##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from to
 Commission File Number: 000-52975
 American Casino & Entertainment Properties LLC
  Delaware
    
    20-0573058(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 2000 Las Vegas Boulevard SouthLas Vegas, NV
    
    89104(Address of principal executive offices)
    
    (Zip code)
 (702) 380-7777
  
  þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ(Do not check if a smaller reporting
company)
    
    Smaller reporting company o
 o þ




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##### 



TABLE OF CONTENTS
 PagePart I Financial InformationItem 1. Unaudited Condensed Consolidated Financial Statements
    
    
    1Condensed Consolidated Balance Sheets  June 30, 2009
(Successor) (unaudited) and December 31, 2008 (Successor)
    
    
    1Condensed Consolidated Statements of Operations (unaudited) 
the three months ended June 30, 2009 (Successor) and June 30,
2008 (Successor),
    
    
    2Condensed Consolidated Statements of Operations (unaudited) 
the six months ended June 30, 2009 (Successor), the period
February 21, 2008 through June 30, 2008 (Successor), and the
period January 1, 2008 through February 20, 2008 (Predecessor)
    
    
    3Condensed Consolidated Statements of Cash Flows (unaudited) 
the six months ended June 30, 2009 (Successor), the period
February 21, 2008 through June 30, 2008 (Successor), and the
period January 1, 2008 through February 20, 2008 (Predecessor)
    
    
    4Condensed Consolidated Statement of Members Equity (unaudited)
 the six months ended June 30, 2009 (Successor)
    
    
    5Notes to Condensed Consolidated Financial Statements (unaudited)
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and
Results of Operations
    
    
    12Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    22Item 4T. Controls and Procedures
    
    
    22Part II Other InformationItem 1A. Risk Factors
    
    
    23Item 6. Exhibits
    
    
    31EX-10.1EX-31.1EX-31.2EX-32.1EX-32.2




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##### Table of Contents



PART I-FINANCIAL INFORMATION
 
 Item 1. Unaudited Condensed Consolidated Financial Statements.
 AMERICAN CASINO & ENTERTAINMENT PROPERTIES LLC
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 SuccessorAs of
    
    
    As ofJune 30, 2009
    
    
    December 31, 2008(Unaudited)(In thousands)AssetsCurrent Assets:Cash and cash equivalents
    
    $
    63,113
    
    
    $
    30,366Restricted cash
    
    
    12,817
    
    
    
    30,353Investments-restricted
    
    
    1,857
    
    
    
    1,857Accounts receivable, net
    
    
    3,250
    
    
    
    4,494Other current assets
    
    
    13,877
    
    
    
    12,857Total Current Assets
    
    
    94,914
    
    
    
    79,927Property and equipment, net
    
    
    1,159,876
    
    
    
    1,172,690Debt issuance and deferred financing costs, net
    
    
    
    
    
    
    8,900Restricted cash
    
    
    26,868
    
    
    
    10,649Intangible and other assets
    
    
    30,452
    
    
    
    31,144Total Other Assets
    
    
    57,320
    
    
    
    50,693Total Assets
    
    $
    1,312,110
    
    
    $
    1,303,310Liabilities and Members EquityCurrent Liabilities:Accounts payable
    
    $
    3,136
    
    
    $
    8,160Accrued expenses
    
    
    16,891
    
    
    
    23,981Accrued payroll and related expenses
    
    
    13,748
    
    
    
    10,061Current portion of capital lease obligations
    
    
    255
    
    
    
    861Total Current Liabilities
    
    
    34,030
    
    
    
    43,063Long-Term Liabilities:Long-term debt
    
    
    571,788
    
    
    
    1,108,000Capital lease obligations, less current portion
    
    
    2,257
    
    
    
    949Total Long-Term Liabilities
    
    
    574,045
    
    
    
    1,108,949Total Liabilities
    
    
    608,075
    
    
    
    1,152,012Commitments and ContingenciesMembers Equity:Members Equity
    
    
    704,035
    
    
    
    151,298Total Members Equity
    
    
    704,035
    
    
    
    151,298Total Liabilities and Members Equity
    
    $
    1,312,110
    
    
    $
    1,303,310
  1




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AMERICAN CASINO & ENTERTAINMENT PROPERTIES LLC
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 SuccessorThree Months Ended
    
