  "Local"),  the Operating  Engineers  Union and the Teamsters  Union.
Although no assurances  can be given,  if employees  decide to be represented by
labor unions,  management does not believe that such representation would have a
material  impact  upon  the  Company's  results  of  operations,  cash  flows or
financial position.

     The Local has requested the Company to recognize it as the bargaining agent
for employees of the Casino Resort. The Company has declined to do so, believing
that current and future  employees  are entitled to select their own  bargaining
agent,  if any.  In the past,  when other  hotel-casino  operators  have taken a
similar  position,  the  Local  has  engaged  in  certain   confrontational  and
obstructive  tactics,  including  contacting  potential  customers,  tenants and
investors,  objecting to various  administrative  approvals and  picketing.  The
Local has  engaged in such  tactics  with  respect to the Casino  Resort and may
continue  to do so.  Although  the  Company  believes it will be able to operate
despite such dispute, no assurance can be given that it will be able to do so or
that the failure to do so would not result in a material  adverse  effect on the
Company's results of operations, cash flows or financial position.

Risk Factors

     The following  risk factors  should be read  carefully in  connection  with
evaluating  the Company and the  forward-looking  statements  contained  in this
Annual  Report  on  Form  10-K.  Any of the  following  risks  could  materially
adversely affect the Company, its operating results, its financial condition and
the actual outcome of matters as to which forward-looking statements are made in
this Annual Report on Form 10-K. Certain statements in "Risk Factors" constitute
"forward-looking  statements." Actual results could differ materially from those
projected in the  forward-looking  statements as a result of certain factors and
uncertainties  set forth below and elsewhere in this Annual Report on Form 10-K.
See "Item 7 - Management's  Discussion  and Analysis of Financial  Condition and
Results of Operations - Special Note Regarding Forward-Looking Statements."

     Substantial Leverage; Ability to Service Debt

     At December 31, 2001, the Company had total  indebtedness of  approximately
$941.0 million  (including  $3.4 million of accreted  original issue discount on
the Senior  Subordinated  Notes),  of which  $129.1  million  represent  current
maturities of long term debt due during 2002. See "Item 8 - Financial Statements
and Supplementary Data - Notes to Financial Statements - Note 8 Long-Term Debt."
The  Company's  substantial  indebtedness  could limit its ability to respond to
changing business and economic  conditions.  Further,  there can be no assurance
that the Company  will have the right under the  agreements  governing  its debt
obligations to issue any additional debt as may be necessary or desirable.

     The  ability of the  Company to make  scheduled  interest  payments  on its
existing  indebtedness  depends on its ability to generate  sufficient cash flow
from  operations,  as well as a range  of  economic,  competitive  and  business
factors,  many of which are outside of the  Company's  control.  The Company has
estimated  interest payments of $90.0 million due during 2002 in connection with
its existing indebtedness. If the Company does not generate sufficient cash flow
from  operations  to satisfy  such debt  obligations,  it may have to  undertake
alternative  financing  plans,  such as refinancing or  restructuring  its debt,
selling  assets,  reducing or delaying  capital  investments or seeking to raise
additional  capital.  There can be no assurance  that any  refinancing  would be
possible, that any assets could be sold, or, if sold, of the timing of the sales
and the amount of proceeds realized from those sales, that additional  financing
could be obtained on acceptable  terms, if at all, or that it would be permitted
under the terms of the Company's  various debt instruments  then in effect.  The
Company's   inability  to  generate   sufficient   cash  flow  to  satisfy  debt
obligations,  or to refinance its obligations on commercially  reasonable terms,
would have an adverse effect on the Company's business,  financial condition and
results of operations.
                                       15
<PAGE>

     Operating Restrictions

     The terms of the Company's secured bank credit facility, its indentures and
the  other   agreements   governing  the  indebtedness  of  the  Company  impose
significant   operating  and  financial   restrictions  on  the  Company.   Such
restrictions significantly limit or prohibit, among other things, the ability of
LVSI,  Venetian and their  subsidiaries to incur additional  indebtedness,  make
certain capital  expenditures,  repay indebtedness prior to its stated maturity,
create liens,  sell assets,  pay dividends or engage in mergers or acquisitions.
There can be no assurances that these restrictions will not adversely affect the
ability of the Company to finance its future  operations or capital  needs.  See
"Item 7 -  Management's  Discussion  and  Analysis of  Financial  Condition  and
Results of Operations - Liquidity and Capital Resources."

     Business Contingencies

     The Company's  operations  are subject to significant  business,  economic,
regulatory and competitive  uncertainties and  contingencies,  many of which are
beyond its control.  There can be no assurance that the Company will continue to
manage  the  Casino  Resort  on a  profitable  basis  or that it will be able to
attract a sufficient  number of guests,  gaming  customers and other visitors to
the Casino Resort to make its various operations profitable  independently or as
a whole.

     On  September  11, 2001,  acts of  terrorism  occurred in New York City and
Washington D.C. As a result of these terrorist acts,  domestic and international
travel was severely  disrupted.  As approximately  45% of customers  utilize air
travel  to come to Las  Vegas,  these  terrorist  acts  and  travel  disruptions
decreased customer  visitation to the Casino Resort.  Although air travel levels
have  rebounded,  the Company  cannot  predict the extent to which the events of
September 11th may continue to have an effect,  directly or  indirectly,  in the
future.  Any further terrorist act, outbreak of hostilities or escalation of war
could  have a material  adverse  effect on the  economy  in  general  and on the
hotel/casino industry in particular,  or could further disrupt air travel, which
would adversely affect the Company's financial condition,  results of operations
or cash flows.

     Competition

     The casino/hotel industry is highly competitive.  Hotels located on or near
the Strip  compete  with other Strip  hotels and with other hotels in Las Vegas.
Many of the Company's  competitors are subsidiaries or divisions of large public
companies and may have greater financial and other resources.

     The Casino Resort competes with a large number of major hotel-casinos and a
number  of  smaller  casinos  located  on or near the  Strip and in and near Las
Vegas,  including  The  Bellagio,  Mandalay  Bay and  Paris.  The  Company  also
competes,  to some extent,  with other hotel-casino  facilities in Nevada and in
Atlantic City, and with  hotel-casinos  and other resort facilities and vacation
destinations elsewhere in the United States and the world.

     The Company also competes  with  legalized  gaming from casinos  located on
Native  American  tribal lands.  In March 2000,  California  voters  approved an
amendment to the California  Constitution  permitting  Native American tribes in
California  to operate a limited  number of slot and video  poker  machines  and
house-banked  card games.  The governor of California  has entered into compacts
with  numerous  tribes  in  California.  The  federal  government  has  approved
approximately 60 such compacts,  and  casino-style  gaming is now legal on those
tribal lands.  While the competitive  impact on the Company's  operations in Las
Vegas from the continued  growth of Native  American  gaming  establishments  in
California remains uncertain,  the proliferation of gaming throughout California
and other areas located near the Casino  Resort could have an adverse  effect on
the Company's operating results.

     In addition, certain states have legalized, and others may legalize, casino
gaming in specific areas,  including  metropolitan  areas, such as New York, Los
Angeles, San Francisco and Boston, from which the Company attracts customers. In
October 2001, the New York legislature approved a bill designed to expand casino
gaming on Native American  reservations  in that state.  Such  proliferation  of
gaming venues, by luring customers close to home and away from Las Vegas,  could
significantly and adversely affect the Company's financial condition, results of
operations or cash flows.

      The construction of new properties and the enhancement or expansion of
existing properties in Las Vegas could have a negative impact on the Company's
business. With the expansion of its facilities, the Las Vegas Convention Center
will be able to solely host many large trade shows which had previously split
space between the Las Vegas Convention Center and the Expo Center. In addition,
the Company anticipates increased competition from the MGM Grand Hotel and
Casino, the Mirage and Mandalay Bay, which are adding conference and meeting
facilities. To the extent that these competitors are able to capture a
substantially larger portion of the trade show and convention business in Las
Vegas, there could be a materially adverse impact on the Expo Center and, given
the Casino Resort's link to the Expo Center, the Company's financial position,
results of operations or cash flows.




                                     16
<PAGE>

     Construction Claims

     The  Company  is party to  litigation  matters  and  claims  related to its
operations and the  construction of the Casino Resort.  The Company is currently
involved in various  lawsuits,  has  asserted  various  claims  against  various
parties,  and has had various claims asserted against it by various parties,  in
connection  with the  construction  of the  Casino  Resort.  All of the  pending
litigation is in preliminary stages, and it is not yet possible to determine the
ultimate  outcomes.  If any litigation or other lien proceedings  concerning the
claims of the Construction  Manager or its subcontractors were decided adversely
to the Company,  such litigation or other lien proceedings could have a material
adverse effect on the financial position, results of operations or cash flows of
the Company to the extent such litigation or lien proceedings are not covered by
the Insurance Policy. See "Item 3 - Legal Proceedings."

     Risk of New Ventures

     The  Company  is  actively  pursuing  the  possibility  of  developing  and
operating an Internet  gaming site and is  currently  exploring  other  business
opportunities   for  expansion,   including   Native  American  gaming  and  the
possibility of operating  casino resorts in certain  foreign  jurisdictions.  At
this point,  it is unclear how long it would take, or if it would be feasible or
attractive, for the Company to develop, operate, obtain the necessary regulatory
approvals  for,  acquire  land  in  connection  with or  take  any of the  other
necessary  business risks and measures to complete any of such ventures.  If the
Company  were  successful  in  launching  any  such  ventures,  there  can be no
assurance that any of these projects would be successful, or that they would not
have a material adverse effect on the Company's financial  position,  results of
operations or cash flows.

     In October 2001, the Macau Subsidiary  entered into a non-binding letter of
intent with Asian American Entertainment Corporation, Limited, ("AAEC"), a Macau
corporation whose largest  shareholder is China  Development  Industrial Bank, a
Taiwanese  bank,  to enter into a joint  venture  to obtain a casino  license in
Macau.  In February 2002, the Company elected to exercise its right to terminate
this letter of intent and to create a joint venture with other parties to seek a
Macau  casino  license.  AAEC has  threatened,  in a press  release,  to sue the
Company in connection with the Company's termination of the letter of intent and
the potential  awarding of a casino license to the Macau  Subsidiary's new joint
venture.  The Company  believes  AAEC's  claims lack merit and, if sued by AAEC,
intends to defend itself vigorously.

     Risks of Planned Construction Projects

     Some of the major  construction  projects that the Company  anticipates for
the future, such as the Phase IA Addition,  entail significant risks,  including
shortages of materials or skilled labor, unforeseen  engineering,  environmental
and/or geological problems, work stoppages, weather interference,  unanticipated
cost  increases and  unavailability  of  construction  equipment.  Construction,
equipment or staffing problems or difficulties in obtaining any of the requisite
licenses,   permits,   allocations  and  authorizations   from  governmental  or
regulatory  authorities  could  increase the total cost,  delay,  or prevent the
construction  or opening of such  projects  or  otherwise  affect the design and
features of the Phase IA Addition or other ventures.

     The  anticipated  costs and  completion  date for the Phase IA Addition are
based on budgets,  conceptual  design documents and schedule  estimates that the
Company has prepared with the assistance of architects. To date, the Company has
completed  the  design  and plans for the Phase IA  Addition  and  substantially
completed a foundation and support systems for the 1,000-room  hotel tower to be
built  on top of the  parking  garage.  The  Company  has  hired  various  trade
contractors for the construction of certain aspects of the Phase IA Addition but
has not yet selected, or finalized an agreement with, a construction manager for
the entire project.  The Company cannot be assured that it will select and reach
an agreement with a construction  manager on financial and other terms that will
meet the forecasted cost budget and timeline. Further, there can be no assurance
that the  Company  will not incur  cost  overruns  that will not be covered by a
construction manager, trade contractors or insurance,  or that construction will
be completed on schedule.  If significant cost overruns are not so covered,  the
Company may not be able to arrange for  additional  financing or may not be able
to find  additional  financing on  commercially  reasonable  terms to fund these
additional  costs.  A failure to complete  the Phase IA Addition on budget or on
schedule may adversely  affect the  Company's  financial  condition,  results of
operations and cash flows.











                  17
<PAGE>

     Insurance Costs

     The  September  11th  terrorist  attacks  have  substantially  affected the
availability of insurance  coverage for certain types of damages or occurrences.
In addition,  insurance premiums have increased. The Company's current insurance
policy  terminates  in April 2002.  The Company does not believe that it will be
able to purchase a new insurance policy or renew its existing policy on terms as
favorable as the terms of its current policy.  The Company  anticipates that the
cost of a new  insurance  policy will be higher as a result of this  increase in
premium  levels.  The cost of  coverage  may become so high that the Company may
need to agree to exclusions  from its  coverage.  The Company also believes that
its future  insurance  policy will  exclude  from  coverage  certain  losses and
damages that are covered under the existing insurance policy. In particular, the
Company cannot be assured that it will be able to obtain any insurance  coverage
with respect to  occurrences  of terrorist acts and any losses that could result
from these acts. This could expose the Company to heavy losses in the event that
any damages occur, directly or indirectly, as a result of terrorist acts.

     Government Regulation

     The gaming  operations  and the  ownership of securities of the Company are
subject  to  extensive  regulation  by the Nevada  Commission,  the NGCB and the
CCLGLB.  The Nevada  Gaming  Authorities  have broad  authority  with respect to
licensing  and  registration  of  entities  and  individuals  involved  with the
Company. See "-Regulation and Licensing."

     Although the Company  currently holds a gaming license issued by the Nevada
Gaming  Authorities,  the Nevada  Gaming  Authorities  may,  among other things,
revoke the gaming  license of any corporate  entity (a "Corporate  Licensee") or
the  registration  of a Registered  Corporation  or any entity  registered  as a
holding  company  of a  Corporate  Licensee.  In  addition,  the  Nevada  Gaming
Authorities  may revoke the license or finding of  suitability  of any  officer,
director,  controlling  person,  shareholder,  noteholder  or key  employee of a
licensed or  registered  entity.  If the gaming  licenses  of the  Company  were
revoked for any reason,  the Nevada Gaming Authorities could require the closing
of the Casino,  which would result in a material  adverse effect on the business
of the Company.

     Dependence Upon Key Management

     The  ability  of the  Company  to  maintain  its  competitive  position  is
dependent to a large degree on the services of the Company's  senior  management
team, including Sheldon G. Adelson, the Principal  Stockholder.  There can be no
assurance that such individuals will remain with the Company.  The death or loss
of the  services of any of the  Company's  senior  managers or an  inability  to
attract and retain additional senior management  personnel could have a material
adverse  effect on the Company.  There can be no assurance that the Company will
be able to  retain  its  existing  senior  management  personnel  or to  attract
additional qualified senior management personnel.

     Principal Stockholder

     The Principal  Stockholder  beneficially owns all of the outstanding common
stock  of LVSI,  the  managing  member  of  Venetian.  See  "Item 12 -  Security
Ownership of Certain  Beneficial Owners and Management - Beneficial  Ownership."
Except for actions that require the approval of the Special Director (as defined
herein),  the  Principal  Stockholder  will  be able to  control  the  business,
policies and affairs of the  Company,  including  the election of directors  and
major corporate transactions of LVSI.

     Possible Conflicts of Interest

          Construction of the Phase II Resort

     The Phase II  Resort is  planned  to be  constructed  on the Phase II Land,
which is adjacent to the Casino Resort.  There is no guarantee that the Phase II
Resort will be built in the near future, in the manner currently planned,  or at
all. In addition,  although the Company intends to construct the Phase II Resort
so as to mitigate the impact of such  construction  on the Casino Resort,  there
can be no  assurance  that such  construction  will  commence  as  planned,  and
therefore, the construction of the Phase II Resort may adversely impact portions
of the Casino Resort.

          Common Ownership of the Casino Resort and the Phase II Resort

     The  common  ownership  of the  Casino  Resort  and the Phase II Resort may
result in potential  conflicts of interest.  For example,  management  may offer
discounts  and other  incentives  for  visitors  to stay at the Phase II Resort,
which might  result in a  competitive  advantage of the Phase II Resort over the
Casino Resort.  In addition,  management may choose to allocate certain business
opportunities to the Phase II Resort rather than to the Casino Resort.  Although
common  ownership  of both the Casino  Resort and the Phase II Resort  often may
result in economies,  efficiencies and joint business  opportunities for the two
resorts in the aggregate, the Casino Resort may, in certain circumstances,  bear
the greater burden of the expenses that are shared by both resorts. In addition,
inasmuch as there may be common management  personnel for both the Casino Resort

                                       18
<PAGE>

and the Phase II Resort,  management's time may be split between  overseeing the
operation of each resort, and management,  in certain circumstances,  may devote
more  time to its  ownership  and  operations  responsibilities  of the Phase II
Resort than those of the Casino Resort. Finally, because it is expected that the
Company  will lease and  operate  the casino for the Phase II Resort,  potential
conflicts  may arise  from the common  operation  of the Casino and the Phase II
Resort casino, such as the allocation of management's time.

          The Expo Center and the Congress Center

     The common ultimate ownership, and management, of the Casino Resort and the
Expo Center also may result in potential conflicts of interest.  The Expo Center
and the Congress Center are potential competitors in the business conference and
meetings business. Under the Cooperation Agreement,  Venetian has agreed that it
will not  conduct,  or permit to be conducted  at the Casino  Resort's  Congress
Center,  trade  shows  or  expositions  of the type  generally  held at the Expo
Center. Furthermore, marketing practices may be implemented that are intended to
benefit the Expo Center and may have a detrimental  effect on the Casino Resort.
See "Item 13 - Certain  Relationships  and Related  Transactions  -  Cooperation
Agreement."

ITEM 2. --PROPERTIES

     The Casino Resort sits on an approximately  30-acre parcel of land owned by
the Company.  The Phase II Subsidiary owns an additional  approximately  15-acre
adjacent parcel on which the conference center for the Phase IA Addition and the
Phase II Resort is planned to be constructed.

ITEM 3. --LEGAL PROCEEDINGS

     The  Company  is party to  litigation  matters  and  claims  related to its
operations and the construction of the Casino Resort. Except as described below,
the Company does not expect that the final resolution of these matters will have
a material  adverse impact on the financial  position,  results of operations or
cash flows of the Company.

     On July 30,  1999,  Venetian  filed a complaint  against  the  Construction
Manager and Bovis in United  States  District  Court for the District of Nevada.
The  action  alleges  breach of  contract  by the  Construction  Manager  of its
obligations under the Construction  Management Contract and a breach of contract
by Bovis of its obligations under the Bovis Guaranty, including failure to fully
pay trade  contractors  and  vendors  and  failure  to meet the  April 21,  1999
guaranteed  completion  date. The Company amended this complaint on November 23,
1999 to add P&O as an  additional  defendant.  The suit is  intended  to ask the
courts,  among  other  remedies,  to require  the  Construction  Manager and its
guarantors to pay its contractors,  to compensate  Venetian for the Construction
Manager's  failure  to  perform  its duties  under the  Construction  Management
Contract and to pay the Company the agreed upon  liquidated  damages penalty for
failure to meet the guaranteed substantial completion date. Venetian seeks total
damages in excess of $100.0 million. The Construction Manager subsequently filed
motions to dismiss the Company's complaint on various grounds, which the Company
opposed.  The Construction  Manager's principal motions to date have either been
denied by the court or voluntarily withdrawn.

     In  response  to  Venetian's   breach  of  contract   claims   against  the
Construction Manager,  Bovis and P&O, the Construction Manager filed a complaint
on  August 3, 1999  against  Venetian  in the  District  Court of Clark  County,
Nevada.  The action alleges a breach of contract and quantum meruit claims under
the Construction  Management  Contract and also alleges that Venetian  defrauded
the  Construction  Manager in  connection  with the  construction  of the Casino
Resort.  The Construction  Manager seeks damages,  attorney's fees and costs and
punitive  damages.  In the lawsuit,  the Construction  Manager claims that it is
owed  approximately  $90.0  million  from  Venetian  and  its  affiliates.  This
complaint was subsequently amended by the Construction Manager, which also filed
an  additional  complaint  against the  Company  relating to work done and funds
advanced with respect to the  contemplated  development  of the Phase II Resort.
Based  upon  its  preliminary  review  of the  complaints,  the  fact  that  the
Construction Manager has not provided Venetian with reasonable  documentation to
support such claims, and the Company's belief that the Construction  Manager has
materially  breached its agreements with the Company,  the Company believes that
the  Construction  Manager's  claims are without merit and intends to vigorously
defend  itself and pursue its claims  against  the  Construction  Manager in any
litigation.

     In connection with these disputes, as of December 31, 1999 the Construction
Manager and its  subcontractors  filed mechanics liens against the Casino Resort
for $145.6 million and $182.2 million, respectively. The Company believes that a
major reason  these lien amounts  exceed the  Construction  Manager's  claims of
$90.0  million is based upon a  duplication  of liens  through the  inclusion of
lower-tier  claims by  subcontractors  in the liens of higher-tier  contractors,
including the lien of the  Construction  Manager.  As of December 31, 1999,  the
Company had purchased  surety bonds for  virtually all of the claims  underlying
these liens (other than  approximately  $15.0  million of claims with respect to
which the Construction  Manager purchased  bonds). As a result,  there can be no



                                       19
<PAGE>

foreclosure  of  the  Casino  Resort  in  connection  with  the  claims  of  the
Construction  Manager  and its  subcontractors.  However,  the  Company  will be
required to pay or  immediately  reimburse  the  bonding  company if, and to the
extent that, the underlying  claims are  judicially  determined to be valid.  If
such claims are not settled,  it is likely to take a significant  amount of time
for their validity to be judicially determined.

     The Company  believes  that these claims are, in general,  unsubstantiated,
without merit,  overstated and/or duplicative.  The Construction  Manager itself
has publicly acknowledged that at least some of the claims of its subcontractors
are without  merit.  In  addition,  the Company  believes  that  pursuant to the
Construction  Management Contract and the Final GMP, the Construction Manager is
responsible  for  payment of any  subcontractors'  claims to the extent they are
determined to be valid. The Company may also have a variety of other defenses to
the liens  that have  been  filed,  including,  for  example,  the fact that the
Construction Manager and its subcontractors  previously waived or released their
rights  to file  liens  against  the  Casino  Resort.  The  Company  intends  to
vigorously defend itself in any lien proceedings.

     On August 9, 1999, the Company notified the insurance  companies  providing
coverage  under the LD Policy  that it has a claim  under the LD Policy.  The LD
Policy provides insurance  coverage for the failure of the Construction  Manager
to achieve  substantial  completion of the portions of the Casino Resort covered
by the  Construction  Management  Contract  within 30 days of the April 21, 1999
deadline,  with a maximum  liability under the LD Policy of approximately  $24.1
million and with coverage being provided, on a per-day basis, for days 31-120 of
the delay in the  achievement  of  substantial  completion.  Because the Company
believes that  substantial  completion was not achieved until November 12, 1999,
the Company's claim under the LD Policy is likely to be for the  above-described
maximum  liability of $24.1 million.  The Company expects the LD Policy insurers
to assert many of the same claims and defenses that the Construction Manager has
asserted or will assert in the above-described litigations.  Liability under the
LD Policy may ultimately be determined by binding arbitration.

     In June 2000,  the Company  purchased an insurance  policy (the  "Insurance
Policy") for loss coverage in  connection  with all  litigation  relating to the
construction  of the Casino Resort (the  "Construction  Litigation").  Under the
Insurance  Policy,  the Company will self-insure the first $45.0 million and the
insurer will insure up to the next $80.0 million of any possible covered losses.
The  Insurance  Policy  provides  coverage  for any  amounts  determined  in the
Construction   Litigation  to  be  owed  to  the  Construction  Manager  or  its
subcontractors relating to claimed delays, inefficiencies,  disruptions, lack of
productivity/unauthorized  overtime or schedule impact,  allegedly caused by the
Company during  construction of the Casino Resort, as well as any defense costs.
The  insurance  is in  addition  to,  and  does not  affect,  any  scope  change
guarantees  provided by the  Principal  Stockholder  pursuant  to the  Principal
Stockholder's $25.0 million collateralized  completion guaranty (the "Completion
Guaranty").

     All of the pending litigation  described above is in preliminary stages and
it is not yet possible to determine a range of loss or its ultimate outcome.  If
any  litigation  or  other  lien  proceedings   concerning  the  claims  of  the
Construction  Manager  or  its  subcontractors  were  decided  adversely  to the
Company, such litigation or other lien proceedings could have a material adverse
effect on the  financial  position,  results of  operations or cash flows of the
Company,  to the extent such  litigation or lien  proceedings are not covered by
the Insurance Policy.

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

      Not applicable.




























                                     20
<PAGE>



                                     PART II

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

Market Information

     There is no established trading market for the common stock of LVSI and the
Company is not aware of any bid quotations for the common stock of LVSI.

Holders

     As of April 1,  2002,  the  Principal  Stockholder  was the only holder of
record of the common stock of LVSI.

Dividends

     LVSI did not pay any dividends in 1999, 2000 or 2001. The Company's current
long-term debt arrangements  generally  prohibit or restrict the payment of cash
dividends.  See "Item 7 -  Management's  Discussion  and  Analysis of  Financial
Condition and Results of Operations - Liquidity and Capital Resources" and "Item
8 - Financial  Statements and Supplementary Data - Notes to Financial Statements
- Note 8 - Long-Term Debt."































































                                                            21
<PAGE>

ITEM 6. --SELECTED FINANCIAL DATA

     The  historical  selected  financial data set forth below should be read in
conjunction  with "Item 7 -  Management's  Discussion  and Analysis of Financial
Condition  and Results of  Operations"  and the Financial  Statements  and Notes
thereto included  elsewhere in this Annual Report on Form 10-K. The statement of
operations  data for the years ended  December 31, 2001,  2000 and 1999, and the
balance  sheet data at  December  31, 2001 and 2000 are  derived  from,  and are
qualified by reference to, the audited financial  statements  included elsewhere
in this Annual Report on Form 10-K.  The  statement of  operations  data for the
years ended  December  31, 1998 and 1997 and the balance  sheet data at December
31,  1999,  1998 and 1997 are  derived  from  the  Company's  audited  financial
statements that do not appear herein. The historical results are not necessarily
indicative of the results of operations to be expected in the future.

<TABLE>
<CAPTION>
                                                                             Year Ended December 31,

                                                         2001         2000(2)      1999(1)(2)       1998           1997
                                                      ----------    ----------     ----------    ----------     ----------
                                                                      (In thousands, except per share data)
<S>                                                   <C>           <C>            <C>               <C>            <C>
STATEMENT OF OPERATIONS DATA
Gross revenues                                        $  566,493    $  627,266     $  273,498        $  937         $  895
Promotional allowances                                   (42,594)      (46,296)       (25,045)           --             --
                                                      ----------    ----------     ----------    ----------     ----------
Net revenues                                             523,899       580,970        248,453           937            895
Operating expenses                                      (414,620)     (444,197)      (244,640)      (8,822)          1,727
                                                      ----------    ----------     ----------    ----------     ----------
Operating income (loss)                                  109,279       136,773          3,813       (7,885)          2,622
Interest expense, net                                   (109,359)     (118,036)       (68,847)      (21,878)        (3,142)
Other income (expense)                                    (1,938)           --             --            --             --
                                                      ----------    ----------     ----------    ----------     ----------
Income (loss) before preferred return and
extraordinary item                                        (2,018)       18,737        (65,034)      (29,763)          (520)

  Preferred return on Redeemable Preferred
    Interest in Venetian Casino Resort, LLC
    (2000, 1999 and 1998, as restated) (3)               (20,766)      (18,482)       (14,399)      (13,647)            --
                                                      ----------    ----------     ----------    ----------     ----------
  Income (loss) before extraordinary item (2000,
    1999 and 1998, as restated) (3)                      (22,784)          255        (79,433)      (43,410)          (520)
    Extraordinary item-loss on early retirement
    of debt                                               (1,383)       (2,785)          (589)           --             --
                                                       ---------    ----------     ----------    ----------     ----------
Net income (loss) (2000, 1999, and 1998,
    as restated)(3)                                   $  (24,167)   $   (2,530)    $  (80,022)   $  (43,410)    $     (520)
                                                      ==========    ==========     ==========    ==========     ==========
Per Share Data

  Basic and diluted income (loss) per share
    before extraordinary item (4)                     $   (22.78)   $     0.26     $   (79.43)   $   (43.41)    $    (0.52)
                                                      ==========    ============   ==========    ==========     ==========
   Basic and diluted loss per share (4)               $   (24.17)   $    (2.53)    $   (80.02)   $   (43.41)    $    (0.52)
                                                      ==========    ============   ==========    ==========     ==========
OTHER DATA
   Capital expenditures                               $   55,134    $   28,589     $  319,106    $  508,399     $  130,827
   Cash dividends per common share                    $       --    $       --     $       --    $       --     $    27.60


                                                                                As of December 31,
                                                          2001          2000           1999          1998           1997
                                                      ----------    ----------     ----------    ----------     ----------

BALANCE SHEET DATA
   Total assets                                       $1,271,786    $1,232,385     $1,209,602    $1,005,944     $  747,767
   Long-term debt                                     $  811,869    $  863,293     $  907,754    $  744,154     $  515,612
   Stockholder's equity                               $  (10,991)   $   13,176     $   15,706    $   67,937     $  111,347


<FN>
---------------
(1)  The Casino Resort opened May 4, 1999.
(2)  Financial  data  for  2000  and 1999  has  been  restated  to  reflect  the
     reclassification  of  certain  cash  incentives  of $6.1  million  and $3.3
     million,  respectively  in connection  with the adoption of Emerging Issues
     Task Force Issue 00-22  ("EITF  00-22").  The adoption of EITF 00-22 had no
     effect on net income. See "Item 8 - Financial  Statements and Supplementary
     Data - Notes to  Financial  Statements  - Note 2 - Summary  of  Significant
     Accounting  Policies - Revenue Recognition - Casino Revenue and Promotional
     Allowances."
(3)  The Company has restated  certain  income  statement  items for each of the
     three years in the period  ended  December  31,  2000 to include  preferred
     return on preferred stock of a subsidiary. Such amounts had been previously
     reflected  as a charge  against  capital  in excess  of par.  See "Item 8 -
     Financial Statements and Supplementary Data - Notes to Financial Statements
     - Note 1 -  Organization  and  Business  of the  Company -  Restatement  of
     Previously Reported Amounts."
(4)  Net  income  (loss)  per  share  and  shares  outstanding  for all  periods
     presented  retroactively  reflect the impact of the Company's first quarter
     2002 stock  split  which  increased  the  number of shares of common  stock
     outstanding from 925,000 to 1,000,000.
</FN>
</TABLE>



                                                            22
<PAGE>

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

     The  following  discussion  should  be read  in  conjunction  with,  and is
qualified in its  entirety by, the  consolidated  financial  statements  and the
notes thereto and other financial  information included elsewhere in this Annual
Report on Form 10-K.  Certain  statements in this  "Management's  Discussion and
Analysis of Financial  Condition and Results of Operations" are  forward-looking
statements. See -"Special Note Regarding Forward-Looking Statements."

General

     The  Company   owns  and  operates  the  Casino   Resort,   a   large-scale
Venetian-themed  hotel, casino, retail, meeting and entertainment complex in Las
Vegas, Nevada. The Casino Resort includes the first and only all-suites hotel on
the Strip with 3,036 suites; a gaming facility of  approximately  116,000 square
feet; an enclosed  retail,  dining and  entertainment  complex of  approximately
445,000 net  leasable  square  feet;  and a meeting and  conference  facility of
approximately  500,000 square feet.  The Company is party to litigation  matters
and claims related to its operations and  construction of the Casino Resort that
could have a  material  adverse  effect on the  financial  position,  results of
operations  or cash flows of the  Company to the extent such  litigation  is not
covered by the Insurance Policy. See "Item 3 - Legal Proceedings."

     The Company was  significantly  impacted by a decline in tourism  following
the  terrorist  attacks of September  11, 2001 as well as an unusually low table
games win percentage.  Consolidated net revenues for the year ended December 31,
2001  were  $523.9  million,   representing  a  decrease  of  $57.1  million  of
consolidated  net  revenues  as  compared  to 2000.  Despite  the  impact of the
terrorist attacks,  the Company continues to improve operating revenues,  due in
large  part  to:  (1)  forward  hotel  room  and  meeting  space  bookings  from
conventions  and trade shows at the Expo Center and Casino Resort;  (2) increase
in average daily room rates in all major  segments of the Casino  Resort's hotel
rooms  business;  (3) a stable  recurring  revenue stream from the Mall; and (4)
successful cost-cutting initiatives.  Although the Company continues to recover,
the extent to which the events of  September  11th will  continue to directly or
indirectly impact operating  results in the future cannot be predicted,  nor can
the Company predict the extent to which future security alerts and/or additional
terrorist attacks may impact operations.

