Station Casinos Inc. Downgraded To 'D' On Bankruptcy Filing

July 30, 2009

– Station filed for Chapter 11 bankruptcy protection.

— We lowered our issue-level rating on the company’s senior secured debt to ‘D’.

— We revised our recovery rating on the company’s senior unsecured notes to ‘5’ from ‘4’.

NEW YORK, July 29, 2009–Standard & Poor’s Ratings Services said today it lowered its issue-level rating on Las Vegas-based Station Casinos Inc.’s $900 million senior secured bank facilities to ‘D’ from ‘CCC’. We removed these ratings from CreditWatch, where we placed them with negative implications on Dec. 15, 2008.

In addition, we revised our recovery rating on the company’s senior unsecured notes to ‘5’ from ‘4’. The ‘5’ recovery rating indicates our expectation of modest (10%-30%) recovery for lenders in the event of a payment default.

We had previously lowered all other ratings on Station, including the corporate credit rating, to ‘D’ following missed interest payments on each of the company’s five senior unsecured and senior subordinated notes earlier this year.

The issue-level ratings downgrade follows yesterday’s filing for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Nevada by Station Casinos Inc. and various of its affiliates. Pursuant to an agreement with the company’s senior secured lenders, none of Station’s casino operating subsidiaries or affiliates were included in the Chapter 11 filings.

This rating action follows our Feb. 4, 2009, research report in which we lowered our corporate credit rating on Station and our issue-level rating on its 6.5% senior subordinated notes to ‘D’ following the missed Feb. 1, 2009, interest payment on the 6.5% senior subordinated notes. At that time, Station also announced a solicitation for votes from eligible institutional holders of its senior unsecured and senior subordinated notes for a restructuring plan under Chapter 11 of the U.S. Bankruptcy Code. We also subsequently lowered our rating on Station’s 7.75% senior notes, 6.875% senior subordinated notes, 6.625% senior subordinated notes, and 6% senior notes to ‘D’, following missed Feb. 15, March 1, March 15, and April 1 interest payments on those notes, respectively.

Complete ratings information is available to RatingsDirect subscribers at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor’s public Web site at www.standardandpoors.com; select your preferred country or region, then Ratings in the left navigation bar, followed by Find a Rating.

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