    
    Three Months EndedJune 30, 2009
    
    
    June 30, 2008(Unaudited)(In thousands)Revenues:Casino
    
    $
    55,905
    
    
    $
    66,622Hotel
    
    
    16,182
    
    
    
    21,815Food and beverage
    
    
    19,539
    
    
    
    23,315Tower, retail and other
    
    
    9,148
    
    
    
    9,565Gross Revenues
    
    
    100,774
    
    
    
    121,317Less promotional allowances
    
    
    6,623
    
    
    
    10,684Net Revenues
    
    
    94,151
    
    
    
    110,633Costs and Expenses:Casino
    
    
    17,652
    
    
    
    21,494Hotel
    
    
    9,022
    
    
    
    8,799Food and beverage
    
    
    15,454
    
    
    
    16,969Other operating expenses
    
    
    3,613
    
    
    
    4,964Selling, general and administrative
    
    
    27,366
    
    
    
    33,744Depreciation and amortization
    
    
    10,537
    
    
    
    9,022Loss on disposal of assets
    
    
    563
    
    
    
    210Total Costs and Expenses
    
    
    84,207
    
    
    
    95,202Income From Operations
    
    
    9,944
    
    
    
    15,431Other Income (Expense):Interest income
    
    
    19
    
    
    
    274Interest expense
    
    
    (10,807
    )
    
    
    (17,897
    )Total Other Expense, net
    
    
    (10,788
    )
    
    
    (17,623
    )Loss Before Income Taxes
    
    
    (844
    )
    
    
    (2,192
    )Benefit for income taxes
    
    
    
    
    
    
    Net Loss
    
    $
    (844
    )
    
    $
    (2,192
    )
  2




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AMERICAN CASINO & ENTERTAINMENT PROPERTIES LLC
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 Successor
    
    
    PredecessorPeriod from
    
    
    Period fromFebruary 21, 2008
    
    
    January 1, 2008Six Months Ended
    
    
    through
    
    
    throughJune 30, 2009
    
    
    June 30, 2008
    
    
    February 20, 2008(Unaudited)(In thousands)Revenues:Casino
    
    $
    115,356
    
    
    $
    99,199
    
    
    $
    36,539Hotel
    
    
    31,163
    
    
    
    33,381
    
    
    
    11,683Food and beverage
    
    
    38,185
    
    
    
    34,461
    
    
    
    12,354Tower, retail and other
    
    
    17,340
    
    
    
    13,781
    
    
    
    4,651Gross Revenues
    
    
    202,044
    
    
    
    180,822
    
    
    
    65,227Less promotional allowances
    
    
    14,203
    
    
    
    15,738
    
    
    
    5,608Net Revenues
    
    
    187,841
    
    
    
    165,084
    
    
    
    59,619Costs and Expenses:Casino
    
    
    36,487
    
    
    
    31,320
    
    
    
    12,363Hotel
    
    
    17,331
    
    
    
    12,617
    
    
    
    4,682Food and beverage
    
    
    29,771
    
    
    
    24,510
    
    
    
    9,183Other operating expenses
    
    
    7,142
    
    
    
    6,861
    
    
    
    2,341Selling, general and administrative
    
    
    55,923
    
    
    
    48,333
    
    
    
    18,511Depreciation and amortization
    
    
    20,439
    
    
    
    12,287
    
    
    
    5,062Loss on disposal of assets
    
    
    578
    
    
    
    251
    
    
    
    Total Costs and Expenses
    
    
    167,671
    
    
    
    136,179
    
    
    
    52,142Income From Operations
    
    
    20,170
    
    
    
    28,905
    
    
    
    7,477Other Income (Expense):Loss on early extinguishment of debt
    
    
    
    
    
    
    
    
    
    
    (13,580
    )Interest income
    
    
    59
    
    
    
    390
    
    
    
    322Interest expense
    
    
    (22,678
    )
    
    
    (26,328
    )
    
    
    (2,564
    )Total Other Expense, net
    
    
    (22,619
    )
    
    
    (25,938
    )
    
    
    (15,822
    )Income (Loss) Before Income Taxes
    
    
    (2,449
    )
    
    
    2,967
    
    
    
    (8,345
    )Benefit for income taxes
    
    
    
    
    
    
    
    
    
    
    2,920Net Income (Loss)
    