     The Company opened  additional  attractions at the Casino Resort on October
7, 2001,  including  the  Guggenheim  Museum  Projects.  The Company  also began
designing,  planning,  permitting and  constructing the Phase IA Addition during
2001. The Phase IA Addition  consists of: (1) an approximately  1,000-room hotel
tower  on  top  of  the  Casino  Resort's   existing  parking  garage;   (2)  an
approximately  1,000-parking  space  expansion  to the parking  garage;  and (3)
approximately  150,000 square feet of additional  convention center space on the
Phase II Land.  To date,  the  Company  has  completed  the  design  of, and has
substantially  completed the foundation and support  systems for, the 1,000-room
hotel tower on top of the existing parking garage.  Due to the travel disruption
to Las Vegas during the fourth quarter of 2001,  the Company  decided to suspend
construction of the Phase IA Addition at that time. Certain designing,  planning
and permitting of the Phase IA Addition is, however,  continuing. The Company is
currently exploring financing alternatives to complete construction of the Phase
IA  Addition,  which it  estimates  will cost  approximately  $225.0  million to
complete.

     The Company has also recently  announced its intention  (with joint venture
partners)  to seek a license  to  operate  casinos  in Macau,  is  pursuing  the
possibility  of  developing an Internet  gaming site and is currently  exploring
other  business  opportunities  for  expansion.  See  "Item 1 -  Business  - New
Developments."

Critical Accounting Policies and Estimates

     Management has identified the following critical  accounting  policies that
affect the  Company's  more  significant  judgments  and  estimates  used in the
preparation of the Company's consolidated financial statements.  The preparation
of the Company's financial  statements in conformity with accounting  principles
generally  accepted  in the United  States of  America  requires  the  Company's
management to make estimates and judgments  that affect the reported  amounts of
assets and  liabilities,  revenues  and  expenses,  and related  disclosures  of
contingent assets and liabilities.  On an on-going basis,  management  evaluates
those estimates, including those related to asset impairment,  accruals for slot
marketing points,  self-insurance,  compensation and related  benefits,  revenue
recognition,  allowance for doubtful accounts, contingencies and litigation. The
Company  states  these  accounting  policies  in the  notes to the  consolidated
financial  statements and in relevant  sections in this discussion and analysis.
These estimates are based on the information that is currently  available to the
Company  and  on  various  other  assumptions  that  management  believes  to be
reasonable  under the  circumstances.  Actual  results  could  vary  from  those
estimates.



                                       23
<PAGE>

     The Company believes that the following critical accounting policies affect
significant  judgments and estimates used in the preparation of its consolidated
financial statements:

     The Company  recognizes  revenue upon occupancy of hotel rooms, as net wins
     and losses  occur in the casino and upon  delivery  of food,  beverage  and
     other services.  Cancellation fees for hotel and food and beverage services
     are recognized as revenue when collection is probable and upon cancellation
     by the  customer  as defined by a written  contract  entered  into with the
     customer.  Minimum  rental  revenues  in the Mall  and  Casino  Resort  are
     recognized on a  straight-line  basis over the terms of the related  lease.
     Percentage  rents are  recognized in the period in which the tenants exceed
     their respective  percentage rent  thresholds.  Recoveries from tenants for
     real estate taxes,  insurance and other shopping center operating  expenses
     are recognized as revenues in the period  billed,  which  approximates  the
     period in which the applicable costs are incurred.

     The Company  maintains an allowance  for  doubtful  accounts for  estimated
     losses  resulting  from the  inability of its  customers  to make  required
     payments,  which results in bad debt  expense.  Management  determines  the
     adequacy of this allowance by continually  evaluating  individual  customer
     receivables, considering the customer's financial condition, credit history
     and current economic  conditions.  If the financial  condition of customers
     were to  deteriorate,  resulting in an  impairment of their ability to make
     payments, additional allowances may be required.

     The  Company  maintains  accruals  for  health  and  workers   compensation
     self-insurance,  slot club point  redemption  and group sales  commissions,
     which are  classified  in other  accrued  liabilities  in the  consolidated
     balance  sheets.  Management  determines  the adequacy of these accruals by
     periodically  evaluating  the historical  experience  and projected  trends
     related to these accruals.  If such information indicates that the accruals
     are  overstated  or  understated,  the Company will adjust the  assumptions
     utilized in the methodologies and reduce or provide for additional accruals
     as appropriate.

     The Company is subject to various  claims and legal actions in the ordinary
     course of business.  Some of these matters  relate to personal  injuries to
     customers and damage to customers'  personal assets.  Management  estimates
     guest claims expense and accrues for such liability  based upon  historical
     experience  in the other  accrued  liability  category in its  consolidated
     balance sheet.

Year Ended December 31, 2001 compared to the Year Ended December 31, 2000

     Operating Revenues

     Consolidated  net revenues for the year ended December 31, 2001 were $523.9
million,  representing  a decrease of $57.1  million when  compared  with $581.0
million of  consolidated  net revenues during 2000. The decrease in net revenues
was primarily due to a decline in casino  revenue,  offset by increases in hotel
and other revenues.

     Casino  revenues were $227.2 million in the year ended December 31, 2001, a
decrease of $71.9 million from 2000.  The decrease was  attributable  to several
factors,  including:  (1) an unusually low historical table games win percentage
(calculated  before  discounts) of 15.3% during 2001 as compared to 20.5% during
2000 (the table games win  percentage is reasonably  predictable  over time, but
may vary considerably  during shorter  periods);  (2) more stringent table games
marketing  parameters during 2001 that resulted in decreased table games volume;
and (3) decreased  visitor  traffic to Las Vegas after the terrorist  attacks of
September 11, 2001. Table games drop (volume) decreased to $966.6 million in the
year ended  December 31, 2001 from  $1,130.0  million  during 2000.  Slot handle
(volume) in the year ended December 31, 2001 decreased to $1,825.1  million from
$1,939.6 million reported during 2000, a result of decreased  visitor traffic to
Las Vegas after September 11, 2001.

     The Casino  Resort's  average daily room rates  increased  from $196 in the
year ended December 31, 2001 as compared to $182 in 2000.  Room revenues  during
the year ended December 31, 2001 were $204.2  million,  representing an increase
of $11.9 million when compared to $192.3  million  during 2000.  The increase in
room rates  occurred in all major  segments of the Casino  Resort's  hotel rooms
business, including the mid-week, group and convention business, and the weekend
retail business. The occupancy of available guestrooms was 94.6% during the year
ended December 31, 2001 compared to 95.2% during 2000.

     Food and  beverage  revenues  were  $62.0  million  during  the year  ended
December 31,  2001,  representing  a decrease of $5.1 million  compared to $67.1
million for 2000.  The decrease was  attributable  to lower room  occupancy  and
banquet  sales as a result of travel  disruption  to Las Vegas during the fourth
quarter of 2001.

     Mall  revenues were $33.5  million  during 2001,  compared to $29.9 million
during 2000. The increase was  attributable  to higher foot traffic,  additional
tenants and increased proceeds from rents calculated on tenant gross revenues.



                                       24
<PAGE>

     Retail and other revenues increased $4.2 million,  to $73.0 million in 2001
from  $68.8  million  in 2000.  Other  revenue  includes  $5.4  million of group
cancellation  fees  during the year ended  December  31,  2001,  including  $5.2
million  during the fourth  quarter of 2001, as compared to $1.9 million  during
all of 2000. In addition,  during the fourth  quarter of 2001, the Company added
$1.0 million to its provision for bad debts as an estimate of settlement  losses
associated  with $1.9  million  of  uncollected  group  cancellation  fees.  The
calculation  of other  revenue for 2001 takes into account an operating  loss of
$2.1 million from the Art of the  Motorcycle  exhibition at the  Guggenheim  Las
Vegas  Museum.  This amount  represents  the Company's  share of the  exhibition
operating  losses during the fourth  quarter of 2001.  The exhibit opened to the
public on October 7, 2001 and the  exhibition  incurred  substantial  amounts of
pre-opening and advertising costs during its first quarter of operations.

     Operating Expenses

     Operating  expenses  (including  pre-opening,  developmental  and corporate
expenses) were $414.6 million in the year ended December 31, 2001,  representing
a decrease of $29.6 million when  compared to $444.2  million  during 2000.  The
decrease in operating  expenses was primarily  attributable  to lower  operating
revenues  and  business  volumes in all  departments  of the  Casino  Resort and
reduced general & administrative  costs during 2001. Provision for bad debts for
the year ended  December 31, 2001 was $20.2  million  compared to $19.3  million
during  2000.  The increase was  primarily  attributable  to estimates of losses
associated with hotel receivables and group  cancellation fees during the fourth
quarter of 2001.

     Mall  operating  expenses were $20.9 million  during 2001 compared to $19.3
million  during 2000.  The  increase in Mall  operating  expenses was  primarily
attributable to increased advertising costs during 2001 as compared to 2000.

     Corporate  expense was $6.4 million in 2001,  compared with $6.3 million in
2000.

     Fixed payment obligations  primarily related to the HVAC Plant for the year
ended December 31, 2001 were $8.1 million, including $5.9 million for the Casino
Resort  and $2.2  million  for the Mall.  Fixed  payment  obligations  were $8.7
million  during  2000,  including  $6.5  million for the Casino  Resort and $2.2
million for the Mall.  The  decrease  was  primarily  attributable  to increased
allocation of costs to tenants during 2001.

     Interest Income (Expense)

     Interest  expense net of amounts  capitalized  was $110.7 million for 2001,
compared to $119.8 million in 2000. Of the net interest  expense incurred during
2001,  $95.6 million was related to the Casino Resort  (excluding  the Mall) and
$15.1  million was  related to the Mall.  The  decrease in interest  expense was
attributable to decreases in interest rates on the Company's  variable rate debt
during 2001 and  capitalization  of $2.0 million of interest in connection  with
current construction projects.

     Interest  income was $1.4  million  and $1.8  million  for the years  ended
December 31, 2001 and 2000, respectively.

Year Ended December 31, 2000 compared to the Year Ended December 31, 1999

     The  Casino  Resort  began  operations  on May 4,  1999 and the Mall  began
operations on June 19, 1999,  and  therefore,  neither the Casino Resort nor the
Mall had any  operating  revenues or operating  expense  before such dates.  All
references  to 1999 include 242 days of  operations of the Casino Resort and 195
days of operations of the Mall.

     Operating Revenues

     Consolidated  net revenues for the year ended December 31, 2000 were $581.0
million,  representing  an increase of $332.5  million when compared with $248.5
million  during  1999.  The  increase in net revenues was due to growth in every
revenue segment at the Casino Resort and the longer operating period in 2000.

     Casino  revenues for the year ended December 31, 2000 were $299.1  million,
representing  an increase of $174.9  million when compared  with $124.2  million
during 1999. The increase in casino  revenues at the Casino Resort was primarily
a result of the longer  operating  period in 2000, as well as higher table games
and slots volume during comparable periods.

     Room  revenues for 2000 were $192.3  million,  representing  an increase of
$102.7  million when compared with $89.6 million  during 1999.  The increase was
due to the longer  operating  period in 2000 and a higher  occupancy of 95.2% in
2000,  when  compared with 81.7% in 1999.  In addition,  the Company  achieved a
higher average daily room rate of $182 in 2000 versus $159 in 1999.

     Food and beverage  revenues for 2000 were $67.1  million,  representing  an
increase of $36.3  million  when  compared  with $30.8  million  for 1999.  This
increase resulted from the longer operating period in 2000,  additional  banquet
revenues  generated  from a full year of operation  at the  Congress  Center and
greater room service revenues as a result of higher occupancy levels.

                                       25
<PAGE>

     Retail and other revenues  increased  $39.8 million,  from $29.0 million in
1999 to $68.8 million in 2000. The Mall revenues were $29.9 million during 2000,
compared  to $9.6  million  during  1999.  The  increase  in Mall  revenues  was
attributable to completion of leasing of the Mall space and the longer operating
period in 2000. Mall occupancy in 2000 was approximately 95% of leaseable space.

     Operating Expenses

     Operating expenses (including  pre-opening and corporate expenses) for 2000
were $444.2  million,  representing  an increase of $199.6 million when compared
with $244.6  million for 1999.  The  increase  was  primarily  due to the longer
operating period in 2000, increased casino expenses resulting from higher gaming
taxes and marketing expenses on the increased  revenues,  and an increase in the
provision  for doubtful  accounts.  Mall  operating  expenses were $19.3 million
during 2000 compared to $9.2 million during 1999. The increase was  attributable
to  completion of leasing of the Mall space and the longer  operating  period in
2000.

     Pre-opening  and other  non-recurring  expenses for the year ended December
31,  1999 of $21.5  million  represent  costs  principally  associated  with the
opening of the Casino Resort on May 4, 1999. There were no pre-opening  expenses
during the year ended December 31, 2000.

     Corporate  expense was $6.3 million in 2000,  compared with $2.5 million in
1999.  The  increase was due to the  creation of the  corporate  division in the
fourth quarter of 1999 and consequently the longer operating period in 2000.

     Fixed payment obligations primarily related to the HVAC Plant for 2000 were
$8.7 million,  including $6.5 million for the Casino Resort and $2.2 million for
the Mall.  Fixed  payment  obligations  were $5.5  million  during  the  shorter
operating period in 1999,  including $4.3 million for the Casino Resort and $1.2
million for the Mall.

     Interest Income (Expense)

     Reflecting the investments in the Hotel, the Casino and Congress Center and
the Mall,  the Company's debt levels and  associated  interest  costs  increased
significantly.   With  the  opening  of  these  new  facilities,  the  Company's
capitalization  of interest costs associated with the construction of the Casino
Resort ceased.  Interest  expense was $119.8 million in 2000,  compared to $71.4
million  (net of  capitalized  interest  of  $31.3  million  in  1999).  Because
construction  of the Casino  Resort  was  virtually  complete  during the fourth
quarter of 1999,  the Company only  capitalized  interest of $0.1 million during
the year ended December 31, 2000,  versus $31.3 million of interest  capitalized
during the year ended December 31, 1999.

     Interest  income was $1.8  million  and $2.6  million  for the years  ended
December 31, 2000 and 1999, respectively.

Other Factors Affecting Earnings

     The Company incurred  development  expenses related to new ventures of $0.4
million  during the year ended  December 31, 2001. The Company did not incur any
such  expenses in the year ended  December 31, 2000.  Since the inception of the
Casino Resort  project,  the Company has expensed $30.6 million for  pre-opening
activities.  Pre-opening  expenses  include payroll,  advertising,  professional
services and other general and administrative expenses related to the opening of
the Casino Resort and other ventures.

     The Company incurred extraordinary charges in 2001 and 2000 of $1.4 million
and  $2.8  million,  respectively,  for  early  retirement  of debt  related  to
restructuring  of the Company's  secured bank credit  facility (the "Bank Credit
Facility"),  and $0.6 million in 1999  related to the take-out  financing of the
Mall. See "-Liquidity  and Capital  Resources - New Mall Subsidiary and Transfer
of Mall Assets."

     During early 2000, the Company  initiated a change to its business strategy
as it relates to premium  casino  customers  and  marketing  to foreign  premium
casino customers.  The Company has generally raised its betting limits for table
games to be  competitive  with other  premium  resorts  on the Strip.  There are
additional risks associated with this change in strategy,  including risk of bad
debts,  risks to profitability  margins in a highly  competitive  market and the
need for additional  working  capital to accommodate  possible  higher levels of
trade receivables and foreign currency  fluctuations  associated with collection
of trade  receivables in other  countries.  The Company has opened  domestic and
foreign  marketing  offices  and bank  collection  accounts  in several  foreign
countries to accommodate this change in business  strategy,  thereby  increasing
marketing  costs.  The Company  continually  evaluates its costs associated with
marketing to the various segments of the premium casino customer market.







                                       26
<PAGE>

Liquidity and Capital Resources

     Cash Flow and Capital Expenditures

     As of December 31, 2001 and  December  31, 2000,  the Company held cash and
cash  equivalents  of $57.6 million and $45.2  million,  respectively.  Net cash
provided by operating  activities for the year ended December 31, 2001 was $50.8
million, compared with $81.0 million for 2000. The Company's operating cash flow
in 2001 was negatively impacted as compared to the prior year because of a $71.9
million decrease in casino revenues. Net trade receivables were $57.1 million as
of December 31, 2001 and $64.3 million as of December 31, 2000.

     Capital  expenditures  paid from  operating cash flow during the year ended
December 31, 2001 were $55.1 million,  including expenditures for the Guggenheim
Museum Projects and the Phase IA Addition. The Company entered into an agreement
during 2001 with a subsidiary of the Solomon R. Guggenheim Foundation to operate
the Guggenheim Las Vegas Museum in the Casino Resort. The agreement requires the
Company  to make  certain  contributions  of  capital.  In  addition  to capital
expenditures,  the Company  contributed  $9.0 million to the  Guggenheim  Museum
Projects  during  2001.  Capital  expenditures  for  2000  were  $16.4  million,
including a variety of on-going capital  improvement  projects and $12.2 million
for construction of the Casino Resort. The Company expects capital  expenditures
in 2002 to total  approximately  $30.0 million  (excluding  additional  Phase IA
construction  cost). These expenditures for 2002 primarily relate to liquidation
of  construction  payables  and  commitments  related to the  Guggenheim  Museum
Projects,  Phase IA Addition design and foundation costs and the continuation of
other capital expenditure projects undertaken during 2001.

     Aggregate Indebtedness and Fixed Payment Obligations to the HVAC Provider

     The Company's total long-term indebtedness and fixed payment obligations to
the HVAC Provider are summarized by year below:

<TABLE>

<CAPTION>

                                              2002           2003            2004           2005       Thereafter
                                             -------        -------        -------        -------      ----------
   <S>                                       <C>            <C>            <C>            <C>             <C>
   Long -Term Indebtedness
    Mortgage Notes                                --             --        425,000             --             --
    Subordinated Notes                            --             --             --         94,113             --
    Bank Credit Facility                       1,527        190,459             --             --             --
    FF&E Credit Facility                      21,494         21,494         10,747             --             --
    Tranche A Take-out Loan                  105,000             --             --             --             --
    Tranche B Take-out Loan                       --             --         35,000             --             --
    Completion Guaranty Loan                      --             --             --         31,123             --
    Phase II Subsidiary Credit Facility           --          3,933             --             --             --
    Phase II Unsecured Bank Loan               1,092             --             --             --             --

   Fixed Payment Obligations To The
   HVAC Provider

    HVAC Provider fixed payments               7,657          7,657          7,657          7,657         26,799
                                             -------        -------        -------        -------         ------
    Total indebtedness and HVAC fixed
   payment obligations                       136,770        223,543        478,404        132,893         26,799
                                             =======        =======        =======        =======         ======
</TABLE>


     During the year  ended  December  31,  2001,  the  Company  made  principal
payments of $0.8 million and $21.5  million on the Bank Credit  Facility and its
credit facility secured by certain furniture,  fixtures and equipment (the "FF&E
Credit  Facility"),  respectively.  The Company has debt  service  payments  due
aggregating $129.1 million during 2002, including: principal payments on (1) the
Bank Credit  Facility  of $1.5  million;  (2) the FF&E Credit  Facility of $21.5
million;  (3) an unsecured bank line of credit for the Phase II Subsidiary  (the
"Phase II  Unsecured  Bank  Loan")  of $1.1  million;  and (4) a first  priority
mortgage  loan  secured by the Mall (the  "Tranche  A Take-out  Loan") of $105.0
million.  Based on current  interest rates under the Bank Credit  Facility,  the
FF&E Credit  Facility and the Tranche A Take-out Loan, the Company has estimated
total interest payments (excluding noncash  amortization of debt offering costs)
of: (1) approximately $79.5 million during fiscal 2002 for indebtedness  secured
by the Casino Resort; and (2) approximately $10.5 million during fiscal 2002 for
indebtedness secured by the Mall.

     The Company  also has fixed  payments  obligations  due during 2002 of $7.7
million under its energy service  agreements  with the HVAC Provider.  The total
remaining payment obligation under this arrangement is $57.4 million, payable in
equal monthly  installments during the period of January 1, 2002 through July 1,
2009.  See - "Item 8 - Financial  Statements and  Supplementary  Data - Notes to
Financial Statements - Note 13 - Commitments and Contingencies - Energy Services
Agreements and Operating Lease Agreements."




                                       27
<PAGE>

     On October 19, 2001, the Phase II Subsidiary  entered into a loan agreement
providing for a $17.5 million term and revolving loan, with a one time option to
increase such loan to $30.0 million (the "Phase II Subsidiary Credit Facility").
The Phase II Subsidiary Credit Facility is secured by the Phase II Land, as well
as the  Phase II  Subsidiary's  interest  in the  Phase II  Lease.  The Phase II
Subsidiary  immediately  drew  $12.5  million  for a letter of credit  under the
revolver  portion of the Phase II  Subsidiary  Credit  Facility  (the "Letter of
Credit")  pursuant to the terms of and to be provided as credit  support for the
Bank Credit Facility.  The Letter of Credit was released in full on February 11,
2002,  pursuant to its terms,  immediately  following  the first fiscal  quarter
period  ending  after  September  30, 2001 in which the  Company's  consolidated
adjusted EBITDA exceeded $30.0 million.

     The Company drew $3.9 million on the Phase II Credit  Facility  during 2001
and during January 2002,  $2.5 million of that amount was repaid.  The remaining
portion of the Phase II  Subsidiary  Credit  Facility and  proceeds  from rental
payments of $8.0 million per year from Venetian to the Phase II Subsidiary under
the Phase II Lease are each  available  for any Phase II Resort  pre-development
expenses  or may be loaned or  distributed  by the  Phase II  Subsidiary  to the
Company for other liquidity needs.

     For the next  twelve  months,  the Company  expects to fund  Casino  Resort
operations,  capital expenditures and debt service  requirements  (excluding the
Tranche A Take-out  Loan) from  existing  cash  balances,  operating  cash flow,
borrowings  under its revolving  credit line (the "Revolver") to the extent that
funds are available,  distributions  of excess cash from the New Mall Subsidiary
to the  extent  permitted  under  the  Tranche  A  Take-out  Loan,  and loans or
distributions  of excess cash from the Phase II Subsidiary as a result of rental
payments under the Phase II Lease and  borrowings  under the Phase II Subsidiary
Credit Facility.  Although there can be no assurance that it will be successful,
the Company  currently  plans to refinance  the Tranche A Take-out Loan prior to
its due date of December 20, 2002. As of December 31, 2001, all of the Company's
$40.0  million  Revolver  availability  was  drawn.  As of April 1,  2002,  the
Revolver balance was approximately $32.0 million.

     The Company's existing debt instruments contain certain  restrictions that,
among other things, limit the ability of the Company and/or certain subsidiaries
to incur additional indebtedness,  issue disqualified stock or equity interests,
pay  dividends  or make other  distributions,  repurchase  equity  interests  or
certain indebtedness, create certain liens, enter into certain transactions with
affiliates,  enter into certain mergers or  consolidations or sell assets of the
Company  without  prior  approval  of  the  lenders  or  noteholders.  Financial
covenants  included in the Bank Credit Facility and FF&E Credit Facility include
a minimum fixed charge  ratio,  maximum  leverage  ratio,  minimum  consolidated
adjusted   EBITDA   standard,   minimum  equity  standard  and  maximum  capital
expenditures  standard.  The financial covenants in the Bank Credit Facility and
the FF&E Credit Facility  involving EBITDA are applied on a rolling four quarter
basis, and the Company's  compliance with financial covenants can be temporarily
affected if the Company  experiences a decline in hotel occupancy or room rates,
or an unusually low win percentage in a particular quarter,  which is not offset
in subsequent  quarters or by other results of operations.  As a result of these
fluctuations,  no assurance  can be given that the Company will be in compliance
with  its  financial   covenants.   See  "Item  8  -  Financial  Statements  and
Supplementary Data - Notes to Financial Statements - Note 8 Long-Term Debt."

     The Company was challenged to meet these covenant tests in 2001 for certain
quarters  during the  rolling  measurement  period due to an  extremely  low win
percentage  and reduced  travel to Las Vegas  during the fourth  quarter of 2001
because of the September  11th  terrorist  attacks.  These  covenants  allow the
Principal  Stockholder to increase EBITDA for measurement  purposes by issuing a
standby letter of credit to the Company's lenders.  The covenants also allow the
New Mall Subsidiary and the Phase II Subsidiary, subject to certain limitations,
to make  distributions  to LVSI which would  increase  EBITDA for debt  covenant
measurement purposes.

     During  the fourth  quarter of 2001,  the  Company  entered  into a limited
waiver  amendment to the Bank Credit Facility and FF&E Credit Facility to obtain
a waiver with respect to the minimum  consolidated  adjusted EBITDA requirement.
During February 2002, the New Mall Subsidiary paid a 7.0 million distribution to
Venetian.

     The Company  expects to be challenged to meet certain of its covenant tests
in the first  quarter of 2002 due to the  carry-over  effects that the extremely
low win  percentage  for  certain of its fiscal 2001  quarters  will have on the
rolling  measurement  period. The Company has certain options available to it in
the  event  that it  needs  to  seek a cure in  order  to meet  such  covenants,
including the ability to draw down on the Phase II Subsidiary  Credit  Facility,
make distributions of excess cash from the Mall under the terms of the Tranche A
Take-out Loan or the  negotiation  with its lenders of further  waivers for debt
covenant  violations in 2002. The Company  anticipates  that  ultimately its win
percentage  will return to normal levels and that it will no longer need to rely
on the various cures and waivers described above.





                                       28
<PAGE>

     In order for the Company to be able to resume construction and complete the
Phase IA  Addition,  the Company  and/or the Phase II  Subsidiary  would need to
incur   additional   indebtedness.   Depending   upon  the   structure  of  such
indebtedness,  this may  require  the  consent of certain  existing  lenders and
modifications  to certain  existing  lender  financial  covenants.  The  current
estimated  cost to  complete  the  Phase IA  Addition  is  approximately  $225.0
million.

     The Company is also currently in active discussions to consider refinancing
all or a  portion  of its  outstanding  indebtedness,  including  the  Tranche A
Take-out  Loan.  This review is taking into  account the cost to  refinance  all
outstanding  indebtedness,  current interest rates,  collateral arrangements and
the ability to raise  additional  funds to fund  on-going and upcoming  projects
discussed in "Item 1 - Business - New  Developments"  above. The Company has not
yet entered into any definitive  agreements  for a refinancing  and no assurance
can be given that refinancing for some or all of such  outstanding  indebtedness
will be  available,  or that such a  refinancing  will be on terms  that will be
favorable to the Company.

     If  the  Company  is  required   to  pay  certain   significant   contested
construction costs (See "-Litigation Contingencies and Available Resources"), or
if the Company is unable to meet its debt service requirements, the Company will
seek,  if necessary and to the extent  permitted  under its  indentures  and the
terms of the Bank Credit Facility and the FF&E Credit Facility or any other debt
instruments then  outstanding,  additional  financing through bank borrowings or
debt or equity  financings.  Also,  there can be no assurance  that new business
developments or unforeseen  events will not occur resulting in the need to raise
additional funds.  There also can be no assurance that additional or replacement
financing, if needed, will be available to the Company, and, if available,  that
the financing will be on terms  favorable to the Company,  or that the Principal
Stockholder or any of his affiliates will provide any such financing.

     Litigation Contingencies and Available Resources

     The Company is a party to certain  litigation matters and claims related to
the construction of the Casino Resort.  If the Company is required to pay any of
the  Construction   Manager's  contested   construction  costs  (the  "Contested
Construction  Costs") which are not covered by the Insurance Policy, the Company
may use cash received from the following  sources to fund such costs: (i) the LD
Policy;  (ii)  the  Construction   Manager,   Bovis  and  P&O  pursuant  to  the
Construction  Management  Contract,  the Bovis  Guaranty  and the P&O  Guaranty,
respectively;  (iii) third parties,  pursuant to their  liability to the Company
under their agreements with the Company; (iv) amounts received from the Phase II
Subsidiary for shared  facilities  designed and  constructed to accommodate  the
operations  of the  Casino  Resort and the Phase II  Resort,  (v) the  Principal
Stockholder,  pursuant to his  liability  under the  Completion  Guaranty;  (vi)
borrowings under the Revolver;  (vii) additional debt or equity financings;  and
(viii) operating cash flow. The Principal Stockholder has remaining liability of
approximately  $5.0  million  under  the  Completion  Guaranty  to  fund  excess
construction  costs  (which  liability  is  collateralized  with  cash  and cash
equivalents),  provided  that  there  is no cap on the  Principal  Stockholder's
liability for excess  construction  costs due to scope  changes.  If the Company
were required to pay substantial  Contested  Construction  Costs, and if it were
unable to raise or obtain  the funds from the  sources  described  above,  there
could be a material adverse effect on the Company's financial position,  results
of operations or cash flows.

     New Mall Subsidiary and Transfer of Mall Assets and Related Assets

     On November 12, 1999, Grand Canal Shops Mall Construction,  LLC transferred
the Mall and related assets (the Mall and such assets,  collectively,  the "Mall
Assets") to its subsidiary, Grand Canal Shops Mall, LLC (the "Mall Subsidiary").
Upon such transfer,  the Mall Assets were released as security to the holders of
the Company's 12 1/4 % Mortgage  Notes due 2004 (the  "Mortgage  Notes") and for
the indebtedness under the Bank Credit Facility, the indebtedness under a $140.0
million mall construction loan facility (the "Mall  Construction Loan Facility")
was assumed by the Mall  Subsidiary  and all  entities  comprising  the Company,
other than the Mall  Subsidiary,  were released from all  obligations  under the
Mall Construction Loan Facility.
















                                       29
<PAGE>

     On December 20, 1999, the Mall  Construction  Loan Facility was paid off in
full with the proceeds of (a) the Tranche A Take-out Loan, made by Goldman Sachs
Mortgage Company, the Bank of Nova Scotia and other lenders  (collectively,  the
Tranche A Take-out  Lender") and (b) a $35.0 million  second  priority  take-out
loan (the  "Tranche B Take-out  Loan" and,  together with the Tranche A Take-out
Loan,  the "Mall  Take-out  Financing")  made by an entity  wholly-owned  by the
Principal  Stockholder  (the  "Tranche B Take-out  Lender").  The Mall  Take-out
Financing  is  secured  by a  $20.0  million  guaranty  made  by  the  Principal
Stockholder  (the "Mall  Take-out  Guaranty").  The annual  interest rate on the
Tranche A Take-out  Loan is 350 basis  points  over 30 day LIBOR.  The Tranche A
Take-out Loan is due in full on December 20, 2002 and no principal  payments are
due  thereunder  until such date. The Company  currently  plans to refinance the
Tranche A Take-out  Loan prior to its due date,  however,  no  assurance  can be
given that  refinancing for such  indebtedness  will be available to the Company
prior to this date. The Tranche B Take-out Loan bears interest at 14% per annum.
The initial  maturity  date is December  20, 2004 with a right of  extension  to
December  20,  2007.  No  principal  payments  are due until  maturity.  Also on
December 20, 1999, the Mall Assets were  transferred from the Mall Subsidiary to
the New Mall Subsidiary, the obligor under the Mall Take-out Financing.

     Because the New Mall  Subsidiary is not a guarantor of any  indebtedness of
the Company (other than the Mall Take-out  Financing),  creditors of the Company
(including  the  holders of the Notes but  excluding  creditors  of the New Mall
Subsidiary)  do not have a direct claim  against the Mall  Assets.  As a result,
indebtedness  of the  entities  comprising  the Company  other than the New Mall
Subsidiary  (including  the  Notes) is now,  with  respect  to the Mall  Assets,
effectively  subordinated to indebtedness  of the New Mall  Subsidiary.  The New
Mall  Subsidiary  is not  restricted  by any of the  debt  instruments  of LVSI,
Venetian or the Company's other subsidiary guarantors (including its indentures)
from  incurring  any  indebtedness.  The terms of the  Tranche A  Take-out  Loan
prohibit the New Mall Subsidiary from paying  dividends or making  distributions
to any of the other entities  comprising  the Company unless  payments under the
Tranche A Take-out  Loan are  current,  and,  with certain  limited  exceptions,
prohibit the New Mall  Subsidiary  from making any loans to such  entities.  Any
additional  indebtedness  incurred  by  the  New  Mall  Subsidiary  may  include
additional  restrictions  on the ability of the New Mall  Subsidiary  to pay any
such dividends and make any such distributions or loans.

     Phase II Resort and Transfer of Phase II Land

     If the Phase II Subsidiary determines to construct the Phase II Resort, the
Phase II  Subsidiary  will be required to raise  substantial  debt and/or equity
financings.  Currently,  there are no commitments to fund the hard  construction
costs of the Phase II Resort.  Approximately  14-acres  of the Phase II Land was
transferred  to the Phase II  Subsidiary  in 1998.  On  December  31,  1999,  an
additional  1.75  acres of land were  contributed  indirectly  by the  Principal
Stockholder to the Phase II Subsidiary.  The  development of the Phase II Resort
may require obtaining additional regulatory  approvals.  The Company has not yet
set a date to begin construction of the Phase II Resort.

     The Phase II Subsidiary has outstanding  project  payables in the amount of
$3.2 million to be funded from future equity  contributions or borrowings by the
Phase II  Subsidiary.  During the first quarter of 2001, the Phase II Subsidiary
borrowed $1.1 million under the Phase II Unsecured  Bank Loan,  which is due and
payable on July 15, 2002.  The proceeds  were used to fund  payments of Phase II
Subsidiary operating costs.