    $
    (2,449
    )
    
    $
    2,967
    
    
    $
    (5,425
    )
  3




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AMERICAN CASINO & ENTERTAINMENT PROPERTIES LLC
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 Successor
    
    
    PredecessorPeriod from
    
    
    Period fromSix Months
    
    
    February 21, 2008
    
    
    January 1, 2008ended
    
    
    Through
    
    
    ThroughJune 30, 2009
    
    
    June 30, 2008
    
    
    February 20, 2008(Unaudited)(In thousands)Cash Flows From Operating Activities:Net income (loss)
    
    $
    (2,449
    )
    
    $
    2,967
    
    
    $
    (5,425
    )Adjustments to reconcile net income (loss) to net cash
providedby (used in) operating activities:Depreciation and amortization
    
    
    20,439
    
    
    
    12,287
    
    
    
    5,062Amortization of debt issuance and deferred financing costs
    
    
    3,851
    
    
    
    2,192
    
    
    
    150Tax benefit
    
    
    
    
    
    
    
    
    
    
    (2,920
    )Write-off of deferred financing costs
    
    
    
    
    
    
    
    
    
    
    4,405Loss on disposal of assets
    
    
    578
    
    
    
    69
    
    
    
    Changes in operating assets and liabilities:Restricted cash
    
    
    1,317
    
    
    
    (8,783
    )
    
    
    Accounts receivable, net
    
    
    1,244
    
    
    
    (51
    )
    
    
    95Other assets
    
    
    (1,073
    )
    
    
    5,669
    
    
    
    (95
    )Accounts payable and accrued expenses
    
    
    (6,677
    )
    
    
    (4,656
    )
    
    
    (9,543
    )Net Cash Provided By (Used In) Operating Activities
    
    
    17,230
    
    
    
    9,694
    
    
    
    (8,271
    )Cash Flows From Investing Activities:Decrease in investments  restricted
    
    
    
    
    
    
    1,001
    
    
    
    Acquisition of property and equipment
    
    
    (6,683
    )
    
    
    (15,175
    )
    
    
    (5,265
    )Acquisition of American Casino & Entertainment Properties
LLC
    
    
    
    
    
    
    (1,299,066
    )
    
    
    Proceeds from sale of property and equipment
    
    
    184
    
    
    
    121
    
    
    
    Net Cash Used In Investing Activities
    
    
    (6,499
    )
    
    
    (1,313,119
    )
    
    
    (5,265
    )Cash Flows From Financing Activities:Debt issuance and deferred financing costs
    
    
    (12,727
    )
    
    
    (16,366
    )
    
    
    Payments on line of credit
    
    
    
    
    
    
    
    
    
    
    (40,000
    )Capital distribution
    
    
    
    
    
    
    
    
    
    
    (15,439
    )Payments on capital lease obligation
    
    
    (257
    )
    
    
    (173
    )
    
    
    (85
    )Due to seller
    
    
    
    
    
    
    7,379
    
    
    
    Proceeds on notes payable
    
    
    
    
    
    
    1,108,000
    
    
    
    Equity contribution
    
    
    35,000
    
    
    
    200,060
    
    
    
    Net Cash Provided By (Used In) Financing Activities
    
    
    22,016
    
    
    
    1,298,900
    
    
    
    (55,524
    )Net increase (decrease) in cash and cash equivalents
    
    
    32,747
    
    
    
    (4,525
    )
    
    
    (69,060
    )Cash and cash equivalents  beginning of period
    
    
    30,366
    
    
    
    38,205
    
    
    
    107,265Cash and Cash Equivalents  end of period
    
    $
    63,113
    
    
    $
    33,680
    
    
    $
    38,205Supplemental Disclosure of Cash Flow Information:Cash paid during the period for interest
    
    $
    20,022
    
    
    $
    16,194
    
    
    $
    9,455Supplemental Disclosure of Non-cash Items:Non-cash acquisition of property and equipment
    
    $
    967
    
    
    $
    
    
    
    $
    Non-cash equity contribution related to troubled debt
restructure
    
    $
    520,186
    
    
    $
    
    
    
    $
    
  4




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AMERICAN CASINO & ENTERTAINMENT PROPERTIES LLC
 
 CONDENSED CONSOLIDATED STATEMENT OF MEMBERS EQUITY
 (Unaudited)
(In thousands)
 Class A
    
    
    Class B
    
    
    TotalEquity
    
    
    Equity
    
    
    EquitySuccessor:Balance at December 31, 2008
    
    $
    
    
    
    $
    151,298
    
    
    $
    151,298Net loss
    
    
    
    
    
    
    (2,449
    )
    
    
    (2,449
    )Debt restructure
    
    
    
    
    
    
    520,186
    
    
    
    520,186Equity contribution
    
    
    
    
    
    
    35,000
    
    
    
    35,000Balance at June 30, 2009
    
    $
    
    
    
    $
    704,035
    
    
    $
    704,035
  5




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##### Table of Contents



AMERICAN CASINO & ENTERTAINMENT PROPERTIES LLC
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Note 1. The Company
       Note 2. Basis of Presentation
  6




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http://www.sec.gov.
 Principles of Consolidation
   Recently Issued Accounting Pronouncements
 Subsequent Events
 Disclosures about Derivative Instruments and Hedging
Activities  an amendment of FASB Statement 133
 Business
Combinations Business Combinations
 Noncontrolling Interests in Consolidated Financial
Statements
 7




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##### Table of Contents



Reclassifications
  Note 3. Related Party Transactions
  
  8




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##### Table of Contents



Note 4. Intangible Assets
 Goodwill and Other
Intangible Assets
   (in thousands)June 30, 2009 (Successor)
    
    
    December 31, 2008 (Successor)Gross
    
    
    
    
    
    
    Net
    
    
    Gross
    
    
    
    
    
    
    NetAsset
    
    
    Carrying
    
    
    Accumulated
    
    
    Carrying
    
    
    Carrying
    
    
    Accumulated
    
    
    CarryingLife
    
    
    Amount
    
    
    Amortization
    
    
    Amount
    
    
    Amount
    
    
    Amortization
    
    
    AmountAmortizing intangible assets:Player Loyalty Plan
    
    5 Years
    
    $
    7,450
    
    
    $
    (1,986
    )
    
    $
    5,464
    
    
    $
    7,450
    
    
    $
    (1,242
    )
    
    $
    6,208Non-amortizing intangible assets:Trade Name
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    24,910
    
    
    
    
    
    
    
    
    
    
    $
    24,910$
    30,374
    
    
    
    
    
    
    
    
    
    
    $
    31,118
 9




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##### Table of Contents



Note 5. Debt




As of
    
    
    As ofJune 30, 2009
    
    
    December 31, 2008(In thousands)(Unaudited)Goldman Term Loans and related mezzanine financings,
due March 11, 2010, interest at a 3% margin above
LIBOR (0.31% at June 30, 2009)
    
    $
    
    
    
    $
    1,108,0002014 Term Loans due June 9, 2014, interest at
a 10% margin above LIBOR (0.31% at June 30, 2009),
with a 2.5% LIBOR floor
    
    
    571,788
    
    
    
    Capital lease obligations
    
    
    2,512
    
    
    
    1,810Total long-term debt and capital lease obligations
    
    
    574,300
    
    
    
    1,109,810Current portion of capital lease obligations
    
    
    255
    
    
    
    861Total long-term debt and capital lease obligations, net
    
    $
    574,045
    
    
    $
    1,108,949
 2014 Term Loans
   
    
    a strict cash management system, requiring that all revenues be applied in
accordance with a waterfall first to satisfy reserve requirements, including
reserves for debt service and for furniture, fixtures and equipment;
    
    an upfront reserve of approximately $26.9 million that may be applied only to
certain capital expenditures and an upfront equity contribution reserve of
approximately $26.9 million that may be applied to general corporate purposes;
    
    the requirement that certain excess cash flow be applied to amortize the loan on
a quarterly basis;
    
    restrictions on us engaging in any other business (e.g., special purpose entity
covenants);
    
    restrictions on incurring any other indebtedness;
    
    restrictions on paying any dividends;
    
    the requirement to pay full yield maintenance during the first two years of the
term and prepayment premiums of 1.5% and 0.5% during the third and fourth years of
term, respectively
    
    minimum release price requirements for asset sales; and
    
    financial maintenance covenants.
 Accounting by Debtors and Creditors for
Troubled Debt Restructurings
 10