     Because  the  Phase  II  Subsidiary  is not a  guarantor  of the  Company's
indebtedness,  creditors of the Company  (including the holders of the Notes) do
not have a direct  claim  against  the assets of the Phase II  Subsidiary.  As a
result the existing  indebtedness of the Company  (including the Notes) is, with
respect to these assets,  effectively  subordinated to indebtedness of the Phase
II Subsidiary.  The Phase II Subsidiary is not subject to any of the restrictive
covenants of the debt instruments of the Company (including, without limitation,
the covenants with respect to the limitations on indebtedness  and  restrictions
on the ability to pay dividends or to make distributions or loans to the Company
and  its  subsidiaries).  Any  indebtedness  to be  incurred  by  the  Phase  II
Subsidiary  in addition to the Phase II Subsidiary  Credit  Facility may include
material restrictions on the ability of the Phase II Subsidiary to pay dividends
or make distributions or loans to the Company and its subsidiaries.

     The debt instruments of the Company limit the ability of LVSI,  Venetian or
any of their  subsidiaries  to  guarantee  or  otherwise  become  liable for any
indebtedness of the Phase II Subsidiary. Such debt instruments also restrict the
sale or other  disposition by the Company and its  subsidiaries of capital stock
of the Phase II Subsidiary,  including the sale of any such capital stock to the
Principal  Stockholder  or  any  affiliate  of  the  Principal  Stockholder.  In
addition, prior to commencement of construction of the Phase II Resort, Venetian
has the right to approve the plans and specifications for the Phase II Resort.










                                       30
<PAGE>

Risk Related to the Subordination Structure of the Mortgage Notes

     The Mortgage Notes  represent  senior secured debt  obligations of LVSI and
Venetian,  secured  by second  priority  liens on the  collateral  securing  the
Mortgage Notes (the "Note Collateral").  However, the guarantees of the Mortgage
Notes by its  subsidiaries,  Mall  Intermediate  Holding  Company,  LLC and Lido
Intermediate  Holding  Company,  LLC, each a special  purpose  entity which is a
wholly-owned  subsidiary of LVSI and Venetian  (collectively,  the "Subordinated
Guarantors"),  are unsecured,  subordinated debt obligations of such guarantors.
The  structure  of these  guarantees  present  certain  risks for holders of the
Mortgage Notes. For example, if the Note Collateral were insufficient to pay the
debt secured by such liens, or such liens were found to be invalid, then holders
of the Mortgage Notes would have a senior claim against any remaining  assets of
LVSI and Venetian.  In contrast,  because of the  subordination  provision  with
respect  to the  Subordinated  Guarantors,  holders of the  Mortgage  Notes will
always be fully subordinated to the claims of holders of senior  indebtedness of
the Subordinated Guarantors.

Recent Accounting Pronouncements

     In June 1998, the Financial Accounting Standards Board adopted Statement of
Financial  Accounting  Standards No. 133 ("SFAS 133") entitled  "Accounting  for
Derivative Instruments and Hedging Activities," which establishes accounting and
reporting standards for derivative  instruments and for hedging  activities.  It
requires  that  an  entity   recognize  all  derivatives  as  either  assets  or
liabilities in the statement of financial position and measure those instruments
at fair value. If specific  conditions are met, a derivative may be specifically
designated  as a hedge of  specific  financial  exposures.  The  accounting  for
changes in the fair value of a  derivative  depends on the  intended  use of the
derivative and, if used in hedging activities,  on its effectiveness as a hedge.
SFAS 133 as  amended  is  effective  for all  fiscal  quarters  of fiscal  years
beginning after December 31, 2000. SFAS 133 should not be applied  retroactively
to  financial  statements  of prior  periods.  The Company  adopted  SFAS 133 on
January 1, 2001.

     Effective in the fourth  quarter of 2000 and the first quarter of 2001, the
Company  adopted  Emerging  Issues  Task Force Issue  00-14  ("EITF  00-14") and
Emerging Issues Task Force Issue 00-22 ("EITF 00-22"), respectively.  EITF 00-14
and EITF 00-22 require that cash discounts and other cash incentives  related to
gaming play be recorded as a reduction of gross casino revenues.  EITF 00-14 and
EITF  00-22 also  require  that prior  periods  be  restated  to conform to this
presentation.  The Company  previously  recorded such  discounts as an operating
expense  and has  reclassified  prior  period  amounts,  which  has no effect on
previously reported net income. In connection with the adoption of EITF 00-14 in
the fourth  quarter  of 2000,  the  Company  reclassified  $6.1  million of such
discounts in the 1999 financial  statements.  In connection with the adoption of
EITF 00-22 in the first quarter of 2001, the Company  reclassified  $6.1 million
and $3.3 million of such  discounts in the 2000 and 1999  financial  statements,
respectively.

     In July 2001, the Financial Accounting Standards Board issued Statement No.
141 ("SFAS 141"), entitled "Business  Combination," and Statement No. 142 ("SFAS
142"), "Goodwill and Other Intangible Assets". SFAS 141 provides as follows: (a)
use of the  pooling-of-interests  method is prohibited for business combinations
initiated  after June 30, 2001; and (b) the provisions of SFAS 141 also apply to
all  business  combinations  accounted  for  by the  purchase  method  that  are
completed after June 30, 2001.  There are also transition  provisions that apply
to business  combinations  completed before July 1, 2001 that were accounted for
by the purchase  method.  SFAS 142 is effective for fiscal years beginning after
December  15,  2001 and  applies to all  goodwill  and other  intangible  assets
recognized  in an  entity's  statement  of  financial  position  at  that  date,
regardless of when those assets were initially recognized.

     In August 2001, the Financial  Accounting  Standards Board issued Statement
No. 143 ("SFAS 143"), "Accounting for Obligations Associated with the Retirement
of  Long-Lived  Assets".  The  objective of SFAS 143 is to establish  accounting
standards for the recognition and measurement of an asset retirement  obligation
and its associated asset retirement cost. SFAS 143 is effective for fiscal years
beginning after June 15, 2002.

     In October 2001, the Financial  Accounting Standards Board issued Statement
No. 144 ("SFAS 144"),  "Accounting  for the Impairment or Disposal of Long-Lived
Assets".   SFAS  144  addresses  financial  accounting  and  reporting  for  the
impairment  or disposal of long-lived  assets.  SFAS 144 is effective for fiscal
years  beginning  after  December  15,  2001 and,  generally,  is to be  applied
prospectively.

     The Company is currently  evaluating  the provisions of SFAS 141, SFAS 142,
SFAS 143 and SFAS 144 and does not anticipate  that the effects of these changes
will  have  an  impact  on  the  Company's  financial  position  or  results  of
operations.






                                       31
<PAGE>

Special Note Regarding Forward-Looking Statements

     Certain  statements  in this section and elsewhere in this Annual Report on
Form 10-K (as well as information  included in oral  statements or other written
statements  made  or to be  made  by the  Company)  constitute  "forward-looking
statements."  Such  forward-looking  statements  include the  discussions of the
business   strategies  of  the  Company  and  expectations   concerning   future
operations,  margins,   profitability,   liquidity  and  capital  resources.  In
addition,  in  certain  portions  of this Form 10-K,  the words:  "anticipates",
"believes",  "estimates",  "seeks",  "expects",  "plans",  "intends" and similar
expressions,  as they relate to the Company or its  management,  are intended to
identify  forward-looking  statements.  Although the Company  believes that such
forward-looking  statements  are  reasonable,  it can give no assurance that any
forward-looking  statements  will  prove  to be  correct.  Such  forward-looking
statements  involve known and unknown  risks,  uncertainties  and other factors,
which may cause the actual  results,  performance or achievements of the Company
to be materially different from any future results,  performance or achievements
expressed or implied by such forward-looking  statements.  Such factors include,
among others,  the risks  associated with entering into new construction and new
ventures, including the Phase IA Addition and the Macau joint venture, increased
competition and other planned  construction in Las Vegas,  including the opening
of a new  casino  resort  on the  site of the  former  Desert  Inn and  upcoming
increases in meeting and  convention  space,  the  completion of  infrastructure
projects in Las Vegas,  government regulation of the casino industry,  including
gaming  license   approvals  and  regulation  in  foreign   jurisdictions,   the
legalization  of  gaming  in  certain  jurisdictions,  such as  Native  American
reservations  in the States of California  and New York and regulation of gaming
on  the  Internet,   leverage  and  debt  service   (including   sensitivity  to
fluctuations in interest rates and other capital markets trends), uncertainty of
casino spending and  vacationing at casino resorts in Las Vegas,  disruptions or
reductions in travel to Las Vegas, the September 11, 2001 attacks and any future
terrorist  incidents,  fluctuations  in occupancy  rates and average  daily room
rates in Las Vegas,  demand for all-suites rooms, the popularity of Las Vegas as
a convention and trade show  destination,  insurance  risks  (including the risk
that the Company will not be able to obtain  coverage  against acts of terrorism
or will only be able to obtain such coverage at significantly  increased rates),
litigation  risks,  including  the  outcome  of the  pending  disputes  with the
Construction  Manager and its subcontractors,  and general economic and business
conditions which may impact levels of disposable  income,  consumer spending and
pricing of hotel rooms.

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. The Company's primary exposure to market risk is interest rate
risk  associated  with its long-term  debt.  The Company  attempts to manage its
interest  rate risk by managing the mix of its long-term  fixed-rate  borrowings
and  variable  rate  borrowings,  and by use of  interest  rate  cap  and  floor
agreements.  The ability to enter into  interest  rate cap and floor  agreements
allows the Company to manage its interest rate risk associated with its variable
rate debt.

     The  Company  does not  hold or issue  financial  instruments  for  trading
purposes  and  does  not  enter  into  deliverable  transactions  that  would be
considered speculative positions. The Company's derivative financial instruments
consist  exclusively  of  interest  rate  cap  and  floor  agreements.  Interest
differentials  resulting from these  agreements are recorded on an accrual basis
as an adjustment to interest expense.

     To manage  exposure to  counterparty  credit risk in interest  rate cap and
floor   agreements,   the  Company  enters  into  agreements  with  highly-rated
institutions  that can be  expected  to fully  perform  under  the terms of such
agreements.  Frequently,  these  institutions are also members of the bank group
providing the Company's  credit  facility,  which  management  believes  further
minimizes the risk of nonperformance.




















                                       32
<PAGE>

     The  table  below  provides   information  about  the  Company's  financial
instruments   that  are  sensitive  to  changes  in  interest  rates.  For  debt
obligations,  the table presents  notional amounts and weighted average interest
rates by contractual maturity dates.

<TABLE>
<CAPTION>

                                                                                                                  FAIR
                                         2002           2003           2004           2005           TOTAL        VALUE(1)
                                        ------         ------         ------         ------         ------        --------
                                                                  (Dollars In Millions)
<S>                                     <C>            <C>            <C>            <C>            <C>           <C>

LIABILITIES
Short-term debt
   Variable rate                        $129.1             --             --             --         $129.1         $129.1
     Average interest rate (2)            5.0%             --             --             --           5.0%             --
Long-term debt
   Fixed rate                               --             --         $460.0         $125.2         $585.2         $602.0
     Average interest rate (2)              --             --          13.1%          14.3%          13.7%             --
   Variable rate                            --         $215.9         $ 10.7             --         $226.6         $228.6
     Average interest rate (2)              --           5.7%           5.8%             --           5.8%             --

<FN>
----------
(1)  The fair values are based on the borrowing  rates  currently  available for
     debt instruments with similar terms and maturities and market quotes of the
     Company's publicly traded debt.
(2)  Based  upon  contractual  interest  rates for fixed  rate  indebtedness  or
     current LIBOR rates for variable rate indebtedness.
</FN>
</TABLE>

     Foreign  currency  translation  gains and losses  were not  material to the
Company's results of operations for the year ended December 31, 2001.

     See also  "Item 7 -  Management's  Discussion  and  Analysis  of  Financial
Condition  and Results of Operations - Liquidity  and Capital  Resources"  and "
Item 8 -  Financial  Statements  and  Supplementary  Data - Notes  to  Financial
Statements - Note 8 Long-Term Debt."















































                                       33
<PAGE>



ITEM 8--FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX TO FINANCIAL STATEMENTS






Financial Statements:

Report of Independent Accountants.......................................37

Consolidated Balance Sheets at December 31, 2001 and 2000...............38

Consolidated Statements of Operations for each of the three years
in the period ended December 31, 2001...................................39

Consolidated Statements of Stockholder's Equity (Deficit) for
each of the three years in the period ended December 31, 2001...........40

Consolidated Statements of Cash Flows for each of the three years
in the period ended December 31, 2001...................................41

Notes to Financial Statements...........................................42

Financial Statement Schedules:
    Report of Independent Accountants...................................73
    Schedule II - Valuation and Qualifying Accounts.....................74


The financial information included in the financial statement schedule should be
read in  conjunction  with the  consolidated  financial  statements.  All  other
financial  statement schedules have been omitted because they are not applicable
or the required information is included in the consolidated financial statements
or the notes thereto.

















































                                       34
<PAGE>



                        Report of Independent Accountants



To the Directors and Stockholder of Las Vegas Sands, Inc.

     In our  opinion,  the  accompanying  consolidated  balance  sheets  and the
related consolidated statements of operations, of stockholder's equity (deficit)
and of cash flows  present  fairly,  in all  material  respects,  the  financial
position of Las Vegas Sands,  Inc. and its subsidiaries at December 31, 2001 and
2000,  and the results of their  operations and their cash flows for each of the
three years in the period ended December 31, 2001, in conformity with accounting
principles  generally accepted in the United States of America.  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 of these  statements  in  accordance  with
auditing  standards  generally  accepted in the United States of America,  which
require that we plan and perform the audit to obtain reasonable  assurance about
whether the financial  statements  are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements,  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.

     As more fully  described  in Note 1, the  Company has  restated  previously
reported  net income  (loss) for the years ended  December  31, 2000 and 1999 to
include preferred return on preferred stock of a subsidiary.


PricewaterhouseCoopers LLP

Las Vegas, Nevada
February 1, 2002


















































                                       35
<PAGE>

                                           LAS VEGAS SANDS, INC.
                                        Consolidated Balance Sheets
                                          (Dollars in thousands)

<TABLE>
<CAPTION>

                                                                                         December 31,
                                                                                    2001           2000
                                                                                -----------    -----------
<S>                                                                             <C>            <C>
ASSETS
Current assets:
    Cash and cash equivalents ...............................................   $    54,936    $    42,606
    Restricted cash and investments .........................................         2,646          2,549
    Accounts receivable, net ................................................        57,092         64,328
    Inventories .............................................................         4,747          3,868
    Prepaid expenses ........................................................         3,862          3,672
                                                                                -----------    -----------
Total current assets ........................................................       123,283        117,023

Property and equipment, net .................................................     1,096,307      1,062,093
Deferred offering costs, net ................................................        18,989         22,314
Other assets, net ...........................................................        33,207         30,955
                                                                                -----------    -----------
                                                                                $ 1,271,786    $ 1,232,385
                                                                                ===========    ===========

LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)
Current liabilities:
    Accounts payable ........................................................   $    36,353    $    23,835
    Construction payables ...................................................        26,115          6,212
    Construction payables-contested .........................................         7,232          7,232
    Accrued interest payable ................................................        10,008         13,277
    Other accrued liabilities ...............................................        70,035         76,735
    Current maturities of long-term debt ....................................       129,113         50,119
                                                                                -----------    -----------
Total current liabilities ...................................................       278,856        177,410

Other long-term liabilities .................................................         3,274         10,494
Long-term debt ..............................................................       745,746        801,222
Long-term subordinated loans payable to Principal Stockholder ...............        66,123         62,071
                                                                                -----------    -----------
                                                                                  1,093,999      1,051,197
                                                                                -----------    -----------
Redeemable Preferred Interest in Venetian Casino Resort, LLC,
    a wholly owned subsidiary ...............................................       188,778        168,012
                                                                                -----------    -----------
Commitments and contingencies

Stockholder's equity (Deficit):
    Common stock, $.10 par value, 3,000,000 shares authorized, 925,000 shares
       issued and outstanding ...............................................            92             92
    Capital in excess of par value (2000, as restated) ......................       140,768        140,768
    Accumulated deficit since June 30, 1996 (2000, as restated) .............      (151,851)      (127,684)
                                                                                -----------    -----------
                                                                                    (10,991)        13,176
                                                                                -----------    -----------
                                                                                $ 1,271,786    $ 1,232,385
                                                                                ===========    ===========


<FN>
----------
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
</FN>

</TABLE>


















                                       36
<PAGE>


                                                   LAS VEGAS SANDS, INC.
                                           Consolidated Statements of Operations
                                           (In thousands, except per share data)


<TABLE>
<CAPTION>

                                                                                           Year Ended December 31,

                                                                                   2001            2000           1999
                                                                                -----------    -----------    -----------
Revenues:
<S>                                                                             <C>            <C>            <C>
   Casino ...................................................................   $   227,240    $   299,083    $   124,161
   Rooms ....................................................................       204,242        192,327         89,585
   Food and beverage ........................................................        61,977         67,052         30,786
   Retail and other .........................................................        73,034         68,804         28,966
                                                                                -----------    -----------    -----------
                                                                                    566,493        627,266        273,498
Less-promotional allowances .................................................       (42,594)       (46,296)       (25,045)
                                                                                -----------    -----------    -----------
   Net revenues .............................................................       523,899        580,970        248,453
                                                                                -----------    -----------    -----------
Operating expenses:
   Casino ...................................................................       139,936        163,157         69,664
   Rooms ....................................................................        50,039         49,618         25,532
   Food and beverage ........................................................        29,630         32,627         19,134
   Retail and other .........................................................        32,302         29,406         11,581
   Provision for doubtful accounts ..........................................        20,198         19,252         13,655
   General and administrative ...............................................        86,887         93,413         50,450
   Corporate expense ........................................................         6,376          6,275          2,510
   Rental expense ...........................................................         8,074          8,727          5,485
   Pre-opening and developemental expense ...................................           355           --           21,484
   Depreciation and amortization ............................................        40,823         41,722         25,145
                                                                                -----------    -----------    -----------
                                                                                    414,620        444,197        244,640
                                                                                -----------    -----------    -----------

Operating income ............................................................       109,279        136,773          3,813

Other income (expense):
  Interest income ...........................................................         1,385          1,771          2,551
  Interest expense, net of amounts capitalized ..............................      (101,724)      (111,026)       (71,235)
  Interest expense on indebtedness to Principal Stockholder .................        (9,020)        (8,781)          (163)
  Other income (expense) ....................................................        (1,938)          --             --
                                                                                -----------    -----------    -----------
Income (loss) before preferred return and extraordinary item ................        (2,018)        18,737        (65,034)
  Preferred return on Redeemable Preferred Interest in Venetian Casino
   Resort, LLC (2000 and 1999, as restated) .................................       (20,766)       (18,482)       (14,399)
                                                                                -----------    -----------    -----------
Income (loss) before extraordinary item (2000 and 1999, as restated) ........       (22,784)           255        (79,433)

  Extraordinary item-loss on early retirement of debt .......................        (1,383)        (2,785)          (589)
                                                                                -----------    -----------    -----------
Net income (loss)(2000 and 1999, as restated) ...............................   $   (24,167)   $    (2,530)   $   (80,022)
                                                                                ===========    ===========    ============
Basic and diluted income (loss) per share before extraordinary item .........   $    (22.78)   $      0.26    $    (79.43)
                                                                                ===========    ===========    ============
Basic and diluted loss per share ............................................   $    (24.17)   $     (2.53)   $    (80.02)
                                                                                ===========    ===========    ============


<FN>
----------  The  accompanying  notes are an integral part of these  consolidated
financial statements.

</FN>

</TABLE>



















                                       37
<PAGE>


<TABLE>
<CAPTION>

                                                  LAS VEGAS SANDS, INC.
                                      Consolidated Statements of Stockholder's Equity (Deficit)
                                                  (Dollars in thousands)






                                                           Common Stock
                                                     --------------------------
                                                                                Capital in
                                                     Number                      Excess of      Accumulated
                                                     Shares           Amount     Par Value        Deficit        Total
                                                     -------------------------------------------------------------------
                                                                                 As Restated (1998-2000)
                                                                                 -----------------------

<S>                                                  <C>           <C>           <C>           <C>           <C>
Balance at December 31, 1998 .....................       925,000   $        92   $   112,977   $   (45,132)  $    67,937
Capital contributions ............................          --            --          27,791          --          27,791
Net loss .........................................          --            --            --         (80,022)      (80,022)
                                                     -----------   -----------   -----------   -----------   -----------
Balance at December 31, 1999 .....................       925,000            92       140,768      (125,154)       15,706
Net loss .........................................          --            --            --          (2,530)       (2,530)
                                                     -----------   -----------   -----------   -----------   -----------
Balance at December 31, 2000 .....................       925,000            92       140,768      (127,684)       13,176
Net loss .........................................          --            --            --         (24,167)      (24,167)
                                                     -----------   -----------   -----------   -----------   -----------
Balance at December 31, 2001 .....................       925,000   $        92   $   140,768   $  (151,851)  $   (10,991)
                                                     ===========   ===========   ===========   ===========   ===========



<FN>
----------
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
</FN>

</TABLE>





































                                       38
<PAGE>

<TABLE>
<CAPTION>

                                                   LAS VEGAS SANDS, INC.
                                           Consolidated Statements of Cash Flows
                                                  (Dollars in thousands)



                                                                                         Year Ended December 31,
                                                                                   2001           2000            1999
                                                                                -----------    -----------    -----------
<S>                                                                             <C>            <C>            <C>
Cash flows from operating activities:
Net income (loss)(2000 and 1999, as restated).................................  $    24,167)   $    (2,530)   $   (80,022)
Adjustments to reconcile net income (loss) to net cash
  provided by (used in) operating activities:
        Depreciation and amortization ........................................       40,823         41,722         25,145
        Amortization of debt offering costs and original issue discount ......        8,691          8,502          7,569
        Non-cash preferred return on Redeemable Preferred Interest in
          Venetian (2000 and 1999, as restated) ..............................       20,766         18,482         14,399
        Loss on early retirement of debt .....................................        1,383          2,785            589
        Non-cash interest on completion guaranty loan ........................        4,052          3,568           --
        Provision for doubtful accounts ......................................       20,198         19,252         13,655
        Interest earned on restricted investments ............................         --             --             --
        Changes in operating assets and liabilities:
          Accounts receivable ................................................      (12,962)       (40,377)       (56,748)
          Inventories ........................................................         (879)           648         (4,443)
          Prepaid expenses ...................................................         (190)           400         (4,070)
          Other assets .......................................................       (2,252)       (19,433)       (10,141)
          Accounts payable ...................................................       12,518          5,707         17,863
          Accrued interest payable ...........................................       (3,269)           787          3,421
          Other accrued liabilities ..........................................      (13,920)        41,504         42,720
                                                                                -----------    -----------    -----------
Net cash provided by (used in) operating activities ..........................       50,792         81,017        (30,063)
                                                                                -----------    -----------    -----------
Cash flows from investing activities:
(Increase) decrease in restricted cash .......................................          (97)         8,431        122,956
Capital expenditures .........................................................      (55,134)       (16,409)          --
Construction of Casino Resort ................................................         --          (12,180)      (319,106)
                                                                                -----------    -----------    -----------
Net cash used in investing activities ........................................      (55,231)       (20,158)      (196,150)
                                                                                -----------    -----------    -----------
Cash flows from financing activities:

Proceeds from capital contributions ..........................................         --             --           16,000
Proceeds from preferred interest in Venetian .................................         --             --           44,431
Repayments on mall construction loan facility ................................         --             --         (140,000)
Proceeds from mall construction loan facility ................................         --             --           37,287
Proceeds from mall-tranche A take-out Loan ...................................         --             --          105,000
Proceeds from mall-tranche B take-out Loan ...................................         --             --           35,000
Proceeds from completion guaranty loan .......................................         --             --           23,503
Repayments on bank credit facility-tranche A term loan .......................     (103,125)       (35,625)       (11,250)
Proceeds from bank credit facility-tranche A term loan .......................         --             --           34,000
Repayments on bank credit facility-tranche B term loan .......................      (49,750)          (250)          --
Proceeds from bank credit facility-tranche B term loan .......................         --           50,000           --
Repayments on bank credit facility-tranche C term loan .......................       (5,750)          --             --
Proceeds from bank credit facility-tranche C term loan .......................        5,750           --             --
Repayments on bank credit term facility ......................................         (764)          --             --
Proceeds from bank credit term facility ......................................      152,750           --             --
Repayments on bank credit facility-revolver ..................................      (18,000)       (50,160)       (10,231)
Proceeds from bank credit facility-revolver ..................................       58,000         11,000         40,506
Repayments on FF&E credit facility ...........................................      (21,494)       (16,609)        (5,862)
Proceeds from FF&E credit facility ...........................................         --             --           83,842
Proceeds from Phase II Subsidiary credit facility ............................        3,933           --             --
Proceeds from Phase II Subsidiary unsecured bank loan ........................        1,092           --             --
Payments of deferred offering costs ..........................................       (5,873)        (2,861)        (2,046)
                                                                                -----------    -----------    -----------
Net cash provided by (used in) financing activities ..........................       16,769        (44,505)       250,180
                                                                                -----------    -----------    -----------
Increase in cash and cash equivalents ........................................       12,330         16,354         23,967
Cash and cash equivalents at beginning of year ...............................       42,606         26,252          2,285
                                                                                -----------    -----------    -----------
Cash and cash equivalents at end of year .....................................  $    54,936    $    42,606    $    26,252
                                                                                ===========    ===========    ===========
Supplemental disclosure of cash flow information:
  Cash payments for interest .................................................  $   106,150    $   106,143    $    91,611
                                                                                ===========    ===========    ===========

Non-cash investing and financing activities:
Contribution of land by Principal Stockholder ................................  $      --      $      --      $    11,791
                                                                                ===========    ===========    ===========
Non-cash interest on completion guaranty loan ................................  $     4,052    $     3,568    $      --
                                                                                ===========    ===========    ===========
Property and equipment asset acquisitions included in accounts payable .......  $    33,347    $    13,444    $    17,410
                                                                                ===========    ===========    ===========

<FN>
----------
The accompanying notes are an integral part of these consolidated financial statements.
</FN>

</TABLE>

                                       39
<PAGE>


LAS VEGAS SANDS, INC.
Notes to Financial Statements

Note 1 - Organization and Business of Company

     Las Vegas Sands, Inc. ("LVSI") is a Nevada corporation.  On April 28, 1989,
LVSI commenced gaming  operations in Las Vegas,  Nevada,  by acquiring the Sands
Hotel and Casino  (the  "Sands").  On June 30,  1996,  LVSI closed the Sands and
subsequently  demolished the facility in order to construct a planned  two-phase
hotel-casino  resort.  The first phase of the  hotel-casino  resort (the "Casino
Resort") includes 3,036 suites,  casino space approximating 116,000 square feet,
approximately 500,000 square feet of convention space, and approximately 475,000
gross leasable square feet of retail shops and  restaurants.  In connection with
the closing of the Sands, LVSI effected a quasi-reorganization (Note 3).

     The consolidated  financial statements include the accounts of LVSI and its
wholly  owned  subsidiaries  (the  "Subsidiaries"),  including  Venetian  Casino
Resort, LLC ("Venetian"),  Grand Canal Shops Mall, LLC (the "Mall  Subsidiary"),
Grand Canal Shops Mall Subsidiary, LLC (the "New Mall Subsidiary"),  Lido Casino
Resort, LLC (the "Phase II Subsidiary"),  Mall Intermediate Holding Company, LLC
("Mall  Intermediate"),   Grand  Canal  Shops  Mall  Construction,   LLC  ("Mall
Construction"),  Lido Intermediate Holding Company,  LLC ("Lido  Intermediate"),
Grand  Canal  Shops  Mall  Holding  Company,  LLC,  Grand  Canal  Shops  Mall MM
Subsidiary,  Inc.,  Lido Casino Resort Holding  Company,  LLC, Grand Canal Shops
Mall MM, Inc. and Lido Casino Resort MM, Inc.  (collectively,  and including all
other direct and indirect subsidiaries of LVSI, the "Company"). Each of LVSI and
the  Subsidiaries  is a separate legal entity and the assets of each such entity
are intended to be available only to the creditors of such entity.

     Venetian was formed on March 20, 1997 to own and operate  certain  portions
of the Casino  Resort.  LVSI is the managing  member and owns 100% of the common
voting equity in Venetian. The entire preferred interest in Venetian is owned by
Interface Group Holding Company,  Inc.  ("Interface  Holding"),  which is wholly
owned by LVSI's Principal stockholder (the "Principal Stockholder") (Note 9).

     Mall  Intermediate  and Lido  Intermediate  are special purpose  companies,
which  are  wholly  owned  subsidiaries  of  Venetian.  They are  guarantors  or
co-obligors of certain  indebtedness  related to the  construction of the Casino
Resort.

     The New Mall Subsidiary,  an indirect wholly-owned  subsidiary of LVSI, was
formed on December 9, 1999 and owns and  operates  the retail mall in the Casino
Resort (the "Mall").

     The Casino Resort is physically connected to the approximately 1.15 million
square  foot Sands Expo and  Convention  Center (the "Expo  Center").  Interface
Group-Nevada,  Inc. ("IGN"), the owner of the Expo Center, is beneficially owned
by the Principal Stockholder. Venetian, the New Mall Subsidiary and IGN transact
business  with each other and are parties to certain  agreements.  The nature of
such  transactions  and the amounts  involved are  disclosed in the notes to the
financial statements.

     Restatement of Previously Reported Amounts

     As more fully described above,  Interface  Holding (an entity controlled by
LVSI's principal  stockholder)  owns a redeemable  preferred  interest in LVSI's
wholly  owned  subsidiary,  Venetian.  The  preferred  return on the  redeemable
preferred  interest  has not been paid,  but it has been  accrued by the Company
each year and  historically  accounted for as a charge  against  capital.  Under
guidance by the Emerging Issues Task Force ("EITF") of the Financial  Accounting
Standards Board, dividends on a subsidiary's preferred stock should be reflected
as a minority interest and recognized as a charge against income.

      The Company has recognized the preferred return as a charge against income
in the accompanying 2001 financial statements, and has restated certain income
statement items, capital in excess of par value and accumulated deficit for the
years ended December 31, 2000 and 1999 to include the preferred return, which
amounts were $18.5 million and $14.4 million, respectively. Accumulated deficit
as of December 31, 1998 has also been restated for the cumulative effect of
years prior to 1999, which amount was $13.6 million. The restatement has no
impact on the previously reported carrying balances of the redeemable preferred
interest, or on the previously reported financial position of the Company. In
addition, because such preferred return was deducted from income available to
common stockholders in calculating earnings per share, the restatement has no
impact on previously reported amounts for earnings per share.







                                       40
<PAGE>

LAS VEGAS SANDS, INC.
Notes to Financial Statements (continued)

Note 2 - Summary of Significant Accounting Policies

Principals of Consolidation

     The consolidated  financial  statements include the accounts of the Company
and its subsidiaries.  Significant  intercompany  balances and transactions have
been eliminated.

Significant Accounting Policies and Estimates

     The preparation of the consolidated financial statements in accordance with
generally accepted accounting  principles requires the Company to make estimates
and judgments that affect the reported amounts of assets, liabilities,  revenues
and expenses, and related disclosure of contingent assets and liabilities. On an
on-going basis, management evaluates those estimates, including those related to
asset   impairment,   accruals  for  slot  marketing   points,   self-insurance,
compensation and related benefits,  revenue recognition,  allowance for doubtful
accounts,  contingencies  and  litigation.  The Company  bases its  estimates on
historical  experience and on various other  assumptions that are believed to be
reasonable  under the  circumstances,  the  results  of which form the basis for
making  judgments about the carrying  values of assets and liabilities  that are
not readily  apparent from other  sources.  Actual results may differ from these
estimates under different assumptions or conditions.

Cash and Cash Equivalents

      Cash and cash equivalents consist of cash and short-term investments with
original maturities not in excess of 90 days.

Inventories

     Inventories  are stated at the lower of cost or market.  Cost is determined
by the first-in,  first-out  and specific  identification  methods.  Inventories
consist primarily of food, beverage and retail products.

Accounts Receivable

     Accounts receivable are due within one year and are recorded net of amounts
estimated to be uncollectible.

Property and Equipment

     Property and equipment are stated at cost.  Depreciation  and  amortization
are provided on a  straight-line  basis over the  estimated  useful lives of the
assets as follows:

<TABLE>
<CAPTION>

                    <S>                                     <C>
                    Building and improvements               15 to 40 years
                    Furniture, fixtures and equipment        3 to 15 years
                    Leasehold improvements                   5 to 10 years
</TABLE>


     Maintenance,  repairs and renewals that neither materially add to the value
of the  property  nor  appreciably  prolong  its life are  charged to expense as
incurred.  Gains or losses on disposition of property and equipment are included
in the statements of operations.

     Management  reviews  assets for possible  impairment of  long-lived  assets
whenever events or changes in circumstances indicate that the carrying amount of
such assets  exceeds their fair value.  Impairment  losses are  recognized  when
estimated future  undiscounted cash flows expected to result from the use of the
assets and their eventual  disposition are less than their carrying amounts. See
Note   3   for   adjustment   of   carrying   values   as  a   result   of   the
quasi-reorganization.

Capitalized Interest

     Interest costs associated with major construction projects are capitalized.
Interest  is  capitalized  on amounts  expended on the Casino  Resort  using the
weighted-average cost of the Company's outstanding borrowings. Capitalization of
interest ceases when the project is substantially complete.

Pre-opening and Developmental Costs

     Pre-opening  and  developmental   costs,   representing   primarily  direct
personnel and other costs incurred prior to the opening of the Casino Resort and
other new ventures are expensed as incurred.

                                       41
<PAGE>

Debt Discount and Deferred Offering Costs

       Debt discount and offering costs are amortized based on the terms of the
related debt instruments using the straight-line method, which approximates the
effective interest method.

Per Share Data

     Basic and diluted  loss per share are  calculated  based upon the  weighted
average number of shares  outstanding.  As further  described in Note 10, in the
first quarter of 2002, the Company completed a stock split whereby the number of
common shares outstanding was increased to 1,000,000 from 925,000.  Accordingly,
all earnings per share  calculations  have been adjusted to  retroactively  give
effect to the increase in shares outstanding to 1,000,000.

Revenue Recognition

      The Company recognizes revenue when persuasive evidence of an arrangement
exists, performance of the service or delivery of the product has occurred, the
sales price is fixed or determinable and collectibility is probable.

     Casino Revenue and Promotional Allowances

     Casino revenue is the aggregate of gaming wins and losses. Effective in the
fourth  quarter  of 2000 and the first  quarter  of 2001,  the  Company  adopted
Emerging  Issues Task Force Issue 00-14 ("EITF 00-14") and Emerging  Issues Task
Force  Issue  00-22  ("EITF  00-22"),  respectively.  EITF  00-14 and EITF 00-22
require that cash discounts and other cash incentives  related to gaming play be
recorded as a reduction of gross casino revenues. EITF 00-14 and EITF 00-22 also
require  that prior  periods be  restated to conform to this  presentation.  The
Company  previously  recorded  such  discounts as an  operating  expense and has
reclassified  prior period amounts,  which has no effect on previously  reported
net income.  In connection  with the adoption of EITF 00-22 in the first quarter
of  2001,  the  Company  reclassified  $6.1  million  and $3.3  million  of such
discounts in the 2000 and 1999 financial statements,  respectively. In addition,
the  retail  value of  accommodations,  food and  beverage,  and other  services
furnished to hotel/casino guests without charge is included in gross revenue and
then deducted as  promotional  allowances.  The estimated  departmental  cost of
providing such promotional  allowances is included primarily in casino operating
expenses as follows (in thousands):

<TABLE>
<CAPTION>

                                                            Cost
                                                        December 31,
                                     ----------------------------------------------------
                                           2001              2000             1999
                                           ----              ----             ----
          <S>                        <C>               <C>               <C>
          Food and Beverage                $   9,357        $   10,391       $     7,126
          Rooms                                6,996             7,956             5,077
          Other                                1,752             1,904               836
                                     ---------------   ---------------   ---------------
                                          $   18,105        $   20,251         $  13,039
                                     ===============   ===============   ===============
</TABLE>


      The estimated retail value of such promotional allowances is included in
operating revenues as follows (in thousands):

<TABLE>
<CAPTION>

                                                           Revenue
                                                        December 31,
                                     ----------------------------------------------------
                                           2001              2000             1999
                                           ----              ----             ----
          <S>                        <C>               <C>               <C>
          Food and Beverage               $   14,749        $   16,053         $   8,265
          Rooms                               25,828            27,421            15,445
          Other                                2,017             2,822             1,335
                                     ---------------   ---------------   ---------------
                                          $   42,594        $   46,296        $   25,045
                                     ===============   ===============   ===============
</TABLE>


     Rental Revenue

     Minimum rental  revenues are recognized on a  straight-line  basis over the
terms of the related  lease.  Percentage  rents are  recognized in the period in
which the tenants exceed their respective percentage rent thresholds. Charges to
tenants for real estate taxes,  insurance and other  shopping  center  operating
expenses are recognized as revenues in the period billed which  approximates the
period in which the applicable costs are incurred.



                                       42
<PAGE>

     Hotel and Food and Beverage Revenues

     Hotel sales  criteria are generally met at the time of occupancy.  Deposits
for future hotel occupancy or food and beverage services  contracts are recorded
as deferred income until revenue recognition criteria are met. Cancellation fees
for hotel and food and beverage services are recognized upon cancellation by the
customer as defined by a written contract entered into with the customer.

     Joint Venture Revenue

     The Company entered into an agreement  during 2001 with a subsidiary of the
Solomon R.  Guggenheim  Foundation to operate the Guggenheim Las Vegas Museum in
the Casino Resort.  The  Guggenheim  entity is the manager of the Guggenheim Las
Vegas Museum. The agreement  requires the Company to make certain  contributions
of capital.  The Company is reimbursed for certain expenses incurred and certain
advances made to open the exhibition at the  Guggenheim Las Vegas Museum.  After
such  expenses are  reimbursed,  the Company is to receive 49% of the  operating
income  generated  pursuant to the agreement.  The Company's  share of operating
losses  generated  pursuant to the  agreements  is also 49%.  The  agreement  is
accounted for on the equity method of accounting.

Slot Club Promotion and Progressive Jackpot Payouts

     The Company has established a promotional club to encourage repeat business
from frequent and active slot machine customers and table games patrons. Members
earn points  based on gaming  activity and such points can be redeemed for cash.
The Company  accrues  for club  points  based upon the  estimates  for  expected
redemptions.  The Company  maintains a number of  progressive  slot machines and
table games. As wagers are made on the respective  progressive games, the amount
available  to win (to be  paid  out  when  the  appropriate  jackpots  are  hit)
increases. The Company has recorded the progressive jackpots as a liability with
a corresponding charge against casino revenue.

Income Taxes

     LVSI has  elected  to be taxed as an S  Corporation  and its  wholly  owned
subsidiaries are either limited liability  companies or S Corporations,  each of
which is a tax pass-through entity for federal income tax purposes.  Nevada does
not levy a corporate income tax. Accordingly,  no provision for federal or state
income taxes is included in the statement of operations.

Advertising Costs

     Costs  for  advertising   are  expensed  as  incurred,   except  costs  for
direct-response advertising, which are capitalized and amortized over the period
of the  related  program.  Direct-response  advertising  consists  primarily  of
mailing costs associated with the direct-mail programs.  Capitalized advertising
costs,  included in prepaid  expense,  were  immaterial at December 31, 2001 and
2000.  Advertising  costs that were expensed  during the year were $5.6 million,
$8.7 million and $5.2 million in 2001, 2000 and 1999, respectively.

Concentrations of Credit Risk

     Financial   instruments,   which   potentially   subject   the  Company  to
concentrations of credit risk, consist principally of short-term investments and
receivables.  The short-term  investments  are placed with a high credit quality
financial institution, which invests primarily in money market funds.

Accounting for Derivative Instruments and Hedging Activities

     In June 1998, the Financial Accounting Standards Board adopted Statement of
Financial  Accounting  Standards No. 133 ("SFAS 133"),  entitled "Accounting for
Derivative Instruments and Hedging Activities," which establishes accounting and
reporting standards for derivative  instruments and for hedging  activities.  It
requires  that  an  entity  recognizes  all  derivatives  as  either  assets  or
liabilities in the statement of financial position and measure those instruments
at fair value. If specific  conditions are met, a derivative may be specifically
designated  as a hedge of  specific  financial  exposures.  The  accounting  for
changes in the fair value of a  derivative  depends on the  intended  use of the
derivative and, if used in hedging  activities,  it depends on its effectiveness
as a hedge.  SFAS 133 as amended is effective for all fiscal  quarters of fiscal
years  beginning  after  December  31,  2000.  SFAS 133  should  not be  applied
retroactively to financial statements of prior periods. The Company adopted SFAS
133 on January 1, 2001.

     The  Company,  from time to time,  uses  interest  rate caps and floors and
similar  financial  instruments to assist in managing  interest  incurred on its
long-term debt. The difference  between amounts  received and amounts paid under
such agreements, as well as any costs or fees, is recorded as a reduction of, or
addition to, interest  expense as incurred over the life of the cap and floor or
similar financial instrument.







                                       43
<PAGE>

     The Company has a policy aimed at managing  interest  rate risk  associated
with its current and  anticipated  future  borrowings.  This policy  enables the
Company to use any combination of interest rate swaps, futures, options, cap and
similar   instruments.   To  the  extent  the  Company  employs  such  financial
instruments  pursuant  to this  policy,  and the  instruments  qualify for hedge
accounting,  they are accounted for as hedging instruments.  In order to qualify
for hedge  accounting,  the  underlying  hedged  item must expose the Company to
risks associated with market fluctuations and the financial instrument used must
be  designated  as a hedge and must  reduce  the  Company's  exposure  to market
fluctuation throughout the hedge period. If these criteria are not met, a change
in the market value of the financial  instrument is recognized as a gain or loss
in the period of change.  Otherwise,  gains and losses are not recognized except
to the extent that the  financial  instrument  is disposed of prior to maturity.
Net interest paid or received  pursuant to the financial  instrument is included
as interest expense in the period.

Reclassifications

     The consolidated financial statements and footnotes for prior years reflect
certain  reclassifications to conform with the current year presentation,  which
have no effect on previously reported net income.

Recent Accounting Pronouncements

     In July 2001, the Financial Accounting Standards Board issued Statement No.
141 ("SFAS 141"), entitled "Business  Combinations" and Statement No. 142 ("SFAS
142"), "Goodwill and Other Intangible Assets". SFAS 141 is effective as follows:
(a)  use  of  the   pooling-of-interests   method  is  prohibited  for  business
combinations  initiated  after June 30 2001;  and (b) the provisions of SFAS 141
also apply to all business  combinations  accounted  for by the purchase  method
that are completed after June 30, 2001. There are also transition provision that
apply to business combinations completed before July 1, 2001 that were accounted
for by the purchase  method.  SFAS 142 is effective  for fiscal years  beginning
after December 15, 2001 and applies to all goodwill and other intangible  assets
recognized  in an  entity's  statement  of  financial  position  at  that  date,
regardless of when those assets were initially recognized.

     In August 2001, the Financial  Accounting  Standards Board issued Statement
No. 143 ("SFAS 143"), "Accounting for Obligations Associated with the Retirement
of Long-Lived  Assets".  The objectives of SFAS 143 are to establish  accounting
standards for the recognition and measurement of an asset retirement  obligation
and its associated asset retirement cost. SFAS 143 is effective for fiscal years
beginning after June 15, 2002.

     In October 2001, the Financial  Accounting Standards Board issued Statement
No. 144 ("SFAS 144"),  "Accounting  for the Impairment or Disposal of Long-Lived
Assets".   SFAS  144  addresses  financial  accounting  and  reporting  for  the
impairment  or disposal of long-lived  assets.  SFAS 144 is effective for fiscal
years  beginning  after  December  15,  2001 and,  generally,  is to be  applied
prospectively.

     The Company is currently  evaluating  the provisions of SFAS 141, SFAS 142,
SFAS 143 and SFAS 144 and does not anticipate  that the effects of these changes
will have an impact the Company's financial position or results of operations.

Note 3 - Strategic Redirection and Quasi-Reorganization

     During  1996,  in  response  to  increasing  competition  and rapid  market
changes, management decided to strategically redirect the Company's business. On
June 30, 1996,  the Company  suspended  operations and closed the existing Sands
property in order to construct a new hotel-casino  resort (Note 1). As a result,
approximately 1,400 employee positions were eliminated.  The estimated severance
and related closing costs were included in selling,  general and  administrative
expense for 1996. In December 1997, the Company  reevaluated its accrued closing
costs   resulting  in  a  credit  of  $1.8  million  to  selling,   general  and
administrative expense.

     In  connection  with the  closing  of the  Sands  (Note 1),  the  Company's
director and Principal Stockholder approved a quasi-reorganization, effective as
of June 30, 1996,  pursuant to which the Company  revalued certain of its assets
as of that date. This revaluation,  in accordance with the accounting principles
applicable  to a  quasi-reorganization,  permitted  the Company to eliminate the
adjusted  accumulated  deficit  account  as of that  date,  by a charge  against
capital in excess of par value, and to establish a new retained earnings account
for   the   accumulation   of   the   results   of   future   operations.    The
quasi-reorganization  resulted in an increase in the  carrying  value of land of
$51.7  million and a  corresponding  decrease of $45.0  million in buildings and
other property and equipment,  net of accumulated  depreciation and $6.7 million
in severance and related closing costs. The remaining  accumulated  depreciation
against  the cost  basis  of the  remaining  property  was  eliminated,  and the
accumulated  deficit of $155.0 million as of June 30, 1996,  was  transferred to
capital in excess of par value.






                                       44
<PAGE>

Note 4 - Restricted Cash

     The net  proceeds of the  Company's  12 1/4%  Mortgage  Notes due 2004 (the
"Mortgage  Notes")  and its 14 1/4%  Senior  Subordinated  Notes  due 2005  (the
"Senior  Subordinated Notes" and, together with the Mortgage Notes, the "Notes")
were  deposited  into  restricted  accounts  and  invested in cash or  permitted
investments by a disbursement agent for the Company's lenders until required for
project costs under the terms of the disbursement  agreement with certain of the
Company's lenders (the  "Disbursement  Agreement") (Note 8). Additional  amounts
have been deposited to other  restricted  accounts,  which are controlled by the
Company,  but  which  are  also  restricted  as to use  under  the  terms of the
Disbursement Agreement.

Note 5 - Accounts Receivable

      Components of accounts receivable were as follows:

<TABLE>
<CAPTION>

                                                                           December 31,
                                                                  ------------------------------

                                                                        2001              2000
                                                                   ----------        ----------
          <S>                                                     <C>               <C>
          Casino                                                   $   58,689        $   66,520
          Hotel                                                        13,987            15,387
          Other                                                         8,409             5,334
                                                                   ----------        ----------
                                                                       81,085            87,241
                                                                   ----------        ----------
          Less:  allowance for doubtful accounts and discounts        (23,993)          (22,913)
                                                                   ----------        ----------
                                                                   $   57,092        $   64,328
                                                                   ==========        ==========
</TABLE>

     The  Company  extends  credit  to  approved  casino   customers   following
background checks and investigations of creditworthiness.  At December 31, 2001,
a  substantial  portion  of the  Company's  casino  receivables  were  due  from
customers residing in foreign countries.  Business or economic  conditions,  the
legal  enforceability  of gaming  debts,  or other  significant  events in these
countries could affect the collectibility of such receivables.

      An estimated allowance for doubtful accounts and discounts is maintained
to reduce the Company's receivables to their estimated net realizable value.
Although management believes the allowance is adequate, it is possible that the
estimated amount of cash collections with respect to the casino accounts
receivable could change.

Note 6 - Property and Equipment, Net

      Property and equipment includes costs incurred to construct the Casino
Resort and consists of the following (in thousands):

<TABLE>
<CAPTION>

                                                                                  December 31,
                                                                         -----------------------------

                                                                             2001             2000
                                                                         -----------       -----------
          <S>                                                           <C>               <C>
          Land and land improvements                                    $    113,309      $    109,863
          Building and improvements                                          882,395           832,429
          Equipment, furniture, fixtures and leasehold improvements          138,978           134,008
          Construction in progress                                            68,542            52,129
                                                                         -----------       -----------
                                                                           1,203,224         1,128,429
          Less:  accumulated depreciation and amortization                  (106,917)          (66,336)
                                                                         -----------       -----------
                                                                         $ 1,096,307       $ 1,062,093
                                                                         ===========       ===========
</TABLE>


      The Casino Resort serves as collateral for various financing facilities
(Note 8).

      During the years ended December 31, 2001, 2000 and 1999, the Company
capitalized interest expense of $2.0 million, $0.1 million, and $31.3 million ,
respectively.




                                       45
<PAGE>

Note 7 - Other Accrued Liabilities

      Other accrued liabilities consist of the following (in thousands):

<TABLE>
<CAPTION>

                                                                              December 31,
                                                                     ----------------------------

                                                                       2001               2000
                                                                     ---------         ---------

          <S>                                                        <C>               <C>
          Customer deposits                                          $  32,735         $  33,807
          Payroll and related                                           16,901            21,226
          Taxes and licenses                                             6,360             8,476
          Outstanding gaming chips and tokens                            5,849             5,095
          Other accruals                                                 8,190             8,131
                                                                     ---------         ---------
                                                                     $  70,035         $  76,735
                                                                     =========         =========
</TABLE>


Note 8 - Long-Term Debt

<TABLE>
<CAPTION>

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

                                                                            December 31,
                                                                    ----------------------------

                                                                        2001             2000
                                                                    ----------        ----------
          <S>                                                       <C>               <C>
          Indebtedness of the Company and its Subsidiaries
          other than the New Mall Subsidiary:
          -----------------------------------

          12 1/4% Mortgage Notes, due November 15, 2004             $  425,000        $  425,000
          14 1/4% Senior Subordinated Notes, due November
            15, 2005 (net of unamortized discount of $3,387
            in 2001 and $4,263 in 2000)                                 94,113            93,237
          Bank Credit Facility-Revolver                                 40,000                --
          Bank Credit Facility- Tranche A Term Loan                         --           103,125
          Bank Credit Facility- Tranche B Term Loan                         --            49,750
          Bank Credit Facility- Term Loan                              151,986                --
          FF&E Credit Facility                                          53,735            75,229

          Indebtedness of the New Mall Subsidiary:
          ----------------------------------------

          Mall Tranche A Take-out Loan                                 105,000           105,000

          Indebtedness of the Phase II Subsidiary:
          ----------------------------------------

          Phase II Subsidiary Credit Facility                            3,933                --
          Phase II Unsecured Bank Loan                                   1,092                --

          Less: current maturities                                   (129,113)          (50,119)
                                                                    ----------        ----------
          Total long-term debt                                      $  745,746        $  801,222
                                                                    ==========        ==========

          Subordinated Owner Indebtedness:
          --------------------------------

          Completion Guaranty Loan (Indebtedness of Venetian)       $   31,123        $   27,071
          Subordinated Mall Tranche B Take-out Loan
            from Principal Stockholder (Indebtedness of New
            Mall Subsidiary)                                            35,000            35,000
                                                                    ----------        ----------
          Total long-term subordinated loans payable to
          Principal Stockholder                                     $   66,123        $   62,071
                                                                    ==========        ==========
</TABLE>






                                       46
<PAGE>

     Mortgage Notes and Senior Subordinated Notes

     In November 1997, the Company  issued $425.0  million  aggregate  principal
amount of the Mortgage Notes and $97.5 million aggregate principal amount of the
Senior  Subordinated  Notes in a  private  placement.  Interest  on the Notes is
payable  each May 15 and  November 15,  commencing  on May 15, 1998.  On June 1,
1998,  LVSI and Venetian  completed an exchange  offer to exchange the Notes for
notes with substantially the same terms.

     The  Mortgage  Notes  are  secured  by second  priority  liens on the Notes
Collateral (the real estate improvements and personal property that comprise the
Hotel, the Casino and the Congress Center, with certain exceptions).  The Senior
Subordinated Notes are unsecured. The Notes are redeemable at the option of LVSI
and Venetian at prices  ranging from 100% to 106.125% for the Mortgage Notes and
100% to 107.125% for the Senior Subordinated Notes commencing after November 14,
2001, as set forth in the Notes and the  indentures  pursuant to which the Notes
were  issued  (the  "Indentures").  Upon a change of control  (as defined in the
Indentures),  each Note holder may require LVSI and Venetian to repurchase  such
Notes at 101% of the principal  amount  thereof plus accrued  interest and other
amounts  which are then due, if any. The Notes are not subject to a sinking fund
requirement.

     The Senior  Subordinated  Notes bear cash  interest  at the rate of 10% per
annum through  November 15, 1999, and thereafter at a rate of 14 1/4% per annum.
The Senior Subordinated Notes were sold at a $7.0 million discount to their face
amount  in  order to yield 14 1/4% per  annum to  maturity  and  accrued  to par
through the second anniversary date of the issuance.

     Bank Credit Facility

     In November 1997, LVSI and Venetian and a syndicate of lenders entered into
a Bank Credit Facility (the "Bank Credit  Facility")  providing for up to $150.0
million in multiple  draw term loans (the  "Tranche A Term Loan") to the Company
for  construction  and development of the Casino Resort.  Up to $40.0 million of
additional  credit in the form of revolving loans under the Bank Credit Facility
(the "Revolver") was made available generally for working capital. In June 2000,
the Company  amended  certain terms of the Bank Credit Facility in order to: (1)
add a new senior secured  tranche B term loan (the "Tranche B Term Loan") in the
amount of $50.0  million,  the  proceeds of which were applied to (x) prepay the
Tranche A Term Loan in forward  order of maturity in the amount of $30.0 million
and (y) reduce  outstanding  loans under the  Revolver by $20.0  million (net of
fees and expenses) without decreasing available commitments of the Revolver; and
(2) adjust certain financial covenants provided for in the Bank Credit Facility.
The Company  recorded a $2.8 million  extraordinary  loss on early retirement of
debt in connection with this transaction.

     On September 17, 2001,  the Company  entered into its second  amendment and
restatement  of the Bank  Credit  Facility  in order to: (1)  combine  the $97.5
million Tranche A Term Loan, $49.5 million Tranche B Term Loan and an additional
$5.8 million tranche C term loan into a single term loan of $152.8 million;  (2)
modify the Company's scheduled  amortization  payments to instead repay $381,875
per quarter until December 2002, to be followed by two bullet  payments of $75.2
million  during  each of March  2003 and June 2003;  (3)  extend the  commitment
termination  date of the Revolver from  September 15, 2001 to June 30, 2003; (4)
eliminate the "cash sweep"  provision of such  agreement in connection  with any
excess cash flows of the Company;  and (5) modify the financial  covenants.  The
Company recorded a $1.4 million  extraordinary  loss on early retirement of debt
in connection with this  transaction.  Each of the term loan and revolving loans
under the Bank Credit  Facility  has an interest  rate of 350 basis  points over
LIBOR.  The average interest rate incurred during 2001 was 7.68% and was payable
upon expiration of each LIBOR contract, limited to three months.

     The  Company is  required  to enter  into  interest  rate cap and/or  floor
agreements  to limit the impact of increases  in interest  rates on its floating
rate debt derived from the Bank Credit Facility. To meet the requirements of the
Bank Credit Facility,  the Company entered into a cap and floor agreement during
1998 which was further amended in 2000 and 2001 (the "Cap and Floor Agreement"),
which resulted in a premium  payment to  counterparties  and receipt of an equal
payment from the  counterparties,  based upon notional  principal  amounts for a
term  equal to the term of the  Bank  Credit  Facility.  The  interest  rate cap
provisions  of the Cap and Floor  Agreement  entitle the Company to receive from
the  counterparties  the amounts,  if any, by which the selected market interest
rates exceed the strike rates stated in such agreement. Conversely, the interest
rate floor provisions of the Cap and Floor Agreement  require the Company to pay
the  counterparties  the amounts,  if any, by which the selected market interest
rates are less than the strike rates stated in such agreement. The net effect of
all such cap and floor agreements resulted in an increase of interest expense of
$0.5 million for the year ended December 31, 2001. If the Company had terminated
the cap and floor agreements as of December 31, 2001, the Company would have had
to pay a net  amount of $1.9  million  based on quoted  market  values  from the
various institutions holding the swaps. In accordance with SFAS 133, the Company
has  recorded the fair value of its  obligation  in the  accompanying  financial
statements.  The notional  amount of the Cap and Floor Agreement at December 31,
2001 was $76.2 million.




                                       47
<PAGE>

     FF&E Financing

     In December 1997, a credit facility (the "FF&E Credit Facility") secured by
certain  furniture,  fixtures and equipment (the  "Specified  FF&E") was entered
into with certain  lenders  (the "FF&E  Lenders")  to provide  $97.7  million of
financing for the Specified  FF&E and an  electrical  substation.  The financing
provides for an interim loan during  construction and a 60-month basic term loan
after completion of the Casino Resort.  In the initial and subsequent draws, the
FF&E  Lenders  reimbursed  the  Company  for  amounts  spent by the  Company for
Specified FF&E prior to the initial draw.

     Interest on the FF&E Credit Facility is the lower of (x) base rate plus 100
basis points and (y) a floating monthly rate calculated at the higher of (a) the
reserve-adjusted  30-day LIBOR rate plus 375 basis points and (b) the eurodollar
interest  rate  margin  in  effect on the Bank  Credit  Facility  plus 125 basis
points. The average interest rate incurred during 2001 was 8.36% and was payable
quarterly.  Amortization  on the FF&E basic loan was 3% of the principal for the
first four quarters  beginning  September 30, 1999 and 5.5% of the principal for
the next 16 quarters.  On September 28, 2001, the Company  entered into a fourth
amendment to the FF&E Credit Facility in order to modify its financial covenants
to  substantially  match those under the September 17, 2001 amended and restated
Bank Credit Facility, as described above. As of December 31, 2001, $97.7 million
had been drawn and $44.0 million  principal  repayments  had been paid under the
FF&E Credit Facility.

     Completion Guaranty Loan

     In accordance with its terms, advances made under the Principal Stockholder
completion  guaranty (the  "Completion  Guaranty")  are treated as a junior loan
from the Principal Stockholder to Venetian (the "Completion Guaranty Loan") that
is  subordinated in right of payment to the  indebtedness  under the Bank Credit
Facility,  the FF&E Credit Facility and the Notes. The Completion  Guaranty Loan
matures on November 16, 2005,  bears interest at a rate of 14 1/4% per annum and
compounds and is added to the principal balance semi-annually. Although interest
may accrue on the  Completion  Guaranty  Loan,  no cash payments with respect to
such loan may be made until senior  indebtedness is repaid,  except for payments
made from certain  construction-related  recoveries.  On November  12, 1999,  an
advance of  approximately  $23.5 million was made under the Completion  Guaranty
and  treated as a  Completion  Guaranty  Loan.  During 2001 and 2000 the Company
incurred interest expense of $4.1 million and $3.6 million,  respectively  under
this loan  which  has been  added to the  principal  balance  of the  Completion
Guaranty  Loan,  resulting in a total  balance of $31.1  million at December 31,
2001.

     Mall Tranche A Take-out Loan

     On December 20, 1999, certain take-out lenders (collectively,  the "Tranche
A Take-out  Lender")  funded a $105.0 million Tranche A take-out loan to the New
Mall Subsidiary (the "Tranche A Take-out Loan"). The proceeds were used to repay
indebtedness under the mall construction loan facility for the Mall.

     The  indebtedness  under the  Tranche A  Take-out  Loan is secured by first
priority  liens on the assets that  comprise the Mall (the "Mall  Assets").  The
annual  interest  rate on the Tranche A Take-out  Loan is 350 basis  points over
30-day LIBOR and is payable  monthly.  The average interest rate incurred during
2001 was 7.71%. The Tranche A Take-out Loan is due in full on December 20, 2002.
The Company  currently  plans to refinance  the Tranche A Take-out Loan prior to
its due date of December  20,  2002;  however,  no  assurance  can be given that
refinancing for such indebtedness will be available to the Company prior to this
date. No principal payments are due thereunder until December 20, 2002.

     The Company is required to enter into an  interest  rate cap  agreement  to
limit the  impact of  increases  in  interest  rates on its  floating  rate debt
derived  from the  Tranche A  Take-out  Loan.  To meet the  requirements  of the
Tranche A Take-out  Loan, the Company  entered into a cap agreement  during 2000
(the "Cap  Agreement"),  which resulted in a premium  payment to  counterparties
based  upon  notional  principal  amounts  for a term  equal  to the term of the
Tranche A Take-out  Loan.  The interest rate cap provisions of the Cap Agreement
entitle the Company to receive from the counterparties  the amounts,  if any, by
which the selected  market interest rates exceed the strike rates stated in such
agreement. The net effect on interest expense of the cap agreements was zero for
the year  ended  December  31,  2001.  If the  Company  had  terminated  the Cap
Agreement  as of December 31,  2001,  the Company  would not have had to pay any
amounts based on quoted market values from the various  institutions holding the
swaps.  The notional  amount of the Cap Agreement at December 31, 2001 was $42.3
million.

     The New Mall Subsidiary is also required pursuant to the Tranche A Take-out
Loan to  maintain  certain  funds in escrow  for mall  management  fees,  tenant
disputes,  tenant  allowances and leasing  commissions.  At each of December 31,
2001 and 2000, $1.1 million was held in escrow for these purposes and classified
as restricted cash in the accompanying financial statements.

                                       48
<PAGE>

     Mall Tranche B Take-out Loan

     On December 20, 1999, the Principal Stockholder funded a Tranche B take-out
loan to provide  $35.0  million in  financing  to the New Mall  Subsidiary  (the
"Tranche B Take-out  Loan" and,  together with the Tranche A Take-out  Loan, the
"Mall Take-out Financing").  The proceeds, along with $105.0 million of proceeds
from the Tranche A Take-out Loan, were used to repay the mall  construction loan
facility for the Mall in full.

     The  indebtedness  under the  Tranche B Take-out  Loan is secured by second
priority liens on the Mall Assets.  The loan bears interest at 14% per annum and
is payable monthly.  During 2001, 2000 and 1999, the Company  incurred  interest
expense of $5.0 million, $5.2 million and $0.2 million, respectively, under this
loan.  The initial  maturity date of the Tranche B Take-out Loan is December 20,
2004 with a right of extension to December 20, 2007.  No principal  payments are
due thereunder until maturity.

     Phase II Subsidiary Credit Facility

     On October 19, 2001, the Phase II Subsidiary  entered into a loan agreement
providing for a $17.5 million term and revolving loan, with a one time option to
increase such loan to $30.0 million (the "Phase II Subsidiary Credit Facility").
The Phase II Subsidiary  Credit Facility is secured by a first priority mortgage
on the land on the site  located  adjacent  to the Casino  Resort (the "Phase II
Land"),  as well as the Phase II  Subsidiary's  interest in a five year lease of
the Phase II Land to Venetian for an annual rental  payment of $8.0 million (the
"Phase II Lease"). The Phase II Subsidiary  immediately drew $12.5 million for a
letter of credit under the revolver  portion of the Phase II  Subsidiary  Credit
Facility (the "Letter of Credit") pursuant to the terms of and to be provided as
credit support for the Bank Credit  Facility.  The Letter of Credit was released
in February 2002, pursuant to its terms,  immediately following the first fiscal
quarter  period  ending  after   September  30,  2001  in  which  the  Company's
consolidated  adjusted  EBITDA  exceeded  $30.0  million.  The Company drew $3.9
million on the Phase II Credit  Facility  during 2001. The remaining  portion of
the Phase II Subsidiary  Credit  Facility and proceeds from rental payments from
Venetian to the Phase II Subsidiary  under the Phase II Lease are each available
for any Phase II Resort pre-development expenses or may be loaned or distributed
by the Phase II Subsidiary to the Company for other liquidity  needs.  The Phase
II Subsidiary  Credit Facility bears interest at LIBOR plus 400 basis points and
is due on June 30, 2003. The average interest rate incurred during 2001 was 6.5%
and was payable upon expiration of each LIBOR contract, limited to three months.

     Phase II Unsecured Bank Loan

     In February  2001,  the Phase II Subsidiary  entered into an unsecured bank
line of credit,  as amended on May 31, 2001,  for $1,092,000 and payable on July
15, 2002. This line of credit bears interest at LIBOR plus 100 basis points. The
proceeds of the line of credit were used to fund payments of Phase II Subsidiary
operating costs. The average interest rate incurred during 2001 was 5.25%.

     Scheduled Maturities of Long-Term Debt

     Scheduled maturities of long-term debt outstanding at December 31, 2001 are
summarized as follows:  $129.1 million for 2002, $215.9 million for 2003, $470.7
million  for 2004,  and $125.3  million  for 2005  (which  includes  unamortized
discount on the Senior Subordinated Notes).

     Waivers

     On November 12, 1999,  the Company  entered  into  various  limited  waiver
agreements (the "Waivers") with the administrative  agent and lenders under: (1)
the Bank Credit Facility;  (2) the FF&E Credit Facility; and (3) certain parties
to the  Disbursement  Agreement.  Under the Waivers,  the various lenders waived
certain  defaults and events of default (to the extent,  if any, they existed or
may have existed)  arising from the Company's  litigation  with Lehrer  McGovern
Bovis, Inc., its construction  manager (the "Construction  Manager"),  the facts
relating  to the  underlying  dispute  with  the  Construction  Manager  and the
mechanics  liens  that were  filed  against  the Casino  Resort  (Note  13).  As
conditions to the  effectiveness  of the Waivers,  the Company and the Principal
Stockholder,  among other  things:  (i) agreed to pay a fee to the lenders under
the Bank Credit Facility and the FF&E Credit  Facility;  (ii) agreed to purchase
surety  bonds for all of the  mechanics  liens and  cause the title  company  to
provide  endorsements  ensuring  that the deeds of trust  under the Bank  Credit
Facility and the Mortgage Notes are superior in priority to all mechanics liens;
and (iii)  agreed that the  Principal  Stockholder's  $25.0  million  Completion
Guaranty would, notwithstanding the prior agreement of the parties providing for
termination of such guaranty upon  substantial  completion of the Casino Resort,
remain in effect until "final completion" (i.e., the completion of all remaining
punchlist items and the final  resolution or settlement of all disputes with the
Construction Manager and subcontractors) and be unlimited in amount with respect
to all  construction  costs arising from scope  changes.  In order to be able to
purchase  the surety  bonds,  the  Principal  Stockholder  had to provide a $5.0
million  irrevocable letter of credit as collateral to the bonding company.  All
of the conditions to the  effectiveness of the limited waivers were satisfied on
November 12, 1999.