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Goldman Term Loans
   Note 6. Legal Proceedings
  11




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 
   We warn you that forward-looking statements are only predictions. Actual events or results may
differ as a result of risks that we face. Forward-looking statements speak only as of the date they
were made, and we undertake no obligation to update them.
  Overview, Background and History
  
    
    the Stratosphere Casino Hotel & Tower, which is located at the northern end of the
Las Vegas Strip and caters to visitors to Las Vegas,
    
    two off-Strip casino and hotel properties, Arizona Charlies Decatur and Arizona
Charlies Boulder, which cater primarily to residents of Las Vegas and the surrounding
communities, and
    
    the Aquarius Casino Resort in Laughlin, Nevada, which caters to visitors to
Laughlin.
  12




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At June 30, 2009Number
    
    
    
    
    
    Number
    
    For the three monthCasino
    
    of
    
    Number
    
    of
    
    period ended June 30,Year Built/
    
    Customer
    
    Square
    
    Hotel
    
    of
    
    Table
    
    2009Last Renovated
    
    Orientation
    
    Footage
    
    Rooms
    
    Slots
    
    Games
    
    Occupancy
    
    ADRStratosphere
    
    1996/2005
    
    Tourist
    
    
    80,000
    
    
    
    2,444
    
    
    
    1,178
    
    
    
    51
    
    
    
    95.5
    %
    
    $
    44.93Arizona Charlies
Decatur
    
    1988/Various
    
    Local
    
    
    54,227
    
    
    
    258
    
    
    
    1,238
    
    
    
    14
    
    
    
    54.5
    %
    
    $
    50.24Arizona Charlies
Boulder
    
    1991 & 1999/Various
    
    Local
    
    
    47,541
    
    
    
    303
    
    
    
    1,057
    
    
    
    12
    
    
    
    51.6
    %
    
    $
    39.35Aquarius
    
    1990/2008
    
    Tourist/Local
    
    
    57,070
    
    
    
    1,907
    
    
    
    1,303
    
    
    
    35
    
    
    
    47.7
    %
    
    $
    48.53
    The Las Vegas and Laughlin Markets
    13




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Years Ending December 31,2006
    
    2007
    
    2008Total gaming revenue
    
    $
    10,643,206,000
    
    
    $
    10,868,029,000
    
    
    $
    9,796,970,000Number of slot machines
    
    
    131,430
    
    
    
    128,904
    
    
    
    126,789Number of table games
    
    
    4,511
    
    
    
    4,458
    
    
    
    4,454Number of visitors
    
    
    38,914,889
    
    
    
    39,196,761
    
    
    
    37,481,552
   14




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Debt Restructuring
   Accounting by Debtors and Creditors for Troubled
Debt Restructurings
  15




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Results of Operations
 Managements Discussion and Analysis of
Financial Condition and Results of Operations
 Cost Savings Initiatives
  Three Months Ended June 30, 2009 Compared to Three Months Ended June 30, 2008
  SuccessorThree Months
    
    
    Three MonthsEnded
    
    
    EndedJune 30, 2009
    
    
    June 30, 2008Income Statement Data:Revenues:Casino
    
    $
    55.9
    
    
    $
    66.6Hotel
    
    
    16.2
    
    
    
    21.8Food and beverage
    
    
    19.5
    
    
    
    23.3Tower, retail and other
    
    
    9.1
    
    
    
    9.6Gross revenues
    
    
    100.7
    
    
    
    121.3Less promotional allowances
    
    
    6.6
    
    
    
    10.7Net revenues
    
    
    94.1
    
    
    
    110.6Costs and expenses:Casino
    
    
    17.7
    
    
    
    21.5Hotel
    
    
    9.0
    
    
    
    8.8Food and beverage
    
    
    15.5
    
    
    
    17.0Other operating expenses
    
    
    3.6
    
    
    
    5.0Selling, general and administrative
    
    
    27.9
    
    
    
    33.9Depreciation and amortization
    
    
    10.5
    
    
    
    9.0Total costs and expenses
    
    
    84.2
    
    
    
    95.2Income from operations
    
    $
    9.9
    
    
    $
    15.4
  16




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Casino
  Hotel
  Food and Beverage
  17