                                       49
<PAGE>

     The debt instruments described above contain certain covenants that require
the Company to pass a number of financial tests relating to, among other things,
a  minimum  consolidated  earnings  before  interest,  taxes,  depreciation  and
amortization  ("EDITDA"),  a  consolidated  leverage  ratio,  and a fixed charge
coverage   ratio  (all  as  defined  in  the  respective   credit   agreements).
Additionally,  the debt  instruments  contain certain  restrictions  that, among
other things,  limit the ability of the Company and/or certain  subsidiaries  to
incur additional indebtedness, issue disqualified stock or equity interests, pay
dividends or make other  distributions,  repurchase  equity interests or certain
indebtedness,  create  certain  liens,  enter  into  certain  transactions  with
affiliates,  enter into certain mergers or  consolidations or sell assets of the
Company  without prior  approval of the lenders or  noteholders.  The Company is
also a party to certain intercreditor  agreements.  The intercreditor agreements
set  forth  the  lender's  interests  and  claims  in the  Company's  assets  as
collateral for borrowings.

     Consolidated  EBITDA is dependent on the Company's  results of  operations,
which in turn are partially dependent on tables games revenues.  While the table
games win  percentage  is  reasonably  predictable  over the long  term,  it can
fluctuate significantly from quarter to quarter, affecting table games revenues.
The financial covenants  involving EBITDA are applied on a rolling  four-quarter
basis, and the Company's  compliance with financial covenants can be temporarily
affected if the Company  experiences a decline in hotel occupancy or room rates,
or an unusually low win percentage in a particular quarter,  which is not offset
in subsequent quarters or by other results of operations.

     The Company was challenged to meet these covenant tests in 2001 for certain
quarters  during the  rolling  measurement  period due to an  extremely  low win
percentage  and reduced  travel to Las Vegas  during the fourth  quarter of 2001
because of the September  11th  terrorist  attacks.  These  covenants  allow the
Principal  Stockholder to increase EBITDA for measurement  purposes by issuing a
standby letter of credit to the Company's lenders.  The covenants also allow the
New Mall Subsidiary and the Phase II Subsidiary, subject to certain limitations,
to make  distributions  to LVSI which would  increase  EBITDA for debt  covenant
measurement  purposes.  The Company  used the letter of credit  mechanism in the
amount of $10.0 million during the first quarter of 2001.  Pursuant to the terms
of the Company's indebtedness,  the letter of credit was subsequently reduced to
$6.9 million during the third quarter of 2001.

     Due to decreased  casino  revenues  attributable  to an unusually low table
games  win  percentage,  the  Company  also  would  not have  met its  financial
covenants in the second  quarter of 2001.  As a result,  on June 29,  2001,  the
Company entered into limited waivers, consents and amendments to the Bank Credit
Facility  and the FF&E Credit  Facility in order to,  among  other  things:  (1)
obtain a waiver with respect to each of its minimum fixed charge ratio covenant,
maximum  leverage  ratio  covenant  and  minimum  consolidated  adjusted  EBITDA
covenant  for the  quarter  ending  June 30,  2001;  and (2) amend  the  maximum
consolidated  capital  expenditures  covenant.  Additionally,  during the fourth
quarter of 2001, the Company entered into a limited waiver amendment to the Bank
Credit  Facility and FF&E Credit Facility to obtain a wavier with respect to the
minimum consolidated adjusted EBITDA requirement. These covenants also allow the
New Mall  Subsidiary and the Phase II Subsidiary to make  distributions  to LVSI
which would increase EBITDA for debt covenant measurement purposes.  The ability
of the New Mall Subsidiary and the Phase II Subsidiary to make  distributions is
subject to certain  limitations.  During  February 2002, the New Mall Subsidiary
paid a $7.0 million distribution to Venetian.

     For the next  twelve  months,  the Company  expects to fund  Casino  Resort
operations,  capital expenditures and debt service  requirements  (excluding the
Tranche A Take-out  Loan) from  existing  cash  balances,  operating  cash flow,
borrowings  under its revolving  credit line (the "Revolver") to the extent that
funds are available,  distributions  of excess cash from the New Mall Subsidiary
to the  extent  permitted  under  the  Tranche  A  Take-out  Loan,  and loans or
distributions  of excess cash from the Phase II Subsidiary as a result of rental
payments under the Phase II Lease and  borrowings  under the Phase II Subsidiary
Credit Facility.

     The Company  expects to be challenged to meet certain of its covenant tests
in the first  quarter of 2002 due to the  carry-over  effects that the extremely
low win  percentage  for  certain of its fiscal 2001  quarters  will have on the
rolling  measurement  period. The Company has certain options available to it in
the  event  that it  needs  to  seek a cure in  order  to meet  such  covenants,
including the ability to draw down on the Phase II Subsidiary  Credit  Facility,
make distributions of excess cash from the Mall under the terms of the Tranche A
Take-out Loan or the  negotiation  with its lenders of further  waivers for debt
covenant  violations in 2002. The Company  anticipates  that  ultimately its win
percentage  will return to normal levels and that it will no longer need to rely
on the various cures and waivers described above.

     The Company is also currently in active discussions to consider refinancing
all or a  portion  of its  outstanding  indebtedness,  including  the  Tranche A
Take-out  Loan.  This review is taking into  account the cost to  refinance  all
outstanding indebtedness,  current interest rates, collateral arrangements,  and
the ability to raise  additional  funds to fund on-going and upcoming  projects.
The Company has not yet entered into any definitive agreements for a refinancing
and no  assurance  can  be  given  that  refinancing  for  some  or all of  such
outstanding  indebtedness will be available,  or that such a refinancing will be
on terms that will be favorable to the Company.


                                       50
<PAGE>

     Fair Value

<TABLE>
<CAPTION>


     Estimated  fair  values  of  the  Company's  debt  and  related   financial
instruments are as follows (in thousands) :

                                                                               December 31,
                                                        ---------------------------------------------------------------

                                                                   2001                               2000
                                                        ----------------------------       ----------------------------

                                                           Carrying           Fair            Carrying           Fair
                                                            Amount            Value            Amount            Value
                                                         ----------        ----------       ----------        ----------
  <S>                                                   <C>               <C>              <C>               <C>
  12 1/4% Mortgage Notes                                $  425,000        $  439,875       $  425,000        $  422,875
  14 1/4% Senior Subordinated Notes                         94,113            95,995           93,237            93,600
  Mall Tranche A Take-out Loan                             105,000           105,000          105,000           105,000
  Mall Tranche B Take-out Loan                              35,000            35,000           35,000            35,000
  Completion Guaranty Loan                                  31,123            31,123           27,071            27,071
  Bank Credit Facility-Tranche A Term Loan                      --               --           103,125           103,125
  Bank Credit Facility-Tranche B Term Loan                      --               --            49,750            49,750
  Bank Credit Facility-Term Loan                           151,986           151,986               --               --
  Bank Credit Facility-Revolver                             40,000            40,000               --               --
  Phase II Subsidiary Credit Facility                        3,933             3,933               --               --
  Phase II Subsidiary Bank Loan                              1,092             1,092               --               --
  FF&E Credit Facility                                      53,735            53,735           75,229            75,229
  Cap and Floor Agreement                                    1,937             1,937               --              184
  Cap Agreement                                                  1                 1               --                4

</TABLE>

     The fair values of the Mortgage Notes and the Senior Subordinated Notes are
based on quoted market prices. The fair values of the Senior  Subordinated Notes
are based upon the $94.1  million  carrying  value  amounts.  The fair values of
other  indebtedness  and the FF&E Credit Facility  approximate  their respective
carrying  amounts  based on the variable  nature of these  facilities.  The fair
value of the Cap and Floor Agreement and the Cap Agreement are based upon quotes
from brokers.

Note 9 - Redeemable Preferred Interest in Venetian Casino Resort, LLC

     During  1997,  Interface  Holding  contributed  $77.1  million  in  cash to
Venetian in exchange for a Series A preferred  interest (the "Series A Preferred
Interest")  in  Venetian.  By its terms,  the Series A  Preferred  Interest  was
convertible  at any time into a Series B preferred  interest  in  Venetian  (the
"Series B Preferred Interest").  In August 1998, the Series A Preferred Interest
was converted into the Series B Preferred  Interest.  The rights of the Series B
Preferred  Interest  include the  accrual of a preferred  return of 12% from the
date of  contribution in respect of the Series A Preferred  Interest.  Until the
indebtedness  under the Bank  Credit  Facility is repaid and cash  payments  are
permitted under the restricted  payment covenants of the indentures entered into
in connection  with the Notes,  the  preferred  return on the Series B Preferred
Interest will accrue and will not be paid in cash.  Commencing in November 2009,
distributions  must be made to the extent of the positive capital account of the
holder.  During  the  second  and  third  quarters  of 1999,  Interface  Holding
contributed  $37.3 million and $7.1 million,  respectively,  in cash in exchange
for an additional Series B Preferred  Interest.  During the years ended December
31,  2001,  2000 and 1999,  $20.8  million,  $18.5  million  and $14.4  million,
respectively,  were  accrued on the Series B Preferred  Interest  related to the
contributions  made.  There  were no  distributions  of  preferred  interest  or
preferred return paid during 1999, 2000 or 2001.

Note 10 - Stockholder's Equity

Increase in Shares Authorized and Outstanding

     In November 1997, the Company's Board of Directors  increased the number of
authorized shares of LVSI from 100,000 to 3,000,000 and authorized and consented
to increase the number of shares  outstanding  with  respect to the  outstanding
shares of common  stock of LVSI,  so that each share of such common  stock would
henceforth be deemed to represent  18.4996 shares of common stock,  resulting in
925,000 shares of common stock  outstanding on such date. The par value remained
$.10 per share.  In the first  quarter of 2002,  the  Company  completed a stock
split whereby the number of common shares held by the Principal  Stockholder was
increased  to  1,000,000  from  925,000.  At the date of the  stock  split,  the
Principal  Stockholder  maintained 100% ownership of the Company's common stock.
All   references  to  share  and  per  share  data  herein  have  been  adjusted
retroactively to give effect to the increase in shares outstanding to 1,000,000.

                                       51
<PAGE>

1997 Fixed Stock Option Plan

     The Company  established a nonqualified  stock option plan,  which provides
for the granting of stock options  pursuant to the applicable  provisions of the
Internal  Revenue Code and  regulations.  The stock option plan provides for the
granting  of up to  75,000  shares  of common  stock to  officers  and other key
employees  of the Company.  As of December  31, 2001,  no grants under the stock
option  plan had  occurred.  In the first  quarter of 2002,  options to purchase
49,900 shares, which represented  approximately 5% of the Company's  outstanding
common  stock,  were  granted  from the  Principal  Stockholder  to certain  key
employees  of the  Company.  On the date of  grant,  the  exercise  price of the
options of $271 per share was higher than the fair market value of the Company's
common stock based upon a preliminary  determination of the fair market value of
a per share  minority  interest  in the common  stock of LVSI,  performed  by an
independent  third-party  appraiser.  The options  granted were fully vested and
exercisable  upon grant.  All of the options were  exercised  immediately  after
issuance by the  respective  employees by delivery of a notice of exercise.  The
notice contemplates that the exercise price of the options will be loaned to the
optionees by the  Principal  Stockholder  on a secured basis under full recourse
notes. The applicable shares of common stock have not yet been delivered.

Note 11 - Employee Savings Plan

     Participation  in the Venetian Casino Resort,  LLC 401 (k) employee savings
plan is  available  for  all  full  time  employees.  The  savings  plan  allows
participants  to  defer,  on a pre-tax  basis,  a portion  of their  salary  and
accumulate  tax-deferred earnings as a retirement fund. Venetian matches 150% of
the first $390 of employee  contributions  and 50% of employee  contributions in
excess of $390 up to a maximum of 3% of participating  employee's eligible gross
wages.  For the year  ended  December  31,  2001,  2000 and 1999,  contributions
accrued under the savings plan were $2.0 million, $1.8 million and $0.8 million,
respectively.

Note 12 - Related Party Transactions

     As support for the  development  and  operation of the Casino  Resort,  the
Principal Stockholder or his affiliates currently provide the following:

(i)  a  construction  completion  guaranty  unlimited  in amount with respect to
     excess construction costs due to scope changes,  with a remaining liability
     of approximately $5.0 million (collateralized by cash and cash equivalents)
     with  respect  to all other  construction  costs.  On  November  12,  1999,
     approximately  $23.5  million of the  completion  guaranty  collateral  was
     utilized for excess  construction  costs,  leaving the $5.0 million of cash
     collateral remaining as described above;

(ii) the $35.0 million Tranche B Take-out Loan; and

(iii)a $20.0 million unsecured guaranty of the $105.0 million Tranche A Take-out
     Loan.

     The Principal  Stockholder is a partner in four entities  formed to operate
restaurants in the Casino Resort. The terms and conditions of the leases granted
by the Company for such  restaurants  are at amounts which  management  believes
would be no less favorable than those negotiated with independent third parties.
Valentino Las Vegas LLC and Night Market,  LLC paid Venetian $1.0 million,  $0.7
million and zero,  and Postrio Las Vegas LLC and  Carnevale  Coffee Bar LLC paid
the Mall  Subsidiary  $1.1  million,  $0.8  million and zero for the years ended
December 31, 2001, 2000 and 1999, respectively.

     During 2001, the Principal Stockholder  guaranteed a $2.9 million bank loan
made to  architects of the Phase II Subsidiary to secure a trade payable owed to
the architects by the Phase II Subsidiary.

     During November 1999, the Principal Stockholder purchased idle construction
equipment from the Company  (tower  cranes) for $2.0 million,  the cost basis of
the equipment which was its fair value.

     During the fourth  quarter of 1999,  the  Principal  Stockholder  purchased
certain  construction  claims from various contractors and subcontractors for an
aggregate price equal to the aggregate amount of the claims  (approximately $1.6
million).  On November  12,  1999,  with the  approval  of all of the  Company's
lenders,  the Company paid the Principal  Stockholder  the  aggregate  amount of
these claims.

     In 2001,  LVSI  received  from,  and  rendered  to, IGN and its  affiliates
certain administrative and other services such as travel. Any such services were
provided at amounts which  management  believes  would be no less favorable than
those  negotiated  with  independent  third  parties.  The Company  paid certain
affiliates $1.1 million, $2.1 million and $0.9 million for these services during
2001, 2000 and 1999, respectively.

     IGN provides audio visual services to group customers of the Casino Resort.
These  services are provided  pursuant to a contract  that provides for an equal
sharing of revenues after direct operating  expenses.  The Company received $2.5
million,  $3.7 million and $1.3 million  pursuant to this contract  during 2001,
2000 and 1999, respectively.

                                       52
<PAGE>

     The Company,  the New Mall Subsidiary and IGN are parties to an Amended and
Restated  Reciprocal  Easement,  Use and Operating  Agreement (the  "Cooperation
Agreement") which, among other things,  provides for the integrated operation of
all the facilities and addresses, encroachments, joint marketing and the sharing
of certain facilities and costs related thereto.

     In conjunction with the Phase II Subsidiary  Credit Facility on October 19,
2001,  the Phase II  Subsidiary  leased the Phase II Land to  Venetian  for five
years at an annual  rent of $8.0  million.  Prior to  October  2001,  IGN leased
parking  spaces on the Phase II Land  from the Phase II  Subsidiary  for rent of
$5,000 per month.

Note 13 - Commitments and Contingencies

Energy Services Agreements and Operating Lease Agreements

     During 1997,  Venetian and the Mall Subsidiary entered into separate energy
service  agreements with a heating and air conditioning  ("HVAC")  provider (the
"HVAC  Provider").  Under the terms of the energy  services  agreement and other
separate energy services agreements,  HVAC energy and services will be purchased
by  Venetian,  the New Mall  Subsidiary,  its mall  tenants and IGN over initial
terms expiring in 2009 with an option to collectively  extend the terms of their
agreements for two consecutive five-year periods.

     Pursuant to the Company's  construction  management contract (as more fully
defined  under  "Litigation"  below),  the HVAC  plant  was  constructed  by the
Construction  Manager  on land  owned  by the  Company  and  leased  to the HVAC
Provider. The HVAC equipment is owned by the HVAC Provider, which paid all costs
("HVAC  Costs") in  connection  with the purchase and  installation  of the HVAC
equipment. The total HVAC Costs were $70.0 million.

     The charges payable under the separate energy services agreements include a
fixed  component   applied  to  the  HVAC  Costs  paid  by  the  HVAC  Provider,
reimbursement of operational and related costs and a management fee.

     As of  December  31,  2001,  Venetian  and the  New  Mall  Subsidiary  were
obligated under the energy services  agreements to make future minimum  payments
as follows (in thousands):

<TABLE>
<CAPTION>

                               Years Ending December 31,
                               <S>                               <C>

                               2002                              $ 7,657
                               2003                                7,657
                               2004                                7,657
                               2005                                7,657
                               2006                                7,657
                               Thereafter                         19,142
                                                                 -------
                               Total minimum payments            $57,427
                                                                 =======

</TABLE>

     Expenses  incurred under the energy services  agreements were $6.2 million,
$7.0 million  ($7.657 million less leasee  reimbursements)  and $4.3 million for
the years ended  December 31, 2001,  2000 and 1999,  respectively.  The New Mall
Subsidiary is responsible  for 19% of energy  services rental payments and these
amounts exclude payments by IGN. Expenses  incurred under  short-term,  variable
rate  operating  lease  agreements  totaled $1.9 million,  $1.7 million and $1.2
million for the years ended December 31, 2001, 2000 and 1999, respectively.

Litigation

     The  Company  is party to  litigation  matters  and  claims  related to its
operations  and  construction  of the Casino  Resort  that could have a material
adverse effect on the financial position, results of operations or cash flows of
the  Company to the  extent  such  litigation  is not  covered by the  Insurance
Policy.

     The  construction  of the  principal  components  of the Casino  Resort was
undertaken by the  Construction  Manager  pursuant to a construction  management
agreement  and certain  amendments  thereto (as so  amended,  the  "Construction
Management Contract").  The Construction Management Contract established a final
guaranteed  maximum price (the "Final GMP") of $645.0 million,  so that, subject
to certain  exceptions  (including  an exception for cost overruns due to "scope








                                    53
<PAGE>

changes"),  the  Construction  Manager was responsible for any costs of the work
covered by the Construction  Management Contract in excess of the Final GMP. The
obligations  of the  Construction  Manager  under  the  Construction  Management
Contract are guaranteed by Bovis,  Inc.  ("Bovis" and such guaranty,  the "Bovis
Guaranty"),   the   Construction   Manager's  direct  parent  at  the  time  the
Construction  Management Contract was entered into. Bovis' obligations under the
Bovis Guaranty are  guaranteed by The  Peninsular and Oriental Steam  Navigation
Company  ("P&O"),  a  British  public  company  and the  Construction  Manager's
ultimate  parent at the time the  Construction  Management  Contract was entered
into (such guaranty, the "P&O Guaranty").

     On July 30,  1999,  Venetian  filed a complaint  against  the  Construction
Manager and Bovis in United  States  District  Court for the District of Nevada.
The  action  alleges  breach of  contract  by the  Construction  Manager  of its
obligations under the Construction  Management Contract and a breach of contract
by Bovis of its obligations under the Bovis Guaranty, including failure to fully
pay trade  contractors  and  vendors  and  failure  to meet the  April 21,  1999
guaranteed  completion  date. The Company amended this complaint on November 23,
1999 to add P&O as an  additional  defendant.  The suit is  intended  to ask the
courts,  among  other  remedies,  to require  the  Construction  Manager and its
guarantors to pay its contractors,  to compensate  Venetian for the Construction
Manager's  failure  to  perform  its duties  under the  Construction  Management
Contract and to pay the Company the agreed upon  liquidated  damages penalty for
failure to meet the guaranteed substantial completion date. Venetian seeks total
damages in excess of $100.0 million. The Construction Manager subsequently filed
motions to dismiss the Company's complaint on various grounds, which the Company
opposed.  The Construction  Manager's principal motions to date have either been
denied by the court or voluntarily withdrawn.

     In  response  to  Venetian's   breach  of  contract   claims   against  the
Construction Manager,  Bovis and P&O, the Construction Manager filed a complaint
on  August 3, 1999  against  Venetian  in the  District  Court of Clark  County,
Nevada.  The action alleges a breach of contract and quantum meruit claims under
the Construction  Management  Contract and also alleges that Venetian  defrauded
the  Construction  Manager in  connection  with the  construction  of the Casino
Resort.  The Construction  Manager seeks damages,  attorney's fees and costs and
punitive  damages.  In the lawsuit,  the Construction  Manager claims that it is
owed  approximately  $90.0  million  from  Venetian  and  its  affiliates.  This
complaint was subsequently amended by the Construction Manager, which also filed
an  additional  complaint  against the  Company  relating to work done and funds
advanced with respect to the  contemplated  development  of the Phase II Resort.
Based  upon  its  preliminary  review  of the  complaints,  the  fact  that  the
Construction Manager has not provided Venetian with reasonable  documentation to
support such claims, and the Company's belief that the Construction  Manager has
materially  breached its agreements with the Company,  the Company believes that
the  Construction  Manager's  claims are without merit and intends to vigorously
defend  itself and pursue its claims  against  the  Construction  Manager in any
litigation.

     In connection with these disputes, as of December 31, 1999 the Construction
Manager and its  subcontractors  filed mechanics liens against the Casino Resort
for $145.6 million and $182.2 million, respectively. The Company believes that a
major reason  these lien amounts  exceed the  Construction  Manager's  claims of
$90.0  million is based upon a  duplication  of liens  through the  inclusion of
lower-tier  claims by  subcontractors  in the liens of higher-tier  contractors,
including the lien of the  Construction  Manager.  As of December 31, 1999,  the
Company had purchased  surety bonds for  virtually all of the claims  underlying
these liens (other than  approximately  $15.0  million of claims with respect to
which the Construction  Manager purchased  bonds). As a result,  there can be no
foreclosure  of  the  Casino  Resort  in  connection  with  the  claims  of  the
Construction  Manager  and its  subcontractors.  However,  the  Company  will be
required  to pay or  immediately  reimburse  the  bonding  company if and to the
extent that the underlying claims are judicially determined to be valid. If such
claims are not settled,  it is likely to take a  significant  amount of time for
their validity to be judicially determined.

     The Company  believes  that these claims are, in general,  unsubstantiated,
without merit,  overstated and/or duplicative.  The Construction  Manager itself
has publicly acknowledged that at least some of the claims of its subcontractors
are without  merit.  In  addition,  the Company  believes  that  pursuant to the
Construction  Management Contract and the Final GMP, the Construction Manager is
responsible  for  payment of any  subcontractors'  claims to the extent they are
determined to be valid. The Company may also have a variety of other defenses to
the liens  that have  been  filed,  including,  for  example,  the fact that the
Construction Manager and its subcontractors  previously waived or released their
rights  to file  liens  against  the  Casino  Resort.  The  Company  intends  to
vigorously defend itself in any lien proceedings.











                                       54
<PAGE>

     On August 9, 1999, the Company notified the insurance  companies  providing
coverage under its liquidated damages insurance policy (the "LD Policy") that it
has a claim under the LD Policy.  The LD Policy provides  insurance coverage for
the failure of the Construction Manager to achieve substantial completion of the
portions of the Casino Resort covered by the  Construction  Management  Contract
within 30 days of the April 21, 1999 deadline,  with a maximum  liability  under
the LD Policy of  approximately  $24.1 million and with coverage being provided,
on a  per-day  basis,  for  days  31-120  of the  delay  in the  achievement  of
substantial completion. Because the Company believes that substantial completion
was not  achieved  until  November 12, 1999,  the  Company's  claim under the LD
Policy  is  likely  to be for the  above-described  maximum  liability  of $24.1
million.  The Company  expects the LD Policy insurers to assert many of the same
claims and defenses that the Construction Manager has asserted or will assert in
the above-described litigations. Liability under the LD Policy may ultimately be
determined by binding arbitration.

     In June 2000,  the Company  purchased an insurance  policy (the  "Insurance
Policy") for loss coverage in  connection  with all  litigation  relating to the
construction  of the Casino Resort (the  "Construction  Litigation").  Under the
Insurance  Policy,  the Company will self-insure the first $45.0 million and the
insurer will insure up to the next $80.0 million of any possible covered losses.
The  Insurance  Policy  provides  coverage  for any  amounts  determined  in the
Construction   Litigation  to  be  owed  to  the  Construction  Manager  or  its
subcontractors relating to claimed delays, inefficiencies,  disruptions, lack of
productivity/unauthorized  overtime or schedule impact,  allegedly caused by the
Company during  construction of the Casino Resort, as well as any defense costs.
The  insurance  is in  addition  to,  and  does not  affect,  any  scope  change
guarantees  provided by the  Principal  Stockholder  pursuant to the  Completion
Guaranty.

     All of the pending litigation  described above is in preliminary stages and
it is not yet possible to determine a range of loss or its ultimate outcome.  If
any  litigation  or  other  lien  proceedings   concerning  the  claims  of  the
Construction  Manager  or  its  subcontractors  were  decided  adversely  to the
Company, such litigation or other lien proceedings could have a material adverse
effect on the  financial  position,  results of  operations or cash flows of the
Company to the extent such litigation or lien proceedings are not covered by the
Insurance Policy.

Note 14 - Minimum Lease Income

      The Company has entered into a number of operating leases in relation to
the New Mall Subsidiary and various retail and food and beverage outlets in the
Casino Resort, which range in length from 5 to 20 years. The future minimum
lease income under these leases (of which approximately 90% is attributable to
the New Mall Subsidiary) consisted of the following at December 31, 2001 (in
thousands):

<TABLE>
<CAPTION>

                               <S>                               <C>
                               2002                              $  19,342
                               2003                                 19,117
                               2004                                 18,382
                               2005                                 16,467
                               2006                                 15,964
                               Thereafter                           62,542
                                                                 ---------
                               Total                             $ 151,814
                                                                 =========
</TABLE>

     Most of the leases include  provisions for  reimbursements of other charges
including  real  estate  taxes,  utilities  and  other  operating  costs.  Total
reimbursements  amounted to $11.4 million,  $9.9 million and $3.6 in 2001,  2000
and 1999, respectively.

     The New Mall  Subsidiary  has entered  into an  agreement  with Forest City
Enterprises   (the  "Mall   Manager"),   a  subsidiary  of  Forest  City  Ratner
Enterprises,  a leading  developer  and  manager of retail and  commercial  real
estate  developments,  whereby the Mall Manager  manages the Mall and supervises
and assists in the  creation of an  advertising  and  promotional  program and a
marketing  plan for the Mall.  The Mall Manager is also  responsible  for, among
other things,  preparation  of a detailed plan for the routine  operation of the
Mall,  collection  and deposit  procedures  for rents and other tenant  charges,
supervision of maintenance and repairs and, on an annual basis, preparation of a
detailed budget  (including any anticipated  extraordinary  expenses and capital
expenditures)  for the Mall. The term of the  management  contract is five years
from June 19,  1999,  the date the Mall opened to the public.  The Mall  Manager
receives a management  fee of 2% of all gross rents  received from the operation
of the Mall;  provided  that the Mall  Manager  will  receive  a minimum  fee of
$450,000  per year.  For the  years  ended  December  31,  2001,  2000 and 1999,
management  fees paid to the Mall Manager were $450,000,  $450,000 and $240,000,
respectively.  Beginning in June 2002, the minimum  management fee will increase
to $600,000 per year.

                                       55
<PAGE>

Note 15 - Summarized Financial Information

     Venetian  and  LVSI  are   co-obligors  of  the  Notes  and  certain  other
indebtedness  related to  construction  of the Casino Resort and are jointly and
severally liable for such  indebtedness  (including the Notes).  Venetian,  Mall
Intermediate,  Mall  Construction  and  Lido  Intermediate  (collectively,   the
"Subsidiary  Guarantors") are wholly-owned  subsidiaries of LVSI. The Subsidiary
Guarantors  have jointly and severally  guaranteed (or are  co-obligors of) such
debt on a full  and  unconditional  basis.  No  other  subsidiary  of LVSI is an
obligor or guarantor of any of the Casino Resort financing.

     Because the New Mall  Subsidiary is not a guarantor of any  indebtedness of
the Company (other than the Mall Take-out Financing), creditors of the Company's
entities  comprising the Company other than the New Mall  Subsidiary  (including
the holders of the Notes but excluding  creditors of the New Mall Subsidiary) do
not have a direct claim against the Mall Assets.  As a result,  indebtedness  of
the  entities  comprising  the  Company  other  than  the  New  Mall  Subsidiary
(including  the  Notes)  is,  with  respect  to  the  Mall  Assets,  effectively
subordinated to indebtedness of the New Mall Subsidiary. The New Mall Subsidiary
is not  restricted  by any of the  debt  instruments  of LVSI,  Venetian  or the
Company's other subsidiary  guarantors (including the Indentures) from incurring
any indebtedness. The terms of the Tranche A Take-out Loan prohibit the New Mall
Subsidiary  from paying  dividends or making  distributions  to any of the other
entities  comprising  the Company  unless  payments under the Tranche A Take-out
Loan are current,  and, with certain limited  exceptions,  prohibit the New Mall
Subsidiary from making any loans to such entities.  Any additional  indebtedness
incurred by the New Mall Subsidiary may include  additional  restrictions on the
ability of the New Mall  Subsidiary to pay any such  dividends and make any such
distributions or loans.

     Prior to October 1998,  Venetian owned approximately 44 acres of land on or
near the Las Vegas Strip (the  "Strip"),  on the site of the former Sands.  Such
property  includes  the  site  on  which  the  Casino  Resort  was  constructed.
Approximately  14 acres of such land was  transferred to the Phase II Subsidiary
in October  1998.  On December 31, 1999,  an  additional  1.75 acres of land was
contributed  indirectly by the Principal Stockholder to the Phase II Subsidiary.
The Phase II Resort is planned to be constructed  adjacent to the Casino Resort.
Because  the  Phase II  Subsidiary  will  not be a  guarantor  of the  Company's
indebtedness, creditors of the Company (including the holders of the Notes) will
not have a direct  claim  against  the assets of the Phase II  Subsidiary.  As a
result, the indebtedness of the Company (including the Notes) will, with respect
to these assets,  be effectively  subordinated  to  indebtedness of the Phase II
Subsidiary.  The Phase II  Subsidiary  is not subject to any of the  restrictive
covenants of the debt  instruments  of the Company  (including  the Notes).  Any
indebtedness  incurred  by the Phase II  Subsidiary  in addition to the Phase II
Subsidiary  Credit Facility may include material  restrictions on the ability of
the Phase II Subsidiary to pay dividends or make  distributions  or loans to the
Company and its subsidiaries.

     Separate  financial  statements and other  disclosures  concerning  each of
Venetian  and  the  Subsidiary   Guarantors  are  not  presented  below  because
management  believes  that  they  are  not  material  to  investors.  Summarized
financial  information  of LVSI,  Venetian,  the  Subsidiary  Guarantors and the
non-guarantor  subsidiaries on a combined basis as of December 31, 2001 and 2000
and the three  years for the period  ended  December  31, 2001 is as follows (in
thousands):































                                       56
<PAGE>

<TABLE>
<CAPTION>

                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                                      CONDENSED BALANCE SHEETS
                                                          December 31, 2001



                                                                                                        GUARANTOR SUBSIDIARIES
                                                                                                        ----------------------

                                                                                                    Lido             Mall
                                                                                   Venetian         Intermediate     Intermediate
                                                                  Las Vegas        Casino Resort    Holding          Holding
                                                                  Sands, Inc.      LLC              Company LLC      Company LLC
                                                                  --------------   ---------------  --------------   --------------
<S>                                                               <C>              <C>              <C>              <C>
Cash and cash equivalents ..................................      $       37,367   $        7,806   $            4   $            4
Restricted cash and investments ............................                --              1,528             --               --
Intercompany receivable ....................................              60,882             --               --               --
Accounts receivable, net ...................................              37,416           18,240             --               --
Inventories ................................................                --              4,747             --               --
Prepaid expenses ...........................................                 546            2,953             --               --
                                                                  --------------   ---------------  --------------   --------------
  Total current assets .....................................             136,211           35,274                4                4

Property and equipment, net ................................                --            878,239             --               --
Investment in Subsidiaries .................................             843,935             --               --               --
Deferred offering costs, net ...............................                --             16,250             --               --
Other assets, net ..........................................               3,771           25,691             --               --
                                                                  --------------   ---------------  --------------   --------------
                                                                  $      983,917   $      955,454   $            4   $            4
                                                                  ==============   ==============   ==============   ==============
Accounts payable ...........................................      $        2,880   $       33,105   $         --     $         --
Construction payable .......................................                --             22,955             --               --
Construction payable-contested .............................                --              7,232             --               --
Intercompany payables ......................................                --             39,455             --               --
Accrued interest payable ...................................                --              9,125             --               --
Other accrued liabilities ..................................              21,249           47,074             --               --
Current maturities of long-term debt (3)....................              23,021           23,021             --               --
                                                                  --------------   ---------------  --------------   --------------
  Total current liabilities ................................              47,150          181,967             --               --

Other long-term liabilities ................................                --              3,274             --               --
Long-term debt (3)..........................................             741,813          741,813             --               --
Long-term subordinated loans payable to Principal Stockholder               --             31,123             --               --
                                                                  --------------   ---------------  --------------   --------------
                                                                         788,963          958,177             --               --
                                                                  --------------   ---------------  --------------   --------------
Redeemable Preferred interest in Venetian ..................                --            188,778             --               --
                                                                  --------------   ---------------  --------------   --------------
Stockholder's equity (Deficit)..............................             194,954         (191,501)               4                4
                                                                  --------------   ---------------  --------------   --------------
                                                                  $      983,917   $      955,454   $            4   $            4
                                                                  ==============   ==============   ==============   ==============

</TABLE>
























                                       57
<PAGE>

<TABLE>
<CAPTION>

                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                                CONDENSED BALANCE SHEETS (continued)
                                                          December 31, 2001




                                                                    NON-GUARANTOR SUBSIDIARIES
                                                                    --------------------------
                                                                  Grand Canal
                                                                  Shops Mall       Other Non-       Consolidating/
                                                                  Subsidiary       Guarantor        Eliminating
                                                                  LLC (1)          Subsidiaries (2) Entries          Total
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Cash and cash equivalents ...................................     $        6,650   $        3,105   $         --     $       54,936
Restricted cash and investments .............................              1,118             --               --              2,646
Intercompany receivable .....................................               --              1,508          (62,390)            --
Accounts receivable, net ....................................              1,436             --               --             57,092
Inventories .................................................               --               --               --              4,747
Prepaid expenses ............................................                363             --               --              3,862
                                                                  --------------   --------------   ---------------  --------------
  Total current assets ......................................              9,567            4,613          (62,390)         123,283

Property and equipment, net .................................            136,167           81,901             --          1,096,307
Investment in Subsidiaries ..................................               --               --           (843,935)            --
Deferred offering costs, net ................................              1,903              836             --             18,989
Other assets, net ...........................................              3,745             --               --             33,207
                                                                  --------------   --------------   ---------------  --------------
                                                                  $      151,382   $       87,350   $     (906,325)     $ 1,271,786
                                                                  ==============   ==============   ===============  ===============
Accounts payable ............................................     $          368   $         --     $         --     $       36,353
Construction payable ........................................               --              3,160             --             26,115
Construction payable-contested ..............................               --               --               --              7,232
Intercompany payables .......................................             22,935             --            (62,390)            --
Accrued interest payable ....................................                872               11             --             10,008
Other accrued liabilities ...................................              1,647               65             --             70,035
Current maturities of long-term debt (3).....................            105,000            1,092          (23,021)         129,113
                                                                  --------------   --------------   ---------------  --------------
  Total current liabilities .................................            130,822            4,328          (85,411)         278,856

Other long-term liabilities .................................               --               --               --              3,274
Long-term debt (3)...........................................               --              3,933          (741,813)        745,746
Long-term subordinated loans payable to Principal Stockholder             35,000             --               --             66,123
                                                                  --------------   --------------   ---------------  --------------
                                                                         165,822            8,261         (827,224)       1,093,999
                                                                  --------------   --------------   ---------------  --------------
Redeemable Preferred interest in Venetian ...................               --               --               --            188,778
                                                                  --------------   --------------   ---------------  --------------
Stockholder's equity (Deficit)...............................            (14,440)          79,089          (79,101)         (10,991)
                                                                  --------------   --------------   ---------------  --------------
                                                                  $      151,382   $       87,350   $     (906,325)  $    1,271,786
                                                                  ==============   ==============   ===============  ===============

<FN>
----------------
(1)  The assets and  liabilities of Mall  Construction,  a guarantor,  were  transferred  to the Mall  Subsidiary,  a  non-guarantor
     subsidiary, upon substantial completion of the Casino Resort on November 12, 1999, and subsequently transferred to the New Mall
     Subsidiary on December 20, 1999. As a result, Mall Construction had no assets or liabilities as of December 31, 2001.
(2)  Land with a historical  cost basis of $29.2 million was transferred  from Venetian,  a co-obligor of the Notes, to the Phase II
     Subsidiary,  a non-guarantor  subsidiary,  in October 1998 and land with a value of $11.8 million was indirectly contributed by
     the Principal Stockholder during December 1999.
(3)  As more fully  described in Note 8, Las Vegas Sands,  Inc. and Venetian  Casino  Resort LLC are  co-obligors  of certain of the
     Company's  indebtedness.  Accordingly,  such  indebtedness  has been  presented as an  obligation of both entities in the above
     balance sheets.
</FN>

</TABLE>















                                       58
<PAGE>

<TABLE>
<CAPTION>

                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                                      CONDENSED BALANCE SHEETS
                                                          December 31, 2000


                                                                                                       GUARANTOR SUBSIDIARIES
                                                                                                         ----------------------
                                                                                                    Lido             Mall
                                                                                   Venetian         Intermediate     Intermediate
                                                                  Las Vegas        Casino Resort    Holding          Holding
                                                                  Sands, Inc.      LLC              Company LLC      Company LLC
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Cash and cash equivalents ...................................     $       35,332   $        4,260   $            4   $            4
Restricted cash and investments .............................               --              1,471             --               --
Intercompany receivable .....................................             43,152             --               --               --
Accounts receivable, net ....................................             45,609           17,686             --               --
Inventories .................................................               --              3,868             --               --
Prepaid expenses ............................................                458            2,897             --               --
                                                                  --------------   --------------   ---------------  --------------
  Total current assets ......................................            124,551           30,182                4                4

Property and equipment, net .................................               --            840,960             --               --
Investment in Subsidiaries ..................................            824,427             --               --               --
Deferred offering costs, net.................................               --             18,335             --               --
Other assets, net............................................              4,928           22,120             --               --
                                                                  --------------   --------------   ---------------  --------------
                                                                  $      953,906   $      911,597   $            4   $            4
                                                                  ==============   ==============   ===============  ===============

Accounts payable ............................................     $        4,794   $       18,036   $         --     $         --
Construction payable ........................................               --              3,297             --               --
Construction payable-contested ..............................               --              7,232             --               --
Intercompany payables .......................................               --             20,626             --               --
Accrued interest payable ....................................               --             11,498             --               --
Other accrued liabilities ...................................             27,939           47,380             --               --
Current maturities of long-term debt (3).....................             50,119           50,119             --               --
                                                                  --------------   --------------   ---------------  --------------
  Total current liabilities .................................             82,852          158,188             --               --

Other long-term liabilities .................................               --             10,494             --               --
Long-term debt (3)...........................................            696,222          696,222             --               --
Long-term subordinated loans payable to Principal Stockholder               --             27,071             --               --
                                                                  --------------   --------------   ---------------  --------------
                                                                         779,074          891,975             --               --
                                                                  --------------   --------------   ---------------  --------------
Redeemable Preferred interest in Venetian ...................               --            168,012             --               --
                                                                  --------------   --------------   ---------------  --------------
Stockholder's equity (Deficit)...............................            174,832         (148,390)               4                4
                                                                  --------------   --------------   ---------------  --------------
                                                                  $      953,906   $      911,597   $            4   $            4
                                                                  ==============   ==============   ===============  ===============

</TABLE>



























                                       59
<PAGE>

<TABLE>
<CAPTION>


                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                                CONDENSED BALANCE SHEETS (continued)
                                                          December 31, 2000



                                                                      NON-GUARANTOR SUBSIDIARIES
                                                                      --------------------------
                                                                  Grand Canal
                                                                  Shops Mall       Other Non-       Consolidating/
                                                                  Subsidiary       Guarantor        Eliminating
                                                                  LLC (1)          Subsidiaries (2) Entries          Total
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Cash and cash equivalents ...................................     $        2,972   $           34   $         --     $       42,606
Restricted cash and investments .............................              1,078             --               --              2,549
Intercompany receivable .....................................               --               --            (43,152)            --
Accounts receivable, net ....................................                973               60             --             64,328
Inventories .................................................               --               --               --              3,868
Prepaid expenses ............................................                317             --               --              3,672
                                                                  --------------   --------------   ---------------  --------------
  Total current assets ......................................              5,340               94          (43,152)         117,023

Property and equipment, net .................................            140,185           80,948             --          1,062,093
Investment in Subsidiaries ..................................               --               --           (824,427)            --
Deferred offering costs, net.................................              3,979             --               --             22,314
Other assets, net............................................              3,907             --               --             30,955
                                                                  --------------   --------------   ---------------  --------------
                                                                  $      153,411   $       81,042   $     (867,579)     $ 1,232,385
                                                                  ==============   ==============   ===============  ===============
Accounts payable ............................................     $        1,005   $         --     $         --     $       23,835
Construction payable ........................................               --              2,915             --              6,212
Construction payable-contested ..............................               --               --               --              7,232
Intercompany payables .......................................             22,526             --            (43,152)            --
Accrued interest payable ....................................              1,779             --               --             13,277
Other accrued liabilities ...................................              1,363               53             --             76,735
Current maturities of long-term debt (3).....................               --               --            (50,119)          50,119
                                                                  --------------   --------------   ---------------  --------------
  Total current liabilities .................................             26,673            2,968          (93,271)         177,410
                                                                  --------------   --------------   ---------------  --------------
Other long-term liabilities .................................               --               --               --             10,494
Long-term debt (3)...........................................            105,000             --           (696,222)         801,222
Long-term subordinated loans payable to Principal Stockholder             35,000             --               --             62,071
                                                                  --------------   --------------   ---------------  --------------
                                                                         166,673            2,968         (789,493)       1,051,197
                                                                  --------------   --------------   ---------------  --------------
Redeemable Preferred interest in Venetian ...................               --               --               --            168,012
                                                                  --------------   --------------   ---------------  --------------
Stockholder's equity (Deficit)...............................            (13,262)          78,074          (78,086)          13,176
                                                                  --------------   --------------   ---------------  --------------
                                                                  $      153,411   $       81,042   $     (867,579)  $    1,232,385
                                                                  ==============   ==============   ===============  ===============
<FN>
----------------
(1)  The assets and  liabilities of Mall  Construction,  a guarantor,  were  transferred  to the Mall  Subsidiary,  a  non-guarantor
     subsidiary, upon substantial completion of the Casino Resort on November 12, 1999, and subsequently transferred to the New Mall
     Subsidiary on December 20, 1999. As a result, Mall Construction had no assets or liabilities as of December 31, 2000.
(2)  Land with a historical cost basis of $29.2 million was transferred from Venetian Casino Resort,  LLC, a co-obligor of the Notes
     to Lido Casino Resort, LLC., a non-guarantor  subsidiary, in October 1998 and land with a value of $11.8 million was indirectly
     contributed by the Principal Stockholder during December 1999.
(3)  As more fully  described in Note 8, Las Vegas Sands,  Inc. and Venetian  Casino  Resort LLC are  co-obligors  of certain of the
     Company's  indebtedness.  Accordingly,  such  indebtedness  has been  presented as an  obligation of both entities in the above
     balance sheets.
</FN>

</TABLE>
















                                       60
<PAGE>

<TABLE>
<CAPTION>

                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                                  CONDENSED STATEMENT OF OPERATIONS
                                                For the year ended December 31, 2001



                                                                                                        GUARANTOR SUBSIDIARIES
                                                                                                        ----------------------
                                                                                                    Lido             Mall
                                                                                   Venetian         Intermediate     Intermediate
                                                                  Las Vegas        Casino Resort    Holding          Holding
                                                                  Sands, Inc.      LLC              Company LLC      Company LLC
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Revenues:
  Casino ....................................................     $      227,240   $         --     $         --     $         --
  Room ......................................................               --            204,242             --               --
  Food and beverage .........................................               --             61,977             --               --
  Retail and other ..........................................              1,417           84,098             --               --
                                                                  --------------   --------------   ---------------  --------------
  Total revenue .............................................            228,657          350,317             --               --
Less promotional allowance ..................................               --            (42,594)                             --
                                                                  --------------   --------------   ---------------  --------------
  Net revenues ..............................................            228,657          307,723             --               --
                                                                  --------------   --------------   ---------------  --------------
Operating expenses:
  Casino ....................................................            185,909             --               --               --
  Rooms .....................................................               --             50,039             --               --
  Food and beverage .........................................               --             29,630             --               --
  Retail and other ..........................................               --             21,287             --               --
  Provision for doubtful accounts ...........................             18,200            1,866             --               --
  General and administrative ................................              2,711           82,603             --               --
  Corporate expense .........................................              2,459            3,917             --               --
  Rental expense ............................................                914            6,625             --               --
  Pre-opening and developemental expense ....................               --                355             --               --
  Depreciation and amortization .............................               --             36,039             --               --
                                                                  --------------   --------------   ---------------  --------------
                                                                         210,193          232,361             --               --
                                                                  --------------   --------------   ---------------  --------------
Operating income (loss) .....................................             18,464           75,362             --               --
                                                                  --------------   --------------   ---------------  --------------
Other income (expense):
    Interest income .........................................                643              613             --               --
    Interest expense, net of amounts capitalized ............               --            (90,947)            --               --
    Interest expense on indebtedness to Principal Stockholder               --             (4,052)            --               --
    Other income (expense) ..................................               --             (1,938)            --               --
    Income (loss) from equity investment in subsidiaries ....            (43,274)            --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before preferred return and extraordinary item             (24,167)         (20,962)            --               --
Preferred return on Redeemable Preferred Interest in Venetian               --            (20,766)            --               --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before extrordinary item                                   (24,167)         (41,728)            --               --

    Loss on early retirement of debt ........................               --             (1,383)            --               --
                                                                  --------------   --------------   ---------------  --------------
Net income (loss) ...........................................     $      (24,167)  $      (43,111)  $         --     $         --
                                                                  ==============   ==============   ===============  ==============

</TABLE>





















                                       61
<PAGE>

<TABLE>
<CAPTION>


                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                            CONDENSED STATEMENT OF OPERATIONS (continued)
                                                For the year ended December 31, 2001



                                                                     NON-GUARANTOR SUBSIDIARIES
                                                                     --------------------------
                                                                  Grand Canal
                                                                  Shops Mall       Other Non-       Consolidating/
                                                                  Subsidiary       Guarantor        Eliminating
                                                                  LLC (1)          Subsidiaries     Entries          Total
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Revenues:
  Casino ....................................................     $         --     $         --     $         --     $      227,240
  Room ......................................................               --               --               --            204,242
  Food and beverage .........................................               --               --               --             61,977
  Retail and other ..........................................             34,707            1,622          (48,810)          73,034
                                                                  --------------   --------------   ---------------  --------------
  Total revenue .............................................             34,707            1,622          (48,810)         566,493
Less promotional allowance ..................................               --               --               --            (42,594)
                                                                  --------------   --------------   ---------------  --------------
  Net revenues ..............................................             34,707            1,622          (48,810)         523,899
                                                                  --------------   --------------   ---------------  --------------
Operating expenses:
  Casino ....................................................               --               --            (45,973)         139,936
  Rooms .....................................................               --               --               --             50,039
  Food and beverage .........................................               --               --               --             29,630
  Retail and other ..........................................             12,230             --             (1,215)          32,302
  Provision for doubtful accounts ...........................                132             --               --             20,198
  General and administrative ................................              1,570                3             --             86,887
  Corporate expense .........................................               --               --               --              6,376
  Rental expense ............................................              2,157             --             (1,622)           8,074
  Pre-opening and developemental expense ....................               --               --               --                355
  Depreciation and amortization .............................              4,784             --               --             40,823
                                                                  --------------   --------------   ---------------  --------------
                                                                          20,873                3          (48,810)         414,620
                                                                  --------------   --------------   ---------------  --------------
Operating income (loss) .....................................             13,834            1,619             --            109,279
                                                                  --------------   --------------   ---------------  --------------
Other income (expense):
    Interest income .........................................                129             --               --              1,385
    Interest expense, net of amounts capitalized ............            (10,173)            (604)            --           (101,724)
    Interest expense on indebtedness to Principal Stockholder             (4,968)            --               --             (9,020)
    Other income (expense) ..................................               --               --               --             (1,938)
    Income (loss) from equity investment in subsidiaries ....               --               --             43,274             --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before preferred return and extraordinary item              (1,178)           1,015           43,274           (2,018)
Preferred return on Redeemable Preferred Interest in Venetian               --               --               --            (20,766)
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before extraordinary item .....................             (1,178)           1,015           43,274          (22,784)
    Loss on early retirement of debt ........................               --               --               --             (1,383)
                                                                  --------------   --------------   ---------------  --------------
Net income (loss) ...........................................     $       (1,178)  $        1,015   $       43,274   $      (24,167)
                                                                  ==============   ==============   ==============   ==============
<FN>
----------
(1)  The assets and  liabilities of Mall  Construction,  a guarantor,  were  transferred  to the Mall  Subsidiary,  a  non-guarantor
     subsidiary, upon substantial completion of the Casino Resort on November 12, 1999, and subsequently transferred to the New Mall
     Subsidiary on December 20, 1999. As a result, Mall Construction had no revenues or expenses as of December 31, 2001.
</FN>


</TABLE>


















                                       62
<PAGE>

<TABLE>
<CAPTION>

                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)

                                                  CONDENSED STATEMENT OF OPERATIONS
                                                For the year ended December 31, 2000




                                                                                                         GUARANTOR SUBSIDIARIES
                                                                                                         ----------------------
                                                                                                    Lido             Mall
                                                                                   Venetian         Intermediate     Intermediate
                                                                  Las Vegas        Casino           Holding          Holding
                                                                  Sands, Inc.      Resort LLC       Company LLC      Company LLC
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Revenues:
  Casino ....................................................     $      299,083   $         --     $         --     $         --
  Room ......................................................               --            192,327             --               --
  Food and beverage .........................................               --             67,052             --               --
  Retail and other ..........................................              1,646           82,455             --               --
                                                                  --------------   --------------   ---------------  --------------
  Total revenue .............................................            300,729          341,834             --               --
Less promotional allowance ..................................               --            (46,296)            --               --
                                                                  --------------   --------------   ---------------  --------------
  Net revenues ..............................................            300,729          295,538             --               --
                                                                  --------------   --------------   ---------------  --------------
Operating expenses:
  Casino ....................................................            208,321             --               --               --
  Rooms .....................................................               --             49,618             --               --
  Food and beverage .........................................               --             32,627             --               --
  Retail and other ..........................................               --             19,126             --               --
  Provision for doubtful accounts ...........................             17,743            1,300             --               --
  General and administrative ................................              3,819           88,344             --                 10
  Corporate expense .........................................              2,293            3,982             --               --
  Rental expense ............................................                714            5,856             --               --
  Depreciation and amortization .............................               --             37,180             --               --
                                                                  --------------   --------------   ---------------  --------------
                                                                         232,890          238,033             --                 10
                                                                  --------------   --------------   ---------------  --------------

Operating income (loss) .....................................             67,839           57,505             --                (10)
                                                                  --------------   --------------   ---------------  --------------
Other income (expense):
    Interest income .........................................                739              960             --               --
    Interest expense, net of amounts capitalized ............               --            (98,437)            --               --
    Interest expense on indebtedness to Principal Stockholder               --             (3,568)            --               --
    Income (loss) from equity investment in subsidiaries ....            (71,108)            --               --               --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before preferred return and extraordinary item              (2,530)         (43,540)            --                (10)
Preferred return on Redeemable Preferred Interest in Venetian               --            (18,482)            --               --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before extraordinary item .....................             (2,530)         (62,022)            --                (10)
    Loss on early retirement of debt ........................               --             (2,785)            --               --
                                                                  --------------   --------------   ---------------  --------------
Net income (loss) ...........................................     $       (2,530)  $      (64,807)  $         --     $          (10)
                                                                  ==============   ==============   ==============   ==============

</TABLE>























                                       63
<PAGE>

<TABLE>
<CAPTION>



                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)

                                            CONDENSED STATEMENT OF OPERATIONS (continued)
                                                For the year ended December 31, 2000



                                                                      NON-GUARANTOR SUBSIDIARIES
                                                                      --------------------------
                                                                  Grand Canal
                                                                  Shops Mall       Other Non-       Consolidating/
                                                                  Subsidiary       Guarantor        Eliminating
                                                                  LLC (1)          Subsidiaries     Entries          Total
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Revenues:
  Casino ....................................................     $         --     $         --     $         --     $      299,083
  Room ......................................................               --               --               --            192,327
  Food and beverage .........................................               --               --               --             67,052
  Retail and other ..........................................             30,781             --            (46,078)          68,804
                                                                  --------------   --------------   ---------------  --------------
  Total revenue .............................................             30,781             --            (46,078)         627,266
Less promotional allowance ..................................               --               --               --            (46,296)
                                                                  --------------   --------------   ---------------  --------------
  Net revenues ..............................................             30,781             --            (46,078)         580,970
                                                                  --------------   --------------   ---------------  --------------
Operating expenses:
  Casino ....................................................               --               --            (45,164)         163,157
  Rooms .....................................................               --               --               --             49,618
  Food and beverage .........................................               --               --               --             32,627
  Retail and other ..........................................             11,194             --               (914)          29,406
  Provision for doubtful accounts ...........................                209             --               --             19,252
  General and administrative ................................              1,219               21             --             93,413
  Corporate expense .........................................               --               --               --              6,275
  Rental expense ............................................              2,157             --               --              8,727
  Depreciation and amortization .............................              4,542             --               --             41,722
                                                                  --------------   --------------   ---------------  --------------
                                                                          19,321               21          (46,078)         444,197
                                                                  --------------   --------------   ---------------  --------------
Operating income (loss) .....................................             11,460              (21)            --            136,773
                                                                  --------------   --------------   ---------------  --------------
Other income (expense):
    Interest income .........................................                 72             --               --              1,771
    Interest expense, net of amounts capitalized ............            (12,589)            --               --           (111,026)
    Interest expense on indebtedness to Principal Stockholder             (5,213)            --               --             (8,781)
    Income (loss) from equity investment in subsidiaries ....               --               --             71,108             --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before preferred return and extraordinary item              (6,270)             (21)          71,108           18,737
Preferred return on Redeemable Preferred Interest in Venetian               --               --               --            (18,482)
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before extraordinary item .....................             (6,270)             (21)          71,108              255
    Loss on early retirement of debt ........................               --               --               --             (2,785)
                                                                  --------------   --------------   ---------------  --------------
Net income (loss) ...........................................     $       (6,270)  $          (21)  $       71,108   $       (2,530)
                                                                  ==============   ==============   ==============   ==============

<FN>
----------
(1)  The assets and  liabilities of Mall  Construction,  a guarantor,  were  transferred  to the Mall  Subsidiary,  a  non-guarantor
     subsidiary, upon substantial completion of the Casino Resort on November 12, 1999, and subsequently transferred to the New Mall
     Subsidiary on December 20, 1999. As a result, Mall Construction had no revenues or expenses as of December 31, 2000.
</FN>


</TABLE>

















                                       64
<PAGE>

<TABLE>
<CAPTION>


                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                                  CONDENSED STATEMENT OF OPERATIONS
                                                For the year ended December 31, 1999




                                                                                                         GUARANTOR SUBSIDIARIES
                                                                                                         ----------------------
                                                                                                    Lido             Mall
                                                                                   Venetian         Intermediate     Intermediate
                                                                  Las Vegas        Casino           Holding          Holding
                                                                  Sands, Inc.      Resort LLC       Company LLC      Company LLC
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Revenues:
  Casino ....................................................     $      124,161   $         --     $         --     $         --
  Room ......................................................               --             89,585             --               --
  Food and beverage .........................................               --             30,786             --               --
  Retail and other ..........................................              1,592           47,197             --               --
                                                                  --------------   --------------   ---------------  --------------
  Total revenue .............................................            125,753          167,568             --               --
Less promotional allowance ..................................               --            (25,045)            --               --
                                                                  --------------   --------------   ---------------  --------------
  Net revenues ..............................................            125,753          142,523             --               --
                                                                  --------------   --------------   ---------------  --------------
Operating expenses:
  Casino ....................................................             99,130             --               --               --
  Rooms .....................................................               --             25,532             --               --
  Food and beverage .........................................               --             19,134             --               --
  Retail and other ..........................................               --              7,385             --               --
  Provision for doubtful accounts ...........................             12,225              730             --               --
  General and administrative ................................              1,369           48,566                1             --
  Corporate expense .........................................              1,794              716             --               --
  Rental expense ............................................                455            3,852             --               --
  Pre-opening expense .......................................                143           21,341             --               --
  Depreciation and amortization .............................                 52           22,692             --               --
                                                                  --------------   --------------   ---------------  --------------
                                                                         115,168          149,948                1             --
                                                                  --------------   --------------   ---------------  --------------

Operating income (loss) .....................................             10,585           (7,425)              (1)            --
                                                                  --------------   --------------   ---------------  --------------
Other income (expense):
    Interest income .........................................                209            2,336             --               --
    Interest expense, net of amounts capitalized ............               --            (63,819)            --               --
    Interest expense on indebtedness to Principal Stockholder               --               --               --               --
    Income (loss) from equity investment in subsidiaries ....            (90,816)            --               --               --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before preferred return and extraordinary item             (80,022)         (68,908)              (1)            --
Preferred return on Redeemable Preferred Interest in Venetian               --            (14,399)            --               --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before extraordinary item .....................            (80,022)         (83,307)              (1)            --
    Loss on early retirement of debt ........................               --               --               --               --
                                                                  --------------   --------------   ---------------  --------------
Net income (loss) ...........................................     $      (80,022)  $      (83,307)  $           (1)  $         --
                                                                  ==============   ==============   ==============   ==============

</TABLE>





















                                       65
<PAGE>

<TABLE>
<CAPTION>


                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                            CONDENSED STATEMENT OF OPERATIONS (continued)
                                                For the year ended December 31, 1999



                                                                      NON-GUARANTOR SUBSIDIARIES
                                                                      --------------------------

                                                                  Grand Canal
                                                                  Shops Mall       Other Non-       Consolidating/
                                                                  Subsidiary       Guarantor        Eliminating
                                                                  LLC (1)          Subsidiaries     Entries          Total
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Revenues:
  Casino ....................................................     $         --     $         --     $         --     $      124,161
  Room ......................................................               --               --               --             89,585
  Food and beverage .........................................               --               --               --             30,786
  Retail and other ..........................................              9,844             --            (29,667)          28,966
                                                                  --------------   --------------   ---------------  --------------
  Total revenue .............................................              9,844             --            (29,667)         273,498
Less promotional allowance ..................................               --               --               --            (25,045)
                                                                  --------------   --------------   ---------------  --------------
  Net revenues ..............................................              9,844             --            (29,667)         248,453
                                                                  --------------   --------------   ---------------  --------------
Operating expenses:
  Casino ....................................................               --               --            (29,466)          69,664
  Rooms .....................................................               --               --               --             25,532
  Food and beverage .........................................               --               --               --             19,134
  Retail and other ..........................................              4,397             --               (201)          11,581
  Provision for doubtful accounts ...........................                700             --               --             13,655
  General and administrative ................................                512                2             --             50,450
  Corporate expense .........................................               --               --               --              2,510
  Rental expense ............................................              1,178             --               --              5,485
  Pre-opening expense .......................................               --               --               --             21,484
  Depreciation and amortization .............................              2,401             --               --             25,145
                                                                  --------------   --------------   ---------------  --------------
                                                                           9,188                2          (29,667)         244,640
                                                                  --------------   --------------   ---------------  --------------

Operating income (loss) .....................................                656               (2)            --              3,813
                                                                  --------------   --------------   ---------------  --------------
Other income (expense):
    Interest income .........................................                  6             --               --              2,551
    Interest expense, net of amounts capitalized ............             (7,416)            --               --            (71,235)
    Interest expense on indebtedness to Principal Stockholder               (163)            --               --               (163)
    Income (loss) from equity investment in subsidiaries ....               --               --             90,816             --
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before preferred return and extraordinary item              (6,917)              (2)          90,816          (65,034)
Preferred return on Redeemable Preferred Interest in Venetian               --               --               --            (14,399)
                                                                  --------------   --------------   ---------------  --------------
Income (loss) before extraordinary item .....................             (6,917)              (2)          90,816          (79,433)
    Loss on early retirement of debt ........................               (589)            --               --               (589)
                                                                  --------------   --------------   ---------------  --------------
Net income (loss) ...........................................     $       (7,506)  $           (2)  $       90,816   $      (80,022)
                                                                  ==============   ==============   ==============   ==============


<FN>
----------------
(1)  The assets and  liabilities of Mall  Construction,  a guarantor,  were  transferred  to the Mall  Subsidiary,  a  non-guarantor
     subsidiary, upon substantial completion of the Casino Resort on November 12, 1999, and subsequently transferred to the New Mall
     Subsidiary on December 20, 1999. As a result, Mall Construction had no revenues or expenses as of December 31, 1999.
</FN>



</TABLE>













                                 66
<PAGE>

<TABLE>
<CAPTION>


                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)

                                        Note 15 Summarized Financial Information (continued)

                                                 CONDENSED STATEMENTS OF CASH FLOWS
                                                For the year ended December 31, 2001


                                                                                                       GUARANTOR SUBSIDIARIES
                                                                                                       ----------------------
                                                                                                    Lido             Mall
                                                                                                    Intermediate     Intermediate
                                                                  Las Vegas        Venetian Casino  Holding          Holding
                                                                  Sands, Inc.      Resort LLC       Company LLC      Company LLC
                                                                  --------------   --------------   ---------------  --------------

<S>                                                               <C>              <C>              <C>              <C>
Net cash provided by operating activities ...................     $       19,765   $       26,390   $         --     $         --
                                                                  --------------   --------------   ---------------  --------------
Cash flows from investing activities:
  (Increase) decrease in restricted cash ....................               --                (57)            --               --
  Capital expenditures ......................................               --            (53,660)            --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash used in investing activities .......................               --            (53,717)            --               --
                                                                  --------------   --------------   ---------------  --------------
Cash flows from financing activities:
  Repayments on bank credit facility-tranche A term loan ....               --           (103,125)            --               --
  Repayments on bank credit facility-tranche B term loan ....               --            (49,750)            --               --
  Repayments on bank credit facility-tranche C term loan ....               --             (5,750)            --               --
  Proceeds from bank credit facility-tranche C term loan ....               --              5,750             --               --
  Repayments on bank credit facility-term ...................               --               (764)            --               --
  Proceeds from bank credit facility-term ...................               --            152,750             --               --
  Repayments on bank credit facility-revolver ...............               --            (18,000)            --               --
  Proceeds from bank credit facility-revolver ...............               --             58,000             --               --
  Repayments on FF&E credit facility ........................               --            (21,494)            --               --
  Proceeds from Phase II Subsidiary credit facility .........               --               --               --               --
  Proceeds from Phase II Subsidiary unsecured bank loan .....               --               --               --               --
  Payments of deferred offering costs .......................               --             (5,573)            --               --
  Net increase (decrease) in intercompany accounts ..........            (17,730)          18,829             --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash provided by  (used in) financing activities ........            (17,730)          30,873             --               --
                                                                  --------------   --------------   ---------------  --------------
Increase in cash and cash equivalents .......................              2,035            3,546             --               --
Cash and cash equivalents at beginning of year ..............             35,332            4,260                4                4
                                                                  --------------   --------------   ---------------  --------------
Cash and cash equivalents at end of year ....................     $       37,367   $        7,806   $            4   $            4
                                                                  ==============   ==============   ==============   ==============

</TABLE>


































                                       67
<PAGE>

<TABLE>
<CAPTION>


                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)

                                        Note 15 Summarized Financial Information (continued)

                                           CONDENSED STATEMENTS OF CASH FLOWS (continued)
                                                For the year ended December 31, 2001



                                                                       NON-GUARANTOR SUBSIDIARIES
                                                                       --------------------------
                                                                  Grand Canal
                                                                  Shops Mall       Other Non-       Consolidating/
                                                                  Subsidiary       Guarantor        Eliminating
                                                                  LLC (1)          Subsidiaries     Entries          Total
                                                                  --------------   --------------   ---------------  --------------