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##### Table of Contents



Tower, Retail and Other
  Promotional Allowances
  Selling, General and Administrative
  Interest Expense
  Six Months Ended June 30, 2009 Compared to Six Months Ended June 30, 2008
  Successor
    
    
    CombinedSix Months
    
    
    Six MonthsEnded
    
    
    EndedJune 30, 2009
    
    
    June 30, 2008Income Statement Data:Revenues:Casino
    
    $
    115.4
    
    
    $
    135.7Hotel
    
    
    31.2
    
    
    
    45.0Food and beverage
    
    
    38.2
    
    
    
    46.8Tower, retail and other
    
    
    17.3
    
    
    
    18.5Gross revenues
    
    
    202.1
    
    
    
    246.0Less promotional allowances
    
    
    14.2
    
    
    
    21.3Net revenues
    
    
    187.9
    
    
    
    224.7Costs and expenses:Casino
    
    
    36.5
    
    
    
    43.7Hotel
    
    
    17.3
    
    
    
    17.3Food and beverage
    
    
    29.8
    
    
    
    33.7Other operating expenses
    
    
    7.1
    
    
    
    9.2Selling, general and administrative
    
    
    56.5
    
    
    
    67.0Depreciation and amortization
    
    
    20.4
    
    
    
    17.4Total costs and expenses
    
    
    167.6
    
    
    
    188.3Income from operations
    
    $
    20.3
    
    
    $
    36.4
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Casino
  Hotel
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Food and Beverage
  Tower, Retail and Other
  Promotional Allowances
  Selling, General and Administrative
  Interest Expense
  Financial Condition
 Liquidity and Capital Resources
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##### Table of Contents



Off-Balance Sheet Arrangements
 Recently Issued Accounting Pronouncements
 Subsequent Events
 Disclosures about Derivative Instruments and Hedging
Activities  an amendment of FASB Statement 133
 Business
Combinations Business Combinations
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Noncontrolling Interests in Consolidated Financial
Statements
 
 Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
     
 Item 4T.
    
    Controls and Procedures
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PART
II-OTHER INFORMATION
 Item 1A.
Risk Factors
 The
recent downturn in the local, regional, national and global economies, the volatility and
disruption of the capital and credit markets and adverse changes in the local, regional,
national and global economies could continue to negatively impact our financial performance
and our ability to access financing.
    Clark County.
 Las Vegas.
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Laughlin.
     Because all four of our gaming properties are concentrated in a relatively small area in Nevada, we
are especially subject to certain risks, including economic and competitive risks, associated with
the conditions in that area and in the areas from which we draw patrons.
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
    
    local economic conditions, including the recent economic downturn in the Las Vegas
metropolitan area discussed in  The recent downturn in the local, regional, national
and global economies....
    
    local competitive conditions;
    
    reduced land and air travel due to increasing fuel costs or transportation disruptions;
    
    inaccessibility of the area due to inclement weather, road construction or closure
of primary access routes; and
    
    a decline in the number of visitors to Las Vegas and Laughlin, Nevada.
 Local Competitive Risks. If we are unable to
compete effectively against our competitors, our business will suffer
 Transportation-Related Risks.
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Weather and Public Health Risks.
 If we are unable to compete effectively against our competitors, our business will suffer.
    We may be unable to raise additional indebtedness because of the recent instability in the
financial markets.
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Our business is subject to extensive governmental gaming regulation, which is costly
to comply with, and failure to do so could cause us to incur penalties or force us to cease
operations.
    Regulation and
Licensing.
   An overall attitude that businesses should eliminate costs perceived as extravagant may have
created a negative political climate for businesses to host meetings and events in Las Vegas.
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Rising operating costs for our gaming properties could have a negative impact on our business.
  
    
    changes in the tax or regulatory environment which impose additional
restrictions or increase our operating costs;
    
    our properties use significant amounts of electricity, natural gas and other
forms of energy, and energy price increases may adversely affect our cost structure;
    
    our properties use significant amounts of water and a water shortage may
adversely affect our operations;
    
    an increase in the cost of health care benefits for our employees could have a
negative impact on our profitability;
    
    as of July 10, 2009, approximately 41% of our employees were members of various
unions and covered by union-sponsored collective bargaining agreements and we may incur
higher costs or work slow-downs or stoppages due to union activities;
    
    our reliance on slot play revenues and the concentration of relatively few slot
play vendors could impose additional costs on us;
    