<S>                                                               <C>              <C>              <C>              <C>
Net cash provided by operating activities ...................     $        4,075   $          562   $         --     $       50,792
                                                                  --------------   --------------   ---------------  --------------
Cash flows from investing activities:
  (Increase) decrease in restricted cash ....................                (40)            --               --                (97)
  Capital expenditures ......................................               (766)            (708)            --            (55,134)
                                                                  --------------   --------------   ---------------  --------------
Net cash used in investing activities .......................               (806)            (708)            --            (55,231)
                                                                  --------------   --------------   ---------------  --------------
Cash flows from financing activities:
  Repayments on bank credit facility-tranche A term loan ....               --               --               --           (103,125)
  Repayments on bank credit facility-tranche B term loan ....               --               --               --            (49,750)
  Repayments on bank credit facility-tranche C term loan ....               --               --               --             (5,750)
  Proceeds from bank credit facility-tranche C term loan ....               --               --               --              5,750
  Repayments on bank credit facility-term ...................               --               --               --               (764)
  Proceeds from bank credit facility-term ...................               --               --               --            152,750
  Repayments on bank credit facility-revolver ...............               --               --               --            (18,000)
  Proceeds from bank credit facility-revolver ...............               --               --               --             58,000
  Repayments on FF&E credit facility ........................               --               --               --            (21,494)
  Proceeds from Phase II Subsidiary credit facility .........               --              3,933             --              3,933
  Proceeds from Phase II Subsidiary unsecured bank loan .....               --              1,092             --              1,092
  Payments of deferred offering costs .......................               --               (300)            --             (5,873)
  Net increase (decrease) in intercompany accounts ..........                409           (1,508)            --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash provided by  (used in) financing activities ........                409            3,217             --             16,769
                                                                  --------------   --------------   ---------------  --------------
Increase in cash and cash equivalents .......................              3,678            3,071             --             12,330
Cash and cash equivalents at beginning of year ..............              2,972               34             --             42,606
                                                                  --------------   --------------   ---------------  --------------
Cash and cash equivalents at end of year ....................     $        6,650   $        3,105   $         --     $       54,936
                                                                  ==============   ==============   ==============   ==============


<FN>
----------------
(1)  The assets and  liabilities of Mall  Construction,  a guarantor,  were  transferred  to the Mall  Subsidiary,  a  non-guarantor
     subsidiary, upon substantial completion of the Casino Resort on November 12, 1999, and subsequently transferred to the New Mall
     Subsidiary on December 20, 1999. As a result, Mall Construction had no cash flows as of December 31, 2001.
</FN>


</TABLE>






























                                       68
<PAGE>

<TABLE>
<CAPTION>


                                                       LAS VEGAS SANDS, INC.
                                             Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)

                                                 CONDENSED STATEMENTS OF CASH FLOWS
                                                For the year ended December 31, 2000




                                                                                                       GUARANTOR SUBSIDIARIES
                                                                                                       ----------------------
                                                                                                    Lido             Mall
                                                                                                    Intermediate     Intermediate
                                                                  Las Vegas        Venetian Casino  Holding          Holding
                                                                  Sands, Inc.      Resort LLC       Company LLC      Company LLC
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Net cash provided by (used in) operating
  activities ................................................     $       56,574   $       21,142   $         --     $          (10)
                                                                  --------------   --------------   ---------------  --------------
Cash flows from investing activities:
  Proceeds from purchases of investments ....................               --              7,319             --               --
  Capital expenditures ......................................               --            (15,647)            --               --
  Construction of Casino Resort .............................               --            (12,178)            --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash used in investing activities .......................               --            (20,506)            --               --
                                                                  --------------   --------------   ---------------  --------------
Cash flows from financing activities:
  Proceeds from capital contributions .......................               --                (35)            --                  9
  Repayments on bank credit facility-tranche A term loan ....               --            (35,625)            --               --
  Repayments on bank credit facility-tranche B term loan ....               --               (250)            --               --
  Proceeds from bank credit facility-tranche B term loan ....               --             50,000             --               --
  Repayments on bank credit facility-revolver ...............               --            (50,160)            --               --
  Proceeds from bank credit facility-revolver ...............               --             11,000             --               --
  Repayments on FF&E credit facility ........................               --            (16,609)            --               --
  Payments of deferred offering costs .......................               --             (2,296)            --               --
  Net increase (decrease) in intercompany accounts ..........            (45,203)          45,362             --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash provided by  (used in) financing activities ........            (45,203)           1,387             --                  9
                                                                  --------------   --------------   ---------------  --------------
Increase (decrease) in cash and cash equivalents ............             11,371            2,023             --                 (1)
Cash and cash equivalents at beginning of year ..............             23,961            2,237                4                5
                                                                  --------------   --------------   ---------------  --------------
Cash and cash equivalents at end of year ....................     $       35,332   $        4,260   $            4   $            4
                                                                  ==============   ==============   ==============   ==============


</TABLE>




























                                       69
<PAGE>


<TABLE>
<CAPTION>


                                                       LAS VEGAS SANDS, INC.
                                             Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)

                                                 CONDENSED STATEMENTS OF CASH FLOWS
                                                For the year ended December 31, 2000



                                                                      NON-GUARANTOR SUBSIDIARIES
                                                                      --------------------------
                                                                  Grand Canal
                                                                  Shops Mall       Other Non-       Consolidating/
                                                                  Subsidiary       Guarantor        Eliminating
                                                                  LLC (1)          Subsidiaries     Entries          Total
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Net cash provided by (used in) operating
  activities ................................................     $        3,341   $          (30)  $         --     $       81,017
                                                                  --------------   --------------   ---------------  --------------
Cash flows from investing activities:
  Proceeds from purchases of investments ....................              1,112             --               --              8,431
  Capital expenditures ......................................               (762)            --               --            (16,409)
  Construction of Casino Resort .............................               --                 (2)            --            (12,180)
                                                                  --------------   --------------   ---------------  --------------
Net cash used in investing activities .......................                350               (2)            --            (20,158)
                                                                  --------------   --------------   ---------------  --------------
Cash flows from financing activities:
  Proceeds from capital contributions .......................                  5               21             --               --
  Repayments on bank credit facility-tranche A term loan ....               --               --               --            (35,625)
  Repayments on bank credit facility-tranche B term loan ....               --               --               --               (250)
  Proceeds from bank credit facility-tranche B term loan ....               --               --               --             50,000
  Repayments on bank credit facility-revolver ...............               --               --               --            (50,160)
  Proceeds from bank credit facility-revolver ...............               --               --               --             11,000
  Repayments on FF&E credit facility ........................               --               --               --            (16,609)
  Payments of deferred offering costs .......................               (565)            --               --             (2,861)
  Net increase (decrease) in intercompany accounts ..........               (159)            --               --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash provided by  (used in) financing activities ........               (719)              21             --            (44,505)
                                                                  --------------   --------------   ---------------  --------------
Increase (decrease) in cash and cash equivalents ............              2,972              (11)            --             16,354
Cash and cash equivalents at beginning of year ..............               --                 45             --             26,252
                                                                  --------------   --------------   ---------------  --------------
Cash and cash equivalents at end of year ....................     $        2,972   $           34   $         --     $       42,606
                                                                  ==============   ==============   ==============   ==============
<FN>
----------------
(1)  The assets and  liabilities of Mall  Construction,  a guarantor,  were  transferred  to the Mall  Subsidiary,  a  non-guarantor
     subsidiary, upon substantial completion of the Casino Resort on November 12, 1999, and subsequently transferred to the New Mall
     Subsidiary on December 20, 1999. As a result, Mall Construction had no cash flows as of December 31, 2000.
</FN>

</TABLE>






































                                 70
<PAGE>


<TABLE>
<CAPTION>

                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                                 CONDENSED STATEMENTS OF CASH FLOWS
                                                For the year ended December 31, 1999





                                                                                                        GUARANTOR SUBSIDIARIES
                                                                                                    Lido             Mall
                                                                                                    Intermediate     Intermediate
                                                                  Las Vegas        Venetian         Holding          Holding
                                                                  Sands, Inc.      Casino LLC       Company LLC      Company LLC
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Net cash provided by (used in) operating activities  ........     $       (7,608)  $      (64,828)  $           (1)  $         --
                                                                  --------------   --------------   ---------------  --------------
Cash flows from investing activities:
  Proceeds from purchases of investments ....................               --            125,147             --               --
  Construction of Casino Resort .............................                (52)        (228,393)            --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash used in investing activities .......................                (52)        (103,246)            --               --
                                                                  --------------   --------------   ---------------  --------------
Cash flows from financing activities:
  Proceeds from capital contributions .......................             27,791             --               --               --
  Proceeds from preferred interest in Venetian ..............               --             44,431             --               --
  Repayments on mall construction loan facility .............               --               --               --               --
  Proceeds from mall construction loan facility .............               --               --               --               --
  Proceeds from mall-tranche A take-out loan ................               --               --               --               --
  Proceeds from mall- tranche B take-out loan ...............               --               --               --               --
  Proceeds from completion guaranty loan ....................               --             23,503             --               --
  Repayments on bank credit facility- tranche A term loan ...               --            (11,250)            --               --
  Proceeds from bank credit facility-tranche A term loan ....               --             34,000             --               --
  Repayments on bank credit facility-revolver ...............               --            (10,231)            --               --
  Proceeds from bank credit facility-revolver ...............               --             40,506             --               --
  Repayments on FF&E credit facility ........................               --             (5,862)            --               --
  Proceeds from FF&E credit facility ........................               --             83,842             --               --
  Payments of deferred offering costs .......................               --             (1,299)            --               --
  Net increase (decrease) in intercompany accounts ..........              2,614          (28,354)            --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash provided by financing activities ...................             30,405          169,286             --               --
                                                                  --------------   --------------   ---------------  --------------
Increase (decrease) in cash and cash equivalents ............             22,745            1,212               (1)            --
Cash and cash equivalents at beginning of year ..............              1,216            1,025                5                5
                                                                  --------------   --------------   ---------------  --------------
Cash and cash equivalents at end of year ....................     $       23,961   $        2,237   $            4   $            5
                                                                  ==============   ==============   ==============   ==============
</TABLE>





























                                       71
<PAGE>

<TABLE>
<CAPTION>


                                                        LAS VEGAS SANDS, INC.
                                              Notes to Financial Statements (continued)


                                        Note 15 Summarized Financial Information (continued)


                                           CONDENSED STATEMENTS OF CASH FLOWS (continued)
                                                For the year ended December 31, 1999



                                                                       NON-GUARANTOR SUBSIDIARIES
                                                                       --------------------------
                                                                  Grand Canal
                                                                  Shops Mall       Other Non-       Consolidating/
                                                                  Subsidiary       Guarantor        Eliminating
                                                                  LLC (1)          Subsidiaries     Entries          Total
                                                                  --------------   --------------   ---------------  --------------
<S>                                                               <C>              <C>              <C>              <C>
Net cash provided by (used in) operating activities .........     $       (7,174)  $           (3)  $       49,551   $      (30,063)
                                                                  --------------   --------------   ---------------  --------------
Cash flows from investing activities:
  Proceeds from purchases of investments ....................             (2,191)            --               --            122,956
  Construction of Casino Resort .............................            (53,593)         (37,068)            --           (319,106)
                                                                  --------------   --------------   ---------------  --------------
Net cash used in investing activities .......................            (55,784)         (37,068)            --           (196,150)
                                                                  --------------   --------------   ---------------  --------------
Cash flows from financing activities:
  Proceeds from capital contributions .......................                498           37,262          (49,551)          16,000
  Proceeds from preferred interest in Venetian ..............               --               --               --             44,431
  Repayments on mall construction loan facility .............           (140,000)            --               --           (140,000)
  Proceeds from mall construction loan facility .............             37,287             --               --             37,287
  Proceeds from mall-tranche A take-out loan ................            105,000             --               --            105,000
  Proceeds from mall- tranche B take-out loan ...............             35,000             --               --             35,000
  Proceeds from completion guaranty loan ....................               --               --               --             23,503
  Repayments on bank credit facility- tranche A term loan ...               --               --               --            (11,250)
  Proceeds from bank credit facility-tranche A term loan ....               --               --               --             34,000
  Repayments on bank credit facility-revolver ...............               --               --               --            (10,231)
  Proceeds from bank credit facility-revolver ...............               --               --               --             40,506
  Repayments on FF&E credit facility ........................               --               --               --             (5,862)
  Proceeds from FF&E credit facility ........................               --               --               --             83,842
  Payments of deferred offering costs .......................               (747)            --               --             (2,046)
  Net increase (decrease) in intercompany accounts ..........             25,910             (170)            --               --
                                                                  --------------   --------------   ---------------  --------------
Net cash provided by financing activities ...................             62,948           37,092          (49,551)         250,180
                                                                  --------------   --------------   ---------------  --------------
Increase (decrease) in cash and cash equivalents ............                (10)              21             --             23,967
Cash and cash equivalents at beginning of year ..............                 10               24             --              2,285
                                                                  --------------   --------------   ---------------  --------------
Cash and cash equivalents at end of year ....................     $         --     $           45   $         --     $       26,252
                                                                  ==============   ==============   ==============   ==============
<FN>
----------------
(1)  The assets and  liabilities of Mall  Construction,  a guarantor,  were  transferred  to the Mall  Subsidiary,  a  non-guarantor
     subsidiary, upon substantial completion of the Casino Resort on November 12, 1999, and subsequently transferred to the New Mall
     Subsidiary on December 20, 1999. As a result, Mall Construction had no cash flows as of December 31, 1999.
</FN>

</TABLE>




























                                       72
<PAGE>

Note 16  Quarterly Financial Information (Unaudited)

      The following unaudited information shows selected items (in thousands,
except per share data), for each quarter in the years ended December 31, 2001
and 2000. As more fully described in Note 1, under guidance by the Emerging
Issues Task Force ("EITF") of the Financial Accounting Standards Board,
dividends on the Venetian's preferred stock have been reflected as a charge
against income. The "as previously reported" amounts are included for reference
purposes. The restatements have no impact on previously reported quarterly
earnings per share.











































































                                       73
<PAGE>

<TABLE>
<CAPTION>

LAS VEGAS SANDS, INC.
Notes for Financial Statements (continued)

Note 16 Quarterly Financial Information (Unaudited)

                                                                    First         Second        Third         Fourth         Year
  2001                                                            ---------     ---------     ---------     ---------     ---------
<S>                                                               <C>           <C>           <C>           <C>           <C>
Gross revenues ...............................................    $ 155,926     $ 146,576     $ 133,594     $ 130,397     $ 566,493
Less-promotional allowances ..................................      (12,286)       (9,658)      (10,440)      (10,210)      (42,594)
                                                                  ---------     ---------     ---------     ---------     ---------
   Net revenues ..............................................      143,640       136,918       123,154       120,187       523,899
                                                                  ---------     ---------     ---------     ---------     ---------
   Operating income ..........................................       33,201        27,389        20,405        28,284       109,279
                                                                  ---------     ---------     ---------     ---------     ---------
   Income (loss) before preferred return
     and extraordinary item ..................................        4,679           414        (5,979)       (1,132)       (2,018)

Preferred return on redeemable Preferred Interest
   in Venetian Casino Resort, LLC ............................       (5,040)       (5,040)       (5,343)       (5,343)      (20,766)
                                                                  ---------     ---------     ---------     ---------     ---------
   Loss before extraordinary item ............................         (361)       (4,626)      (11,322)       (6,475)      (22,784)

Extraordinary item-loss on early retirement of debt ..........         --            --          (1,383)         --          (1,383)
                                                                  ---------     ---------     ---------     ---------     ---------
   Net loss ..................................................    $    (361)    $  (4,626)    $ (12,705)    $  (6,475)    $ (24,167)
                                                                  =========     =========     =========     =========     =========
Basic and diluted (loss) per share before extraordinary item .    $   (0.36)    $   (4.63)    $  (11.32)    $   (6.48)    $  (22.78)
                                                                  =========     =========     =========     =========     =========
Basic and diluted loss per share .............................    $   (0.36)    $   (4.63)    $  (12.71)    $   (6.48)    $  (24.17)
                                                                  =========     =========     =========     =========     =========
Income (loss) before extraordinary
   item (as previously reported) .............................    $   4,679     $     414     $  (5,979)

Extraordinary item-loss on early retirement
   of debt (as previously reported) ..........................         --            --          (1,383)
                                                                  ---------     ---------     ---------

   Net income (loss) (as previously reported) ................    $   4,679     $     414     $  (7,362)
                                                                  =========     =========     =========
Basic and diluted loss per share before extraordinary item
   (as previously reported) ..................................    $   (0.36)    $   (4.63)    $  (11.32)
                                                                  =========     =========     =========
Basic and diluted (loss) per share (as previously reported) ..    $   (0.36)    $   (4.63)    $  (12.71)
                                                                  =========     =========     =========
</TABLE>














































                                       74
<PAGE>



<TABLE>
<CAPTION>


LAS VEGAS SANDS, INC.
Notes for Financial Statements (continued)

Note 16 Quarterly Financial Information (Unaudited) (continued)

                                                                    First        Second         Third         Fourth         Year
   2000                                                           ---------     ---------     ---------     ---------     ---------
<S>                                                               <C>           <C>           <C>           <C>           <C>
Gross revenues ...............................................    $ 166,847     $ 154,939     $ 148,508     $ 156,972     $ 627,266
Less-promotional allowances ..................................      (10,933)      (11,693)      (11,971)      (11,699)      (46,296)
                                                                  ---------     ---------     ---------     ---------     ---------
   Net revenues ..............................................      155,914       143,246       136,537       145,273       580,970
                                                                  ---------     ---------     ---------     ---------     ---------
   Operating income ..........................................       45,578        31,051        25,523        34,621       136,773
                                                                  ---------     ---------     ---------     ---------     ---------
   Income (loss) before preferred return
     and extraordinary item ..................................       16,630         1,635        (4,676)        5,148        18,737

Preferred return on redeemable Preferred Interest
   in Venetian Casino Resort, LLC ............................       (4,419)       (4,553)       (4,755)       (4,755)      (18,482)
                                                                  ---------     ---------     ---------     ---------     ---------
   Income (loss) before extraordinary item ...................       12,211        (2,918)       (9,431)          393           255

Extraordinary item-loss on early retirement of debt ..........         --          (2,785)         --            --          (2,785)
                                                                  ---------     ---------     ---------     ---------     ---------
   Net income (loss) .........................................    $  12,211     $  (5,703)    $  (9,431)    $     393     $  (2,530)
                                                                  =========     =========     =========     =========     =========
Basic and diluted income (loss) per share before
   extraordinary item ........................................    $   12.21     $   (2.92)    $   (9.43)    $    0.39     $    0.26
                                                                  =========     =========     =========     =========     =========
Basic and diluted income (loss) per share ....................    $   12.21     $   (5.70)    $   (9.43)    $    0.39     $   (2.53)
                                                                  =========     =========     =========     =========     =========
   Income (loss) before extraordinary item (as previously
    reported) ................................................    $  16,630     $   1,635     $  (4,676)    $   5,148     $  18,737

Extraordinary item-loss on early retirement of debt (as
    previously reported) .....................................         --          (2,785)         --            --          (2,785)
                                                                  ---------     ---------     ---------     ---------     ---------
   Net income (loss)(as previously reported) .................    $  16,630     $  (1,150)    $  (4,676)    $   5,148     $  15,952
                                                                  =========     =========     =========     =========     =========
Basic and diluted income (loss) per share before
   extraordinary item (as previously reported) ...............    $   12.21     $   (2.92)    $   (9.43)    $    0.39     $    0.26
                                                                  =========     =========     =========     =========     =========
Basic and diluted income (loss) per share
   (as previously reported) ..................................    $   12.21     $   (5.70)    $   (9.43)    $    0.39     $   (2.53)
                                                                  =========     =========     =========     =========     =========


</TABLE>


































                                      75
<PAGE>





       Report of Independent Accountants on Financial Statements Schedule









To the Board of Directors of Las Vegas Sands, Inc.


     Our audits of the  consolidated  financial  statements  referred  to in our
report dated  February 1, 2002  appearing in this Annual  Report on Form 10-K of
Las Vegas Sands, Inc. also included an audit of the financial statement schedule
listed in Item 14  (a)(2) of this Form  10-K.  In our  opinion,  this  financial
statement  schedule presents fairly, in all material  respects,  the information
set  forth  therein  when  read in  conjunction  with the  related  consolidated
financial statements.


PricewaterhouseCoopers LLP


Las Vegas, Nevada
February 1, 2002
























































                                       76
<PAGE>

<TABLE>
<CAPTION>


                                             LAS VEGAS SANDS, INC.
                                         Financial Statement Schedule


                                 SCHEDULE II- VALUATION AND QUALIFYING ACCOUNTS
                                                 (In thousands)





                                                                  Additions        Deductions
                                                  Balance at      Charge to        Accounts         Balance
                                                  beginning       costs and        charged off      at end
                 Description                      of period       expenses         (recovered)      of period
----------------------------------------------    -----------     -----------      -----------      ----------
Allowance for doubtful accounts and discounts:
   Year ended December 31:

                       <S>                        <C>             <C>              <C>              <C>
                       1999 .................     $     --            13,655           (6,758)      $   6,897
                                                  ===========     ===========      ===========      =========
                       2000 .................     $    6,897          19,252           (3,236)      $  22,913
                                                  ===========     ===========      ===========      ==========
                       2001 .................     $   22,913          20,198          (19,118)      $  23,993
                                                  ===========     ===========      ===========      ==========

</TABLE>





























































                                       77
<PAGE>



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

None.
















































































                                 78
<PAGE>

                                    PART III

ITEM 10. --DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     LVSI has a Board of Directors comprised of two persons. One director is the
Principal  Stockholder,  who has two votes for all  matters  before the Board of
Directors.  In the event that LVSI increases the number of directors  comprising
the Board of Directors,  the number of votes which the Principal Stockholder has
will be increased so that the Principal Stockholder will have one more vote than
the  number  of votes  of all of the  other  directors  aggregated.  The  second
director (the "Special Director") is unaffiliated with the Principal Stockholder
or any other affiliate of the Principal Stockholder,  has no other position with
LVSI or Venetian and has one vote for all matters before the Board of Directors.
To the extent the Special  Director  receives  compensation,  it is paid by LVSI
from sources unrelated to and independent from the Principal Stockholder and its
affiliates  (other than LVSI and Venetian).  The Special Director is required to
file an application for a gaming license with the Nevada Gaming Authorities.

     The table below sets forth the executive  officers and the directors of the
Company.

<TABLE>
<CAPTION>

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

<S>                                         <C>       <C>
Sheldon G. Adelson                          68        Chairman of the Board, Chief Executive Officer and Director
Robert F. List                              65        Special Director
William P. Weidner                          56        President and Chief Operating Officer
Bradley H. Stone                            47        Executive Vice President
Robert G. Goldstein                         46        Senior Vice President
David Friedman                              45        Assistant to Chairman of the Board and Secretary
Harry D. Miltenberger                       58        Vice President-Finance

</TABLE>

     Sheldon G.  Adelson  has been the  Chairman of the Board,  Chief  Executive
Officer  and a director  of the  Company  since  April 1988 when the Company was
formed to own and operate the former  Sands  Hotel and Casino.  Mr.  Adelson has
extensive experience in the convention,  trade show, tour and travel businesses.
Mr.  Adelson also has  investments in other  business  enterprises.  He has been
President  and  Chairman  of  Interface  since the  mid-1970s  and  Chairman  of
Interface Group-Massachusetts Inc. since 1990. Mr. Adelson created and developed
the COMDEX  Trade  Shows,  including  the  COMDEX/Fall  Trade Show,  the world's
largest  computer show, all of which were sold to Softbank  Corporation in April
1995.

     Robert F. List was elected as Special  Director of LVSI in April 2000.  Mr.
List  is  the  Chief  Executive  Officer  of  the  Robert  List  Company,  a Las
Vegas-based  consulting  firm, and serves as counsel to the law firm of Beckley,
Singleton,  Jemison,  Cobeaga  and  List.  Mr.  List  served as  Executive  Vice
President,  Corporate  Counsel and Member of the Board of Directors of Boomtown,
Inc. from 1992 to 1999. Mr. List has served in various elected  positions in the
State of Nevada  including  Attorney General from 1970 to 1978 and Governor from
1978 to 1982.

     William P. Weidner has been the  President and Chief  Operating  Officer of
the Company since  December  1995.  From 1985 to 1995, Mr. Weidner was President
and Chief Operating Officer and served on the board of Pratt Hotel  Corporation.
From  February  1991 to December  1995,  Mr.  Weidner was also the  President of
Pratt's  Hollywood  Casino-Aurora  subsidiary  and from June 1992 until December
1995,  he  served  on the  board  of the  Hollywood  Casino  Corporation.  Since
September  1993,  Mr.  Weidner has served on the Board of Directors of Shorewood
Packaging Corporation. Mr. Weidner directed the opening of Hollywood Casino, one
of Chicago's  first  riverboat  casino hotels,  New York City's Maxim's de Paris
(now the Peninsula), and hotels in Orlando and Palm Springs.

     Bradley H. Stone has been  Executive  Vice  President of the Company  since
December 1995. From June 1984 through December 1995, Mr. Stone was President and
Chief  Operating  Officer of the Sands Hotel in Atlantic  City.  Mr.  Stone also
served as an Executive Vice President of the parent Pratt Hotel Corporation from
June 1986 through December 1995.

     Robert G.  Goldstein  has been Senior Vice  President of the Company  since
December  1995.  From 1992 until  joining  the  Company in  December  1995,  Mr.
Goldstein was the Executive Vice President of Marketing at the Sands in Atlantic
City  as  well  as an  Executive  Vice  President  of  the  parent  Pratt  Hotel
Corporation.

     David  Friedman  has been  Assistant  to the  Chairman of  Interface  since
October 1995.  Subsequently,  Mr. Friedman became both Assistant to the Chairman
of the Board and  Secretary of the Company.  Mr.  Friedman is also an officer of
other  companies  owned  by the  Principal  Stockholder.  Prior to  joining  the
Company,  Mr.  Friedman was the Senior Vice President of  Development  and Legal
Affairs for President Casinos, Inc. from May 1993 to October 1995.

                                       79
<PAGE>

     Harry D.  Miltenberger is a certified  public  accountant and has been Vice
President-Finance  of the Company  since  February  1997.  From March 1995 until
February 1997, he was Senior Vice President and Chief Financial  Officer of SUB,
a banking company.

ITEM 11.--EXECUTIVE COMPENSATION

     The  following  table  sets  forth  certain   information   concerning  the
compensation  for the last three  fiscal  years of those  persons  who were,  at
December  31,  2001,  the Chief  Executive  Officer  and the four  highest  paid
executive officers of LVSI, which is the managing member of Venetian.  Under the
limited  liability  company  agreement  of  Venetian,  LVSI  is  entitled  to be
reimbursed  for all expenses  incurred in connection  with its activities as the
managing member of Venetian, including all employee compensation costs.

<TABLE>
<CAPTION>

                                                                                                  Long Term
                                                                                                Compensation
                                                                 Annual Compensation               Awards
                                                           --------------------------------     --------------
                                                                                                 Securities         All Other
                                                                                                 Underlying       Compensation
    Name and Principal Position               Year             Salary           Bonus              Options             (1)
-------------------------------------     -------------    ---------------- ---------------     --------------    --------------

<S>                                           <C>             <C>                <C>               <C>               <C>
Sheldon G. Adelson                            2001               --               --                 --                --
   Chairman of the Board and Chief            2000            1,500,000           --                 --                --
   Executive Officer                          1999               --               --                 --                --

William P. Weidner                            2001            1,038,462          500,000                                 2,322
   President  and  Chief   Operating          2000              951,284          300,000             --                  2,239
   Officer                                    1999              797,165           --                 --                  1,917

Bradley H. Stone                              2001              830,769          400,000             --                    810
   Executive Vice President                   2000              726,214          240,000             --                    789
                                              1999              511,882           --                 --                    729

Robert G. Goldstein                           2001              778,846          375,000             --                    810
   Senior Vice President                      2000              686,269          225,000             --                    789
                                              1999              457,881           --                 --                    729

David Friedman                                2001              415,385          200,000             --                  1,057
   Assistant to Chairman of the               2000              359,615          170,000             --                    540
   Board and Secretary                        1999              300,000           --                 --                    745

<FN>
----------
(1)  Represents Group Life Insurance.
</FN>

</TABLE>

Las Vegas Sands, Inc. 1997 Fixed Stock Option Plan

     The Las Vegas  Sands,  Inc.  1997  Fixed  Stock  Option  Plan (the  "Plan")
provides  for 75,000  shares of common  stock of the Company to be reserved  for
issuance by the Company to officers and other key  employees or  consultants  of
the Company or any of its  Affiliates  or  Subsidiaries  (each as defined in the
Plan) pursuant to options  granted under the Plan. The grant of such options has
been  approved by the Nevada Gaming  Authorities.  The purpose of the Plan is to
promote  the  interest  of the  Company  and its  Principal  Stockholder  by (i)
attracting  and  retaining  exceptional  officers  and other key  employees  and
consultants to the Company and its Affiliates and Subsidiaries and (ii) enabling
such individuals to participate in the long-term growth and financial success of
the  Company.  The  Board  of  Directors  has the  authority  to  determine  the
participants  to whom options are granted,  the number of shares covered by each
option or any repurchase or other disposition of shares thereunder, the exercise
price therefor, and the conditions and limitations applicable to the exercise of
the option.  The Board of Directors is  authorized  to make  adjustments  in the
terms and conditions of, and the criteria  included in, options,  in the case of
certain  unusual  or  nonrecurring  events,  whenever  the  Board  of  Directors
determines that such adjustments are appropriate in order to prevent dilution or
enlargement of benefits or potential  benefits under the Plan.  Options  granted
under the Plan expire on the earlier of (i) a specified number of years from the
date  of  grant,  (ii)  the  date  three  days  prior  to a  Change  in  Control
Acceleration  Event (as defined in the Plan) and (iii) the date three days prior
to a Public Offering  Acceleration  Event (as defined in the Plan). In the event
of any Acceleration Event (as defined in the Plan) any outstanding  options then
held by the participants  which are unexercisable or otherwise  unvested,  shall
automatically  become  fully  vested and shall be  exercisable  pursuant  to the
applicable  award  agreement.  The Plan provides that the Principal  Stockholder
may,  at any time,  assume the Plan or certain  obligations  under the Plan,  in
which case the Principal  Stockholder will be the administrator of the Plan, the
issuer  of  the   options,   and  will  have  all  the   rights,   powers,   and
responsibilities granted to the Company or the Board of Directors under the Plan
with respect to such assumed obligations.

                                       80
<PAGE>

     The Board of Directors may amend, alter, suspend,  discontinue or terminate
the Plan or any portion thereof at any time, provided that any such action shall
not be taken  without  shareholder  approval if such  approval is  necessary  to
comply  with  any tax or  regulatory  requirement  applicable  to the  Plan  and
provided that any such  amendment,  alteration,  suspension,  discontinuance  or
termination  that would  impair  the  rights of any holder of an option  already
granted shall not be effective without the holder's consent.

     The Principal  Stockholder has assumed the obligations of the Company under
the Plan and has granted options to Mr. Weidner,  Mr. Stone,  Mr.  Goldstein and
Mr.  Friedman (the "Named  Optionees")  to acquire shares  representing  1.996%,
1.497%,  .9980%, and .4990%,  respectively,  of the common stock of the Company.
The specific terms and conditions of the options were agreed to in 1999 and were
memorialized  in the first  quarter  of 2002.  The  exercise  price of the stock
options on the grant date was not lower than the fair market value of the common
stock of the  Company.  The options  granted to the Named  Optionees  were fully
vested and  exercisable  upon  grant.  The options of the Named  Optionees  were
exercised  immediately  after  issuance by delivery of a notice of exercise from
each  of  the  Named  Optionees  to  the  Principal   Stockholder.   The  notice
contemplates  that the exercise price of the options will be loaned to the Named
Optionees by the Principal  Stockholder on a secured basis. See "Item 13-Certain
Relationships  and Related  Transactions-Stock  Option  Loans."  The  applicable
shares of common stock have not yet been  delivered.  Shares issued to the Named
Optionees  pursuant  to the  exercise  of an option and held at the time of each
Named  Optionee's  termination  of  employment  are subject to redemption by the
Principal Stockholder.

ITEM 12. --SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Beneficial Ownership

     The  following  table sets forth certain  information  as of April 1, 2002
with respect to the beneficial ownership of the common stock of LVSI by (i) each
person  who, to the  knowledge  of LVSI,  beneficially  owns more than 5% of its
outstanding  common  stock,  (ii) the  directors  of LVSI,  (iii) all  executive
officers  named in the  summary  compensation  table  in  "Item  11 -  Executive
Compensation" and (iv) all executive officers and directors of LVSI as a group.

<TABLE>
<CAPTION>

                                                                                Percentage of
                                                 Number of Shares            Outstanding Common
Beneficial Owner (1)                            Beneficially Owned                  Stock
--------------------                            ------------------           ------------------
<S>                                                 <C>                             <C>
Sheldon G. Adelson                                  1,000,000                        100%
Robert F. List                                             --                         --
William P. Weidner                                     19,960 (2)                   2.00%
Bradley H. Stone                                       14,970 (2)                   1.50%
Robert G. Goldstein                                     9,980 (2)                      *
David Friedman                                          4,990 (2)                      *
All executive officers and the directors
 of the Company as a group                          1,000,000                        100%

<FN>
----------
*    Less than 1%
(1)  The address of each person named above is c/o the  Company,  3355 Las Vegas
     Boulevard South,  Room 1A, Las Vegas, NV 89109,  other than Mr. List, whose
     address is 3993 Howard Hughes Parkway, Suite 850, Las Vegas, NV 89109.
(2)  Includes  the right to purchase  shares of common stock of the Company from
     the Principal Stockholder pursuant to an exercise of options within 60 days
     of the date hereof.  Each of the Named  Optionees has delivered a notice of
     exercise pursuant to such options, however, the applicable shares of common
     stock have not yet been issued. See "Item 11 - Executive Compensation - Las
     Vegas Sands, Inc. 1997 Fixed Stock Option Plan."
</FN>
</TABLE>

Stockholders' Agreement

     Upon the Named Optionees  becoming  stockholders of the Company,  the Named
Optionees,  the  Principal  Stockholder  and the Company  expect to enter into a
Stockholders' Agreement (the "Stockholders' Agreement"). It is contemplated that
the  Stockholders'  Agreement  will provide that no Named  Optionee,  nor any of
their  permitted  transferees  who has  agreed  to be  bound  by the  terms  and
conditions of the  Stockholders'  Agreement  (together with the Named Optionees,
the "Additional Stockholders"), will sell, assign, pledge, encumber or otherwise
dispose of any shares of common stock of the Company,  except in accordance with
the  provisions  of the  Stockholders'  Agreement.  The parties  also expect the
Stockholders'  Agreement  to provide the  Additional  Stockholders  with certain
tag-along rights, piggyback registration rights and preemptive rights.

                                       81
<PAGE>

ITEM 13. --CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Redeemable Preferred Interest

     Venetian currently has two members, the Company and Interface Group Holding
Company,  Inc.  ("Interface  Holding"),  which owns all of the capital  stock of
Interface.  LVSI is the managing  member of Venetian and owns 100% of the common
equity  interest  in  Venetian.  Interface  Holding  currently  holds a Series B
preferred interest in Venetian (the "Series B Preferred  Interest").  The rights
of the Series B Preferred  Interest  are  non-voting,  not subject to  mandatory
redemption or redemption at the option of the holder and have a preferred return
of 12%. Upon the 12th  anniversary  of the closing of the offering of the Notes,
to the extent of the  positive  capital  account of the  holders of the Series B
Preferred  Interest,  there must be a  distribution  on the  Series B  Preferred
Interest.  Until the  indebtedness  under the Bank Credit Facility is repaid and
cash payments are permitted  under the restricted  payment  covenants  under the
Indentures,  the preferred return on the Series B Preferred Interest will accrue
and will not be paid in  cash.  Subject  to the  foregoing,  distributions  with
respect  to the  preferred  capital of the  holders  of the  Series B  Preferred
Interest may, at the option of the Company, be made at any time.

Tranche B Take-out Loan and Principal Stockholder's $20.0 million Guaranty of
 Tranche A Take-out Loan

     On December 20, 1999,  each of the $105.0  million  Tranche A Take-out Loan
and the $35.0  million  Tranche B Take-out  Loan were made,  and were secured by
mortgages on the Mall Assets. The Principal Stockholder has agreed to guarantee,
on an  unsecured  basis,  $20.0  million  of  indebtedness  under the  Tranche A
Take-out Loan. In addition, the Tranche B Take-out Lender is wholly-owned by the
Principal Stockholder. The Tranche B Take-out Loan is deeply subordinated to the
Tranche A Take-out Loan, so that, among other things, (a) the Tranche A Take-out
Lender has first priority  liens on the Mall Assets,  and the Tranche B Take-out
Lender has second  priority  liens;  (b) no payment can be made on the Tranche B
Take-out Loan unless (x) all payments then due under the Tranche A Take-out Loan
have been paid in full,  (y) there is no  default  under the  Tranche A Take-out
Loan and (z) there is available cash flow (taking into account certain  required
reserves) to make such  payment;  and (c) the Tranche B Take-out  Lender  cannot
exercise  any  remedies  or take any  enforcement  actions  under the  Tranche B
Take-out Loan for so long as the Tranche A Take-out Loan is outstanding,  unless
the  Tranche A Take-out  Lender  consents.  The  Tranche B Take-out  Loan is due
December 16, 2004, provided that the New Mall Subsidiary has an option to extend
the loan until  December 16, 2007.  See "Item 7 -  Management's  Discussion  and
Analysis of  Financial  Condition  and  Results of  Operations  - Liquidity  and
Capital Resources".

Completion Guaranty

     The  Completion  Guaranty  with respect to the  construction  of the Casino
Resort was provided by the Principal  Stockholder in November 1997.  Pursuant to
the  Completion  Guaranty,  the  Principal  Stockholder  guaranteed,  subject to
certain conditions and limitations,  payment of Casino Resort construction costs
in excess of available  funds,  up to a maximum of $25.0 million (plus  interest
accrued on the collateral for such guaranty, as described below),  provided that
such cap on liability under the Completion  Guaranty does not apply with respect
to excess  construction  costs  attributable  to scope  changes.  The  Principal
Stockholder's  obligations under the Completion  Guaranty were collateralized by
$25.0 million in cash and cash equivalents and the interest accrued thereon (the
"Guaranty Collateral").  On November 12, 1999, an advance of approximately $23.5
million  was made  under  the  Completion  Guaranty  and is being  treated  as a
Completion  Guaranty loan that is  subordinated  in right of payment  (except as
described  below) to the indebtedness  under the Bank Credit Facility,  the FF&E
Credit Facility and the Notes (the "Completion  Guaranty Loan").  The Completion
Guaranty  Loan  matures on  November  16,  2005 and bears  interest at a rate of
14-1/4% per annum. Although interest may accrue on the Completion Guaranty Loan,
no cash payments with respect  thereto may be made until senior  indebtedness is
repaid,  except for payments made from certain  construction-related  recoveries
(including any payments received by the Company from the Construction Manager or
its  subcontractors  in connection with the litigations  discussed above). As of
December 31, 2001, there was approximately  $5.0 million of Guaranty  Collateral
remaining,  and the Company  expects that such  collateral  will be used to fund
excess  construction  costs,  with a portion of such  funding  being  treated as
another completion guaranty loan. Although the Completion Guaranty provided that
the Principal  Stockholder's  liability thereunder would expire upon substantial
completion of the Casino  Resort,  which was achieved on November 12, 1999,  the
Principal  Stockholder  agreed on November 12, 1999 that he would remain  liable
under the Completion  Guaranty until "final completion" (i.e., the completion of
all remaining  punchlist items and the final resolution of all disputes with the
Construction  Manager and  subcontractors) is achieved.  The Completion Guaranty
does not provide for the  incurrence by the Principal  Stockholder,  directly or
indirectly,  of any  obligation,  contingent  or  otherwise,  for the payment of
principal or interest on the Notes or any other indebtedness described herein.

                                       82
<PAGE>

Cooperation Agreement

     The  Company's  business  plan calls for each of the Hotel,  the Casino and
Congress Center,  the Mall and the Expo Center (and,  potentially,  the Phase II
Resort),  though separately owned, to be part of an integrally  related project.
In order to establish  terms for the integrated  operation of these  facilities,
Venetian (as owner of the Hotel,  Casino and Congress  Center,  and the Phase II
Land),  the New Mall  Subsidiary  and Interface  are parties to the  Cooperation
Agreement.  The Cooperation  Agreement sets forth  agreements  among the parties
regarding, among other things,  encroachments,  easements,  operating standards,
maintenance  requirements,  insurance  requirements,  casualty and condemnation,
joint marketing,  the sharing of certain  facilities and costs relating thereto.
The obligations  set forth in the Cooperation  Agreement "run with the land" and
so bind the  respective  property  owners and their  successors,  provided  that
certain of the obligations  under the Cooperation  Agreement,  are not senior to
previously  recorded  mortgages  encumbering  the Expo  Center  and so would not
survive any foreclosure of such mortgages.

     The Cooperation  Agreement  contains cross  encroachment  provisions  which
permit the Mall to  encroach,  to a limited  extent,  on other  portions  of the
Casino  Resort,  and which will permit  other  portions of the Casino  Resort to
encroach, to a limited extent, on the Mall.

     The Cooperation  Agreement also contains certain  covenants  respecting the
operation of the Expo Center and the Casino Resort. Such covenants include,  for
example, (a) a covenant by Venetian to operate the Hotel and Casino continuously
and to use the Hotel and the Casino  exclusively in accordance with standards of
first-class Las Vegas Boulevard-style  hotels and casinos; (b) a covenant by the
New Mall  Subsidiary  to operate and to use the Mall  exclusively  in accordance
with  standards  of  first-class  retail  and  restaurant  complexes;  and (c) a
covenant  by  Interface  to operate and to use the Expo  Center  exclusively  in
accordance with standards of first-class  convention,  trade show and exposition
centers. Additionally,  with respect to the joint marketing of the Casino Resort
and the Expo Center, the Cooperation  Agreement provides that until December 31,
2010,  Interface  (upon request from the owner of the Hotel and Casino) will use
commercially   reasonable   efforts  to  have  the  Hotel   designated   as  the
"headquarters  hotel" for trade show and  convention  events at the Expo Center,
and the owner of the Hotel and Casino will use commercially  reasonable  efforts
to promote the use and  occupancy  of the Expo  Center.  It should be noted that
trade show and convention promoters will be under no obligation to designate the
Hotel as the "headquarters hotel" for their events.

     The  Cooperation  Agreement  also  requires each of: (a) the owners of each
component  of the  Casino  Resort;  and (b) the  owner  of the Expo  Center,  to
maintain  certain  minimum  types and levels of  insurance,  including  property
damage, general liability and business interruption insurance.

Administrative Services Agreement

     Pursuant to a certain services agreement (the "Services Sharing Agreement")
among LVSI, certain of its subsidiaries and Interface Holding (collectively, the
"Participants"),  the Participants have agreed to share ratably in the costs of,
and  under  certain  circumstances  provide  to one  another,  shared  services,
including  legal  services,   accounting  services,   insurance  administration,
benefits  administration,  and such other  services as each party may request of
the other. In addition,  under the Services Sharing Agreement,  the Participants
have  agreed  to share  ratably  the costs of any  shared  office  space.  Total
payments  made by the Company to Interface  and its  affiliates  pursuant to the
Services Sharing Agreement were $1.1 million in 2001.

Temporary Lease

     On November 1, 1996,  LVSI and  Interface  entered  into a lease  agreement
whereby LVSI agreed to lease  approximately 5,000 square feet in the Expo Center
to be used as its temporary  executive  offices during the  construction  of the
Casino Resort. Management believes that the lease agreement,  which provides for
monthly rent of $5,000 to be paid by LVSI to Interface, is at least as favorable
as the Company could have obtained from an independent  third party. The initial
term of the lease agreement  expired on November 1, 1998, but LVSI and Interface
have extended this term on a month-to-month  basis.  Total payments made by LVSI
to Interface pursuant to the lease agreement in 2001 totaled $60,000.

Audio Visual Services

     IGN provides audio visual services to group customers of the Casino Resort.
These  services are provided  pursuant to a contract  that provides for an equal
sharing of revenues after direct operating  expenses.  The Company received $2.5
million pursuant to this contract during 2001.

Possible Conflicts of Interest

     The common ultimate ownership of the Casino Resort, the Phase II Resort and
the Expo  Center may present  potential  conflicts  of  interest.  For  example,
management may offer discounts and other  incentives for visitors to stay at the
Phase II Resort  which might result in a  competitive  advantage of the Phase II
Resort over the Casino  Resort.  In addition,  management may choose to allocate
certain business  opportunities to the Phase II Resort rather than to the Casino
Resort.  Although  common  ownership of both the Casino  Resort and the Phase II
Resort  often  may  result  in  economies,   efficiencies   and  joint  business
opportunities  for the two resorts in the  aggregate,  the Casino Resort may, in
certain  circumstances,  bear the greater burden of the expenses that are shared

                                       83
<PAGE>

by both resorts.  In addition,  inasmuch as there may be a common management for
both the Casino Resort and the Phase II Resort,  management's  time may be split
between  overseeing  the operation of each resort,  and  management,  in certain
circumstances,   may  devote  more  time  to  its   ownership   and   operations
responsibilities  of the  Phase  II  Resort  than  those of the  Casino  Resort.
Finally,  because it is  expected  that the  Company  will lease and operate the
casino for the Phase II Resort,  potential  conflicts  may arise from the common
operation of the Casino and the Phase II Resort  casino,  such as the allocation
of  management's  time.  In order to share  expenses  and provide for  efficient
management  and  operations  of the Casino Resort and Phase II Resort and shared
facilities,  Venetian and the Phase II Subsidiary  entered into the  Cooperation
Agreement and may in the future enter into  additional cost sharing and easement
agreements.

     The common ultimate ownership, and management, of the Casino Resort and the
Expo Center also may result in potential conflicts of interest.  The Expo Center
and the Congress Center are potential competitors in the business conference and
meetings business. Under the Cooperation Agreement,  Venetian has agreed that it
will not conduct, or permit to be conducted at the Casino Resort, trade shows or
expositions  of the  type  generally  held  at  the  Expo  Center.  Furthermore,
marketing  practices  may be  implemented  that are intended to benefit the Expo
Center and may have a detrimental effect on the Casino Resort.

Restaurant Leases

     The Principal Stockholder is a partner in four entities formed that operate
restaurants in the Casino Resort. The terms and conditions of the leases granted
by the Company for such  restaurants  are at amounts which  management  believes
would be no less favorable than those negotiated with independent third parties.
Valentino  Las Vegas LLC and Night Market,  LLC paid Venetian $1.0 million,  and
Postrio Las Vegas LLC and Carnevale Coffee Bar LLC paid the Mall Subsidiary $1.1
million, for the year ended December 31, 2001.

Phase II Land Lease

     In conjunction with the Phase II Subsidiary  Credit Facility on October 19,
2001,  the Phase II  Subsidiary  leased the Phase II Land to  Venetian  for five
years at an annual  rent of $8.0  million.  Prior to  October  2001,  IGN leased
parking  spaces on the Phase II Land  from the Phase II  Subsidiary  for rent of
$5,000 per month.

Phase II Subsidiary Bank Loan Guarantee

     During 2001, the Principal Stockholder  guaranteed a $2.9 million bank loan
made to  architects of the Phase II Subsidiary to secure a trade payable owed to
the architects by the Phase II Subsidiary.

Stock Option Loans

     The  Principal  Stockholder  intends  to make  loans  to each of the  Named
Optionees  (collectively,  the "Stock  Option  Loans")  to allow such  executive
officers to exercise  options  that they have been  granted  from the  Principal
Stockholder to purchase  common stock of the Company.  Each Stock Option Loan is
expected to be evidenced by a full recourse  promissory note, to be secured by a
pledge  of  the  Named  Optionee's  common  stock.  See  "Item  11  -  Executive
Compensation - Las Vegas Sands, Inc. 1997 Fixed Stock Option Plan."





























                                       84
<PAGE>



                                                PART IV

ITEM 14.--EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.


  (a) Documents filed as part of the report.

  (1) List of Financial Statements

      Report of Independent Accountants
      Consolidated Balance Sheets
      Consolidated Statements of Operations
      Consolidated Statements of Stockholder's Equity
      Consolidated Statements of Cash Flows
      Notes to Financial Statements

  (2) List of Financial Statement Schedules

      Report of Independent Accountants
      Schedule II - Valuation and Qualifying Accounts

<TABLE>
<CAPTION>

  (3) List of Exhibits

    Exhibit No.    Description of Document
    -----------    -----------------------
    <S>            <C>
    3.1            Amended and Restated Articles of Incorporation of LVSI.(1)
    3.2            Certificate of Amendment of Amended and Restated Articles of
                   Incorporation of LVSI.(1)
    3.3            Amended and Restated By-laws of LVSI.(1)
    3.4            Amended and Restated Limited Liability Company Agreement of
                   Venetian(1)
    4.1            Indenture,  dated as of November  14,  1997,  by and among
                   LVSI and  Venetian,  as  issuers,  Mall
                   Intermediate Holding Company, LLC ("Mall Intermediate"),
                   Lido Intermediate Holding Company, LLC ("Lido
                   Intermediate") and Grand Canal Shops Mall Construction,
                   LLC ("Mall Construction"), as Mortgage Note guarantors,
                   and U.S. Bank Trust National Association (previously
                   known as First Trust National Association), as Mortgage
                   Note trustee (the "Mortgage Note Trustee").(1)
    4.2            Indenture, dated as of November 14, 1997, by and among
                   LVSI and Venetian, as issuers, Mall Intermediate, Lido
                   Intermediate and Mall Construction, as Senior
                   Subordinated Note guarantors, and First Union National
                   Bank ("First Union"), as Senior Subordinated Note
                   trustee.(1)
    4.3            Registration Rights Agreement,  dated as of November 14,
                   1997, by and among LVSI,  Venetian,  Mall
                   Intermediate,  Lido Intermediate and Mall Construction, and
                   Goldman, Sachs & Co. and Bear, Stearns
                   & Co. Inc. (the "Initial Purchasers").(1)
    4.4            Funding Agents' Disbursement and Administration  Agreement,
                   dated as of November 14, 1997, by and among  LVSI,  Venetian,
                   Mall  Construction,  jointly  and  severally,  The  Bank of
                   Nova  Scotia ("Scotiabank"),  as Bank Agent,  the Mortgage
                   Note Trustee,  Atlantic  Pacific Las Vegas, LLC (the "HVAC
                   Provider") and Scotiabank, as disbursement agent (the
                   "Disbursement Agent").(1)
    4.5            FADAA Limited  Waiver,  dated as of November 12, 1999, by and
                   among LVSI,  Sheldon G. Adelson,  as Principal  stockholder
                   (the "Principal  Stockholder"),  the Bank Agent, the Mortgage
                   Note Trustee, Salomon  Brothers Realty Corp.  ("SBRC"),  as
                   successor-in-interest  to GMAC Commercial  Mortgage
                   Corporation ("GMAC"), and the HVAC Provider. (5)
    4.6            Company  Security  Agreement,  dated as of November 14, 1997,
                   by and among LVSI,  Venetian,  Mall Construction and
                   Scotiabank, as the Intercreditor Agent.(1)
    4.7            Mall  Construction  Subsidiary  Security  Agreement, dated as
                   of November 14, 1997,  between Mall Construction and
                   Scotiabank, as the Intercreditor Agent.(1)
    4.8            Deed of Trust, Assignment of Rents and Leases and Security
                   Agreement made by Venetian and LVSI, jointly and
                   severally as trustor, to Lawyers Title of Nevada, Inc.
                   ("Lawyer's Title"), as trustee, for the benefit of the
                   Mortgage Note Trustee, as Beneficiary.(1)
</TABLE>






                                      85
<PAGE>


<TABLE>
<CAPTION>



    Exhibit No.        Description of Document
    -----------        -----------------------
    <S>                <C>
    4.9                First  Amendment to Deed of Trust,  Assignment of Rents
                       and Leases and Security  Agreement made by Venetian  and
                       LVSI,  jointly and  severally as trustor,  to Lawyer's
                       Title,  as trustee,  for the benefit of  the Mortgage
                       Note Trustee, as Beneficiary. (3)
    4.10               Leasehold  Deed of Trust,  Assignment of Rents and Leases
                       and  Security  Agreement  made by Mall Construction,  as
                       trustor, to Lawyer's Title,  as trustee,  for the benefit
                       of the Mortgage Note Trustee, as Beneficiary. (1)
    4.11               First Amendment to Leasehold Deed of Trust,  Assignment
                       of Rents and Leases and Security Agreement made by Mall
                       Construction,  as trustor,  to Lawyer's  Title, as
                       trustee,  for the benefit of the Mortgage Note Trustee,
                       as Beneficiary. (3)
    4.12               Disbursement  Collateral  Account  Agreement,  dated as
                       of  November  14,  1997,  by,  among LVSI, Venetian, Mall
                       Construction  and  Scotiabank,   as  Disbursement  Agent,
                       and  as  Securities Intermediary. (1)
    4.13               Mortgage Notes Proceeds Collateral Account Agreement,
                       dated as of November 14, 1997, by and among LVSI,
                       Venetian and Scotiabank, as Disbursement Agent. (1)
    4.14               Mortgage Notes Proceeds Account Third-Party  Account
                       Agreement,  dated as of November 14, 1997, by and among
                       LVSI,  Venetian,  Scotiabank,  as  Disbursement  Agent,
                       and Goldman, Sachs & Co., as Securities Intermediary. (1)
    4.15               Intercreditor  Agreement,  dated as of November 14, 1997,
                       among  Scotiabank, as Bank Agent and Intercreditor Agent,
                       the Mortgage Note Trustee,  GMAC, as Interim Mall Lender,
                       and First Union, as Senior Subordinated Note trustee. (1)
    4.16               Completion Guaranty,  dated as of November 14, 1997, made
                       by the Principal  Stockholder,  in favor of  Scotiabank,
                       as the Bank  Agent  acting on behalf of the bank lender
                       parties,  GMAC,  as the Interim Mall Lender, and the
                       Mortgage Note Trustee. (1)
    4.17               Completion  Guaranty  Collateral Account Agreement,
                       dated as of November 14, 1997, by and between the
                       Principal Stockholder, as Pledgor, and Scotiabank, as
                       Disbursement Agent. (1)
    4.18               Completion  Guaranty  Third-Party  Account Agreement,
                       dated as of November 14, 1997, by and among the Principal
                       Stockholder,  Scotiabank,  as  Disbursement  Agent,  and
                       Goldman,  Sachs & Co., as Securities Intermediary. (1)
    4.19               Unsecured  Indemnity  Agreement,  dated as of November
                       14, 1997,  by and among LVSI,  Venetian and Mall
                       Construction, to and for the benefit of the Mortgage Note
                       Trustee. (1)
    10.1               Energy  Services  Agreement, dated as of November 14,
                       1997,  by and between the HVAC Provider and Venetian. (1)
    10.2               Energy  Services  Agreement  Amendment No. 1, dated July
                       1, 1999, by and between the HVAC Provider and
                       Venetian. (5)
    10.3               Energy  Services  Agreement,  dated as of November 14,
                       1997,  by and between the HVAC Provider and Mall
                       Construction. (1)
    10.4               Energy  Services  Agreement  Amendment No. 1, dated
                       July 1, 1999, by and between the HVAC Provider and Mall
                       Construction. (5)
    10.5               Construction  Management  Agreement,  dated as of
                       February 15, 1997,  between LVSI, as owner,  and Lehrer
                       McGovern Bovis, Inc. as construction manager (the
                       "Construction Manager"). (1)
    10.6               Assignment,  Assumption and Amendment of Construction
                       Management Agreement,  dated as of November 14, 1997, by
                       and among LVSI, Venetian and the Construction
                       Manager. (1)
    10.7               Guaranteed  Maximum Price  Amendment to  Construction
                       Management  Agreement,  dated June 17, 1998 (effective
                       September 9, 1998), between the Construction Manager and
                       Venetian. (2)
    10.8               Agreement,  effective as of January 1, 1996,  between
                       Venetian,  as owner,  and the architect,  a collaboration
                       between the firms of TSA of Nevada, LLP and WAT&G, Inc.,
                       Nevada. (1)
    10.9               Amended and Restated Reciprocal Easement,  Use and
                       Operating  Agreement,  dated as of November 14, 1997,
                       by and among Interface Group-Nevada, Inc. ("Interface"),
                       Mall Construction and Venetian. (1)

</TABLE>


                                       86
<PAGE>

<TABLE>
<CAPTION>


    Exhibit No.        Description of Document
    -----------        -----------------------
    <S>                <C>
    10.10              First Amendment to Amended and Restated Reciprocal
                       Easement,  Use and Operating  Agreement,  dated as of
                       December 20, 1999, by and among Interface,  Grand Canal
                       Shops Mall Subsidiary, LLC (the "New Mall Subsidiary"),
                       Lido Casino Resort, LLC (the "Phase II Subsidiary") and
                       Venetian. (5)
    10.11              Casino Lease, dated as of November 14, 1997, by and
                       between LVSI and Venetian. (1)
    10.12              Amended and Restated  Services  Agreement,  dated as of
                       November 14, 1997, by and among  Venetian, Interface
                       Group Holding Company, Inc., Interface,  Lido Casino
                       Resort, LLC, Grand Canal Shops Mall MM, Inc. and certain
                       subsidiaries of Venetian named therein. (1)
    10.13              Intercreditor  Agreement,  dated  as of  November 14,
                       1997,  by  and  among  Scotiabank,  as the Administrative
                       Agent, the Mortgage Note Trustee,  GMAC, as the Interim
                       Mall Lender,  First Union, as Subordinated Note trustee,
                       LVSI, Venetian, Mall Construction and the Principal
                       Stockholder. (1)
    10.14              Indemnity  and  Guaranty  Agreement,  dated  as of
                       December  20,  1999,  made  by  the  Principal
                       Stockholder. (5)
    10.15              Guaranty, dated as of December 20, 1999, made by the
                       Principal Stockholder. (5)
    10.16              Mall Scope Change Guaranty, dated as of December 20,
                       1999, made by the Principal Stockholder. (5)
    10.17              Note,  dated December 20, 1999, by the New Mall
                       Subsidiary in favor of SGA  Development,  Inc., in
                       the amount of $35,000,000. (5)
    10.18              Construction  Agency  Agreement,  dated as of November
                       14, 1997,  by and between  Venetian and the HVAC
                       Provider. (1)
    10.19              Management  Agreement,  dated as of April 23, 1997, by
                       and between LVSI and Forest City Commercial
                       Management,  Inc.  ("Forest  City"),  as assigned  by
                       LVSI to Mall  Construction  by that  certain
                       Assignment and Assumption of Contracts. (1)
    10.20              Management  Agreement,  dated as of November 12, 1999,
                       by and between the Mall  Construction  and Forest City,
                       as assigned by Mall  Construction to the Mall  Subsidiary
                       by that certain  Assignment and Assumption of Contracts. (5)
    10.21              Primary  Liquidated  Damages  Insurance  Agreement,
                       dated  August 4,  1997,  by and  between  the
                       Construction Manager and C.J. Coleman & Companies,
                       Ltd. (1)
    10.22              Guaranty  of  Performance,  dated as of August 19,
                       1997,  by the  Peninsula  and  Oriental  Steam Navigation
                       Company in favor of LVSI, as assigned by LVSI to Venetian
                       by that certain  Assignment, Assumption and Amendment of
                       Contracts. (1)
    10.23              Guaranty of  Performance  and  Completion,  dated as of
                       August 19,  1997,  by Bovis,  Inc.,  LVSI, Venetian and
                       Mall Construction, for the benefit of Scotiabank, as the
                       Intercreditor Agent. (1)
    10.24              Sands Resort Hotel and Casino Agreement,  dated February
                       18, 1997, by and between Clark County and LVSI, and all
                       amendments thereto. (1)
    10.25              Las Vegas Sands, Inc. 1997 Fixed Stock Option Plan. (1)
    10.26              Term Loan and Security  Agreement,  dated as of December
                       22, 1997, by and among LVSI and Venetian, as Borrowers,
                       the lender parties thereto,  BancBoston Leasing, Inc., as
                       co-agent  ("BancBoston"), and General Electric Capital
                       Corporation ("GECC"), as administrative agent. (1)
    10.27              Limited Waiver and First Amendment to Term Loan and
                       Security Agreement,  dated November 12,  1999, by and
                       among LVSI and Venetian, as Borrowers,  the lender
                       parties thereto,  BancBoston,  and GECC, as
                       administrative agent.  (5)
    10.28              Intercreditor  Agreement,  dated as of December 22, 1997,
                       by and among Scotiabank,  as Bank Agent, First Trust, as
                       Mortgage Note trustee, GMAC and GECC.  (1)
    10.29              Loan  Agreement,  dated as of December 20, 1999, by and
                       among Goldman Sachs Mortgage  Company,  as Syndication
                       Agent,  Scotiabank,  as Administrative Agent and as
                       Collateral Agent, and the New Mall Subsidiary, as
                       Borrower. (5)
    10.30              Subordination  and Intercreditor  Agreement (Trade
                       Claims),  dated November 12, 1999, by and among
                       Scotiabank, as Bank Agent, LVSI and the Principal
                       Stockholder. (5)

</TABLE>

                                       87
<PAGE>

<TABLE>
<CAPTION>


    Exhibit No.        Description of Document
    -----------        -----------------------
    <S>                <C>
    10.31              Amended and  Restated  Credit  Agreement,  dated as of
                       September  17, 2001,  by and among LVSI and Venetian,  as
                       Borrowers,  the  lenders  party  thereto  and Scotiabank,
                       as  Lead  Arranger  and Administrative Agent. (8)
    10.32              Limited  Waiver and Second  Amendment  to Term Loan and
                       Security  Agreement,  dated as of June 14, 2000, by and
                       among LVSI and Venetian, as borrowers,  GECC, as
                       Administrative Agent, and the lender parties thereto. (6)
    10.33              Limited Waiver, Consent and Third Amendment to Term Loan
                       and Security Agreement,  dated as of June 29, 2001, by
                       and among LVSI and Venetian,  as borrowers,  GECC, as
                       Administrative  Agent, and the lender parties
                       thereto. (7)
    10.34              Fourth  Amendment to Term Loan and Security  Agreement,
                       dated as of  September  28, 2001,  by and among LVSI and
                       Venetian, as joint and several obligors,  the financial
                       institutions party thereto and GECC, as Administrative
                       Agent. (8)
    10.35              Credit  Agreement,  dated as of October 19, 2001, by and
                       among Phase II  Subsidiary,  as Borrower, the lenders
                       party thereto and Scotiabank, as Administrative
                       Agent. (8)
    10.36              Limited  Waiver under Term Loan and  Security  Agreement,
                       dated as of December  31, 2001,  by and among LVSI and
                       Venetian,  as borrowers,  GECC, as  Administrative
                       Agent,  and the lender  parties thereto.  (9)
    10.37              Limited Waiver  Regarding Credit  Agreement,  dated as of
                       December 31, 2001, by and among LVSI and Venetian,  as
                       borrowers,  Scotiabank,  as Lead Arranger and
                       Administrative  Agent, and the lender parties
                       thereto. (9)
    10.38              Limited  Waiver  Regarding  Credit  Agreement,  dated as
                       of December 31, 2001,  by and among Lido Casino  Resort,
                       LLC, as  borrower,  Scotiabank,  as Administrative Agent,
                       and the other lender parties thereto.  (9)
    21.1               Subsidiaries of the registrant. (9)
    24.1               Powers of Attorney (included on signature pages).

<FN>
----------
          (1)  Incorporated by reference from Registration Statement on Form S-4
               of  the  Company  and  certain  of  its  subsidiaries  (File  No.
               333-42147).
          (2)  Incorporated by reference from the Company's  Quarterly Report on
               Form 10-Q for the Quarter ended September 30, 1998.
          (3)  Incorporated  by reference  from the  Company's  Annual Report on
               Form 10-K for the Fiscal Year ended December 31, 1998.
          (4)  Incorporated  by reference  from the  Company's  Annual Report on
               Form 10-K for the Fiscal Year ended December 31, 1999.
          (5)  Incorporated by reference from the Company's  Quarterly Report on
               Form 10-Q for the Quarter ended June 30, 2000.
          (6)  Incorporated  by reference  from the  Company's  Annual Report on
               Form 10-K for the Fiscal Year ended December 31, 2000.
          (7)  Incorporated by reference from the Company's  Quarterly Report on
               Form 10-Q for the Quarter ended June 30, 2001.
          (8)  Incorporated by reference from the Company's  Quarterly Report on
               Form 10-Q for the Quarter ended September 30, 2001.
          (9)  Filed herewith.
</FN>
</TABLE>

 (b)  Reports on Form 8-K

      No report on Form 8-K was filed during the quarter ended December 31,
2001.


                                       88
<PAGE>



                                   SIGNATURES




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



                                                  LAS VEGAS SANDS, INC.



                                             /s/ Sheldon G. Adelson
                                            ------------------------------------
                                            Sheldon G. Adelson,
                                            Chairman of the Board and
                                            Chief Executive Officer


     We, the undersigned officers and directors of Las Vegas Sands, Inc., hereby
severally  constitute  William P.  Weidner and David  Friedman  and each of them
singly,  our true and lawful attorneys with full power to them, and each of them
singly,  to sign for us and in our names in the capacities  indicated below, any
and all amendments to this Annual Report on Form 10-K, and generally do all such
things in our name and behalf in such capacities to enable Las Vegas Sands, Inc.
to comply with the applicable provisions of the Securities Exchange Act of 1934,
and all  requirements of the Securities and Exchange  Commission,  and we hereby
ratify and confirm our  signatures as they may be signed by our said  attorneys,
or either of them, to any and all such amendments.

     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
report has been signed by the  following  persons in the  capacities  and on the
dates indicated.


<TABLE>
<CAPTION>

         SIGNATURE                                TITLE                                     DATE
         ---------                                -----                                     ----


<S>                                    <C>                                               <C>
/s/ Sheldon G. Adelson                  Chairman of the Board, Chief                     April 1, 2002
-----------------------------
Sheldon  G. Adelson                     Executive Officer and Director

/s/ Robert F. List                      Special Director                                 April 1, 2002
-----------------------------
Robert F. List

/s/ Harry D. Miltenberger               Vice President--Finance (principal               April 1, 2002
-----------------------------
Harry D. Miltenberger                   financial and accounting officer)

</TABLE>