    as our properties age, we may need to increase our expenditures for repairs,
maintenance, and to replace equipment necessary to operate our business in amounts
greater than what we have spent historically; and
    
    aggressive marketing and promotional campaigns by our competitors for an extended
period of time could force us to increase our expenditures for marketing and promotional
campaigns in order to maintain our existing customer base and attract new customers.
  Increasing prices or shortages of energy and water may increase our cost of operations or force us
to temporarily or permanently cease operations.
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Changes in tax laws could increase our cost of doing business and negatively affect our
business.
    Our operations may be adversely impacted by expanded Native American gaming operations if they
attract patrons that otherwise would visit our properties.
  We have significant working capital needs, and if we are unable to satisfy those needs from cash
generated from our operations or indebtedness, we may not be able to meet our obligations,
including payroll and statutory tax payment requirements.
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Acts of terrorism and war and natural disasters may negatively impact our business.
   We are subject to a wide variety of environmental laws and potential exposure to
environmental liabilities
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From time to time, we are a defendant in a variety of litigation and other adversary
proceedings, which are costly to defend, divert managements attention from our operations and may
cause us to pay damages if we are unsuccessful in defending against the actions or unable to cover
damages with insurance proceeds.
  We may incur property and other losses that are not adequately covered by insurance, which may harm
our results of operations.
  A significant portion of our labor force is covered by collective bargaining agreements, and a
dispute with covered employees or new labor agreements may lower our revenues and increase our
costs.
   Claims that we infringe upon third parties intellectual property rights could be costly to
defend or settle, and thus could reduce our income or increase our net loss.
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Our
revenues may be negatively impacted by volatility in our hold percentage.
  Our hotels and casinos may need to increase capital expenditures to compete effectively but we
may not have sufficient funds to do so.
  The loss of management and other key personnel could significantly harm our business, and the
quality of individuals hired for positions in the hotel and gaming operations will be critical to
the success of our business.
  We are dependent upon technology services and electrical power to operate our business, and if we
experience damage or service interruptions, we may have to cease some or all of our operations,
resulting in a decrease in revenues.
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We may incur impairments to intangible assets or long-lived assets, which would reduce our net
income.
 Goodwill and Other Intangible Assets, Accounting for the Impairment or
Disposal of Long-Lived Assets,
   A smoking ban in the jurisdictions in which we operate could have a negative impact on our business
and operations.
  We are controlled by officers of Goldman Sachs and the general partners of Whitehall 2007, and the
interests of Goldman Sachs, Whitehall 2007 and their affiliates may not be aligned with ours.
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Certain Relationships and Related Party Transactions Use of Proceeds.
  Our hotels and casinos may incur substantial costs in connection with any growth and expansion
strategy.
  We may find it difficult to expand our business into additional states due to varying state
regulatory requirements.
  Item 6.
Exhibits
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SIGNATURES
  AMERICAN CASINO & ENTERTAINMENT PROPERTIES LLCDate: August 3, 2009
    By:
    /s/ Edward W. Martin, IIIEdward W. Martin, IIIAuthorized Officer, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer)




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Exhibits Index
 Exhibit No.
    
    Description10.1
    
    Loan Agreement, dated as of June 25, 2009, among American Casino & Entertainment Properties LLC, W2007 ACEP First Mezzanine A Borrower, L.P.,
W2007 ACEP First Mezzanine B Borrower, L.P., Arizona Charlies, LLC, Fresca, LLC, Aquarius Gaming LLC, Stratosphere Gaming LLC, W2007
Aquarius Propco, L.P., W2007 Stratosphere Propco, L.P., W2007 Stratosphere Land Propco, L.P.,
W2007 Arizona Charlies Propco, L.P. and W2007
Fresca Propco, L.P. each, as a Co-Borrower and collectively as the Borrower, and Goldman Sachs Commercial Mortgage Capital,
L.P. as Initial Lender, Wells Fargo Bank, N.A., as Collateral Agent and Archon Group, L.P., as Administrative Agent.31.1
    
    Certification of Principal Executive Officer pursuant to
Section 302(a) of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Principal Financial Officer pursuant to
Section 302(a) of the Sarbanes-Oxley Act of 2002.32.1
    
    Certification of Chief Executive Officer pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certification of Chief Financial Officer pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.